Daggett; Finseth; Harder; Knoblach; Kraus; Lynch; McElroy; Mulder; Olson, E.; Olson, M.; Onnen; Rice; Sarna; Tompkins; Tunheim; Van Dellen and Vickerman were excused.

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

S. F. No. 1874 and H. F. No. 2485, which had been referred to the Chief Clerk for comparison, were examined and found to be identical.

Wejcman moved that S. F. No. 1874 be substituted for H. F. No. 2485 and that the House File be indefinitely postponed. The motion prevailed.

S. F. No. 1981 and H. F. No. 2236, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.

Entenza moved that the rules be so far suspended that S. F. No. 1981 be substituted for H. F. No. 2236 and that the House File be indefinitely postponed. The motion prevailed.

S. F. No. 1996 and H. F. No. 2357, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.

Dawkins moved that the rules be so far suspended that S. F. No. 1996 be substituted for H. F. No. 2357 and that the House File be indefinitely postponed. The motion prevailed.

S. F. No. 2009 and H. F. No. 2336, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.

S. F. No. 2020 and H. F. No. 2952, which had been referred to the Chief Clerk for comparison, were examined and found to be identical.

Wejcman moved that S. F. No. 2020 be substituted for H. F. No. 2952 and that the House File be indefinitely postponed. The motion prevailed.

S. F. No. 2596 and H. F. No. 2902, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.

Bakk moved that the rules be so far suspended that S. F. No. 2596 be substituted for H. F. No. 2902 and that the House File be indefinitely postponed. The motion prevailed.

Solberg from the Committee on Ways and Means to which was referred:

H. F. No. 2206, A bill for an act relating to education; removing mandates from higher education; requiring increased accountability and performance for funding; amending Minnesota Statutes 1994, sections 15.43, subdivisions 2 and 3; 16B.01, subdivision 2; 16B.06, subdivision 2; 16B.21, subdivisions 1 and 3; 16B.33, subdivisions 1, 3, and 4; 16B.35, by adding a subdivision; 16B.41, subdivision 2; 16B.49; 16B.531; 16B.54, subdivision 1; 16B.85, subdivision 2; 43A.05, subdivision 4; 43A.10, subdivision 3; 123.70, subdivision 10; 135A.033; 135A.14, as amended; 137.37; 169.448, subdivision 2; 201.1611; and 248.07, subdivision 7; Minnesota Statutes 1995 Supplement, sections

16B.17, subdivision 6; 16B.465, subdivision 4; 43A.06, subdivision 1; 135A.181; 136A.101, subdivision 10; 136F.06, subdivisions 1 and 2; 136F.12; 136F.16, subdivision 3; 136F.18; 136F.30; 136F.36, subdivision 2; 136F.44; 136F.50; 136F.53, subdivisions 1 and 3; 136F.58; 136F.71, by adding a subdivision; 136F.72, subdivision 3; and 136F.80, subdivision 2; Laws 1995, chapter 212, article 2, sections 15; and 20, subdivisions 1 and 2; proposing coding for new law in Minnesota Statutes, chapters 135A; 136A; and 136F; repealing Minnesota Statutes 1994, sections 137.03; 137.05; 137.06; 137.07; 137.08; 137.11; 137.14; 137.15; 137.33; and 137.36; Minnesota Statutes 1995 Supplement, sections 16A.125, subdivision 6a; 135A.08; 136F.25; and 136F.59, subdivision 1; Laws 1995, chapter 212, article 1, section 6, subdivision 1.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. [LEGISLATIVE INTENT.]

It is the intent of the legislature to increase the accountability of higher education through added system and campus responsibilities for decision-making, governance and management. To accomplish this, the legislature intends to relieve higher education of many of the mandates that are legislatively imposed or that emanate from executive agency actions. In so doing, the legislature is placing the burden on higher education to take control of its spending in a time of fiscal constraints and to thereby demonstrate, through its choices, the value of the state's investment. In removing legislative and executive mandates, the legislature intends to provide higher education with greater flexibility in how it conducts its business by making the letter of the law less constraining. However, it is the intent of the legislature that higher education continue to meet its public responsibilities by abiding by the spirit of the laws that have been enacted.

Sec. 2. Minnesota Statutes 1994, section 15.43, subdivision 2, is amended to read:

Subd. 2. [TEXTBOOKS EXEMPTED.] Textbooks, software, and other course materials authored by an employee of the state's education systems Minnesota state colleges and universities or of the University of Minnesota may be used as required course material upon receipt of written approval from the head of the department. Instructors in state institutions and at the university may accept free samples of textbooks and related teaching materials.

Sec. 3. Minnesota Statutes 1994, section 15.43, subdivision 3, is amended to read:

Subd. 3. [OTHER EXEMPTIONS.] The commissioners of human services and corrections, and the chancellors of the state university and community college systems may by rule prescribe procedure for the acceptance of gifts from any person or organization, provided that such gifts are accepted by the commissioner or chancellor, or a designated representative of the commissioner or chancellor, and that such gifts are used solely for the direct benefit of patients, or inmates or students under the jurisdiction of the accepting state officer.

Sec. 4. Minnesota Statutes 1994, section 16B.01, subdivision 2, is amended to read:

Subd. 2. [AGENCY.] "Agency" means any state officer, employee, board, commission, authority, department, or other agency of the executive branch of state government. Unless specifically provided elsewhere in this chapter, agency does not include the Minnesota state colleges and universities.

Sec. 5. Minnesota Statutes 1995 Supplement, section 16B.17, subdivision 6, is amended to read:

Subd. 6. [EXCLUSIONS.] This section and section 16B.167 do not apply:

(1) to Minnesota state college or university contracts to provide instructional services to public or private organizations, agencies, businesses, or industries;

(2) to contracts with individuals or organizations for administration of employee pension plans authorized under chapter 354B or 354C; or

(3) to instructional services provided to Minnesota state colleges or universities by organizations or individuals provided the contracts are consistent with terms of applicable labor agreements.

Sec. 6. Minnesota Statutes 1994, section 16B.21, subdivision 1, is amended to read:

Subdivision 1. [COMMISSIONER OF ADMINISTRATION.] The commissioner shall submit an annual report pursuant to section 3.195 to the governor and the legislature with a copy to the commissioner of trade and economic development indicating the progress being made toward the objectives and goals of sections 16B.19 to 16B.22, 137.31, 137.35, 161.321, and 473.142 during the preceding fiscal year. The commissioner shall also submit a quarterly report to the small business and targeted group procurement advisory council. These reports shall include the following information:

(1) the total dollar value and number of potential set-aside awards identified during this period and the percentage of total state procurement this figure reflects;

(2) the number of small businesses identified by and responding to the small business procurement program, the total dollar value and number of set-aside and other contracts actually awarded to small businesses, and the total number of small businesses that were awarded set-aside and other contracts;

(3) the total dollar value and number of contracts awarded to small targeted group businesses pursuant to each bidding process authorized by sections 16B.19, subdivision 2c, 137.31, 137.35, 161.321, and 473.142; the total number and value of these contracts awarded to each small targeted group business and to each type of small targeted group business in each purchasing category, and the percentages of the total procurement for each purchasing category the figures represent;

(4) the total dollar value and number of contracts awarded to small businesses in economically disadvantaged areas under the bidding process authorized in section 16B.19, subdivision 2d; the total number and value of these contracts awarded to each business, and to all businesses within each economically disadvantaged area in each purchasing category, and the percentages of total procurement for each purchasing category the figures represent.

The information required by clauses (1) and (2) must be presented on a statewide basis and also broken down by geographic regions within the state.

Sec. 7. Minnesota Statutes 1994, section 16B.21, subdivision 3, is amended to read:

Subd. 3. [REPORTS FROM OTHER AGENCIES.] The commissioner of transportation, and each metropolitan agency listed in section 473.143, subdivision 1, and the University of Minnesota shall report to the commissioner of administration all information that the commissioner requests to make reports required under this section. The information must be reported at the time and in the manner requested by the commissioner of administration.

Sec. 8. Minnesota Statutes 1994, section 16B.33, subdivision 1, is amended to read:

Subdivision 1. [DEFINITIONS.] As used in this section, the following terms have the meanings given them:

(a) "Agency" has the meaning given in section 16B.01, and also includes the University of Minnesota.

(b) "Architect" means an architect or landscape architect registered to practice under sections 326.02 to 326.15.

(c) "Board" means the state designer selection board.

(d) "Designer" means an architect or engineer, or a partnership, association, or corporation comprised primarily of architects or engineers or of both architects and engineers.

(e) "Engineer" means an engineer registered to practice under sections 326.02 to 326.15.

(f) "Person" includes an individual, corporation, partnership, association, or any other legal entity.

(g) "Primary designer" means the designer who is to have primary design responsibility for a project, and does not include designers who are merely consulted by the user agency and do not have substantial design responsibility, or designers who will or may be employed or consulted by the primary designer.

(h) "Project" means an undertaking to construct, erect, or remodel a building by or for the state or an agency.

(i) "User agency" means the agency undertaking a specific project.

Sec. 9. Minnesota Statutes 1994, section 16B.33, subdivision 3, is amended to read:

Subd. 3. [AGENCIES MUST REQUEST DESIGNER.] (a) [APPLICATION.] Upon undertaking a project with an estimated cost greater than $750,000 or a planning project with estimated fees greater than $60,000, every user agency, except the capitol area architectural and planning board, shall submit a written request for a primary designer for its project to the commissioner, who shall forward the request to the board. The University of Minnesota and the Minnesota state colleges and universities shall follow the process in subdivision 3a to select designers for their projects. The written request must include a description of the project, the estimated cost of completing the project, a description of any special requirements or unique features of the proposed project, and other information which will assist the board in carrying out its duties and responsibilities set forth in this section.

(b) [REACTIVATED PROJECT.] If a project for which a designer has been selected by the board becomes inactive, lapses, or changes as a result of project phasing, insufficient appropriations, or other reasons, the commissioner, the Minnesota state colleges and universities, or the University of Minnesota may, if the project is reactivated, retain the same designer to complete the project.

(c) [FEE LIMIT REACHED AFTER DESIGNER SELECTED.] If a project initially estimated to be below the cost and planning fee limits of this subdivision has its cost or planning fees revised so that the limits are exceeded, the project must be referred to the board for designer selection even if a primary designer has already been selected. In this event, the board may, without conducting interviews, elect to retain the previously selected designer if it determines that the interests of the state are best served by that decision and shall notify the commissioner of its determination.

Sec. 10. Minnesota Statutes 1994, section 16B.33, is amended by adding a subdivision to read:

Subd. 3a. [HIGHER EDUCATION PROJECTS.] When the University of Minnesota or the Minnesota state colleges and universities undertakes a project with an estimated cost greater than $2,000,000 or a planning project with estimated fees greater than $200,000, the system office shall either (1) submit a written request for a primary designer to the commissioner, who shall forward the request to the designer selection board as provided in subdivision 4; or (2) establish a selection process, publicize the proposed project, select at least three qualified designers as finalists, and submit their names to the designer selection board which shall make the final selection.

Sec. 11. Minnesota Statutes 1994, section 16B.33, subdivision 4, is amended to read:

Subd. 4. [DESIGNER SELECTION PROCESS.] (a) [PUBLICITY.] Upon receipt of a request from a user agency for a primary designer, the board shall publicize the proposed project in order to determine the identity of designers interested in the design work on the project. The board shall establish criteria for the selection process and make this information public, and shall compile data on and conduct interviews of designers. The board's selection criteria must include consideration of each interested designer's performance on previous projects for the state or any other person. Upon completing the process, the board shall select the primary designer and shall state its reasons in writing. Notification to the commissioner of the selection shall be made not more than 60 days after receipt from a user agency of a request for a primary designer. The commissioner shall promptly notify the designer and the user agency. The commissioner shall negotiate the designer's fee and prepare the contract to be entered into between the designer and the user agency.

(b) [CONFLICT OF INTEREST.] The board may not select a designer or firm in which a member of the designer selection board has a current financial interest.

(c) [SELECTION BY COMMISSIONER.] In the event the board receives a request for a primary designer on a project, the estimated cost of which is less than the limit established by subdivision 3, or a planning project with estimated fees of less than the limit established by subdivision 3, the board may submit the request to the commissioner of administration, with or without recommendations, and the commissioner shall thereupon select the primary designer for the project.

(d) [SECOND SELECTION.] If the designer selected for a project declines the appointment or is unable to reach agreement with the commissioner on the fee or the terms of the contract, the commissioner shall, within 60 days after the first appointment, request the board to make another selection.

(e) [SIXTY DAYS TO SELECT.] If the board fails to make a selection and forward its recommendation to the commissioner within 60 days of the user agency's request for a designer, the commissioner may appoint a designer to the project without the recommendation of the board.

(f) [LESS THAN SATISFACTORY PERFORMANCE.] The commissioner, or the University of Minnesota for projects under its supervision, shall forward to the board a written report describing each instance in which the performance of a designer selected by the board or the commissioner has been less than satisfactory. Criteria for determining satisfaction include the ability of the designer to complete design work on time, to provide a design responsive to program needs within the constraints of the budget, to solve design problems and achieve a design consistent with the proposed function of the building, to avoid costly design errors or omissions, and to observe the construction work. These reports are public data and are available for inspection under section 13.03.

Sec. 12. Minnesota Statutes 1994, section 16B.35, is amended by adding a subdivision to read:

Subd. 4. [CAMPUSES.] Art for a building on a public college or university campus shall be selected by the campus, in consultation with the arts board. Consideration of the artwork of faculty and students on that campus is encouraged.

Sec. 13. Minnesota Statutes 1994, section 16B.41, subdivision 2, is amended to read:

Subd. 2. [RESPONSIBILITIES.] The office has the following duties:

(a) The office must develop and establish a state information architecture to ensure that further state agency development and purchase of information systems equipment and software is directed in such a manner that individual agency information systems complement and do not needlessly duplicate or needlessly conflict with the systems of other agencies. In those instances where state agencies have need for the same or similar computer data, the commissioner shall ensure that the most efficient and cost-effective method of producing and storing data for or sharing data between those agencies is used. The development of this information architecture must include the establishment of standards and guidelines to be followed by state agencies. On January 1, 1988, and every six months thereafter, any state agency that has purchased information systems equipment or software in the past six months, or that is contemplating purchasing this equipment or software in the next six months, must report to the office and to the chairs of the house ways and means committee and the senate finance committee on how the purchases or proposed purchases comply with the applicable standards and guidelines.

(b) The office shall assist state agencies in the planning and management of information systems so that an individual information system reflects and supports the state agency's and the state's mission, requirements, and functions.

(c) The office must review and approve all agency requests for legislative appropriations for the development or purchase of information systems equipment or software. Requests may not be included in the governor's budget submitted to the legislature, unless the office has approved the request.

(d) Each biennium the office must rate agency requests for new appropriations for development or purchase of information systems equipment or software based on established information management criteria. The office must submit this rating to the legislature at the same time, or no later than 14 days after, the governor submits the budget message to the legislature. The governor must provide information necessary to rate agency requests to the office.

(e) The office must define, review, and approve major purchases of information systems equipment to (1) ensure that the equipment follows the standards and guidelines of the state information architecture; (2) ensure that the equipment is consistent with the information management principles adopted by the information policy council; (3) evaluate whether or not the agency's proposed purchase reflects a cost-effective policy regarding volume purchasing; and (4) ensure the equipment is consistent with other systems in other state agencies so that data can be shared among agencies, unless the office determines that the agency purchasing the equipment has special needs justifying the inconsistency. The commissioner of finance may not allot funds appropriated for major purchases of information systems equipment until the office reviews and approves the proposed purchase. A public institution of higher education must not purchase interconnective more than $250,000 of equipment or other computer technology to connect the college or university to sites outside the institution without the prior approval of the office.

(f) The office shall review the operation of information systems by state agencies and provide advice and assistance so that these systems are operated efficiently and continually meet the standards and guidelines established by the office. These standards and guidelines shall emphasize uniformity that encourages information interchange, open systems environments, and portability of information whenever practicable and consistent with an agency's authority

and the Minnesota government data practices act. The office, in consultation with the intergovernmental information systems advisory council and the legislative reference library, shall adopt specific standards and guidelines to be met by each state agency within a time period fixed by the office in regard to the following:

(1) establishment of methodologies and systems directed at reducing and ultimately eliminating redundant storage of data and encouraging greater use of central databases;

(2) establishment of data retention schedules, disaster recovery plans and systems, security systems, and procedural safeguards concerning privacy of data;

(3) establishment of pricing policies and incentives that encourage electronic transfer of information in electronic forms, while giving due consideration to the value and cost of providing the information in those forms. These pricing policies may include preferential prices for information requested by a public entity for a public purpose; and

(4) establishment of information sales systems that utilize licensing and royalty agreements to the greatest extent possible, together with procedures for agency denial of requests for licenses or royalty agreements by commercial users or resellers of the information. Section 3.751 does not apply to these licensing and royalty agreements and the agreements must include provisions that section 3.751 does not apply and that the state is immune from liability under the agreement.

If an agency needs additional funds to comply with the requirements of this paragraph, the agency must first obtain approval of the proposal by the office as required by paragraph (c) before submitting it to the legislature.

(g) The office must conduct a comprehensive review at least every three years of the information systems investments that have been made by state agencies and higher education institutions. The review must include recommendations on any information systems applications that could be provided in a more cost beneficial manner by an outside source. The office must report the results of its review to the legislature and the governor.

(h) The office shall recommend to the legislature any statutory changes that are necessary or desirable to accomplish the duties described in this subdivision.

(i) The office must report to the legislature by January 15 each year on progress in implementing paragraph (f), clauses (1) to (4).

Sec. 14. Minnesota Statutes 1995 Supplement, section 16B.465, subdivision 4, is amended to read:

Subd. 4. [PROGRAM PARTICIPATION.] (a) The commissioner may require the participation of state agencies, the state board of education, and the governing boards board of the Minnesota state colleges and universities, the community colleges, and the technical colleges, and may request the participation of the board of regents of the University of Minnesota, in the planning and implementation of the network to provide interconnective technologies. The commissioner shall establish reimbursement rates in cooperation with the commissioner of finance to be billed to participating agencies and educational institutions sufficient to cover the operating, maintenance, and administrative costs of the system.

(b) A direct appropriation made to an educational institution for usage costs associated with the STARS network must only be used by the educational institution for payment of usage costs of the network as billed by the commissioner of administration. The post-secondary appropriations may be shifted between systems as required by unanticipated usage patterns. An intersystem transfer must be requested by the appropriate system and may be made only after review and approval by the commissioner of finance, in consultation with the commissioner of administration.

Sec. 15. Minnesota Statutes 1994, section 16B.482, is amended to read:

16B.482 [REIMBURSEMENT FOR MATERIALS AND SERVICES.]

The commissioner of administration may provide materials and services under this chapter to state legislative and judicial branch agencies, political subdivisions, the Minnesota state colleges and universities, the University of Minnesota, and federal government agencies. Legislative and judicial branch agencies, political subdivisions, the Minnesota state colleges and universities, the University of Minnesota, and federal government agencies purchasing materials and services from the commissioner of administration shall reimburse the general services, intertechnologies, and cooperative purchasing revolving funds for cost.

Sec. 16. Minnesota Statutes 1994, section 16B.49, is amended to read:

16B.49 [CENTRAL MAILING SYSTEM.]

The commissioner shall maintain and operate for agencies a central mailing system. Official mail of an agency occupying quarters within the boundaries of the city of St. Paul must be delivered unstamped to the central mailing station. Account must be kept of the postage required on that mail, which is then a proper charge against the agency delivering the mail. To provide funds for the payment of postage, each agency shall make advance payments to the commissioner sufficient to cover its postage obligations for at least 60 days. For purposes of this section, the Minnesota state colleges and universities is a state agency.

Sec. 17. Minnesota Statutes 1994, section 16B.531, is amended to read:

16B.531 [TRAVEL SERVICES.]

The commissioner may offer a centralized travel service to all state departments and agencies, and to the Minnesota state colleges and universities, and may, in connection with that service, accept payments from travel agencies under contracts for the provision of travel services. The payments must be deposited in the motor pool revolving account established by section 16B.54, subdivision 8, and must be used for the expenses of managing the centralized travel service. Revenues in excess of the management costs of the centralized service must be returned to the general fund.

Sec. 18. Minnesota Statutes 1994, section 16B.54, subdivision 1, is amended to read:

Subdivision 1. [MOTOR POOLS.] The commissioner shall manage a central motor pool of passenger motor vehicles and trucks used by state agencies with principal offices in the city of St. Paul and may provide for branch central motor pools at other places within the state. For purposes of this section, (1) "agencies" includes the Minnesota state colleges and universities, and (2) "truck" means a pickup or panel truck up to one ton carrying capacity.

Sec. 19. Minnesota Statutes 1994, section 16B.85, subdivision 2, is amended to read:

Subd. 2. [RISK MANAGEMENT FUND.] (a) All state agencies, and the Minnesota state colleges and universities, may, in cooperation with the commissioner, participate in insurance programs and other funding alternative programs provided by the risk management fund.

(b) When an agency or agencies enter into an insurance or self-insurance program, each agency shall contribute the appropriate share of its costs as determined by the commissioner.

(c) The money in the fund to pay claims arising from state activities and for administrative costs, including costs for the adjustment and defense of the claims, is appropriated to the commissioner.

(d) Interest earned from the investment of money in the fund shall be credited to the fund and be available to the commissioner for the expenditures authorized in this subdivision.

(e) The fund is exempt from the provisions of section 16A.152, subdivision 4. In the event that proceeds in the fund are insufficient to pay outstanding claims and associated administrative costs, the commissioner, in consultation with the commissioner of finance, may assess state agencies participating in the fund amounts sufficient to pay the costs. The commissioner shall determine the proportionate share of the assessment of each agency.

Sec. 20. Minnesota Statutes 1994, section 43A.05, subdivision 4, is amended to read:

Subd. 4. [TIME OFF IN EMERGENCIES.] The commissioner shall authorize appointing authorities to pay for time off in emergencies. The commissioner, after consultation with the commissioner of public safety, may excuse employees from duty with full pay in the event of a natural or other emergency, if continued operation would involve a threat to the health or safety of individuals. Absence with pay shall not exceed 16 working hours at any one time unless the commissioner authorizes a longer duration. Authority to excuse employees from duty with full pay on the campuses of the Minnesota state colleges and universities is vested in the college and university presidents, under guidelines established by the board of trustees of the Minnesota state colleges and universities.

Sec. 21. Minnesota Statutes 1995 Supplement, section 43A.06, subdivision 1, is amended to read:

Subdivision 1. [GENERAL.] (a) The commissioner, through the labor relations bureau, shall perform the duties assigned to the commissioner by sections 3.855, 179A.01 to 179A.25 and this section.

(b) The deputy commissioner for the labor relations bureau shall be the state labor negotiator for purposes of negotiating and administering agreements with exclusive representatives of employees and shall perform any other duties delegated by the commissioner subject to the limitations in paragraph (c).

(c) In consultation with the commissioner of employee relations and except as specified in this paragraph, The board of trustees of the Minnesota state colleges and universities may exercise the powers under this section for employees included in units 9, 10, 11, and 12 in section 179A.10, subdivision 2. The power and authority to engage in collective bargaining or to enter into interest arbitration remains with the commissioner of employee relations, who shall exercise those powers in consultation with the board of trustees of the Minnesota state colleges and universities. The commissioner of employee relations shall have the right to review and comment to the Minnesota state colleges and universities on the board's final proposals prior to exchange of final positions with the designated bargaining units as well as any requests for interest arbitration. When submitting a proposed collective bargaining agreement to the legislative coordinating commission and the legislature under section 3.855, subdivision 2, the board of trustees must use procedures and assumptions consistent with those used by the commissioner of employee relations in calculating the costs of the proposed contract.

Sec. 22. Minnesota Statutes 1994, section 43A.10, subdivision 3, is amended to read:

Subd. 3. [FACILITIES FURNISHED EXAMINERS.] The authorities having control of public buildings in political subdivisions of the state and school districts, upon written request of the commissioner, shall furnish without charge convenient facilities for the administration of examinations. Upon such request, it shall be the duty of state and local authorities and employees, as it is consistent with their other duties, to aid in carrying out the provisions of this section. Campuses of the Minnesota state colleges and universities may charge the commissioner for actual costs incurred in providing facilities for examinations, provided that the costs were incurred due solely to the examination.

Sec. 23. Minnesota Statutes 1994, section 123.70, subdivision 10, is amended to read:

Subd. 10. A statement required to be submitted under subdivisions 1, 2, and 4 to document evidence of immunization shall include month, day, and year for immunizations administered after January 1, 1990.

(a) For persons enrolled in grades 7 and 12 during the 1992-1993 1996-1997 school term, the statement must indicate that the person has received at least two doses of vaccine against measles, mumps, and rubella, given alone or separately and given not less that one month apart a dose of tetanus and diphtheria toxoid no earlier than 11 years of age.

(b) For persons enrolled in grades 7, 8, and 12 during the 1993-1994 1997-1998 school term, the statement must indicate that the person has received at least two doses of vaccine against measles, mumps, and rubella, given alone or separately and given not less than one month apart a dose of tetanus and diphtheria toxoid no earlier than 11 years of age.

(c) For persons enrolled in grades 7, 8, 9, and 12 during the 1994-1995 1998-1999 school term, the statement must indicate that the person has received at least two doses of vaccine against measles, mumps, and rubella, given alone or separately and given not less than one month apart a dose of tetanus and diphtheria toxoid no earlier than 11 years of age.

(d) For persons enrolled in grades 7, 8, 9, 10, and 12 during the 1995-1996 1999-2000 school term, the statement must indicate that the person has received at least two doses of vaccine against measles, mumps, and rubella, given alone or separately and given not less than one month apart a dose of tetanus and diphtheria toxoid no earlier than 11 years of age.

(e) For persons enrolled in grades 7 through 12 during the 2000-2001 school term and for each year thereafter, the statement must indicate that the person has received a dose of tetanus and diphtheria toxoid no earlier than 11 years of age.

(f) For persons enrolled in grades 7 through 12 during the 1996-1997 school year and for each year thereafter, the statement must indicate that the person has received at least two doses of vaccine against measles, mumps, and rubella, given alone or separately and given not less than one month apart.

Sec. 24. Minnesota Statutes 1994, section 135A.033, is amended to read:

135A.033 [PERFORMANCE FUNDING.]

The governing boards of the University of Minnesota, the state universities, the community colleges, and the technical colleges and the Minnesota state colleges and universities, in conjunction with their respective campuses, shall each specify performance categories and indicators relating to section 135A.053, subdivision 1, to be used for policy and appropriations decisions, as well as allocations for rewarding campuses that achieve performance levels and assisting campuses that are unable to achieve these levels. Because the mission of each system and type of campus varies, categories and indicators shall vary accordingly.

Sec. 25. [135A.053] [STATE HIGHER EDUCATION POLICY.]

Subdivision 1. [STATEWIDE OBJECTIVES.] Minnesota's higher education investment is made in pursuit of the following objectives:

(1) to ensure quality - to provide a level of excellence that is competitive on a national and international level, through high quality teaching, scholarship, and learning in a broad range of arts and sciences, technical education, and professional fields;

(2) to foster student success - to enable and encourage students to choose institutions and programs that are best suited for their talents and abilities, and to provide an educational climate that supports students in pursuing their goals and aspirations;

(3) to promote democratic values - to enhance Minnesota's quality of life by developing understanding and appreciation of a free and diverse society;

(4) to maintain access - to provide an opportunity for all Minnesotans, regardless of personal circumstances, to participate in higher education; and

(5) to enhance the economy - to assist the state in being competitive in the world market, and to prepare a highly skilled and adaptable workforce that meets Minnesota's opportunities and needs.

Subd. 2. [PERFORMANCE AND ACCOUNTABILITY.] Higher education systems and campuses are expected to achieve the objectives in subdivision 1 and will be held accountable for doing so. The legislature is increasing the flexibility of the systems and campuses to provide greater responsibility to higher education in deciding how to achieve statewide objectives, and to decentralize authority so that those decisions can be made at the level where the education is delivered. To demonstrate their accountability, the legislature expects each system and campus to measure and report on its performance, using meaningful indicators that are critical to achieving the objectives in subdivision 1, as provided in section 135A.033. Nothing in this section precludes a system or campus from determining its own objectives and performance measures beyond those identified in this section.

Sec. 26. Minnesota Statutes 1994, section 135A.14, as amended by Laws 1995, chapter 212, article 3, section 59, and Laws 1995, First Special Session chapter 3, article 16, section 13, is amended to read:

135A.14 [STATEMENT OF IMMUNIZATION OF POST-SECONDARY STUDENTS.]

Subdivision 1. [DEFINITIONS.] As used in this section, the following terms have the meanings given them.

(a) "Administrator" means the administrator of the institution or other person with general control and supervision of the institution.

(b) "Public or private post-secondary educational institution" or "institution" means any of the following institutions having an enrollment of more than 100 persons during any quarter, term, or semester during the preceding year: (1) the University of Minnesota; (2) the state universities; (3) the state community colleges; (4) public technical colleges; (5) private four-year, professional and graduate institutions; (6) private two-year colleges; and (7) schools subject to either chapter 141, sections 136A.61 to 136A.71, or schools exempt under section 136A.657, and which offer educational programs within the state for an academic year greater than six consecutive months. An institution's report to the Minnesota higher education services office or the Minnesota department of children, families, and learning may be considered when determining enrollment.

(c) "Student" means a person born after 1956 who did not graduate from a Minnesota high school in 1997 or later, and who is (1) registering for more than one class during a full academic term, such as a quarter or a semester; or (2) housed on campus and is registering for one or more classes. Student does not include persons enrolled in extension classes only or correspondence classes only.

Subd. 2. [STATEMENT OF IMMUNIZATION REQUIRED.] Except as provided in subdivision 3, no student may remain enrolled in a public or private post-secondary educational institution unless the student has submitted to the administrator a statement that the student has received appropriate immunization against measles, rubella, and mumps after having attained the age of 12 months, and against diphtheria and tetanus within ten years of first registration at the institution. This statement must indicate the month and year of each immunization given. Instead of submitting a statement, a student may provide an immunization record maintained by a school according to section 123.70, subdivision 7, or a school in another state if the required information is contained in the record. A student who has submitted a statement as provided in this subdivision, may transfer to a different Minnesota institution without submitting another statement if the student's transcript or other official documentation indicates that the statement was submitted.

Subd. 3. [EXEMPTIONS FROM IMMUNIZATION.] (a) An immunization listed in subdivision 2 is not required if the student submits to the administrator a statement signed by a physician that shows:

(1) that, for medical reasons, the student did not receive an immunization;

(2) that the student has experienced the natural disease against which the immunization protects; or

(3) that a laboratory has confirmed the presence of adequate immunity.

(b) If the student submits a notarized statement that the student has not been immunized as required in subdivision 2 because of the student's conscientiously held beliefs, the immunizations described in subdivision 2 are not required. The institution shall forward this statement to the commissioner of health.

Subd. 4. [IMMUNIZATION FILES REQUIRED.] The institution must maintain an immunization record within the student's file for all students each student governed by this section for at least one year from the time of original filing. The immunization records may be inspected by the department of health and the local board of health in whose jurisdiction the institution is located.

Subd. 5. [DEADLINE FOR SUBMITTING STATEMENT.] The institution shall require that the statement from the student, as required within subdivision 2 or 3, be submitted within 45 days of commencement of the academic term for which the student has registered.

Sec. 27. Minnesota Statutes 1995 Supplement, section 135A.181, is amended to read:

135A.181 [ACADEMIC CALENDAR.]

Subdivision 1. [TRANSITION TO SEMESTER SYSTEM.] The board of trustees of the Minnesota state colleges and universities shall convert, and the board of regents of the University of Minnesota is requested to convert, to the semester system by the 1998-1999 academic year. The boards may delay implementation of semesters on a campus for a year if the delay would improve the academic quality of the new calendar. The public post-secondary institutions shall review and revise the content and structure of their academic programs, degrees, and courses, and prepare new course materials as necessary. Each public post-secondary board shall submit information on the progress to a semester system in the 1997 biennial budget document. The board of trustees may permit a campus to remain on the quarter system or another alternative if the board determines that this would better serve students' needs.

Subd. 2. [COMMON CALENDAR.] In converting to the semester system required in subdivision 1 shall be offered on a common calendar throughout all, the campuses under the jurisdiction of the board of trustees of the Minnesota state colleges and universities. This calendar, in consultation with the system office, shall set calendars that best meet the needs of students, including those jointly enrolled in local school districts and other cooperative programs. Common calendars shall include be a priority at colocated campuses including a common start and end date for each semester as well as common summer school schedules. The board of trustees may exempt a campus from this calendar if they determine that because of extenuating circumstances an alternative calendar would better serve students' needs.

Subd. 3. [REPEALER.] This section is repealed June 30, 1999.

Sec. 28. Minnesota Statutes 1995 Supplement, section 136A.101, subdivision 10, is amended to read:

Subd. 10. "Satisfactory academic progress" means that:

(1) at a point between by the end of a student's first and second academic year of attendance at an institution, the student has at least a cumulative grade point average of C or its equivalent, or academic standing consistent with the institution's graduation requirements; and

(2) by the end of the first term of the third and fourth academic year of attendance, (i) the student has a cumulative grade point average of at least a C or its equivalent, (ii) the student's advisor certifies that the student has reviewed the general education requirements necessary for graduation and is making satisfactory progress toward completing them, and (iii) the student's advisor certifies that the student has chosen a major and reviewed the requirements necessary for completion of the major.

Sec. 29. [136A.1312] [FINANCIAL AID ADMINISTRATOR, PROFESSIONAL JUDGMENT.]

Nothing in this chapter or in the office's rules shall be interpreted as limiting the ability of student financial aid administrators, on the basis of adequate documentation, to make necessary adjustments to the cost of attendance and expected family contribution computations to allow for treatment of individual students with special circumstances. In addition, nothing in this chapter or in the office's rules shall be interpreted as limiting the ability of the student financial aid administrator to use supplementary information about the financial status of eligible applicants in selecting recipients of state financial aid and determining the amount of awards. Nothing in this section precludes a financial aid administrator from establishing an appeals process for other extenuating circumstances.

Sec. 30. [136A.1313] [FINANCIAL AID AUDITS.]

Beginning with audits for fiscal year 1996, in place of the audits provided by the office, public institutions that administer state grants under decentralized delivery may arrange for audits of state financial aid awards and tuition reciprocity recipients in conjunction with their audits for federal financial aid. Audits must be conducted in compliance with guidelines and materials prepared by the office. The office shall develop a review process including procedures for responding to audit exceptions. All other institutions under decentralized delivery may arrange for audits under this section beginning with audits for fiscal year 1997.

Sec. 31. Minnesota Statutes 1995 Supplement, section 136F.06, subdivision 1, is amended to read:

Subdivision 1. [GENERAL AUTHORITY.] The board shall possess all powers necessary to govern the state colleges and universities and all related property. Those powers shall include, but are not limited to, those enumerated in this section. The board shall prescribe courses of study and conditions of admission, set tuition and fees, prescribe approve programs of study and requirements for completion of programs, approve the awarding of appropriate certificates, diplomas, and degrees, enter into contracts and other agreements, and adopt suitable policies for the institutions it governs. To the extent practicable in protecting statewide interests, the board shall provide autonomy to the campuses while holding them accountable for their decisions. Sections 14.01 to 14.47 do not apply to policies and procedures of the board.

Sec. 32. Minnesota Statutes 1995 Supplement, section 136F.06, subdivision 2, is amended to read:

Subd. 2. [GOVERNANCE AUTHORITY.] The board shall have the authority needed to operate and govern the state colleges and universities unless otherwise directed or limited prohibited by law. The board is responsible for its operations and necessary decisions unless these are specifically delegated by law to a state department or agency.

Sec. 33. Minnesota Statutes 1995 Supplement, section 136F.12, is amended to read:

136F.12 [FOND DU LAC CAMPUS.]

The Fond du Lac campus has a unique mission among two-year colleges to serve the lower division general education needs in Carlton and south St. Louis counties, and the education needs of American Indians throughout the state and especially in northern Minnesota. Accordingly, while the college is governed by the board of trustees, its governance is accomplished in conjunction with the board of directors of Fond du Lac tribal college. By

July 1, 1995, the board of trustees and the board of directors of Fond du Lac tribal college shall implement the mechanisms necessary to accomplish the sharing of authority while ensuring accountability for college actions. The mechanisms shall supersede any previous arrangement, agreement, or memorandum of understanding.

Sec. 34. Minnesota Statutes 1995 Supplement, section 136F.16, subdivision 3, is amended to read:

Subd. 3. [OFF-CAMPUS SITES.] The board shall not establish off-campus centers or other permanent sites to provide academic programs, courses, or student services without authorizing legislation. For the purposes of this subdivision, the campus of Metropolitan State University is the seven-county metropolitan area. This section does not apply to sites set up specifically for the delivery of courses and programs through telecommunications.

Sec. 35. Minnesota Statutes 1995 Supplement, section 136F.18, is amended to read:

136F.18 [CAMPUS CLOSING.]

The board may develop policies to close a campus or center under its jurisdiction. Prior to closing a campus or center, the board shall hold a public hearing on the issue, after reasonable notice, in the area which would be affected by the closing. At the hearing affected persons shall have an opportunity to present testimony. The board shall give notice of this hearing by publishing notice in the State Register and in a newspaper of general circulation in the affected area at least 30 days before the scheduled hearing.

Sec. 36. Minnesota Statutes 1995 Supplement, section 136F.30, is amended to read:

136F.30 [COURSES AND PROGRAMS.]

The board shall prescribe the courses review and approve or disapprove campus proposals for adding, deleting, or substantially changing programs of study, including graduate and undergraduate academic programs, training in professional, semiprofessional, and technical fields, and adult education. The board shall avoid duplicate program offerings. The board may initiate activities to close programs. The board shall place a high priority on ensuring the transferability of credit.

Sec. 37. Minnesota Statutes 1995 Supplement, section 136F.36, subdivision 2, is amended to read:

Subd. 2. [EXEMPTIONS.] The sale requirements of chapters 92 and 94 do not apply to this section, nor do the leasing provisions of section 16B.24, nor do the construction supervision and control provisions of sections 16B.30 to 16B.335. The board shall develop policies for leasing requirements and construction supervision. The board will normally competitively bid contracts related to instructional construction but, notwithstanding the provisions of sections 16B.07 to 16B.09, may negotiate contracts without competitive bidding where it deems appropriate.

Sec. 38. [136F.42] [PERSONNEL MANAGEMENT.]

Subdivision 1. [TIME REPORTING.] As provided in executive order 96-2, the board, in consultation with the commissioners of employee relations and finance, may develop policies to allow system office or campus employees on salaries, as defined in section 43A.17, subdivision 1, to use negative time reporting in which employees report only that time for which leave is taken. By the end of the 1997 fiscal year, the board, in consultation with the commissioners of employee relations and finance, shall evaluate the use of negative time reporting and its potential for use with other state employees.

Subd. 2. [TRAVEL POLICIES.] Notwithstanding chapter 43A, the board may adopt policies for colleges and universities to approve and administer travel arrangements, other than reimbursement, for employees on campus, and for the system office to provide the same services for employees in that office.

Sec. 39. Minnesota Statutes 1995 Supplement, section 136F.44, is amended to read:

136F.44 [ADMINISTRATIVE INTERACTION WITH STUDENTS.]

Subdivision 1. [SYSTEM AND CAMPUS ADMINISTRATORS.] As part of their annual goal setting activity, all unrepresented system and campus academic administrators employed in their positions before July 1, 1995, shall have the expectation of are encouraged to substantially increasing increase their interaction with students through activities such as teaching a regularly scheduled course or serving as an academic advisor. Contracts for persons initially

employed in unclassified administrative positions on or after July 1, 1995, shall include requirements for activities involving student contact. Actions to increase the interaction of students and administrators under this section shall not displace permanent faculty or staff.

Subd. 2. [EVALUATION INFORMATION.] Each state university, community college, and technical college campus shall provide an evaluation of this activity to the board, and The board shall include a summary of campus and system activities related to subdivision 1 in its 1998-1999 biennial budget request.

Sec. 40. Minnesota Statutes 1995 Supplement, section 136F.50, is amended to read:

136F.50 [COOPERATION OR PROMOTION OF A STATE COLLEGE OR UNIVERSITY.]

The board, system office, and the campuses may cooperate by contractual arrangement or otherwise with responsible persons, firms, corporations, associations, or governmental agencies to promote short courses, research, and other programs and activities in the state colleges and universities as in the judgment of the board, system office, or a campus contribute to the development of the state colleges and universities and the welfare of their students.

Sec. 41. [136F.526] [AUDITS.]

Each college and university shall be audited as provided by board policy. The policy shall be designed to ensure financial integrity, necessary internal controls, and appropriate accordance between board policies and campus expenditures. The college or university may arrange for any additional audits it desires by contracting with the legislative auditor or a private certified public accountant. Nothing in this section shall limit the authority of the legislative auditor to perform selected scope audits or other duties of the office as provided under section 3.971.

Sec. 42. Minnesota Statutes 1995 Supplement, section 136F.53, subdivision 1, is amended to read:

Subdivision 1. [BOARD POWER CAMPUS PARKING AUTHORITY.] Notwithstanding section 169.966, the board may authorize a state college or university to may adopt and enforce policies, regulations, or ordinances for the regulation of traffic and parking in parking facilities and on private roads and roadways situated on property owned, leased, occupied, or operated by the state college or university.

Sec. 43. Minnesota Statutes 1995 Supplement, section 136F.53, subdivision 3, is amended to read:

Subd. 3. [DISPUTES.] A state college or university, with the approval of the board, shall establish procedures to resolve a dispute arising from enforcement of a policy.

Sec. 44. Minnesota Statutes 1995 Supplement, section 136F.58, is amended to read:

136F.58 [BOOKSTORES.]

The board may permit A state college or university to conduct may operate a bookstore in a state college or university building, or may allocate space in a state college or university building and permit a person or corporation to conduct operate a bookstore therein without rent at the board's campus' pleasure and on such conditions as the board may impose. The board may provide insurance, at no cost to the state, for the inventory of a bookstore a state college or university conducts in its building.

Sec. 45. [136F.581] [PURCHASES AND CONTRACTS.]

Subdivision 1. [CONDITIONS.] The board and the colleges and universities are subject to the provisions of section 471.345.

Subd. 2. [POLICIES AND PROCEDURES.] The board shall develop policies, and each college and university shall develop procedures for purchases and contracts that are consistent with subdivision 1. In addition, each college and university, in consultation with the system office, shall develop procedures for those purchases and contracts that can be accomplished by a college and university without board approval. The board policies must allow each college and university the local authority to enter into contracts for construction projects of up to $250,000 and to make other purchases of up to $50,000, without receiving board approval. The board may allow a college or university local authority to make purchases over $50,000 without receiving board approval.

Subd. 3. [PROCUREMENT FROM DEIGNATED BUSINESSES.] The policies and procedures must include provisions for procurement, including construction, from small targeted group businesses and businesses from economically disadvantaged areas designated under section 16B.19. The board, colleges, and universities shall use the methods contained in section 471.345, subdivision 8, for such purchasing, or may develop additional methods in which the cost percentage preferences are consistent with the provision of section 16B.19, subdivision 2c and 2d, or consistent with the provisions of the University of Minnesota's targeted group business purchasing program.

Subd. 4. [PROFESSIONAL OR TECHNICAL SERVICES.] (a) The board shall develop policies for entering into contracts for professional or technical services, other than instructional services. The policies must allow each college and university the authority to enter into contracts for professional or technical services up to $15,000 without board approval. The board may allow a college or university authority to enter into contracts for professional or technical services over $15,000 without receiving board approval.

(b) Each college and university, in consultation with the system office, shall develop procedures to enter into contracts for professional or technical services.

(c) The policies and procedures developed by the board and by each college and university for professional or technical service contracts must be done in consultation with employees and their exclusive bargaining representatives and must address topics such as employee protections, information availability and reporting, conflict of interest, and renewal restrictions.

Sec. 46. [136F.582] [LOCAL CONTRACTING AUTHORITY.]

Notwithstanding the provisions of chapter 8 or 16B, college and university presidents may enter into contracts to provide customized training or for short-term leases of instructional space or equipment without additional authorization.

Sec. 47. [136F.61] [STATE BUILDING CODE.]

All Minnesota state college and university facilities are subject to the provisions of the state building code under chapter 16B and the Uniform Fire Code under chapter 299F.

Sec. 48. [136F.67] [FINANCING OF CHILD CARE; PARKING.]

Subdivision 1. [AUTHORIZATION.] A technical college or a community college must not seek financing for child care facilities or parking facilities through the higher education facilities authority, as provided in section 136A.28, subdivision 7, without the explicit authorization of the board.

Subd. 2. [PARKING.] State appropriations for repair or construction of parking facilities must not be used for more than one-half of the repair or construction cost of a parking facility at any technical college or community college campus. The campus must provide the remaining costs through local revenue; however, revenue must not be raised through campuswide assessments of students or employees without regard to use of the parking facilities.

Sec. 49. Minnesota Statutes 1995 Supplement, section 136F.71, is amended by adding a subdivision to read:

Subd. 3. [INTEREST INCOME.] Beginning July 1, 1997, interest income attributable to general fund dedicated receipts of the board is appropriated to the board. The board shall allocate the income proportionately among the colleges and universities. The board shall report this income separately in its biennial budget requests.

Sec. 50. Minnesota Statutes 1995 Supplement, section 136F.72, subdivision 3, is amended to read:

Subd. 3. [ADMINISTRATION.] The board Each college and university, independent of other authority and notwithstanding chapters 16A and 16B, shall administer the money collected for the state colleges and universities its activity funds and the administrative fund. The board, independent of other authority and notwithstanding chapters 16A and 16B, shall administer the administrative fund established in the system office. All activity fund money collected shall be administered under the policies of the board subject to audit of the legislative auditor.

Sec. 51. Minnesota Statutes 1995 Supplement, section 136F.80, subdivision 2, is amended to read:

Subd. 2. [DEPOSIT OF MONEY.] The board shall provide by policy, in accordance with provisions of chapter 118, for the deposit of all money received or referred to under this section. Whenever the board shall by resolution determine that there are moneys in the state college or university funds not currently needed, the board may by

resolution authorize and direct the president of the college or university to invest a specified amount in securities as are duly authorized as legal investments for savings banks and trust companies. Securities so purchased shall be deposited and held for the board by any bank or trust company authorized to do a banking business in this state. Notwithstanding the provisions of chapter 118, the state board of investment may invest assets of the board, colleges, and universities when requested by the board, college, or university.

Sec. 52. Minnesota Statutes 1994, section 137.37, is amended to read:

137.37 [OFF-CAMPUS SITES AND CENTERS.]

The board of regents and the university campuses are requested to not establish any off-campus centers or other permanent sites located off university campuses to provide academic programs, courses, or student services without authorizing legislation. This section does not apply to sites set up specifically for the delivery of courses and programs through telecommunications.

Sec. 53. Minnesota Statutes 1995 Supplement, section 169.441, subdivision 5, is amended to read:

Subd. 5. [OPTIONAL MARKINGS; RULES.] A school district or technical college may elect to show on the front and rear of the school buses that it owns or contracts for, a plainly visible, summary message explaining section 169.444, subdivisions 1 and 2. If the school district or technical college elects to display the message, it must conform with the rules of the commissioner of children, families, and learning. The commissioner shall adopt rules governing the size, type, design, display, and content of the summary message that may be shown.

Sec. 54. Minnesota Statutes 1994, section 169.448, subdivision 2, is amended to read:

Subd. 2. [SCHOOL MOTOR COACHES.] (a) Neither A school district nor a technical college may not acquire a motor coach for transportation purposes.

(b) A motor coach acquired by a school district or technical college before March 26, 1986, may be used by it only to transport students participating in school activities, their instructors, and supporting personnel to and from school activities. A motor coach may not be outwardly equipped and identified as a school bus. A motor coach operated under this subdivision is not a school bus for purposes of section 124.225. The state board of education shall implement rules governing the equipment, identification, operation, inspection, and certification of motor coaches operated under this subdivision.

(c) After January 1, 1998, neither a school district nor a technical college may not own or operate a motor coach for any purpose.

Sec. 55. Minnesota Statutes 1994, section 201.1611, is amended to read:

201.1611 [POST-SECONDARY INSTITUTION VOTER REGISTRATION.]

Subdivision 1. [FORMS.] All post-secondary institutions that enroll students accepting state or federal financial aid shall provide voter registration forms to each student upon payment of tuition, fees, and activities funds at the commencement of as early as possible in the fall quarter. The forms must contain spaces for the information required in section 201.071, subdivision 1, and applicable rules of the secretary of state. The institutions may request these forms from the secretary of state. Institutions shall consult with their campus student government in determining the most effective means of distributing the forms.

Subd. 2. [STUDENT VOTER REGISTRATION.] Upon registration or receipt of payment of fees, students must be asked if they want to register to vote at the same time. A copy of each completed voter registration form must be sent to the county auditor of the county in which the voter maintains residence or to the secretary of state as soon as possible. All completed voter registration forms must be forwarded to the county auditor within five days and in no case later than 21 days before the general election.

Sec. 56. Minnesota Statutes 1994, section 248.07, subdivision 7, is amended to read:

Subd. 7. [BLIND, VENDING STANDS AND MACHINES ON GOVERNMENTAL PROPERTY.] Notwithstanding any other law, for the rehabilitation of blind persons the commissioner shall have exclusive authority to establish and to operate vending stands and vending machines in all buildings and properties owned or rented exclusively by the

Minnesota state colleges and universities at a state university or, a community college systems, a consolidated community technical college, or a technical college served by the commissioner before January 1, 1996, or by any department or agency of the state of Minnesota except the department of natural resources properties operated directly by the division of state parks and not subject to private leasing. The merchandise to be dispensed by such vending stands and machines may include nonalcoholic beverages, food, candies, tobacco, souvenirs, notions and related items. Such vending stands and vending machines herein authorized shall be operated on the same basis as other vending stands for the blind established and supervised by the commissioner under federal law. The commissioner shall waive this authority to displace any present private individual concessionaire in any state-owned or rented building or property who is operating under a contract with a specific renewal or termination date, until the renewal or termination date. With the consent of the governing body of a governmental subdivision of the state, the commissioner may establish and supervise vending stands and vending machines for the blind in any building or property exclusively owned or rented by the governmental subdivision.

Sec. 57. Laws 1995, chapter 212, article 2, section 15, is amended to read:

Sec. 15. [CREDIT STUDENT TRACKING.] The board of regents of the University of Minnesota and the board of trustees of the Minnesota state colleges and universities are requested to develop a centralized electronic tracking system systems of credits earned by students student enrollment.

Sec. 58. Laws 1995, chapter 212, article 2, section 20, subdivision 1, is amended to read:

Subdivision 1. [PLAN.] The state universities, community colleges, and technical colleges shall each develop and implement plans, in conjunction with the board of trustees, to provide students with job placement history and projected demand to students at the time the student declares a major program or field of study for careers in major programs or fields of study. The University of Minnesota campuses are requested to develop and implement similar plans. These plans may allow for this information to be provided through such means as in-person student advising or electronic delivery, as determined by the campus to best address student needs.

Sec. 59. Laws 1995, chapter 212, article 2, section 20, subdivision 2, is amended to read:

Subd. 2. [CONTENTS.] Information provided must include program placement history, and projected demand in the field and in associated types of placement, using labor market forecasting information from the department of economic security or similar materials. The plan must provide for students to indicate in writing that they received the information.

Sec. 60. [MINNESOTA STATE COLLEGE AND UNIVERSITY POLICIES.]

Subdivision 1. [GENERAL.] In establishing system policies under this section and elsewhere in this act, the system office and campus representatives shall consult with the departments of administration, employee relations, and finance.

Subd. 2. [DEVELOPMENT.] The system office and the campuses shall begin developing policies and procedures and do other necessary planning to implement this act immediately upon final enactment. Policies and procedures necessary to implement sections 20, 38, and 45 shall be developed by July 1, 1996. To the extent possible, policies and procedures necessary to implement any other sections shall be developed before the beginning of the 1996-1997 academic year.

Subd. 3. [PROPERTY DISPOSAL POLICY.] Notwithstanding Minnesota Statutes, section 15.054, Minnesota state college and university system and campus officials, in consultation with the department of administration, shall establish an efficient method for the disposal and exchange of property and equipment no longer needed by the system office or a campus, but that might be of use to another college or university in the system.

Minnesota state college and university system and campus officials may allow other state and local governmental agencies access to property and equipment to be used for educational purposes.

Subd. 4. [ENVIRONMENTALLY RESPONSIBLE PRACTICES.] The board shall develop (1) resource recovery policies that ensure recycling in the system office and at the colleges and universities is at least maintained at the current level, and (2) environmentally responsible practices that are consistent in their intent and goals with Minnesota Statutes, sections 16B.121 and 115A.15, and related administrative policies.

Subd. 5. [FOOD CONTRACT.] The system office, in conjunction with its review of auxiliary enterprises, shall consider allowing individual state universities to contract for the provision of food services, upon the expiration of the current statewide contract.

Sec. 61. [REQUEST FOR INTEREST INCOME.]

The board may receive an appropriation for interest income as provided in section 49, if the board requests it as a change item in its 1998-1999 biennial budget request and the 1997 legislature appropriates money for it.

Sec. 62. [FINANCIAL AID RULES.]

The higher education services office shall eliminate the requirement that schools document that students have been counseled regarding responsibilities as SELF loan borrowers. Schools shall have a campus policy for counseling students about their obligations and responsibilities as SELF borrowers. This counseling may be done in conjunction with federal loan counseling. The office shall work with the Minnesota association of financial aid administrators to determine a solution to the problems created by different federal and state disbursement schedules and to improve the process relating to holds on state grants for nonpayment of child support.

Sec. 63. [CONTRACT LIABILITY.]

Any procurement contract involving the department of administration that (1) was entered into before March 1, 1996, and (2) the attorney general certifies would be violated without the participation of the Minnesota state colleges and universities, shall stay in effect until the first time that the Minnesota state colleges and universities can be excluded without liability.

Sec. 64. [REPEALER.]

Minnesota Statutes 1994, sections 137.03; 137.05; 137.06; 137.07; 137.08; 137.11; 137.14; 137.15; and 137.33; Minnesota Statutes 1995 Supplement, sections 135A.08; 136F.25; and 136F.59, subdivision 1; and Laws 1995, chapter 212, article 1, section 6, subdivision 1, are repealed.

Sec. 65. [EFFECTIVE DATE.]

Sections 1 to 3, 6 to 15, 24 to 29, 31 to 36, 39 to 44, 46, and 51 to 64 are effective the day following final enactment. Sections 4, 5, 16 to 23, 30, 37, 38, 45, and 47 to 50 are effective July 1, 1996."

Delete the title and insert:

"A bill for an act relating to education; removing mandates from higher education; requiring increased accountability and performance for funding; amending Minnesota Statutes 1994, sections 15.43, subdivisions 2 and 3; 16B.01, subdivision 2; 16B.21, subdivisions 1 and 3; 16B.33, subdivisions 1, 3, 4, and by adding a subdivision; 16B.35, by adding a subdivision; 16B.41, subdivision 2; 16B.482; 16B.49; 16B.531; 16B.54, subdivision 1; 16B.85, subdivision 2; 43A.05, subdivision 4; 43A.10, subdivision 3; 123.70, subdivision 10; 135A.033; 135A.14, as amended; 137.37; 169.448, subdivision 2; 201.1611; and 248.07, subdivision 7; Minnesota Statutes 1995 Supplement, sections 16B.17, subdivision 6; 16B.465, subdivision 4; 43A.06, subdivision 1; 135A.181; 136A.101, subdivision 10; 136F.06, subdivisions 1 and 2; 136F.12; 136F.16, subdivision 3; 136F.18; 136F.30; 136F.36, subdivision 2; 136F.44; 136F.50; 136F.53, subdivisions 1 and 3; 136F.58; 136F.71, by adding a subdivision; 136F.72, subdivision 3; 136F.80, subdivision 2; and 169.441, subdivision 5; Laws 1995, chapter 212, article 2, sections 15; and 20, subdivisions 1 and 2; proposing coding for new law in Minnesota Statutes, chapters 135A; 136A; and 136F; repealing Minnesota Statutes 1994, sections 137.03; 137.05; 137.06; 137.07; 137.08; 137.11; 137.14; 137.15; and 137.33; Minnesota Statutes 1995 Supplement, sections 135A.08; 136F.25; and 136F.59, subdivision 1; Laws 1995, chapter 212, article 1, section 6, subdivision 1."

With the recommendation that when so amended the bill pass.

The report was adopted.

Carlson, L., from the Committee on Education to which was referred:

H. F. No. 2568, A bill for an act relating to education; appropriating money to reduce tuition rates.

Reported the same back with the following amendments:

Page 1, line 7, delete "$25,000,000" and insert "$3,500,000"

Page 1, line 12, delete "$25,000,000" and insert "$1,500,000"

Page 1, delete lines 17 to 24 and insert:

"Subd. 3. [HIGHER EDUCATION SERVICES OFFICE.] $5,000,000 from the general fund in fiscal year 1997 is appropriated to the higher education services office to establish a one-year pilot targeted grant program to test the effects of providing an additional grant to very low-income students. The office shall provide an equal targeted grant to every dependent student, and independent student with a dependent child, who receives a state grant and whose family has a gross income up to $20,000."

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Rules and Legislative Administration.

The report was adopted.

Rest from the Committee on Taxes to which was referred:

H. F. No. 2781, A bill for an act relating to taxation; providing for taxation of certain property managed or owned by certain public entities or partnerships which include such entities; authorizing creation of joint powers boards for purposes of housing ownership and management; amending Minnesota Statutes 1994, sections 469.040, by adding a subdivision; and section 471.59, by adding a subdivision.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. Minnesota Statutes 1994, section 469.040, is amended by adding a subdivision to read:

Subd. 4. [FACILITIES FUNDED FROM MULTIPLE SOURCES.] In the metropolitan area, as defined in section 473.121, subdivision 2, the tax treatment provided in subdivision 3 applies to that portion of any multifamily rental housing facility represented by the ratio of (1) the number of units in the facility that are subject to the requirements of Section 5 of the United States Housing Act of 1937, as the result of the implementation of a federal court order or consent decree to (2) the total number of units within the facility.

The housing and redevelopment authority for the city in which the facility is located, any public entity exercising the powers of such housing and redevelopment authority, or the county housing and redevelopment authority for the county in which the facility is located, shall annually certify to the assessor responsible for assessing the facility, at the time and in the manner required by the assessor, the number of units in the facility that are subject to the requirements of Section 5 of the United States Housing Act of 1937.

Nothing in this subdivision shall prevent that portion of the facility not subject to this subdivision from meeting the requirements of section 273.1317, and for that purpose the total number of units in the facility must be taken into account.

Sec. 2. Minnesota Statutes 1994, section 471.59, is amended by adding a subdivision to read:

Subd. 13. [JOINT POWERS BOARD FOR HOUSING.] (a) For purposes of implementing a federal court order or decree, two or more housing and redevelopment authorities, or public entities exercising the public housing powers of housing and redevelopment authorities, may by adoption of a joint powers agreement that complies with the provisions of subdivisions 1 to 5, establish a joint board for the purpose of acquiring an interest in, rehabilitating, constructing, owning, or managing low-rent public housing located in the metropolitan area, as defined in section 473.121, subdivision 2, and financed, in whole or in part, with federal financial assistance under Section 5 of the United States Housing Act of 1937. The joint board established pursuant to this subdivision shall:

(1) be composed of members designated by the governing bodies of the governmental units which established such joint board, and possess such representative and voting power provided by the joint powers agreement;

(2) constitute a public body, corporate, and politic; and

(3) notwithstanding the provisions of subdivision 1, requiring commonality of powers between parties to a joint powers agreement, and solely for the purpose of acquiring an interest in, rehabilitating, constructing, owning, or managing federally financed low-rent public housing, shall possess all of the powers and duties contained in sections 469.001 to 469.047 and, if at least one participant is an economic development authority, sections 469.090 to 469.1081, except (i) as may be otherwise limited by the terms of the joint powers agreement; and (ii) a joint board shall not have the power to tax pursuant to section 469.033, subdivision 6, or 469.107, nor shall it exercise the power of eminent domain. Every joint powers agreement establishing a joint board shall specifically provide which and under what circumstances the powers granted herein may be exercised by that joint board.

(b) If a housing and redevelopment authority exists in a city which intends to participate in the creation of a joint board pursuant to paragraph (a), such housing and redevelopment authority shall be the governmental unit which enters into the joint powers agreement unless it determines not to do so, in which event the governmental entity which enters into the joint powers agreement may be any public entity of that city which exercises the low-rent public housing powers of a housing and redevelopment authority.

(c) A joint board shall not make any contract with the federal government for low-rent public housing, unless the governing body or bodies creating the participating authority in whose jurisdiction the housing is located has, by resolution, approved the provision of that low-rent public housing.

(d) This subdivision does not apply to any housing and redevelopment authority, or public entity exercising the powers of a housing and redevelopment authority, within the jurisdiction of a county housing and redevelopment authority which is actively carrying out a public housing program under Section 5 of the United States Housing Act of 1937. For purposes of this paragraph, a county housing and redevelopment authority is considered to be actively carrying out a public housing program under Section 5 of the United States Housing Act of 1937, if it (1) owns 200 or more public housing units constructed under Section 5 of the United States Housing Act of 1937, and (2) has applied for public housing development funds under Section 5 of the United States Housing Act of 1937, during the three years immediately preceding January 1, 1996.

(e) For purposes of sections 469.001 to 469.047, "city" means the city in which the housing units with respect to which the joint board was created are located and "governing body" or "governing body creating the authority" means the council of such city.

Sec. 3. [EFFECTIVE DATE.]

Sections 1 and 2 are effective the day following final enactment."

With the recommendation that when so amended the bill pass.

The report was adopted.

Anderson, R., from the Committee on Health and Human Services to which was referred:

H. F. No. 2818, A bill for an act relating to human services; appropriating money.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

Section 1. [HEALTH AND HUMAN SERVICES APPROPRIATIONS.]

The sums shown in the columns marked "APPROPRIATIONS" are appropriated from the general fund, or any other fund named, to the agencies and for the purposes specified in the following sections of this article, to be available for the fiscal years indicated for each purpose. The figures "1996" and "1997" where used in this article, mean that the appropriation or appropriations listed under them are available for the fiscal year ending June 30, 1996, or June 30, 1997, respectively. Where a dollar amount appears in parentheses, it means a reduction of an appropriation.

APPROPRIATIONS BIENNIAL

1996 1997 TOTAL

General $ (114,331,000) $ (52,000,000)$ (166,331,000)

State Government

Special Revenue 50,000 300,000 350,000

Metropolitan Landfill

Contingency Action Fund -0- -0- -0-

Trunk Highway -0- -0- -0-

Special Revenue -0- -0- -0-

TOTAL $ (114,281,000) $ (51,700,000)$ (165,981,000)

APPROPRIATIONS

Available for the Year

Ending June 30

1996 1997

Sec. 2. COMMISSIONER OF HUMAN SERVICES

Subdivision 1. Total Appropriation (114,331,000) (52,531,000)

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 2.

Subd. 2. Finance and Management

General

-0- 329,000

[COMBINED MANUAL PRODUCTION COSTS.] For the biennium ending June 30, 1997, money received from individuals and private or public entities to recover the cost of producing the department of human services combined manual is appropriated to the commissioner.

[CRIMINAL BACKGROUND CHECKS.] Of this sum, $54,000 is appropriated to the commissioner of human services to cover the costs of expanded criminal background checks required by Minnesota Statutes, sections 144.057 and 245A.04, subdivision 3.

Subd. 3. Life Skills Self-Sufficiency

(3,462,000) (243,000)

The amounts that may be spent from this appropriation for each purpose are as follows:

(a) Semi-Independent Living Services (SILS) Grants

-0- -0-

(b) Chemical Dependency Consolidated Treatment

(3,462,000) (1,346,000)

(c) American Indian Chemical Dependency Grants and Chemical

Dependency Special Grants

-0- -0-

(d) Chemical Dependency Consolidated Treatment - Nonentitled

-0- -0-

(e) Deaf and Hard of Hearing Services Grants

-0- 100,000

(f) Community Social Services Grants

-0- -0-

(g) Consumer Support

-0- -0-

(h) Developmental Disabilities Family Support Grants

-0- 53,000

(i) Administration and Other Grants

-0- -0-

[DEAF AND HARD-OF-HEARING ADULTS WITH MENTAL ILLNESS.] $100,000 is appropriated for the fiscal year ending June 30, 1997, for a grant to a nonprofit agency that is currently serving deaf and hard-of-hearing adults with mental illness through residential programs and supported housing outreach activities. The grant must be used to expand the services provided by the nonprofit agency to include community support services for deaf and hard-of-hearing adults with mental illness.

Subd. 4. Children's Program 360,000 2,000,000

The amounts that may be spent from this appropriation for each purpose are as follows:

(a) Children's Trust Fund Grants

-0- -0-

(b) Families With Children Services Grants and Administration

360,000 -0-

(c) Family Service Collaborative Grants

-0- -0-

(d) Family Preservation, Family Support, and Child Protection Grants

-0- -0-

(e) Subsidized Adoption Grants

-0- 1,500,000

(f) Other Families with Children Services Grants

-0- 500,000

[CHILD CARE WORKER TRAINING.] $500,000 is appropriated to the commissioner of human services for the fiscal year ending June 30, 1997, for child care worker training. The commissioner shall transfer this appropriation to the commissioner of children, families, and learning for early childhood development training for child care workers working in child care centers and family child care homes that serve low-income children. The training must include: registered apprenticeship and mentoring programs; training programs designed to promote people of color working in the area of early childhood development; and scholarships for credit-based early childhood development training from accredited institutions.

[MARTIN LUTHER KING NONVIOLENT INSTITUTIONAL CHILD

DEVELOPMENT PILOT PROGRAM.] The commissioner shall transfer the appropriation for the fiscal year ending June 30, 1996, for the Martin Luther King nonviolent institutional child development pilot program to the council on Black Minnesotans for the purposes of the pilot program and to pay related costs and expenses. Unexpended funds do not cancel, but are available to the council until expended. This provision is effective the day following final enactment.

Subd. 5. Economic Self-Sufficiency

General

(13,947,000)(15,854,000)

The amounts that may be spent from this appropriation for each purpose are as follows:

(a) STRIDE Grants

-0- -0-

(b) AFDC Grants

(13,092,000)(16,794,000)

(c) General Assistance Grants

958,000 470,000

(d) Minnesota Supplemental Aid

(740,000) (823,000)

(e) Minnesota Family Investment Plan (MFIP) Grants

-0- 64,000

(f) Child Care Fund Entitlement Grants

(1,258,000) (1,321,000)

(g) Child Support Enforcement Grants

-0- -0-

(h) Administration and Other Grants

185,000 1,600,000

(i) Aging Ombudsman

-0- -0-

(j) Aging Grants

-0- 950,000

[CHILD CARE SUPPLEMENTAL APPROPRIATION.] $1,500,000 is appropriated for the fiscal year ending June 30, 1997, to the commissioner of human services for the purposes of the basic sliding fee child care program under Minnesota Statutes, section 256H.03. This appropriation is in addition to the appropriation in Laws 1995, chapter 207, article 1, section 2, subdivision 4.

Subd. 6. Health Care

General

(97,282,000)(38,563,000)

The amounts that may be spent from this appropriation for each purpose are as follows:

(a) Group Residential Housing Grants

(3,318,000) (4,358,000)

(b) MA Long-Term Care Facilities

(19,775,000) (787,000)

(c) MA Long-Term Care Waivers and Home Care

(2,313,000) (7,166,000)

(d) MA Managed Care and Fee-for-Service

(20,231,000)(10,729,000)

(e) General Assistance Medical Care

(52,145,000)(30,375,000)

(f) Alternative Care

-0- -0-

(g) Medicaid Management Information System

-0- -0-

(h) Administration and Other Grants

500,000 520,000

[NEW ICF/MR.] For the fiscal year ending June 30, 1997, a newly constructed or newly established intermediate care facility for persons with mental retardation that is developed and financed during that period shall not be subject to the equity requirements in Minnesota Statutes, section 256B.501, subdivision 11, paragraph (d), or Minnesota Rules, part 9553.0060, subpart 3, item F, provided that the provider's interest rate does not exceed the interest rate available through state agency tax exempt financing.

[ICF/MR RECEIVERSHIP.] For the fiscal year ending June 30, 1997, if a facility which is in receivership under Minnesota Statutes, section 245A.12 or 245A.13, is sold to an unrelated organization, then: (a) the facility shall be considered a newly established facility for rate setting purposes, notwithstanding any provisions to the contrary in Minnesota Statutes, section 256B.501, subdivision 11; and (b) the facility's historical basis for the physical plant, land, and land improvements for each facility must not exceed the prior owner's aggregate historical basis for these same assets for each facility. The allocation of the purchase price between physical plant, land, and land improvements shall be based on the real estate appraisal using the depreciated replacement cost method.

[COUNTY WAIVERED SERVICES RESERVE.] Notwithstanding the provisions of Minnesota Statutes, section 256B.092, subdivision 4, and Minnesota Rules, part 9525.1830, subpart 2, the commissioner may approve written procedures and criteria for the allocation of home- and community-based waivered services funding for persons with mental retardation or related conditions which enables a county to maintain a reserve resource account. The reserve resource account may not exceed five percent of the county agency's total annual allocation of home- and community-based waivered services funds. The reserve may be utilized to ensure the county's ability to

meet the changing needs of current recipients, to ensure the health and safety needs of current recipients, or to provide short-term emergency intervention care to eligible waiver recipients.

[PREADMISSION SCREENING TRANSFER.] Effective the day following final enactment, up to $40,000 of the appropriation for preadmission screening and alternative care for fiscal year 1996 may be transferred to the health care administration account to pay the state's share of county claims for conducting nursing home assessments for persons with mental illness or mental retardation as required by Public Law Number 100-203.

[PREPAID MEDICAL PROGRAMS.] Administrative money appropriated for the prepaid medical assistance program and the prepaid general assistance medical care program may be transferred between grants and nongrant administrative costs.

[SERVICE ALLOWANCE TRANSFER.] For the fiscal year ending June 30, 1997, the commissioner may transfer $848,000 from the medical assistance grants account to the alternative care grants account for allocation as service allowances to counties under Minnesota Statutes 1995 Supplement, section 256B.0913, subdivision 15.

[ICF/MR PAYMENT INCREASE.] For the rate year beginning October 1, 1996, the commissioner shall increase each ICF/MR facility's payment rate by $0.75 per resident per day.

[NF PAYMENT INCREASE.] For the rate year beginning July 1, 1996, the commissioner shall increase each nursing facility's payment rate for those facilities whose rates are determined under Minnesota Statutes, section 256B.431, subdivision 25, by $0.75 per resident per day.

[HIV/AIDS DRUG REIMBURSEMENT PROGRAM.] Of this appropriation, $240,000 in fiscal year 1997 is for the HIV/AIDS drug reimbursement program and shall be added to federal funds available for that program.

[NURSING FACILITY RECEIVERSHIP COSTS.] Notwithstanding the provisions of Minnesota Statutes, section 256B.495, for a nursing facility where the closure of the facility after resident relocation and the loss of the nursing home beds will significantly decrease the regional average number of long-term care beds per thousand elderly over 65 in the year 2000 to within 11 beds of the hardship standard as referenced in the study, The 1993 Distribution of Nursing Home Beds in Minnesota, prepared by the Interagency Long-Term Care Planning committee in March 1994, the commissioner of human services shall waive the recovery of up to $350,000 of receivership costs incurred during a department of health receivership of a nursing home beginning on September 15, 1995. The commissioner of human services shall also extend the period to recover receivership costs in excess of $350,000 if the commissioner considers an extension appropriate to promote the best interests of the residents in the facility.

The purchaser of a nursing home beginning receivership on September 15, 1995, shall not be liable for the $350,000 of the receivership costs. The decision to extend the time for recovery is contingent on the following considerations:

(1) the purchaser of the facility has demonstrated to the satisfaction of the department of health and the department of human services that the facility will be operated in accordance with the reimbursement system. The purchaser must provide documentation to verify access to funds to purchase the facility, access to appropriate lines of credit to cover anticipated and unanticipated operating costs, cash flow projections which provide a realistic estimate of expenses and income, and other financial information that might be required by the commissioners to determine whether a license should be granted;

(2) the cost of continued operation under the receivership while residents are relocated has been estimated to equal or exceed $500,000;

(3) the purchaser has demonstrated that the purchase of the facility and the ongoing operation of the facility will not occur without the decision to forgo the recovery of the receivership funds, that the former owner of the facility does not financially benefit by the sale of the facility, and that the entities with financial interests in the nursing home land and building have taken substantial losses; and

(4) the closure of the facility will require the relocation of a majority of residents to facilities in different counties.

Subd. 7. Community Mental Health and State-Operated Services

General

-0- (200,000)

The amounts that may be spent from this appropriation for each purpose are as follows:

(a) Mental Health Grants - Children

-0- (200,000)

(b) Mental Health Grants - Adults

-0- -0-

(c) Residential Treatment Center Facilities

-0- -0-

(d) Developmental Disability and Mentally Ill (DD and MI)

State-Operated Community Services (SOCS)

-0- -0-

(e) Administration and Other Grants

-0- -0-

[COMPULSIVE GAMBLING GRANT FOR ADOLESCENT PROGRAMS.] The appropriation in Laws 1995, chapter 207, article 1, section 2, subdivision 7, for compulsive gambling programs is reduced by $40,000. $40,000 is appropriated to the commissioner for the fiscal year ending June 30, 1996, for a grant to a compulsive gambling council located in St. Louis county for a compulsive gambling prevention and education project for adolescents. This appropriation does not cancel, but is available until June 30, 1997.

Sec. 3. COMMISSIONER OF HEALTH

Subdivision 1. Total Appropriation -0- 606,000

Summary by Fund

General -0- 406,000

Metropolitan Landfill Contingency Action Fund

-0- -0-

State Government Special Revenue

-0- 200,000

Trunk Highway -0- -0-

Special Revenue-0- -0-

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 3.

Subd. 2. Health Systems Development -0- 55,000

Summary by Fund

General -0- 55,000

State Government Special Revenue

-0- -0-

[HOSPITAL CONVERSION; SUPPLEMENTAL ALLOCATION.]

Of the appropriation from the general fund, for the fiscal year ending June 30, 1997, the commissioner of health shall provide $25,000 to a 28-bed hospital located in Chisago county, to enable that facility to plan for closure and conversion, in partnership with other entities, in order to offer outpatient and emergency services at the site. This allocation is in addition to funds authorized by Laws 1995, article 1, section 3, subdivision 2.

Subd. 3. Health Quality Assurance -0- 200,000

Summary by Fund

General -0- -0-

Trunk Highway -0- -0-

State Government Special Revenue

-0- 200,000

[SHARED ADMINISTRATOR.] Notwithstanding the provisions of Minnesota Statutes, section 144A.04, subdivision 5, the administrator of a county owned nursing home may serve, until September 30, 1996, as the administrator of a nursing home located in a county owned hospital provided that the total number of nursing home beds in both facilities does not exceed 153 beds.

[MEDICARE INITIAL SURVEYS.] $200,000 is appropriated to the commissioner for the fiscal year ending June 30, 1997, to support initial surveys of Medicare providers. This appropriation shall be available until federal law prohibiting the collection of a fee for Medicare initial surveys is repealed. Upon repeal of the federal law, the commissioner shall charge fees in accordance with Minnesota Statutes, section 144.122, paragraph (e).

Subd. 4. Health Protection -0- 351,000

Summary by Fund

General -0- 351,000

State Government Special Revenue

-0- -0-

Metropolitan Landfill Contingency Action Fund

-0- -0-

Special Revenue -0- -0-

[REPORT ON INSPECTION FEES.] The commissioner may spend up to $20,000 of the money appropriated for the fiscal year ending June 30, 1997, to develop recommendations for options to reduce inspection fees for establishments licensed under Minnesota Statutes, chapter 157, which are operating in the category of small establishment with full menu selection, and which have ten or fewer employees. The recommendations must not include the option of a general fund appropriation as a way to reduce inspection fees. The commissioner must report the recommendations to the legislature by October 1, 1996.

[LEAD HAZARD REDUCTION.] Of the appropriation for lead hazard reduction, $50,000 is for the purposes of Minnesota Statutes, section 144.9504, subdivision 1; $75,000 is for the purposes of Minnesota Statutes, section 144.9504, subdivision 7; and $25,000 is for the purposes of Minnesota Statutes, section 144.9503, subdivision 9.

Subd. 5. Management and Support Services -0- -0-

Summary by Fund

General -0- -0-

Metropolitan Landfill Contingency Action Fund

-0- -0-

Trunk Highway -0- -0-

State Government Special Revenue

-0- -0-

Sec. 4. VETERANS NURSING HOMES BOARD -0- 125,000

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 4.

[VETERANS NURSING HOMES BOARD.] $125,000 is appropriated from the general fund to the veterans nursing homes board for the fiscal year ending June 30, 1997, for the nursing home in Fergus Falls. This appropriation is to fund positions and support services, to coordinate and oversee the construction of the facility, and to begin planning for the opening of the facility.

Sec. 5. HEALTH-RELATED BOARDS

Subdivision 1. Total Appropriation 50,000 100,000

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 5.

[STATE GOVERNMENT SPECIAL REVENUE FUND.] The appropriations in this section are from the state government special revenue fund.

[NO SPENDING IN EXCESS OF REVENUES.] The commissioner of finance shall not permit the allotment, encumbrance, or expenditure of money appropriated in this section in excess of the anticipated biennial revenues or accumulated surplus revenues from fees collected by the boards. Neither this provision nor Minnesota Statutes, section 214.06, applies to transfers from the general contingent account, if the amount transferred does not exceed the amount of surplus revenue accumulated by the transferee during the previous five years.

Subd. 2. Board of Chiropractic Examiners -0- -0-

Subd. 3. Board of Dentistry -0- -0-

Subd. 4. Board of Dietetic and Nutrition Practice -0- -0-

Subd. 5. Board of Marriage and Family Therapy -0- -0-

Subd. 6. Board of Medical Practice 50,000 150,000

[MEDICAL PRACTICE BOARD.] $50,000 in fiscal year 1996 and $100,000 in fiscal year 1997 is appropriated from the state government special revenue fund to the board of medical practice for the health professionals services program, and is added to the appropriation in Laws 1995, chapter 207, article 1, section 5, subdivision 6.

Subd. 7. Board of Nursing -0- -0-

Subd. 8. Board of Nursing Home Administrators -0- -0-

Subd. 9. Board of Optometry -0- -0-

Subd. 10. Board of Pharmacy -0- -0-

Subd. 11. Board of Podiatry -0- -0-

Subd. 12. Board of Psychology -0- -0-

Subd. 13. Board of Social Work -0- -0-

Subd. 14. Board of Veterinary Medicine -0- -0-

Sec. 6. COUNCIL ON DISABILITY -0- -0-

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 6.

Sec. 7. OMBUDSMAN FOR MENTAL HEALTH AND

MENTAL RETARDATION -0- -0-

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 7.

Sec. 8. OMBUDSMAN FOR FAMILIES -0- -0-

This appropriation is added to the appropriation in Laws 1995, chapter 207, article 1, section 8.

Sec. 9. CARRYOVER LIMITATION

None of the appropriations in this act which are allowed to be carried forward from fiscal year 1996 to fiscal year 1997 shall become part of the base level funding for the 1997-1999 biennial budget, unless specifically directed by the legislature.

Sec. 10. SUNSET OF UNCODIFIED LANGUAGE

All uncodified language contained in this article expires on June 30, 1997, unless a different expiration is explicit.

Section 1. Minnesota Statutes 1994, section 62D.04, subdivision 5, is amended to read:

Subd. 5. [PARTICIPATION; GOVERNMENT PROGRAMS.] Health maintenance organizations shall, as a condition of receiving and retaining a certificate of authority, participate in the medical assistance, general assistance medical care, and MinnesotaCare programs. The participation required from health maintenance organizations shall be pursuant to rules adopted under section 256B.0644 A health maintenance organization is required to submit proposals in good faith to serve individuals eligible for the above programs in a geographic region of the state if, at the time of publication of a request for proposal, the percentage of recipients in the public programs in the region who are enrolled in the health maintenance organization is less than the HMO's percentage of the total number of individuals enrolled in HMOs in the same region. Geographic regions shall be defined by the commissioner of human services in the request for proposals.

Sec. 2. Minnesota Statutes 1994, section 62N.10, subdivision 4, is amended to read:

Subd. 4. [PARTICIPATION; GOVERNMENT PROGRAMS.] Integrated service networks shall, as a condition of licensure, participate in the medical assistance, general assistance medical care, and MinnesotaCare programs. An integrated service network, including a community integrated service network is required to submit proposals in good faith to serve persons who are eligible for the above programs if, at the time of publication of a request for proposal, the percentage of recipients in the public programs in the region who are enrolled in the integrated service network is less than the integrated service network's percentage of the total number of individuals enrolled in integrated service networks in the same region. Geographic regions shall be defined by the commissioner of human services in the request for proposals. The commissioner shall adopt rules specifying the participation required of the networks. The rules must be consistent with Minnesota Rules, parts 9505.5200 to 9505.5260, governing participation by health maintenance organizations in public health care programs.

Sec. 3. Minnesota Statutes 1994, section 144.0722, is amended by adding a subdivision to read:

Subd. 2a. [SEMIANNUAL ASSESSMENT BY NURSING FACILITIES.] Notwithstanding Minnesota Rules, part 9549.0059, subpart 2, item B, the individual dependencies items 21 to 24 and 28 are required to be completed in accordance with the Facility Manual for Completing Case Mix Requests for Classification, July 1987, issued by the Minnesota department of health.

Sec. 4. Minnesota Statutes 1994, section 245.462, subdivision 4, is amended to read:

Subd. 4. [CASE MANAGER.] "Case manager" means an individual employed by the county or other entity authorized by the county board to provide case management services specified in section 245.4711. A case manager must have a bachelor's degree in one of the behavioral sciences or related fields from an accredited college or university and have at least 2,000 hours of supervised experience in the delivery of services to adults with mental illness, must be skilled in the process of identifying and assessing a wide range of client needs, and must be knowledgeable about local community resources and how to use those resources for the benefit of the client. The case manager shall meet in person with a mental health professional at least once each month to obtain clinical supervision of the case manager's activities. Case managers with a bachelor's degree but without 2,000 hours of supervised experience in the delivery of services to adults with mental illness must complete 40 hours of training approved by the commissioner of human services in case management skills and in the characteristics and needs of adults with serious and persistent mental illness

and must receive clinical supervision regarding individual service delivery from a mental health professional at least once each week until the requirement of 2,000 hours of supervised experience is met. Clinical supervision must be documented in the client record.

Until June 30, 1996 1999, a refugee who does not have the qualifications specified in this subdivision may provide case management services to adult refugees with serious and persistent mental illness who are members of the same ethnic group as the case manager if the person: (1) is actively pursuing credits toward the completion of a bachelor's degree in one of the behavioral sciences or a related field from an accredited college or university; (2) completes 40 hours of training as specified in this subdivision; and (3) receives clinical supervision at least once a week until the requirements of obtaining a bachelor's degree and 2,000 hours of supervised experience are met.

Sec. 5. Minnesota Statutes 1994, section 245.4871, subdivision 4, is amended to read:

Subd. 4. [CASE MANAGER.] (a) "Case manager" means an individual employed by the county or other entity authorized by the county board to provide case management services specified in subdivision 3 for the child with severe emotional disturbance and the child's family. A case manager must have experience and training in working with children.

(b) A case manager must:

(1) have at least a bachelor's degree in one of the behavioral sciences or a related field from an accredited college or university;

(2) have at least 2,000 hours of supervised experience in the delivery of mental health services to children;

(3) have experience and training in identifying and assessing a wide range of children's needs; and

(4) be knowledgeable about local community resources and how to use those resources for the benefit of children and their families.

(c) The case manager may be a member of any professional discipline that is part of the local system of care for children established by the county board.

(d) The case manager must meet in person with a mental health professional at least once each month to obtain clinical supervision.

(e) Case managers with a bachelor's degree but without 2,000 hours of supervised experience in the delivery of mental health services to children with emotional disturbance must:

(1) begin 40 hours of training approved by the commissioner of human services in case management skills and in the characteristics and needs of children with severe emotional disturbance before beginning to provide case management services; and

(2) receive clinical supervision regarding individual service delivery from a mental health professional at least once each week until the requirement of 2,000 hours of experience is met.

(f) Clinical supervision must be documented in the child's record. When the case manager is not a mental health professional, the county board must provide or contract for needed clinical supervision.

(g) The county board must ensure that the case manager has the freedom to access and coordinate the services within the local system of care that are needed by the child.

(h) Until June 30, 1996 1999, a refugee who does not have the qualifications specified in this subdivision may provide case management services to child refugees with severe emotional disturbance of the same ethnic group as the refugee if the person:

(1) is actively pursuing credits toward the completion of a bachelor's degree in one of the behavioral sciences or related fields at an accredited college or university;

(2) completes 40 hours of training as specified in this subdivision; and

(3) receives clinical supervision at least once a week until the requirements of obtaining a bachelor's degree and 2,000 hours of supervised experience are met.

Sec. 6. Minnesota Statutes 1995 Supplement, section 252.27, subdivision 2a, is amended to read:

Subd. 2a. [CONTRIBUTION AMOUNT.] (a) The natural or adoptive parents of a minor child, including a child determined eligible for medical assistance without consideration of parental income, must contribute monthly to the cost of services, unless the child is married or has been married, parental rights have been terminated, or the child's adoption is subsidized according to section 259.67 or through title IV-E of the Social Security Act.

(b) The parental contribution shall be the greater of a minimum monthly fee of $25 for households with adjusted gross income of $30,000 and over, or an amount to be computed by applying to the adjusted gross income of the natural or adoptive parents that exceeds 150 percent of the federal poverty guidelines for the applicable household size, the following schedule of rates:

(1) on the amount of adjusted gross income over 150 percent of poverty, but not over $50,000, ten percent;

(2) on the amount of adjusted gross income over 150 percent of poverty and over $50,000 but not over $60,000, 12 percent;

(3) on the amount of adjusted gross income over 150 percent of poverty, and over $60,000 but not over $75,000, 14 percent; and

(4) on all adjusted gross income amounts over 150 percent of poverty, and over $75,000, 15 percent.

If the child lives with the parent, the parental contribution is reduced by $200, except that the parent must pay the minimum monthly $25 fee under this paragraph. If the child resides in an institution specified in section 256B.35, the parent is responsible for the personal needs allowance specified under that section in addition to the parental contribution determined under this section. The parental contribution is reduced by any amount required to be paid directly to the child pursuant to a court order, but only if actually paid.

(c) The household size to be used in determining the amount of contribution under paragraph (b) includes natural and adoptive parents and their dependents under age 21, including the child receiving services. Adjustments in the contribution amount due to annual changes in the federal poverty guidelines shall be implemented on the first day of July following publication of the changes.

(d) For purposes of paragraph (b), "income" means the adjusted gross income of the natural or adoptive parents determined according to the previous year's federal tax form.

(e) The contribution shall be explained in writing to the parents at the time eligibility for services is being determined. The contribution shall be made on a monthly basis effective with the first month in which the child receives services. Annually upon redetermination or at termination of eligibility, if the contribution exceeded the cost of services provided, the local agency or the state shall reimburse that excess amount to the parents, either by direct reimbursement if the parent is no longer required to pay a contribution, or by a reduction in or waiver of parental fees until the excess amount is exhausted.

(f) The monthly contribution amount must be reviewed at least every 12 months; when there is a change in household size; and when there is a loss of or gain in income from one month to another in excess of ten percent. The local agency shall mail a written notice 30 days in advance of the effective date of a change in the contribution amount. A decrease in the contribution amount is effective in the month that the parent verifies a reduction in income or change in household size.

(g) Parents of a minor child who do not live with each other shall each pay the contribution required under paragraph (a), except that a court-ordered child support payment actually paid on behalf of the child receiving services shall be deducted from the contribution of the parent making the payment.

(h) The contribution under paragraph (b) shall be increased by an additional five percent if the local agency determines that insurance coverage is available but not obtained for the child. For purposes of this section, "available" means the insurance is a benefit of employment for a family member at an annual cost of no

more than five percent of the family's annual income. For purposes of this section, insurance means health and accident insurance coverage, enrollment in a nonprofit health service plan, health maintenance organization, self-insured plan, or preferred provider organization.

Parents who have more than one child receiving services shall not be required to pay more than the amount for the child with the highest expenditures. There shall be no resource contribution from the parents. The parent shall not be required to pay a contribution in excess of the cost of the services provided to the child, not counting payments made to school districts for education-related services. Notice of an increase in fee payment must be given at least 30 days before the increased fee is due.

(i) The contribution under paragraph (b) shall be reduced by $300 per fiscal year if, in the 12 months prior to July 1;

(1) the parent applied for insurance for the child,

(2) the insurer denied insurance,

(3) the parents submitted a complaint or appeal, in writing to the insurer, submitted a complaint or appeal, in writing, to the commissioner of health or the commissioner of commerce, or litigated the complaint or appeal, and

(4) as a result of the dispute, the insurer reversed its decision and granted insurance.

For purposes of this section, insurance has the meaning given in paragraph (h).

A parent who has requested a reduction in the contribution amount under this paragraph shall submit proof in the form and manner prescribed by the commissioner or county agency, including, but not limited to, the insurer's denial of insurance, the written letter or complaint of the parents, court documents, and the written response of the insurer approving insurance. The determinations of the commissioner or county agency under this paragraph are not rules subject to chapter 14.

Sec. 7. [252.53] [GENERAL PRINCIPLES.]

In developing and implementing new purchasing and service delivery models for Minnesotans with mental retardation and related developmental disabilities, the commissioner and any advisory bodies established by the commissioner shall evaluate existing and alternative models according to the extent that they conform to the following principles: maximum informed consumer control of purchasing decisions, the utilization of outcome-based data, regulatory reform, and competition based on quality and cost.

Sec. 8. [252.54] [ADVISORY COUNCIL ON SERVICES TO PERSONS WITH MENTAL RETARDATION AND RELATED DEVELOPMENTAL DISABILITIES.]

Subdivision 1. [ESTABLISHMENT.] The commissioner of human services shall, by June 1, 1996, convene an advisory council representative of key stakeholders in services to Minnesotans with mental retardation and related developmental disabilities. The advisory council shall, by January 1, 1997, present a report to the commissioner and legislature containing recommendations for the purchasing and delivery of services to Minnesotans with mental retardation and related developmental disabilities. These recommendations must conform to the principles established in section 252.53.

Subd. 2. [REQUIREMENTS FOR REPORT.] The advisory council's report shall develop purchasing and service delivery models that are driven by consumer control and based on outcomes. The purchase and service delivery models must include, but are not limited to, models based on the December 1995 report by the developmental disabilities working group on a cost-effective future for Minnesotans with developmental disabilities.

Subd. 3. [MEMBERSHIP.] The advisory council shall consist of the following 21 members:

(1) two members appointed by the Minnesota association for retarded citizens;

(2) one member appointed by the disability law center;

(3) two residential providers appointed by the association of residential resources in Minnesota;

(4) one-day training and habilitation provider appointed by the Minnesota developmental achievement center association;

(5) one-day training and habilitation provider appointed by the Minnesota habilitation coalition;

(6) one family member of a Minnesotan with mental retardation or related developmental disabilities appointed by the commissioner;

(7) one self-advocate appointed by advocating change together;

(8) two members appointed by the association of Minnesota counties;

(9) two department of human services staff specializing in developmental disabilities appointed by the commissioner;

(10) one specialist in mental retardation and related developmental disabilities appointed by the Minnesota school superintendents association;

(11) two members appointed by the American federation of state, county, and municipal employees;

(12) one member appointed by the center of community living and institute on community integration;

(13) one direct services employee employed by private facilities providing services to Minnesotans with mental retardation and related developmental disabilities appointed by the commissioner;

(14) one member appointed by the United Steelworkers of America district council;

(15) the ombudsman for mental health and mental retardation, or the ombudsman's designee;

(16) one member appointed by the Minnesota council of HMOs; and

(17) one member appointed by care providers of Minnesota.

Subd. 4. [GOVERNANCE.] The chair of the advisory council shall be a member of the council elected by the members. The council expires June 30, 1997.

Sec. 9. [252.56] [MAINTENANCE OF CURRENT POLICIES.]

Subdivision 1. [APPLICABILITY.] The requirements of this section apply to the provision of services for Minnesotans with developmental disabilities and related conditions. The commissioner shall comply with the requirements of this section until July 1, 1997.

Subd. 2. [REQUIREMENT.] Unless specifically authorized by the 1996 legislature to do otherwise, the commissioner shall maintain the definition of eligibility for services in effect on July 1, 1995, and shall not decrease expenditures for services for persons with developmental disabilities and related conditions unless the decrease is proportional to the decrease in total expenditures for all services covered under the medical assistance and general assistance medical care programs.

Sec. 10. [252B.01] [RULE CONSOLIDATION.]

Subdivision 1. [STANDARDS.] For programs or services licensed pursuant to Minnesota Rules, parts 9525.0215 to 9525.0355; 9525.0500 to 9525.0660; 9525.1500 to 9525.1690; and 9525.2000 to 9525.2140, the following standards apply and supersede the requirements of the applicable rule parts for staff qualification, orientation, and training.

Subd. 2. [STAFF QUALIFICATIONS.] (a) The license holder must ensure that staff is competent through training, experience, and education to meet the consumer's needs as written in the individual service plan. The staff qualifications must be documented.

(b) Delivery and evaluation of services provided by the license holder to a consumer must be coordinated by a designated person. This designated person or coordinator must minimally have a four-year degree in a field related to service provision and one-year work experience with consumers with mental retardation or related conditions, a two-year degree in a field related to service provision, and two years work experience with consumers with mental retardation or related conditions, or a certificate of competence from an accredited post-secondary program in the area of developmental disabilities and two years work experience with consumers with mental retardation or related conditions. The coordinator must provide supervision, support, and evaluation of activities that include:

(1) oversight of the license holder's responsibilities designated in the individual service plan;

(2) instructions and assistance to staff implementing the individual service plan areas;

(3) evaluation of the effectiveness of service delivery, methodologies, and progress on consumer outcomes based on the condition set for objective change; and

(4) review of incident and emergency reports, identification of incident patterns, and implementation of corrective action as necessary to reduce occurrences.

(c) The coordinator is responsible for taking necessary actions to facilitate the accomplishment of the outcomes for each consumer as specified in the consumer's individual service plan.

(d) The license holder must provide for adequate supervision for direct care staff to ensure implementation of the individual service plan.

Subd. 3. [STAFF ORIENTATION.] (a) Within 60 days of hiring staff who provide direct service, the license holder must provide 30 hours of orientation. Direct care staff must complete 15 of the 30 hours before providing any direct service to a consumer without direct supervision. If the staff person has received orientation training from a license holder licensed under a program rule identified in this chapter, or provided semi-independent living services only, the 15-hour requirement may be reduced to eight hours. The total orientation of 30 hours may be reduced to 15 hours if the staff person has previously received orientation training from a license holder licensed by a program rule identified in this chapter.

(b) The 30 hours of orientation must combine supervised on-the-job training with coverage of the material in clauses (1) to (8);

(1) review of the consumer's complete individual service plan to achieve an understanding of the consumer as a unique individual;

(2) review and instructions regarding the license holder's policies and procedures including their location and access;

(3) emergency procedures;

(4) explanation of specific job functions including implementing objectives from the consumer's individual service plan;

(5) explanation of responsibilities related to sections 626.556 and 626.557, and Minnesota Rules, parts 9555.8000 to 9555.8500, including requirements of rules promulgated thereunder; sections 245A.01 to 245A.16, the human services licensing act; and Minnesota Rules, parts 9525.2700 to 9525.2810, governing use of aversive and deprivation procedures;

(6) medication administration as it applies to the individual consumer;

(7) consumer rights; and

(8) other topics necessary as determined by the consumer's individual service plan or other areas identified by the license holder.

(c) The license holder must document each employee's orientation received.

Subd. 4. [STAFF TRAINING.] (a) The license holder shall ensure that direct service staff annually complete hours of training equal to two percent of the number of hours the staff person worked or one percent for license holders under Minnesota Rules, parts 9525.0500 to 9525.0660. If direct service staff have received training from a license holder licensed under a program rule identified in this chapter, the training may also count toward training requirements for other services and of other license holders licensed under this chapter.

(b) The license holder must document the training completed by each employee.

(c) Training shall address the staff competencies necessary to address the consumer needs as identified in the consumer's individual service plan and ensure consumer health, safety, and protection of rights. Training may also include other areas identified by the license holder.

Sec. 11. [252B.02] [RESIDENTIAL BASED HABILITATION SERVICES.]

Residential service sites controlled by license holders licensed under Minnesota Rules, parts 9525.2000 to 9525.2140, for four or fewer adults are exempt from compliance with Minnesota Rules, parts 9555.5505; 9555.5515; 9555.5605; 9555.5705; 9555.6125, subparts 4 to 6; and 9555.6185. The provisions of this chapter do not apply to foster care homes that do not provide residential habilitation services funded under the home and community-based waiver programs defined in section 256B.092. The commissioner may approve alternative methods of providing overnight supervision using the process and criteria for granting a variance in section 245A.04, subdivision 9.

Sec. 12. Minnesota Statutes 1994, section 253B.11, subdivision 2, is amended to read:

Subd. 2. [FACILITIES.] Each county or a group of counties shall maintain or provide by contract a facility for confinement of persons held temporarily for observation, evaluation, diagnosis, treatment, and care. When the confinement is provided at a regional center, the commissioner shall charge the county of financial responsibility for the costs of confinement of persons hospitalized under section 253B.05, subdivisions 1 and 2, and section 253B.07, subdivision 6; except that the commissioner shall bill the responsible prepaid plan for medically necessary hospitalizations for individuals enrolled in a prepaid plan under contract to provide medical assistance, general assistance medical care, or MinnesotaCare services. If the prepaid plan determined under the terms of the medical assistance, general assistance medical care, or MinnesotaCare contract that a hospitalization was not medically necessary, the county is responsible. "County of financial responsibility" means the county in which the person resides at the time of confinement or, if the person has no residence in this state, the county which initiated the confinement. The charge shall be based on the commissioner's determination of the cost of care pursuant to section 246.50, subdivision 5. When there is a dispute as to which county is the county of financial responsibility, the county charged for the costs of confinement shall pay for them pending final determination of the dispute over financial responsibility. Disputes about the county of financial responsibility shall be submitted to the commissioner to be settled in the manner prescribed in section 256G.09.

Sec. 13. Minnesota Statutes 1995 Supplement, section 256.045, subdivision 3, is amended to read:

Subd. 3. [STATE AGENCY HEARINGS.] (a) State agency hearings are available for the following: (1) any person applying for, receiving or having received public assistance or a program of social services granted by the state agency or a county agency under sections 252.32, 256.031 to 256.036, and 256.72 to 256.879, chapters 256B, 256D, 256E, 261, or the federal Food Stamp Act whose application for assistance is denied, not acted upon with reasonable promptness, or whose assistance is suspended, reduced, terminated, or claimed to have been incorrectly paid; (2) any patient or relative aggrieved by an order of the commissioner under section 252.27; (3) a party aggrieved by a ruling of a prepaid health plan; or (4) an applicant aggrieved by an adverse decision to an application for a hardship waiver under section 256B.15; or (5) any individual or facility determined by a lead agency to have maltreated a vulnerable adult under section 626.557 after they have exercised their right to administrative reconsideration under section 626.557. Individuals and organizations specified in this section may contest the specified action, decision, or final disposition before the state agency by submitting a written request for a hearing to the state agency within 30 days after receiving written notice of the action, decision, or final disposition, or within 90 days of such written notice if the applicant, recipient, patient, or relative shows good cause why the request was not submitted within the 30-day time limit.

The hearing for an individual or facility under clause (4) is the only administrative appeal to the final lead agency disposition specifically, including a challenge to the accuracy and completeness of data under section 13.04.

For purposes of this section, bargaining unit grievance procedures are not an administrative appeal.

(b) Except for a prepaid health plan, a vendor of medical care as defined in section 256B.02, subdivision 7, or a vendor under contract with a county agency to provide social services under section 256E.08, subdivision 4, is not a party and may not request a hearing under this section, except if assisting a recipient as provided in subdivision 4.

(c) An applicant or recipient is not entitled to receive social services beyond the services included in the amended community social services plan developed under section 256E.081, subdivision 3, if the county agency has met the requirements in section 256E.081.

Sec. 14. Minnesota Statutes 1994, section 256.9355, subdivision 3, is amended to read:

Subd. 3. [EFFECTIVE DATE OF COVERAGE.] The effective date of coverage is the first day of the month following the month in which eligibility is approved and the first premium payment has been received. The effective date of coverage for eligible newborns or eligible newly adoptive children added to a family receiving covered health services is the date of entry into the family. The effective date of coverage for other new recipients added to the family receiving covered health services is the first day of the month following the month in which eligibility is approved and the first premium payment has been received. The premium must be received eight working days prior to the end of the month for coverage to begin the following month. Benefits are not available until the day following discharge if an enrollee is hospitalized on the first day of coverage. Notwithstanding any other law to the contrary, benefits under sections 256.9351 to 256.9361 are secondary to a plan of insurance or benefit program under which an eligible person may have coverage and the commissioner shall use cost avoidance techniques to ensure coordination of any other health coverage for eligible persons. The commissioner shall identify eligible persons who may have coverage or benefits under other plans of insurance or who become eligible for medical assistance.

Sec. 15. Minnesota Statutes 1995 Supplement, section 256.969, subdivision 1, is amended to read:

Subdivision 1. [HOSPITAL COST INDEX.] (a) The hospital cost index shall be the change in the Consumer Price Index-All Items (United States city average) (CPI-U) forecasted by Data Resources, Inc. The commissioner shall use the indices as forecasted in the third quarter of the calendar year prior to the rate year. The hospital cost index may be used to adjust the base year operating payment rate through the rate year on an annually compounded basis.

(b) For fiscal years beginning on or after July 1, 1993, the commissioner of human services shall not provide automatic annual inflation adjustments for hospital payment rates under medical assistance, nor under general assistance medical care, except that the inflation adjustments under paragraph (a) for medical assistance, excluding general assistance medical care, shall apply for the biennium ending June 30, 1997 through calendar year 1997. The commissioner of finance shall include as a budget change request in each biennial detailed expenditure budget submitted to the legislature under section 16A.11 annual adjustments in hospital payment rates under medical assistance and general assistance medical care, based upon the hospital cost index.

Sec. 16. Minnesota Statutes 1995 Supplement, section 256.969, subdivision 2b, is amended to read:

Subd. 2b. [OPERATING PAYMENT RATES.] In determining operating payment rates for admissions occurring on or after the rate year beginning January 1, 1991, and every two years after, or more frequently as determined by the commissioner, the commissioner shall obtain operating data from an updated base year and establish operating payment rates per admission for each hospital based on the cost-finding methods and allowable costs of the Medicare program in effect during the base year. Rates under the general assistance medical care program, medical assistance, and MinnesotaCare programs shall not be rebased to more current data on January 1, 1997. The base year operating payment rate per admission is standardized by the case mix index and adjusted by the hospital cost index, relative values, and disproportionate population adjustment. The cost and charge data used to establish operating rates shall only reflect inpatient services covered by medical assistance and shall not include property cost information and costs recognized in outlier payments.

Sec. 17. Minnesota Statutes 1995 Supplement, section 256.969, subdivision 10, is amended to read:

Subd. 10. [SEPARATE BILLING BY CERTIFIED REGISTERED NURSE ANESTHETISTS.] Hospitals may exclude certified registered nurse anesthetist costs from the operating payment rate as allowed by section 256B.0625, subdivision 11. To be eligible, a hospital must notify the commissioner in writing by October 1 of

the year preceding the rate year of the request of even-numbered years to exclude certified registered nurse anesthetist costs. The hospital must agree that all hospital claims for the cost and charges of certified registered nurse anesthetist services will not be included as part of the rates for inpatient services provided during the rate year. In this case, the operating payment rate shall be adjusted to exclude the cost of certified registered nurse anesthetist services.

For admissions occurring on or after July 1, 1991, and until the expiration date of section 256.9695, subdivision 3, services of certified registered nurse anesthetists provided on an inpatient basis may be paid as allowed by section 256B.0625, subdivision 11, when the hospital's base year did not include the cost of these services. To be eligible, a hospital must notify the commissioner in writing by July 1, 1991, of the request and must comply with all other requirements of this subdivision.

Sec. 18. Minnesota Statutes 1994, section 256B.03, is amended by adding a subdivision to read:

Subd. 3. [AMERICAN INDIAN HEALTH FUNDING.] Notwithstanding subdivision 1 and sections 256B.0625 and 256D.03, paragraph (f), the commissioner may make payments to federally recognized Indian tribes with a reservation in the state to provide medical assistance to Indian tribal members who reside on the reservation. The payments may be made in the form of a block grant or other payment mechanism determined in consultation with the tribe. To the extent that the payment mechanism differs from the manner in which payments are otherwise made under the program, payments may not exceed state fiscal year 1995 expenditures for the same population, with an inflation adjustment.

For purposes of this subdivision, "Indian tribe" means a tribe, band, or nation, or other organized group or community of Indians that is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians and for which a reservation exists as is consistent with Public Law Number 100-485, as amended.

For purposes of this subdivision, "state fiscal year 1995 expenditures" include state and federal payments made for administration of the program and for covered services.

Sec. 19. Minnesota Statutes 1994, section 256B.056, subdivision 1a, is amended to read:

Subd. 1a. [INCOME AND ASSETS GENERALLY.] Unless specifically required by state law or rule or federal law or regulation, the methodologies used in counting income and assets to determine eligibility for medical assistance for persons whose eligibility category is based on blindness, disability, or age of 65 or more years, the methodologies for the supplemental security income program shall be used, except that payments made pursuant to a court order for the support of children shall be excluded from income in an amount not to exceed the difference between the applicable income standard used in the state's medical assistance program for aged, blind, and disabled persons and the applicable income standard used in the state's medical assistance program for families with children. Exclusion of court-ordered child support payments is subject to the condition that if there has been a change in the financial circumstances of the person with the legal obligation to pay support since the support order was entered, the person with the legal obligation to pay support has petitioned for modification of the support order. For families and children, which includes all other eligibility categories, the methodologies for the aid to families with dependent children program under section 256.73 shall be used. In-kind contributions to, and payments made on behalf of, a recipient, by an obligor, in satisfaction of or in addition to a temporary or permanent order for child support or maintenance, shall be considered income to the recipient. For these purposes, a "methodology" does not include an asset or income standard, or accounting method, or method of determining effective dates.

Sec. 20. Minnesota Statutes 1995 Supplement, section 256B.0575, is amended to read:

256B.0575 [AVAILABILITY OF INCOME FOR INSTITUTIONALIZED PERSONS.]

When an institutionalized person is determined eligible for medical assistance, the income that exceeds the deductions in paragraphs (a) and (b) must be applied to the cost of institutional care.

(a) The following amounts must be deducted from the institutionalized person's income in the following order:

(1) the personal needs allowance under section 256B.35 or, for a veteran who does not have a spouse or child, or a surviving spouse of a veteran having no child, the amount of an improved pension received from the veteran's administration not exceeding $90 per month;

(2) the personal allowance for disabled individuals under section 256B.36;

(3) if the institutionalized person has a legally appointed guardian or conservator, five percent of the recipient's gross monthly income up to $100 as reimbursement for guardianship or conservatorship services;

(4) a monthly income allowance determined under section 256B.058, subdivision 2, but only to the extent income of the institutionalized spouse is made available to the community spouse or ex-spouse;

(5) a monthly allowance for children under age 18 which, together with the net income of the children, would provide income equal to the medical assistance standard for families and children according to section 256B.056, subdivision 4, for a family size that includes only the minor children. This deduction applies only if the children do not live with the community spouse and only to the extent that the deduction is not included in the personal needs allowance under section 256B.35, subdivision 1, as child support garnished under a court order;

(6) a monthly family allowance for other family members, equal to one-third of the difference between 122 percent of the federal poverty guidelines and the monthly income for that family member;

(7) reparations payments made by the Federal Republic of Germany and reparations payments made by the Netherlands for victims of Nazi persecution between 1940 and 1945; and

(8) amounts for reasonable expenses incurred for necessary medical or remedial care for the institutionalized spouse that are not medical assistance covered expenses and that are not subject to payment by a third party.

For purposes of clause (6), "other family member" means a person who resides with the community spouse and who is a minor or dependent child, dependent parent, or dependent sibling of either spouse. "Dependent" means a person who could be claimed as a dependent for federal income tax purposes under the Internal Revenue Code.

(b) Income shall be allocated to an institutionalized person for a period of up to three calendar months, in an amount equal to the medical assistance standard for a family size of one if:

(1) a physician certifies that the person is expected to reside in the long-term care facility for three calendar months or less;

(2) if the person has expenses of maintaining a residence in the community; and

(3) if one of the following circumstances apply:

(i) the person was not living together with a spouse or a family member as defined in paragraph (a) when the person entered a long-term care facility; or

(ii) the person and the person's spouse become institutionalized on the same date, in which case the allocation shall be applied to the income of one of the spouses.

For purposes of this paragraph, a person is determined to be residing in a licensed nursing home, regional treatment center, or medical institution if the person is expected to remain for a period of one full calendar month or more.

Sec. 21. Minnesota Statutes 1994, section 256B.058, subdivision 2, is amended to read:

Subd. 2. [MONTHLY INCOME ALLOWANCE FOR COMMUNITY SPOUSE.] (a) For an institutionalized spouse with a spouse residing in the community, monthly income may be allocated to the community spouse as a monthly income allowance for the community spouse. Beginning with the first full calendar month the institutionalized spouse is in the institution, the monthly income allowance is not considered available to the institutionalized spouse for monthly payment of costs of care in the institution as long as the income is made available to the community spouse.

(b) The monthly income allowance is the amount by which the community spouse's monthly maintenance needs allowance under paragraphs (c) and (d) exceeds the amount of monthly income otherwise available to the community spouse.

(c) The community spouse's monthly maintenance needs allowance is the lesser of $1,500 or 122 percent of the monthly federal poverty guideline for a family of two plus an excess shelter allowance. The excess shelter allowance is for the amount of shelter expenses that exceed 30 percent of 122 percent of the federal poverty guideline line for a family of two. Shelter expenses are the community spouse's expenses for rent, mortgage payments including principal and interest, taxes, insurance, required maintenance charges for a cooperative or condominium that is the community spouse's principal residence, and the standard utility allowance under section 5(e) of the federal Food Stamp Act of 1977. If the community spouse has a required maintenance charge for a cooperative or condominium, the standard utility allowance must be reduced by the amount of utility expenses included in the required maintenance charge.

If the community or institutionalized spouse establishes that the community spouse needs income greater than the monthly maintenance needs allowance determined in this paragraph due to exceptional circumstances resulting in significant financial duress, the monthly maintenance needs allowance may be increased to an amount that provides needed additional income.

(d) The percentage of the federal poverty guideline used to determine the monthly maintenance needs allowance in paragraph (c) is increased to 133 percent on July 1, 1991, and to 150 percent on July 1, 1992. Adjustments in the income limits due to annual changes in the federal poverty guidelines shall be implemented the first day of July following publication of the annual changes. The $1,500 maximum must be adjusted January 1, 1990, and every January 1 after that by the same percentage increase in the consumer price index for all urban consumers (all items; United States city average) between the two previous Septembers.

(e) If a court has entered an order against an institutionalized spouse for monthly income for support of the community spouse or ex-spouse, the community spouse's or ex-spouse's monthly income allowance under this subdivision shall not be less than the amount of the monthly income ordered.

Sec. 22. Minnesota Statutes 1995 Supplement, section 256B.0625, subdivision 17, is amended to read:

Subd. 17. [TRANSPORTATION COSTS.] (a) Medical assistance covers transportation costs incurred solely for obtaining emergency medical care or transportation costs incurred by nonambulatory persons in obtaining emergency or nonemergency medical care when paid directly to an ambulance company, common carrier, or other recognized providers of transportation services. For the purpose of this subdivision, a person who is incapable of transport by taxicab or bus shall be considered to be nonambulatory.

(b) Medical assistance covers special transportation, as defined in Minnesota Rules, part 9505.0315, subpart 1, item F, if the provider receives and maintains a current physician's order by the recipient's attending physician certifying that the recipient is so mentally or physically impaired as to be unable to has a physical or mental impairment that would prohibit the recipient from safely access accessing and use using a bus, taxi, other commercial transportation, or private automobile. Special transportation includes driver-assisted service to eligible individuals. Driver-assisted service includes passenger pickup at and return to the individual's residence or place of business, assistance with admittance of the individual to the medical facility, and assistance in passenger securement or in securing of wheelchairs or stretchers in the vehicle. The commissioner shall establish maximum medical assistance reimbursement rates for special transportation services for persons who need a wheelchair lift van or stretcher-equipped vehicle and for those who do not need a wheelchair lift van or stretcher-equipped vehicle. The average of these two rates must not exceed $14 for the base rate and $1.10 per mile. Special transportation provided to nonambulatory persons who do not need a wheelchair lift van or stretcher-equipped vehicle, may be reimbursed at a lower rate than special transportation provided to persons who need a wheelchair lift van or stretcher-equipped vehicle.

Sec. 23. Minnesota Statutes 1995 Supplement, section 256B.0625, subdivision 19a, is amended to read:

Subd. 19a. [PERSONAL CARE SERVICES.] Medical assistance covers personal care services in a recipient's home. To qualify for personal care services, recipients or responsible parties must be able to identify their the recipient's needs, direct and evaluate task accomplishment, and assure their provide for health and safety. Approved hours may be used outside the home when normal life activities take them outside the home and when, without the provision of personal care, their health and safety would be jeopardized. Total hours for services, whether actually performed inside or outside the recipient's home, cannot exceed that which is otherwise allowed for personal care services in an in-home setting according to section 256B.0627. Medical assistance does not cover personal care services for residents of a hospital, nursing facility, intermediate care

facility, health care facility licensed by the commissioner of health, or unless a resident who is otherwise eligible is on leave from the facility and the facility either pays for the personal care services or forgoes the facility per diem for the leave days that personal care services are used. All personal care services must be provided according to section 256B.0627. Personal care services may not be reimbursed if the personal care assistant is the spouse or legal guardian of the recipient or the parent of a recipient under age 18, or the responsible party or the foster care provider of a recipient who cannot direct the recipient's own care unless, in the case of a foster care provider, a county or state case manager visits the recipient as needed, but not less than every six months, to monitor the health and safety of the recipient and to ensure the goals of the care plan are met. Parents of adult recipients, adult children of the recipient or adult siblings of the recipient may be reimbursed for personal care services if they are not the recipient's legal guardian and are granted a waiver under section 256B.0627.

Sec. 24. Minnesota Statutes 1995 Supplement, section 256B.0625, subdivision 30, is amended to read:

Subd. 30. [OTHER CLINIC SERVICES.] (a) Medical assistance covers rural health clinic services, federally qualified health center services, nonprofit community health clinic services, public health clinic services, and the services of a clinic meeting the criteria established in rule by the commissioner. Rural health clinic services and federally qualified health center services mean services defined in United States Code, title 42, section 1396d(a)(2)(B) and (C). Payment for rural health clinic and federally qualified health center services shall be made according to applicable federal law and regulation.

(b) A federally qualified health center that is beginning initial operation shall submit an estimate of budgeted costs and visits for the initial reporting period in the form and detail required by the commissioner. A federally qualified health center that is already in operation shall submit an initial report using actual costs and visits for the initial reporting period. Within 90 days of the end of its reporting period, a federally qualified health center shall submit, in the form and detail required by the commissioner, a report of its operations, including allowable costs actually incurred for the period and the actual number of visits for services furnished during the period, and other information required by the commissioner. Federally qualified health centers that file Medicare cost reports shall provide the commissioner with a copy of the most recent Medicare cost report filed with the Medicare program intermediary for the reporting year which support the costs claimed on their cost report to the state.

(c) In order to continue cost-based payment under the medical assistance program according to paragraphs (a) and (b), a federally qualified health center or rural health clinic must apply for designation as an essential community provider within six months of final adoption of rules by the department of health according to section 62Q.19, subdivision 7. For those federally qualified health centers and rural health clinics that have applied for essential community provider status within the six-month time prescribed, medical assistance payments will continue to be made according to paragraphs (a) and (b) for the first three years of essential community provider status after application. For federally qualified health centers and rural health clinics that either do not apply within the time specified above, that are denied essential community provider status by the department of health, or who have had essential community provider status for three years, medical assistance payments for health services provided by these entities shall be according to the same rates and conditions applicable to the same service provided by health care providers that are not federally qualified health centers or rural health clinics. This paragraph takes effect only if the Minnesota health care reform waiver is approved by the federal government, and remains in effect for as long as the Minnesota health care reform waiver remains in effect. When the waiver expires, this paragraph expires, and the commissioner of human services shall publish a notice in the State Register and notify the revisor of statutes.

Sec. 25. Minnesota Statutes 1994, section 256B.0627, subdivision 1, as amended by Laws 1995, chapter 207, article 6, sections 52 and 125, subdivision 9, is amended to read:

Subdivision 1. [DEFINITION . ] (a) "Assessment" means a review and evaluation of a recipient's need for home care services conducted in person. Assessments for private duty nursing shall be conducted by a private duty nurse. Assessments for home health agency services shall be conducted by a home health agency nurse. Assessments for personal care services shall be conducted by the county public health nurse or a certified public health nurse under contract with the county. Assessments for medical assistance home care services for mental retardation or related conditions and alternative care services for developmentally disabled home and community-based waiver recipients may be conducted by the county public health nurse to assure coordination and avoid duplication. Assessments must be completed on forms provided by the commissioner within 30 days of a request for home care services by a recipient or responsible party.

(b) "Care plan" means a written description of personal care assistant services developed by the agency nurse with the recipient or responsible party to be used by the personal care assistant with a copy provided to the recipient or responsible party.

(c) "Home care services" means a health service, determined by the commissioner as medically necessary, that is ordered by a physician and documented in a care service plan that is reviewed by the physician at least once every 60 days for the provision of home health services, or private duty nursing, or at least once every 365 days for personal care. Home care services are provided to the recipient at the recipient's residence that is a place other than a hospital or long-term care facility or as specified in section 256B.0625.

(d) "Medically necessary" has the meaning given in Minnesota Rules, parts 9505.0170 to 9505.0475.

(e) "Personal care assistant" means a person who: (1) is at least 18 years old, except for persons 16 to 18 years of age who participated in a school-based job training program or have completed other comparable training approved by the personal care provider organization; (2) is able to read, write, and speak English, or effectively communicate with sign language, as well as communicate with the recipient and personal care provider organization; (3) effective July 1, 1996, has completed one of the training requirements as specified in Minnesota Rules, part 9505.0335, subpart 3, items A to D; (4) has the ability to, and provides covered personal care services according to the recipient's care plan, responds appropriately to recipient needs, and reports changes in the recipient's condition to the supervising registered nurse; (5) is not a consumer of personal care services; and (6) is subject to criminal background checks. An individual who has ever been convicted of a crime specified in Minnesota Rules, part 4668.0020, subpart 14, or a comparable crime in another jurisdiction is disqualified from being a personal care assistant, unless the individual meets the rehabilitation criteria specified in Minnesota Rules, part 4668.0020, subpart 15.

(f) "Personal care provider organization" means an organization enrolled to provide personal care services under the medical assistance program that complies with the following: (1) owners who have a five percent interest or more, and managerial officials are subject to a criminal history check background study as provided in section 245A.04 at the time of application. This applies to currently enrolled personal care provider organizations and those agencies seeking enrollment as a personal care provider organization. An organization will be barred from enrollment if an owner or managerial official of the organization has ever been convicted of a crime specified in Minnesota Rules, part 4668.0020, subpart 14, or a comparable crime in another jurisdiction, unless the owner or managerial official meets the rehabilitation criteria specified in Minnesota Rules, part 4668.0020, subpart 15; (2) the organization must maintain a surety bond and liability insurance throughout the duration of enrollment and provides proof thereof. The insurer must notify the department of human services of the cancellation or lapse of policy; and (3) the organization must maintain documentation of services as specified in Minnesota Rules, part 9505.2175, subpart 7, as well as evidence of compliance with personal care assistant training requirements.

(g) "Responsible party" means an individual residing with a recipient of personal care services who is capable of providing the supportive care necessary to assist the recipient to live in the community, is at least 18 years old, and is not a personal care assistant. Responsible parties who are parents of minors or guardians of minors or incapacitated persons may delegate the responsibility to another adult during a temporary absence of at least 24 hours but not more than six months. The person delegated as a responsible party must be able to meet the definition of responsible party, except that the delegated responsible party is required to reside with the recipient only while serving as the responsible party. Foster care license holders may be designated the responsible party for residents of the foster care home if case management is provided as required in section 256B.0625, subdivision 19a. For persons who, as of April 1, 1992, are sharing personal care services in order to obtain the availability of 24-hour coverage, an employee of the personal care provider organization may be designated as the responsible party if case management is provided as required in section 256B.0625, subdivision 19a.

(h) "Service plan" means a written description of the services needed based on the assessment developed by the nurse who conducts the assessment together with the recipient or responsible party. The service plan shall include a description of the covered home care services, frequency and duration of services, and expected outcomes and goals. The recipient and the provider chosen by the recipient or responsible party must be given a copy of the completed service plan within 30 calendar days of the request for home care services by the recipient or responsible party.

(i) "Skilled nurse visits" are provided in a recipient's residence under a plan of care or service plan that specifies a level of care which the nurse is qualified to provide. These services are:

(1) nursing services according to the written plan of care or service plan and accepted standards of medical and nursing practice in accordance with chapter 148;

(2) services which due to the recipient's medical condition may only be safely and effectively provided by a registered nurse or a licensed practical nurse;

(3) assessments performed only by a registered nurse; and

(4) teaching and training the recipient, the recipient's family, or other caregivers requiring the skills of a registered nurse or licensed practical nurse.

Sec. 26. Minnesota Statutes 1994, section 256B.0627, subdivision 4, as amended by Laws 1995, chapter 207, article 6, sections 54 and 125, subdivision 11, is amended to read:

Subd. 4. [PERSONAL CARE SERVICES.] (a) The personal care services that are eligible for payment are the following:

(1) bowel and bladder care;

(2) skin care to maintain the health of the skin;

(3) repetitive maintenance range of motion and, muscle strengthening exercises, and other tasks specific to maintaining a recipient's optimal level of function;

(4) respiratory assistance;

(5) transfers and ambulation;

(6) bathing, grooming, and hairwashing necessary for personal hygiene;

(7) turning and positioning;

(8) assistance with furnishing medication that is self-administered;

(9) application and maintenance of prosthetics and orthotics;

(10) cleaning medical equipment;

(11) dressing or undressing;

(12) assistance with eating and meal preparation and necessary grocery shopping;

(13) accompanying a recipient to obtain medical diagnosis or treatment; and

(14) assisting, monitoring, or prompting the recipient to complete the services in clauses (1) to (13);

(15) redirection, monitoring, and observation that are medically necessary and an integral part of completing the personal cares described in clauses (1) to (14);

(16) redirection and intervention for behavior, including observation and monitoring;

(17) interventions for seizure disorders, including monitoring and observation if the recipient has had a seizure that requires intervention within the past three months; and

(18) incidental household services that are an integral part of a personal care service described in clauses (1) to (13) (17).

For purposes of this subdivision, monitoring and observation means watching for outward visible signs that are likely to occur and for which there is a covered personal care service or an appropriate personal care intervention.

(b) The personal care services that are not eligible for payment are the following:

(1) services not ordered by the physician;

(2) assessments by personal care provider organizations or by independently enrolled registered nurses;

(3) services that are not in the service plan;

(4) services provided by the recipient's spouse, legal guardian for an adult or child recipient, or parent of a recipient under age 18;

(5) services provided by a foster care provider of a recipient who cannot direct their own care, unless monitored by a county or state case manager under section 256B.0625, subdivision 19a;

(6) services provided by the residential or program license holder in a residence for more than four persons;

(6) (7) services that are the responsibility of a residential or program license holder under the terms of a service agreement and administrative rules;

(7) (8) sterile procedures;

(8) (9) injections of fluids into veins, muscles, or skin;

(9) (10) services provided by parents of adult recipients, adult children or adult siblings of the recipient, unless these relatives meet one of the following hardship criteria and the commissioner waives this requirement:

(i) the relative resigns from a part-time or full-time job to provide personal care for the recipient;

(ii) the relative goes from a full-time to a part-time job with less compensation to provide personal care for the recipient;

(iii) the relative takes a leave of absence without pay to provide personal care for the recipient;

(iv) the relative incurs substantial expenses by providing personal care for the recipient; or

(v) because of labor conditions or intermittent hours of care needed, the relative is needed in order to provide an adequate number of qualified personal care assistants to meet the medical needs of the recipient;

(10) (11) homemaker services that are not an integral part of a personal care services;

(11) (12) home maintenance, or chore services;

(12) (13) services not specified under paragraph (a); and

(13) (14) services not authorized by the commissioner or the commissioner's designee.

Sec. 27. Minnesota Statutes 1994, section 256B.0627, subdivision 5, as amended by Laws 1995, chapter 207, article 6, sections 55 and 125, subdivision 12, is amended to read:

Subd. 5. [LIMITATION ON PAYMENTS.] Medical assistance payments for home care services shall be limited according to this subdivision.

(a) [LIMITS ON SERVICES WITHOUT PRIOR AUTHORIZATION.] A recipient may receive the following amounts of home care services during a calendar year:

(1) a total of 40 home health aide visits or skilled nurse visits under section 256B.0625, subdivision 6a; and

(2) assessments and reassessments done to determine a recipient's need for personal care services.

(b) [PRIOR AUTHORIZATION; EXCEPTIONS.] All home care services above the limits in paragraph (a) must receive the commissioner's prior authorization, except when:

(1) the home care services were required to treat an emergency medical condition that if not immediately treated could cause a recipient serious physical or mental disability, continuation of severe pain, or death. The provider must request retroactive authorization no later than five working days after giving the initial service. The provider must be able to substantiate the emergency by documentation such as reports, notes, and admission or discharge histories;

(2) the home care services were provided on or after the date on which the recipient's eligibility began, but before the date on which the recipient was notified that the case was opened. Authorization will be considered if the request is submitted by the provider within 20 working days of the date the recipient was notified that the case was opened;

(3) a third-party payor for home care services has denied or adjusted a payment. Authorization requests must be submitted by the provider within 20 working days of the notice of denial or adjustment. A copy of the notice must be included with the request; or

(4) the commissioner has determined that a county or state human services agency has made an error; or

(5) the professional nurse determines an immediate need for up to 40 skilled nursing or home health aide visits per calendar year and submits a request for authorization within 20 working days of the initial service date, and medical assistance is determined to be the appropriate payer.

(c) [RETROACTIVE AUTHORIZATION.] A request for retroactive authorization will be evaluated according to the same criteria applied to prior authorization requests.

(d) [ASSESSMENT AND SERVICE PLAN.] Assessments under section 256B.0627, subdivision 1, paragraph (a), shall be conducted initially, and at least annually thereafter, in person with the recipient and result in a completed service plan using forms specified by the commissioner. Within 30 days of recipient or responsible party request for home care services, the assessment, the service plan, and other information necessary to determine medical necessity such as diagnostic or testing information, social or medical histories, and hospital or facility discharge summaries shall be submitted to the commissioner. For personal care services:

(1) The amount and type of service authorized based upon the assessment and service plan will follow the recipient if the recipient chooses to change providers.

(2) If the recipient's medical need changes, the recipient's provider may assess the need for a change in service authorization and request the change from the county public health nurse. Within 30 days of the request, the public health nurse will determine whether to request the change in services based upon the provider assessment, or conduct a home visit to assess the need and determine whether the change is appropriate.

(3) To continue to receive personal care services when the recipient displays no significant change, the county public health nurse has the option to review with the commissioner, or the commissioner's designee, the service plan on record and receive authorization for up to an additional 12 months at a time for up to five years.

(e) [PRIOR AUTHORIZATION.] The commissioner, or the commissioner's designee, shall review the assessment, the service plan, and any additional information that is submitted. The commissioner shall, within 30 days after receiving a complete request, assessment, and service plan, authorize home care services as follows:

(1) [HOME HEALTH SERVICES.] All home health services provided by a licensed nurse or a home health aide that exceed the limits established in paragraph (a) must be prior authorized by the commissioner or the commissioner's designee. Prior authorization must be based on medical necessity and cost-effectiveness when compared with other care options. When home health services are used in combination with personal care and private duty nursing, the cost of all home care services shall be considered for cost-effectiveness. The commissioner shall limit nurse and home health aide visits to no more than one visit each per day.

(2) [PERSONAL CARE SERVICES.] (i) All personal care services and registered nurse supervision must be prior authorized by the commissioner or the commissioner's designee except for the assessments established in paragraph (a). The amount of personal care services authorized must be based on the recipient's home care rating. A child may not be found to be dependent in an activity of daily living if because of the child's age an adult would either perform

the activity for the child or assist the child with the activity and the amount of assistance needed is similar to the assistance appropriate for a typical child of the same age. Based on medical necessity, the commissioner may authorize:

(A) up to 1.75 two times the average number of direct care hours provided in nursing facilities for the recipient's comparable case mix level; or

(B) up to 2.625 three times the average number of direct care hours provided in nursing facilities for recipients who have complex medical needs or are dependent in at least seven activities of daily living and need physical assistance with eating or have a neurological diagnosis but in no case shall the dollar amount authorized exceed the statewide weighted average nursing facility payment rate for fiscal year 1995; or

(C) up to 60 percent of the average reimbursement rate, as of July 1, 1991, for care provided in a regional treatment center for recipients who have Level I behavior; plus any inflation adjustment as provided by the legislature for personal care service; or

(D) up to the amount the commissioner would pay, as of July 1, 1991, plus any inflation adjustment provided for home care services, for care provided in a regional treatment center for recipients referred to the commissioner by a regional treatment center preadmission evaluation team. For purposes of this clause, home care services means all services provided in the home or community that would be included in the payment to a regional treatment center; or

(D) (E) up to the amount medical assistance would reimburse for facility care for recipients referred to the commissioner by a preadmission screening team established under section 256B.0911 or 256B.092; and

(E) (F) a reasonable amount of time for the provision of nursing supervision of personal care services.

(ii) The number of direct care hours shall be determined according to the annual cost report submitted to the department by nursing facilities. The average number of direct care hours, for the report year 1993, as established by July 11, 1994, shall be calculated and incorporated into the home care limits on July 1, 1996. These limits shall be calculated to the nearest quarter hour.

(iii) The home care rating shall be determined by the commissioner or the commissioner's designee based on information submitted to the commissioner by the county public health nurse on forms specified by the commissioner. The home care rating shall be a combination of current assessment tools developed under sections 256B.0911 and 256B.501 with an addition for seizure activity that will assess the frequency and severity of seizure activity and with adjustments, additions, and clarifications that are necessary to reflect the needs and conditions of recipients who need home care including children and adults under 65 years of age. The commissioner shall establish these forms and protocols under this section and shall use an advisory group, including representatives of recipients, providers, and counties, for consultation in establishing and revising the forms and protocols.

(iv) A recipient shall qualify as having complex medical needs if the care required is difficult to perform and because of recipient's medical condition requires more time than community-based standards allow or requires more skill than would ordinarily be required and the recipient needs or has one or more of the following:

(A) daily tube feedings;

(B) daily parenteral therapy;

(C) wound or decubiti care;

(D) postural drainage, percussion, nebulizer treatments, suctioning, tracheotomy care, oxygen, mechanical ventilation;

(E) catheterization;

(F) ostomy care;

(G) quadriplegia; or

(H) other comparable medical conditions or treatments the commissioner determines would otherwise require institutional care.

(v) A recipient shall qualify as having Level I behavior if there is reasonable supporting evidence that the recipient exhibits, or that without supervision, observation, or redirection would exhibit, one or more of the following behaviors that cause, or have the potential to cause:

(A) injury to his or her own body;

(B) physical injury to other people; or

(C) destruction of property.

(vi) Time authorized for personal care relating to Level I behavior in subclause (v), items (A) to (C), shall be based on the predictability, frequency, and amount of intervention required.

(vii) A recipient shall qualify as having Level II behavior if the recipient exhibits on a daily basis one or more of the following behaviors that interfere with the completion of personal care services under subdivision 4, paragraph (a):

(A) unusual or repetitive habits;

(B) withdrawn behavior; or

(C) offensive behavior.

(viii) A recipient with a home care rating of Level II behavior in subclause (vii), items (A) to (C), shall be rated as comparable to a recipient with complex medical needs under subclause (iv). If a recipient has both complex medical needs and Level II behavior, the home care rating shall be the next complex category up to the maximum rating under subclause (i), item (B).

(3) [PRIVATE DUTY NURSING SERVICES.] All private duty nursing services shall be prior authorized by the commissioner or the commissioner's designee. Prior authorization for private duty nursing services shall be based on medical necessity and cost-effectiveness when compared with alternative care options. The commissioner may authorize medically necessary private duty nursing services in quarter-hour units when:

(i) the recipient requires more individual and continuous care than can be provided during a nurse visit; or

(ii) the cares are outside of the scope of services that can be provided by a home health aide or personal care assistant.

The commissioner may authorize:

(A) up to two times the average amount of direct care hours provided in nursing facilities statewide for case mix classification "K" as established by the annual cost report submitted to the department by nursing facilities in May 1992;

(B) private duty nursing in combination with other home care services up to the total cost allowed under clause (2);

(C) up to 16 hours per day if the recipient requires more nursing than the maximum number of direct care hours as established in item (A) and the recipient meets the hospital admission criteria established under Minnesota Rules, parts 9505.0500 to 9505.0540.

The commissioner may authorize up to 16 hours per day of medically necessary private duty nursing services or up to 24 hours per day of medically necessary private duty nursing services until such time as the commissioner is able to make a determination of eligibility for recipients who are cooperatively applying for home care services under the community alternative care program developed under section 256B.49, or until it is determined by the appropriate regulatory agency that a health benefit plan is or is not required to pay for appropriate medically necessary health care services. Recipients or their representatives must cooperatively assist the commissioner in obtaining this determination. Recipients who are eligible for the community alternative care program may not receive more hours of nursing under this section than would otherwise be authorized under section 256B.49.

(4) [VENTILATOR-DEPENDENT RECIPIENTS.] If the recipient is ventilator-dependent, the monthly medical assistance authorization for home care services shall not exceed what the commissioner would pay for care at the highest cost hospital designated as a long-term hospital under the Medicare program. For purposes of this clause,

home care services means all services provided in the home that would be included in the payment for care at the long-term hospital. "Ventilator-dependent" means an individual who receives mechanical ventilation for life support at least six hours per day and is expected to be or has been dependent for at least 30 consecutive days.

(f) [PRIOR AUTHORIZATION; TIME LIMITS.] The commissioner or the commissioner's designee shall determine the time period for which a prior authorization shall be effective. If the recipient continues to require home care services beyond the duration of the prior authorization, the home care provider must request a new prior authorization. Under no circumstances, other than the exceptions in paragraph (b), shall a prior authorization be valid prior to the date the commissioner receives the request or for more than 12 months. A recipient who appeals a reduction in previously authorized home care services may continue previously authorized services, other than temporary services under paragraph (h), pending an appeal under section 256.045. The commissioner must provide a detailed explanation of why the authorized services are reduced in amount from those requested by the home care provider.

(g) [APPROVAL OF HOME CARE SERVICES.] The commissioner or the commissioner's designee shall determine the medical necessity of home care services, the level of caregiver according to subdivision 2, and the institutional comparison according to this subdivision, the cost-effectiveness of services, and the amount, scope, and duration of home care services reimbursable by medical assistance, based on the assessment, primary payer coverage determination information as required, the care service plan, the recipient's age, the cost of services, the recipient's medical condition, and diagnosis or disability. The commissioner may publish additional criteria for determining medical necessity according to section 256B.04.

(h) [PRIOR AUTHORIZATION REQUESTS; TEMPORARY SERVICES.] The agency nurse, the independently enrolled private duty nurse, or county public health nurse may request a temporary authorization for home care services by telephone. The commissioner may approve a temporary level of home care services based on the assessment, and service or care plan information, and primary payer coverage determination information as required. Authorization for a temporary level of home care services including nurse supervision is limited to the time specified by the commissioner, but shall not exceed 45 days, unless extended because the county public health nurse has not completed the required assessment and service plan, or the commissioner's determination has not been made. The level of services authorized under this provision shall have no bearing on a future prior authorization.

(i) [PRIOR AUTHORIZATION REQUIRED IN FOSTER CARE SETTING.] Home care services provided in an adult or child foster care setting must receive prior authorization by the department according to the limits established in paragraph (a).

The commissioner may not authorize:

(1) home care services that are the responsibility of the foster care provider under the terms of the foster care placement agreement and administrative rules. Requests for home care services for recipients residing in a foster care setting must include the foster care placement agreement and determination of difficulty of care;

(2) personal care services when the foster care license holder is also the personal care provider or personal care assistant unless the recipient can direct the recipient's own care, or case management is provided as required in section 256B.0625, subdivision 19a;

(3) personal care services when the responsible party is an employee of, or under contract with, or has any direct or indirect financial relationship with the personal care provider or personal care assistant, unless case management is provided as required in section 256B.0625, subdivision 19a;

(4) home care services when the number of foster care residents is greater than four unless the county responsible for the recipient's foster placement made the placement prior to April 1, 1992, requests that home care services be provided, and case management is provided as required in section 256B.0625, subdivision 19a; or

(3) (5) home care services when combined with foster care payments, other than room and board payments that exceed the total amount that public funds would pay for the recipient's care in a medical institution.

Sec. 28. Minnesota Statutes 1994, section 256B.0627, is amended by adding a subdivision to read:

Subd. 7. [NONCOVERED HOME CARE SERVICES.] The following home care services are not eligible for payment under medical assistance:

(1) skilled nurse visits for the sole purpose of supervision of the home health aide;

(2) a skilled nursing visit:

(i) only for the purpose of monitoring medication compliance with an established medication program for a recipient; or

(ii) to administer or assist with medication administration, including injections, prefilling syringes for injections, or oral medication set-up of an adult recipient, when as determined and documented by the registered nurse, the need can be met by an available pharmacy or the recipient is physically and mentally able to self-administer or prefill a medication;

(3) home care services to a recipient who is eligible for covered services including hospice, if elected by the recipient, under the Medicare program or any other insurance held by the recipient;

(4) services to other members of the recipient's household;

(5) a visit made by a skilled nurse solely to train other home health agency workers;

(6) any home care service included in the daily rate of the community-based residential facility where the recipient is residing;

(7) nursing and rehabilitation therapy services that are reasonably accessible to a recipient outside their place of residence, excluding the assessment, counseling and education, and personal care;

(8) any home health agency service, excluding personal care assistant services and private duty nursing services, which are performed in a place other than the recipient's residence; and

(9) Medicare evaluation or administrative nursing visits on dual-eligible recipients that do not qualify for Medicare visit billing.

Sec. 29. Minnesota Statutes 1995 Supplement, section 256B.0628, subdivision 2, is amended to read:

Subd. 2. [DUTIES.] (a) The commissioner may contract with or employ qualified registered nurses and necessary support staff, or contract with qualified agencies, to provide home care prior authorization and review services for medical assistance recipients who are receiving home care services.

(b) Reimbursement for the prior authorization function shall be made through the medical assistance administrative authority. The state shall pay the nonfederal share. The functions will be to:

(1) assess the recipient's individual need for services required to be cared for safely in the community;

(2) ensure that a service plan that meets the recipient's needs is developed by the appropriate agency or individual;

(3) ensure cost-effectiveness of medical assistance home care services;

(4) recommend the approval or denial of the use of medical assistance funds to pay for home care services;

(5) reassess the recipient's need for and level of home care services at a frequency determined by the commissioner; and

(6) conduct on-site assessments when determined necessary by the commissioner and recommend changes to care plans that will provide more efficient and appropriate home care.

(c) In addition, the commissioner or the commissioner's designee may:

(1) review service plans and reimbursement data for utilization of services that exceed community-based standards for home care, inappropriate home care services, medical necessity, home care services that do not meet quality of care standards, or unauthorized services and make appropriate referrals within the department or to other appropriate entities based on the findings;

(2) assist the recipient in obtaining services necessary to allow the recipient to remain safely in or return to the community;

(3) coordinate home care services with other medical assistance services under section 256B.0625;

(4) assist the recipient with problems related to the provision of home care services; and

(5) assure the quality of home care services.; and

(6) assure that all liable third-party payers including Medicare have been used prior to medical assistance for home care services, including but not limited to, home health agency, elected hospice benefit, waivered services, alternative care program services, and personal care services.

(d) For the purposes of this section, "home care services" means medical assistance services defined under section 256B.0625, subdivisions 6a, 7, and 19a.

Sec. 30. [256B.07] [MEDICARE MAXIMIZATION PROGRAM.]

Subdivision 1. [DEFINITION.] (a) "Dual entitlees" means recipients eligible for either the medical assistance program or the alternative care program who are also eligible for the federal Medicare program.

(b) For purposes of this section "home care services" means home health agency services, private duty nursing services, personal care assistant services, waivered services, alternative care program services, hospice services, rehabilitation therapy services, and medical supplies and equipment.

Subd. 2. [TECHNICAL ASSISTANCE TO PROVIDERS.] (a) The commissioner shall establish a technical assistance program to require providers of services and equipment under this section to maximize collections from the federal Medicare program. The technical assistance may include the provision of materials to help providers determine those services and equipment likely to be reimbursed by Medicare. The technical assistance may also include the provision of computer software to providers to assist in this process. The commissioner may expand the technical assistance program to include providers of other services under this chapter.

(b) Any provider of home care services enrolled in the medical assistance program, or county public health nursing agency responsible for personal care assessments, or county case managers for alternative care or medical assistance waiver programs, is required to use the method developed and supplied by the department of human services for determining Medicare coverage for home care equipment and services provided to dual entitlees to ensure appropriate billing of Medicare. The method will be developed in two phases; the first phase is a manual system effective July 1, 1996, and the second phase will automate the manual procedure by expanding the current Medicaid Management Information System (MMIS) effective January 1, 1997. Both methods will determine Medicare coverage for the dates of service, Medicare coverage for home care services, and create an audit trail including reports. Both methods will be linked to prior authorization, therefore, either method must be used before home care services are authorized and when there is a change of condition affecting medical assistance authorization. The department will conduct periodic reviews of participant performance with the method and upon demonstrating appropriate referral and billing of Medicare, participants may be determined exempt from regular performance audits.

Subd. 3. [REFERRALS TO MEDICARE CERTIFIED PROVIDERS REQUIRED.] Non-Medicare certified and nonparticipating Medicare certified home care service providers must refer dual eligible recipients to Medicare certified providers when Medicare is determined to be the appropriate payer for supplies and equipment or services. Non-Medicare certified and nonparticipating Medicare certified home care service providers will be terminated from participation in the medical assistance program for failure to make such referrals.

Subd. 4. [MEDICARE CERTIFICATION REQUIREMENT.] Medicare certification is required of all medical assistance enrolled home care service providers as defined in subdivision 1 within one year of the date the Minnesota department of health gives notice to the department that initial Medicare surveys will resume.

Subd. 5. [ADVISORY COMMITTEE.] The commissioner shall establish an advisory committee comprised of home care service recipients, providers, county public health nurses, home care and county nursing associations, and department of human services staff to make recommendations to the Medicare maximization program. The recommendations shall include nursing practice issues as they relate to home care services funded by Medicare and medical assistance, and streamlining assessment, prior authorization, and up-front payer determination processes to achieve administrative efficiencies.

Sec. 31. Minnesota Statutes 1995 Supplement, section 256B.0913, subdivision 5, is amended to read:

Subd. 5. [SERVICES COVERED UNDER ALTERNATIVE CARE.] (a) Alternative care funding may be used for payment of costs of:

(1) adult foster care;

(2) adult day care;

(3) home health aide;

(4) homemaker services;

(5) personal care;

(6) case management;

(7) respite care;

(8) assisted living;

(9) residential care services;

(10) care-related supplies and equipment;

(11) meals delivered to the home;

(12) transportation;

(13) skilled nursing;

(14) chore services;

(15) companion services;

(16) nutrition services; and

(17) training for direct informal caregivers; and

(18) telemedicine devices to monitor recipients in their own homes as an alternative to hospital care, nursing home care, or home visits.

(b) The county agency must ensure that the funds are used only to supplement and not supplant services available through other public assistance or services programs.

(c) Unless specified in statute, the service standards for alternative care services shall be the same as the service standards defined in the elderly waiver. Persons or agencies must be employed by or under a contract with the county agency or the public health nursing agency of the local board of health in order to receive funding under the alternative care program.

(d) The adult foster care rate shall be considered a difficulty of care payment and shall not include room and board. The adult foster care daily rate shall be negotiated between the county agency and the foster care provider. The rate established under this section shall not exceed 75 percent of the state average monthly nursing home payment for the case mix classification to which the individual receiving foster care is assigned, and it must allow for other alternative care services to be authorized by the case manager.

(e) Personal care services may be provided by a personal care provider organization. A county agency may contract with a relative of the client to provide personal care services, but must ensure nursing supervision. Covered personal care services defined in section 256B.0627, subdivision 4, must meet applicable standards in Minnesota Rules, part 9505.0335.

(f) Costs for supplies and equipment that exceed $150 per item per month must have prior approval from the commissioner. A county may use alternative care funds to purchase medical supplies and equipment without prior approval from the commissioner when: (1) there is no other funding source; (2) the supplies and equipment are specified in the individual's care plan as medically necessary to enable the individual to remain in the community according to the criteria in Minnesota Rules, part 9505.0210, item A; and (3) the supplies and equipment represent an effective and appropriate use of alternative care funds. A county may use alternative care funds to purchase supplies and equipment from a non-Medicaid certified vendor if the cost for the items is less than that of a Medicaid vendor. A county is not required to contract with a provider of supplies and equipment if the monthly cost of the supplies and equipment is less than $250.

(g) For purposes of this section, residential care services are services which are provided to individuals living in residential care homes. Residential care homes are currently licensed as board and lodging establishments and are registered with the department of health as providing special services. Residential care services are defined as "supportive services" and "health-related services." "Supportive services" means the provision of up to 24-hour supervision and oversight. Supportive services includes: (1) transportation, when provided by the residential care center only; (2) socialization, when socialization is part of the plan of care, has specific goals and outcomes established, and is not diversional or recreational in nature; (3) assisting clients in setting up meetings and appointments; (4) assisting clients in setting up medical and social services; (5) providing assistance with personal laundry, such as carrying the client's laundry to the laundry room. Assistance with personal laundry does not include any laundry, such as bed linen, that is included in the room and board rate. Health-related services are limited to minimal assistance with dressing, grooming, and bathing and providing reminders to residents to take medications that are self-administered or providing storage for medications, if requested. Individuals receiving residential care services cannot receive both personal care services and residential care services.

(h) For the purposes of this section, "assisted living" refers to supportive services provided by a single vendor to clients who reside in the same apartment building of three or more units. Assisted living services are defined as up to 24-hour supervision, and oversight, supportive services as defined in clause (1), individualized home care aide tasks as defined in clause (2), and individualized home management tasks as defined in clause (3) provided to residents of a residential center living in their units or apartments with a full kitchen and bathroom. A full kitchen includes a stove, oven, refrigerator, food preparation counter space, and a kitchen utensil storage compartment. Assisted living services must be provided by the management of the residential center or by providers under contract with the management or with the county.

(1) Supportive services include:

(i) socialization, when socialization is part of the plan of care, has specific goals and outcomes established, and is not diversional or recreational in nature;

(ii) assisting clients in setting up meetings and appointments; and

(iii) providing transportation, when provided by the residential center only.

Individuals receiving assisted living services will not receive both assisted living services and homemaking or personal care services. Individualized means services are chosen and designed specifically for each resident's needs, rather than provided or offered to all residents regardless of their illnesses, disabilities, or physical conditions.

(2) Home care aide tasks means:

(i) preparing modified diets, such as diabetic or low sodium diets;

(ii) reminding residents to take regularly scheduled medications or to perform exercises;

(iii) household chores in the presence of technically sophisticated medical equipment or episodes of acute illness or infectious disease;

(iv) household chores when the resident's care requires the prevention of exposure to infectious disease or containment of infectious disease; and

(v) assisting with dressing, oral hygiene, hair care, grooming, and bathing, if the resident is ambulatory, and if the resident has no serious acute illness or infectious disease. Oral hygiene means care of teeth, gums, and oral prosthetic devices.

(3) Home management tasks means:

(i) housekeeping;

(ii) laundry;

(iii) preparation of regular snacks and meals; and

(iv) shopping.

Assisted living services as defined in this section shall not be authorized in boarding and lodging establishments licensed according to sections 157.03 and 157.15 to 157.22.

(i) For the purposes of this section, reimbursement for assisted living services and residential care services shall be a monthly rate negotiated and authorized by the county agency. The rate shall not exceed the nonfederal share of the greater of either the statewide or any of the geographic groups' weighted average monthly medical assistance nursing facility payment rate of the case mix resident class to which the 180-day eligible client would be assigned under Minnesota Rules, parts 9549.0050 to 9549.0059. For alternative care assisted living projects established under Laws 1988, chapter 689, article 2, section 256, monthly rates may not exceed 65 percent of the greater of either statewide or any of the geographic groups' weighted average monthly medical assistance nursing facility payment rate of the case mix resident class to which the 180-day eligible client would be assigned under Minnesota Rules, parts 9549.0050 to 9549.0059. The rate may not cover rent and direct food costs.

(j) For purposes of this section, companion services are defined as nonmedical care, supervision and oversight, provided to a functionally impaired adult. Companions may assist the individual with such tasks as meal preparation, laundry and shopping, but do not perform these activities as discrete services. The provision of companion services does not entail hands-on medical care. Providers may also perform light housekeeping tasks which are incidental to the care and supervision of the recipient. This service must be approved by the case manager as part of the care plan. Companion services must be provided by individuals or nonprofit organizations who are under contract with the local agency to provide the service. Any person related to the waiver recipient by blood, marriage or adoption cannot be reimbursed under this service. Persons providing companion services will be monitored by the case manager.

(k) For purposes of this section, training for direct informal caregivers is defined as a classroom or home course of instruction which may include: transfer and lifting skills, nutrition, personal and physical cares, home safety in a home environment, stress reduction and management, behavioral management, long-term care decision making, care coordination and family dynamics. The training is provided to an informal unpaid caregiver of a 180-day eligible client which enables the caregiver to deliver care in a home setting with high levels of quality. The training must be approved by the case manager as part of the individual care plan. Individuals, agencies, and educational facilities which provide caregiver training and education will be monitored by the case manager.

Sec. 32. Minnesota Statutes 1994, section 256B.0913, subdivision 7, is amended to read:

Subd. 7. [CASE MANAGEMENT.] The lead agency shall appoint a social worker from the county agency or a registered nurse from the county public health nursing service of the local board of health to be the case manager for any person receiving services funded by the alternative care program. The case manager must ensure the health and safety of the individual client and is responsible for the cost-effectiveness of the alternative care individual care plan. The county may allow a case manager to delegate certain aspects of the case management activity to another individual employed by the county provided there is oversight of the individual by the case manager. The case manager may not delegate those aspects which require professional judgment including assessments, reassessments, and care plan development.

Sec. 33. Minnesota Statutes 1995 Supplement, section 256B.0913, subdivision 15a, is amended to read:

Subd. 15a. [REIMBURSEMENT RATE; ANOKA COUNTY.] Notwithstanding subdivision 14, paragraph (e), or any other law to the contrary, for services rendered on or after effective January 1, 1996, Anoka county may pay vendors, and the commissioner shall reimburse the county, for actual costs up to a limit which is the maximum rate in effect on December 31, 1995, plus half the difference between that rate and the maximum allowed state county's maximum allowed rate for home health aide services per 15-minute unit is $4.39, and its maximum allowed rate for homemaker services per 15-minute unit is $2.90. Any adjustments in fiscal year 1997 to the maximum allowed rates for home health aide or homemaker services for Anoka county shall be calculated from the maximum rate in effect on January 1, 1996.

Sec. 34. Minnesota Statutes 1994, section 256B.0913, is amended by adding a subdivision to read:

Subd. 15b. [REIMBURSEMENT RATE; AITKIN COUNTY.] Notwithstanding subdivision 14, paragraph (e), effective April 1, 1996, Aitkin county's maximum allowed rate for in-home respite care services is $6.62 per 30-minute unit. Any adjustments in fiscal year 1997 to the maximum allowed rate for in-home respite care services for Aitkin county shall be calculated from the maximum rate in effect on April 1, 1996.

Sec. 35. Minnesota Statutes 1994, section 256B.0913, is amended by adding a subdivision to read:

Subd. 15c. [REIMBURSEMENT RATE; POLK AND PENNINGTON COUNTIES.] Notwithstanding subdivision 14, paragraph (e), effective July 1, 1996, Polk and Pennington counties' maximum allowed rate for homemaker services is $6.18 per 30-minute unit. Any adjustments in fiscal year 1997 to the maximum allowed rate for homemaker services for Polk and Pennington counties shall be calculated from the maximum rate in effect on July 1, 1996.

Sec. 36. Minnesota Statutes 1994, section 256B.0915, subdivision 1b, is amended to read:

Subd. 1b. [PROVIDER QUALIFICATIONS AND STANDARDS.] The commissioner must enroll qualified providers of elderly case management services under the home and community-based waiver for the elderly under section 1915(c) of the Social Security Act. The enrollment process shall ensure the provider's ability to meet the qualification requirements and standards in this subdivision and other federal and state requirements of this service. An elderly case management provider is an enrolled medical assistance provider who is determined by the commissioner to have all of the following characteristics:

(1) the legal authority for alternative care program administration under section 256B.0913;

(2) the demonstrated capacity and experience to provide the components of case management to coordinate and link community resources needed by the eligible population;

(3) administrative capacity and experience in serving the target population for whom it will provide services and in ensuring quality of services under state and federal requirements;

(4) the legal authority to provide preadmission screening under section 256B.0911, subdivision 4;

(5) a financial management system that provides accurate documentation of services and costs under state and federal requirements; and

(6) the capacity to document and maintain individual case records under state and federal requirements; and

(7) the county may allow a case manager to delegate certain aspects of the case management activity to another individual employed by the county provided there is oversight of the individual by the case manager. The case manager may not delegate those aspects which require professional judgment including assessments, and care plan development.

Sec. 37. Minnesota Statutes 1995 Supplement, section 256B.0915, subdivision 3, is amended to read:

Subd. 3. [LIMITS OF CASES, RATES, REIMBURSEMENT, AND FORECASTING.] (a) The number of medical assistance waiver recipients that a county may serve must be allocated according to the number of medical assistance waiver cases open on July 1 of each fiscal year. Additional recipients may be served with the approval of the commissioner.

(b) The monthly limit for the cost of waivered services to an individual waiver client shall be the statewide average payment rate of the case mix resident class to which the waiver client would be assigned under the medical assistance case mix reimbursement system. If medical supplies and equipment or adaptations are or will be purchased for an elderly waiver services recipient, the costs may be prorated on a monthly basis throughout the year in which they are purchased. If the monthly cost of a recipient's other waivered services exceeds the monthly limit established in this paragraph, the annual cost of the waivered services shall be determined. In this event, the annual cost of waivered services shall not exceed 12 times the monthly limit calculated in this paragraph. The statewide average payment rate is calculated by determining the statewide average monthly nursing home rate, effective July 1 of the fiscal year in which the cost is incurred, less the statewide average monthly income of nursing home residents who are age 65 or older, and who are medical assistance recipients in the month of March of the previous state fiscal year.

The annual cost divided by 12 of elderly or disabled waivered services for a person who is a nursing facility resident at the time of requesting a determination of eligibility for elderly or disabled waivered services shall not exceed the monthly payment for the resident class assigned under Minnesota Rules, parts 9549.0050 to 9549.0059, for that resident in the nursing facility where the resident currently resides. The following costs must be included in determining the total monthly costs for the waiver client:

(1) cost of all waivered services, including extended medical supplies and equipment; and

(2) cost of skilled nursing, home health aide, and personal care services reimbursable by medical assistance.

(c) Medical assistance funding for skilled nursing services, private duty nursing, home health aide, and personal care services for waiver recipients must be approved by the case manager and included in the individual care plan.

(d) Expenditures for extended medical supplies and equipment that cost over $150 per month For both the elderly waiver and the nursing facility disabled waiver must have the commissioner's prior approval waivers, a county may purchase extended supplies and equipment without prior approval from the commissioner when there is no other funding source and the supplies and equipment are specified in the individual's care plan as medically necessary to enable the individual to remain in the community according to the criteria in Minnesota Rules, part 9505.0210, items A and B. A county is not required to contract with a provider of supplies and equipment if the monthly cost of the supplies and equipment is less than $250.

(e) For the fiscal year beginning on July 1, 1993, and for subsequent fiscal years, the commissioner of human services shall not provide automatic annual inflation adjustments for home and community-based waivered services. The commissioner of finance shall include as a budget change request in each biennial detailed expenditure budget submitted to the legislature under section 16A.11, annual adjustments in reimbursement rates for home and community-based waivered services, based on the forecasted percentage change in the Home Health Agency Market Basket of Operating Costs, for the fiscal year beginning July 1, compared to the previous fiscal year, unless otherwise adjusted by statute. The Home Health Agency Market Basket of Operating Costs is published by Data Resources, Inc. The forecast to be used is the one published for the calendar quarter beginning January 1, six months prior to the beginning of the fiscal year for which rates are set. The adult foster care rate shall be considered a difficulty of care payment and shall not include room and board.

(f) The adult foster care daily rate for the elderly and disabled waivers shall be negotiated between the county agency and the foster care provider. The rate established under this section shall not exceed the state average monthly nursing home payment for the case mix classification to which the individual receiving foster care is assigned; the rate must allow for other waiver and medical assistance home care services to be authorized by the case manager.

(g) The assisted living and residential care service rates for elderly and community alternatives for disabled individuals (CADI) waivers shall be made to the vendor as a monthly rate negotiated with the county agency. The rate shall not exceed the nonfederal share of the greater of either the statewide or any of the geographic groups' weighted average monthly medical assistance nursing facility payment rate of the case mix resident class to which the elderly or disabled client would be assigned under Minnesota Rules, parts 9549.0050 to 9549.0059. For alternative care assisted living projects established under Laws 1988, chapter 689, article 2, section 256, monthly rates may not exceed 65 percent of the greater of either the statewide or any of the geographic groups' weighted average monthly medical assistance nursing facility payment rate for the case mix resident class to which the elderly or disabled client would be assigned under Minnesota Rules, parts 9549.0050 to 9549.0059. The rate may not cover direct rent or food costs.

(h) The county shall negotiate individual rates with vendors and may be reimbursed for actual costs up to the greater of the county's current approved rate or 60 percent of the maximum rate in fiscal year 1994 and 65 percent of the maximum rate in fiscal year 1995 for each service within each program.

(i) On July 1, 1993, the commissioner shall increase the maximum rate for home-delivered meals to $4.50 per meal.

(j) Reimbursement for the medical assistance recipients under the approved waiver shall be made from the medical assistance account through the invoice processing procedures of the department's Medicaid Management Information System (MMIS), only with the approval of the client's case manager. The budget for the state share of the Medicaid expenditures shall be forecasted with the medical assistance budget, and shall be consistent with the approved waiver.

(k) Beginning July 1, 1991, the state shall reimburse counties according to the payment schedule in section 256.025 for the county share of costs incurred under this subdivision on or after January 1, 1991, for individuals who are receiving medical assistance.

Sec. 38. Minnesota Statutes 1995 Supplement, section 256B.0915, subdivision 3a, is amended to read:

Subd. 3a. [REIMBURSEMENT RATE; ANOKA COUNTY.] Notwithstanding subdivision 3, paragraph (h), or any other law to the contrary, for services rendered on or after effective January 1, 1996, Anoka county may pay vendors, and the commissioner shall reimburse the county, for actual costs up to a limit which is the maximum rate in effect on December 31, 1995, plus half the difference between that rate and the maximum allowed state county's maximum allowed rate for home health aide services per 15-minute unit is $4.43, and its maximum allowed rate for homemaker services per 15-minute unit is $2.93. Any adjustments in fiscal year 1997 to the maximum allowed rates for home health aide or homemaker services for Anoka county shall be calculated from the maximum rate in effect on January 1, 1996.

Sec. 39. Minnesota Statutes 1994, section 256B.0915, is amended by adding a subdivision to read:

Subd. 3b. [REIMBURSEMENT RATE; AITKIN COUNTY.] Notwithstanding subdivision 3, paragraph (h), effective April 1, 1996, Aitkin county's maximum allowed rate for in-home respite care services is $6.67 per 30-minute unit. Any adjustments in fiscal year 1997 to the maximum allowed rate for in-home respite care services for Aitkin county shall be calculated from the maximum rate in effect on April 1, 1996.

Sec. 40. Minnesota Statutes 1994, section 256B.0915, is amended by adding a subdivision to read:

Subd. 3c. [REIMBURSEMENT RATE; POLK AND PENNINGTON COUNTIES.] Notwithstanding subdivision 3, paragraph (h), effective July 1, 1996, Polk and Pennington counties' maximum allowed rate for homemaker services is $6.25 per 30-minute unit. Any adjustments in fiscal year 1997 to the maximum allowed rate for homemaker services for Polk and Pennington counties shall be calculated from the maximum rate in effect on July 1, 1996.

Sec. 41. Minnesota Statutes 1995 Supplement, section 256B.093, subdivision 3, is amended to read:

Subd. 3. [TRAUMATIC BRAIN INJURY PROGRAM DUTIES.] The department shall fund administrative case management under this subdivision using medical assistance administrative funds. The traumatic brain injury program duties include:

(1) recommending to the commissioner in consultation with the medical review agent according to Minnesota Rules, parts 9505.0500 to 9505.0540, the approval or denial of medical assistance funds to pay for out-of-state placements for traumatic brain injury services and in-state traumatic brain injury services provided by designated Medicare long-term care hospitals;

(2) coordinating the traumatic brain injury home and community-based waiver;

(3) approving traumatic brain injury waiver eligibility or care plans or both;

(4) providing ongoing technical assistance and consultation to county and facility case managers to facilitate care plan development for appropriate, accessible, and cost-effective medical assistance services;

(5) providing technical assistance to promote statewide development of appropriate, accessible, and cost-effective medical assistance services and related policy;

(6) providing training and outreach to facilitate access to appropriate home and community-based services to prevent institutionalization;

(7) facilitating appropriate admissions, continued stay review, discharges, and utilization review for neurobehavioral hospitals and other specialized institutions;

(8) providing technical assistance on the use of prior authorization of home care services and coordination of these services with other medical assistance services;

(9) developing a system for identification of nursing facility and hospital residents with traumatic brain injury to assist in long-term planning for medical assistance services. Factors will include, but are not limited to, number of individuals served, length of stay, services received, and barriers to community placement; and

(10) providing information, referral, and case consultation to access medical assistance services for recipients without a county or facility case manager. Direct access to this assistance may be limited due to the structure of the program.

Sec. 42. Minnesota Statutes 1995 Supplement, section 256B.15, subdivision 5, is amended to read:

Subd. 5. [UNDUE HARDSHIP.] Any person entitled to notice in subdivision 1a has a right to apply for waiver of the claim based upon undue hardship. Any claim pursuant to this section may be fully or partially waived because of undue hardship. Undue hardship does not include action taken by the decedent which divested or diverted assets in order to avoid estate recovery. Any waiver of a claim must benefit the person claiming undue hardship. The commissioner shall have authority to hear claimant appeals, pursuant to section 256.045, when an application for a hardship waiver is denied in whole or part.

Sec. 43. Minnesota Statutes 1994, section 256B.15, is amended by adding a subdivision to read:

Subd. 6. [NOTICE.] (a) Upon being appointed, the personal representative for the estate of a deceased person or the estate of a deceased spouse who survived the person shall notify the commissioner of their death if they received assistance under this chapter. If the receipt of assistance is not known, notice must be given to the commissioner.

(b) The notice shall be in writing, addressed to the county agency, sent by certified mail, return receipt requested, and shall state the deceased medical recipient's full name, date of birth, social security number, address at the time of death, the name of the county agency which administered the recipient's medical assistance, the county and district court in which the deceased recipient's estate has been opened, the probate number assigned to that estate, and the name, address, and telephone number of the personal representative and attorney for the estate.

If the decedent was the surviving spouse of a deceased recipient, the notice shall also state the surviving spouse's full name, date of birth, social security number, date of death, the county and district court in which the estate has been opened, the probate number assigned to the estate, and the name, address, and telephone number of the personal representative and the attorney for the estate.

(c) Notwithstanding the provisions in chapter 524 or 525, or any will or other instrument, no one may, without the consent of the county agency, sell, assign, convey, transfer, distribute, or otherwise dispose of any real or personal property subject to administration by the estate until at least 70 days after the commissioner has received the notice required by this subdivision.

Sec. 44. Minnesota Statutes 1994, section 256B.15, is amended by adding a subdivision to read:

Subd. 7. [PRIORITY OF CLAIM.] Notwithstanding any other law to the contrary, payment of claims arising under this section shall have priority over the payment of any and all amounts payable under section 524.2-403.

Sec. 45. Minnesota Statutes 1994, section 256B.35, subdivision 1, is amended to read:

Subdivision 1. [PERSONAL NEEDS ALLOWANCE.] (a) Notwithstanding any law to the contrary, welfare allowances for clothing and personal needs for individuals receiving medical assistance while residing in any skilled nursing home, intermediate care facility, or medical institution including recipients of supplemental security income, in this state shall not be less than $45 per month from all sources. When benefit amounts for social security or supplemental security income recipients are increased pursuant to United States Code, title 42, sections 415(i) and 1382f, the commissioner shall, effective in the month in which the increase takes effect, increase by the same percentage to the nearest whole dollar the clothing and personal needs allowance for individuals receiving medical assistance while residing in any skilled nursing home, medical institution, or intermediate care facility. The commissioner shall provide timely notice to local agencies, providers, and recipients of increases under this provision.

(b) The personal needs allowance may be paid as part of the Minnesota supplemental aid program, notwithstanding the provisions of section 256D.37, subdivision 2, and payments to recipients of Minnesota supplemental aid may be made once each three months covering liabilities that accrued during the preceding three months.

(c) The personal needs allowance shall be increased to include income garnished for child support under a court order, up to a maximum of $250 per month but only to the extent that the amount garnished is not deducted as a monthly allowance for children under section 256B.0575, paragraph (a), clause (5).

Sec. 46. Minnesota Statutes 1994, section 256B.37, subdivision 5, is amended to read:

Subd. 5. [PRIVATE BENEFITS TO BE USED FIRST.] Private accident and health care coverage including Medicare for medical services is primary coverage and must be exhausted before medical assistance is paid for medical services including home health care, personal care assistant services, hospice, or services covered under a Health Care

Financing Administration (HCFA) waiver. When a person who is otherwise eligible for medical assistance has private accident or health care coverage, including Medicare or a prepaid health plan, the private health care benefits available to the person must be used first and to the fullest extent.

Sec. 47. Minnesota Statutes 1995 Supplement, section 256B.432, subdivision 2, is amended to read:

Subd. 2. [EFFECTIVE DATE.] For rate years beginning on or after July 1, 1990, the central, affiliated, or corporate office cost allocations in subdivisions 3 to 6 must be used when determining medical assistance rates under sections section 256B.431 and 256B.50.

Sec. 48. Minnesota Statutes 1995 Supplement, section 256B.434, subdivision 10, is amended to read:

Subd. 10. [EXEMPTIONS.] (a) To the extent permitted by federal law, (1) a facility that has entered into a contract under this section is not required to file a cost report, as defined in Minnesota Rules, part 9549.0020, subpart 13, for any year after the base year that is the basis for the calculation of the contract payment rate for the first rate year of the alternative payment demonstration project contract; and (2) a facility under contract is not subject to audits of historical costs or revenues, or paybacks or retroactive adjustments based on these costs or revenues, except audits, paybacks, or adjustments relating to the cost report that is the basis for calculation of the first rate year under the contract.

(b) A facility that is under contract with the commissioner under this section is not subject to the moratorium on licensure or certification of new nursing home beds in section 144A.071, unless the project results in a net increase in bed capacity or involves relocation of beds from one site to another. Contract payment rates must not be adjusted to reflect any additional costs that a nursing facility incurs as a result of a construction project undertaken under this paragraph. In addition, as a condition of entering into a contract under this section, a nursing facility must agree that any future medical assistance payments for nursing facility services will not reflect any additional costs attributable to the sale of a nursing facility under this section and to construction undertaken under this paragraph that otherwise would not be authorized under the moratorium in sections 144A.071 and section 144A.073. Nothing in this section prevents a nursing facility participating in the alternative payment demonstration project under this section from seeking approval of an exception to the moratorium through the process established in section 144A.071 144A.073, and if approved the facility's rates shall be adjusted to reflect the cost of the project.

(c) Notwithstanding section 256B.48, subdivision 6, paragraphs (c), (d), and (e), and pursuant to any terms and conditions contained in the facility's contract, a nursing facility that is under contract with the commissioner under this section is in compliance with section 256B.48, subdivision 6, paragraph (b), if the facility is Medicare certified.

(d) Notwithstanding paragraph (a), if by April 1, 1996, the health care financing administration has not approved a required waiver, or the health care financing administration otherwise requires cost reports to be filed prior to the waiver's approval, the commissioner shall require a cost report for the rate year.

Sec. 49. Minnesota Statutes 1995 Supplement, section 256B.49, subdivision 6, is amended to read:

Subd. 6. [ADMISSION CERTIFICATION.] In determining an individual's eligibility for the community alternative care (CAC) waiver program, and an individual's eligibility for medical assistance under section 256B.055, subdivision 12, paragraph (b), the commissioner may review or contract for review of the individual's medical condition to determine level of care using criteria in Minnesota Rules, parts 9505.0520 to 9505.0540.

For purposes of this subdivision, a person requires long-term care in an inpatient hospital setting if the person has an ongoing condition that is expected to last one year or longer, and would require continuous or frequent hospitalizations during that period, but for the provision of home care services under this section.

Sec. 50. Minnesota Statutes 1995 Supplement, section 256B.49, subdivision 7, is amended to read:

Subd. 7. [PERSONS WITH DEVELOPMENTAL DISABILITIES OR RELATED CONDITIONS.] Individuals who apply for services under the community alternatives for disabled individuals (CADI) waiver program or the traumatic brain injury nursing facility waiver program who have developmental disabilities or related conditions must be screened for the appropriate institutional level of care in accordance with section 256B.092.

Sec. 51. Minnesota Statutes 1994, section 256B.49, is amended by adding a subdivision to read:

Subd. 9. [CASE MANAGEMENT SERVICES.] The county may allow a case manager to delegate certain aspects of the case management activity to another individual employed by the county provided there is oversight of the individual by the case manager. The case manager may not delegate those aspects which require professional judgment including assessments, reassessments, and care plan development.

Sec. 52. Minnesota Statutes 1995 Supplement, section 256B.69, subdivision 3a, is amended to read:

Subd. 3a. [COUNTY AUTHORITY.] The commissioner, when implementing the general assistance medical care, or medical assistance or MinnesotaCare prepayment program within a county, must include the county board in the process of development, approval, and issuance of the request for proposals to provide services to eligible individuals within the proposed county. County boards must be given reasonable opportunity to make recommendations regarding the development, issuance, review of responses, and changes needed in the request for proposals. The commissioner must provide county boards the opportunity to review each proposal based on the identification of community needs under chapters 145A and 256E and county advocacy activities. If a county board finds that a proposal does not address certain community needs, the county board and commissioner shall continue efforts for improving the proposal and network prior to the approval of the contract. The county board shall make recommendations regarding the approval of local networks and their operations to ensure adequate availability and access to covered services. The provider or health plan must respond directly to county advocates and the state prepaid medical assistance ombudsperson regarding service delivery and must be accountable to the state regarding contracts with medical assistance and general assistance medical care funds. The county board may recommend a maximum number of participating health plans after considering the size of the enrolling population; ensuring adequate access and capacity; considering the client and county administrative complexity; and considering the need to promote the viability of locally developed health plans. Prior to the development of the request for proposal, there shall be established a mutually agreed upon timetable. This process shall in no way delay the department's ability to secure and finalize contracts for the medical assistance prepayment program. The prepaid medical assistance and general assistance medical care programs shall not be expanded to any county that has not begun enrollment as of March 1, 1996, until July 1, 1997, unless the expansion is approved by the county board. Additional services and additional target populations shall not be expanded in the counties currently implementing a prepaid medical assistance program until July 1, 1997, unless the expansion is approved by the county board.

Sec. 53. Minnesota Statutes 1995 Supplement, section 256B.69, subdivision 4, is amended to read:

Subd. 4. [LIMITATION OF CHOICE.] The commissioner shall develop criteria to determine when limitation of choice may be implemented in the experimental counties. The criteria shall ensure that all eligible individuals in the county have continuing access to the full range of medical assistance services as specified in subdivision 6. The commissioner shall exempt the following persons from participation in the project, in addition to those who do not meet the criteria for limitation of choice: (1) persons eligible for medical assistance according to section 256B.055, subdivision 1; (2) persons eligible for medical assistance due to blindness or disability as determined by the social security administration or the state medical review team, unless: (i) they are 65 years of age or older, or (ii) they are eligible for medical assistance according to section 256B.055, subdivision 12, or (iii) unless they reside in Itasca county or they reside in a county in which the commissioner conducts a pilot project under a waiver granted pursuant to section 1115 of the Social Security Act; (3) recipients who currently have private coverage through a health maintenance organization; (4) recipients who are eligible for medical assistance by spending down excess income for medical expenses other than the nursing facility per diem expense; and (5) recipients who receive benefits under the Refugee Assistance Program, established under United States Code, title 8, section 1522(e); (6) effective the day following final enactment, children who, prior to enrollment in the prepaid medical assistance program, are both determined to be severely emotionally disturbed and receiving case management services according to section 256B.0625, subdivision 20; and (7) effective the day following final enactment, adults who, prior to enrollment in the prepaid medical assistance program, are both determined to be seriously and persistently mentally ill and received case management services according to section 256B.0625, subdivision 20. Children under age 21 who are in foster placement may enroll in the project on an elective basis. Individuals excluded under clauses (6) and (7) may choose to enroll on an elective basis. The commissioner may allow persons with a one-month spenddown who are otherwise eligible to enroll to voluntarily enroll or remain enrolled, if they elect to prepay their monthly spenddown to the state. Beginning on or after January 1, 1997, the commissioner may require those individuals to enroll in the prepaid medical assistance program who otherwise would have been excluded under clauses (1) and (3) under Minnesota Rules, part 9500.1452, items H, K, and L. Before limitation of choice is implemented, eligible individuals shall be notified and after notification, shall be allowed to choose only among demonstration providers. The commissioner may assign an individual with private coverage through a health maintenance organization, to the same

health maintenance organization for medical assistance coverage, if the health maintenance organization is under contract for medical assistance in the individual's county of residence. After initially choosing a provider, the recipient is allowed to change that choice only at specified times as allowed by the commissioner. If a demonstration provider ends participation in the project for any reason, a recipient enrolled with that provider must select a new provider but may change providers without cause once more within the first 60 days after enrollment with the second provider.

Sec. 54. Minnesota Statutes 1995 Supplement, section 256B.69, subdivision 5b, is amended to read:

Subd. 5b. [PROSPECTIVE REIMBURSEMENT RATES.] For prepaid medical assistance and general assistance medical care program contract rates effective on or after January 1, 1996, through December 31, 1996, capitation rates for nonmetropolitan counties shall on a weighted average be no less than 85 percent of the capitation rates for metropolitan counties, excluding Hennepin county.

Sec. 55. Minnesota Statutes 1995 Supplement, section 256B.69, subdivision 6, is amended to read:

Subd. 6. [SERVICE DELIVERY.] (a) Each demonstration provider shall be responsible for the health care coordination for eligible individuals. Demonstration providers:

(1) shall authorize and arrange for the provision of all needed health services including but not limited to the full range of services listed in sections 256B.02, subdivision 8, and 256B.0625 and for children eligible for medical assistance under section 256B.055, subdivision 12, home care services and personal care assistant services in order to ensure appropriate health care is delivered to enrollees;

(2) shall accept the prospective, per capita payment from the commissioner in return for the provision of comprehensive and coordinated health care services for eligible individuals enrolled in the program;

(3) may contract with other health care and social service practitioners to provide services to enrollees; and

(4) shall institute recipient grievance procedures according to the method established by the project, utilizing applicable requirements of chapter 62D. Disputes not resolved through this process shall be appealable to the commissioner as provided in subdivision 11.

(b) Demonstration providers must comply with the standards for claims settlement under section 72A.201, subdivisions 4, 5, 7, and 8, when contracting with other health care and social service practitioners to provide services to enrollees. A demonstration provider must pay a clean claim, as defined in Code of Federal Regulations, title 42, section 447.45(b), within 30 business days of the date of acceptance of the claim.

(c) A county may develop a service delivery system to provide services for eligible individuals enrolled in the program. In order to maintain an opportunity for choice, the county may not be the exclusive provider of services.

Sec. 56. Minnesota Statutes 1995 Supplement, section 256B.69, subdivision 21, is amended to read:

Subd. 21. [PREPAYMENT COORDINATOR.] The local agency county board shall designate a prepayment coordinator to assist the state agency in implementing this section and section 256D.03, subdivision 4. Assistance must include educating recipients about available health care options, enrolling recipients under subdivision 5, providing necessary eligibility and enrollment information to health plans and the state agency, and coordinating complaints and appeals with the ombudsman established in subdivision 18.

Sec. 57. Minnesota Statutes 1994, section 256B.69, is amended by adding a subdivision to read:

Subd. 24. [SOCIAL SERVICE AND PUBLIC HEALTH COSTS.] (a) For rate years beginning on or after January 1, 1997, the commissioner shall: (1) exclude from the overall prepaid capitation rate all costs related to social services and public health administrative services; and (2) establish a separate prepaid capitation rate for social services and public health administrative services, which includes all public health nursing costs that are not related to the direct provision of those services.

(b) The commissioner may contract with county boards or health plan companies to provide all covered social service and public health administrative services to enrollees in counties participating in prepaid managed care under the medical assistance, general assistance medical care, or MinnesotaCare programs. Prior to entering into these

contracts, the commissioner shall consult with county boards in those counties. The commissioner shall reimburse county boards and health plan companies for each enrollee at a rate equal to the prepaid capitation rate for social services and public health administrative services.

(c) The commissioner shall require county boards and health plan companies to establish mechanisms to coordinate service delivery and minimize cost-shifting between entities financially responsible for different aspects of care.

Sec. 58. [256B.77] [DEMONSTRATION PROJECTS FOR PERSONS WITH DISABILITIES.]

Subdivision 1. [IN GENERAL.] The commissioner shall develop and implement upon federal approval, demonstration projects to create alternative service delivery systems in which all services covered under the medical assistance program for disabled individuals are provided in an integrated manner and funded on a capitation basis. The demonstration projects in total are limited to serving no more than six counties in which all categories of disabled persons are served, and no more than four additional counties in which not all the categories of disabled individuals are served. These alternative delivery systems shall be designed to increase coordination of health care services, improve access to quality health care services, reduce incentives for institutionalization, and reduce incentives among providers and payer to shift costs.

Subd. 2. [WAIVERS.] The commissioner shall request any authority from the United States Department of Health and Human Services that is necessary to implement these demonstration projects under the medical assistance program, and to combine Medicare and Medicaid funding and services for those disabled individuals who are eligible for both programs. Implementation of these programs may begin without authority to include Medicare funding and services. The commissioner may begin enrollment of individuals in these systems on or after January 1, 1997, for Itasca county, and on or after July 1, 1997, for all other geographic areas.

Subd. 3. [HEALTH CARE SERVICE DELIVERY NETWORKS.] The commissioner may contract with any entity that demonstrates the ability to manage all health care services covered under this chapter through its network of providers, and according to the terms and conditions of the contract with the commissioner. The commissioner must be assured that the contractor will comply with all laws and rules in effect on July 1, 1995, relating to consumer due process procedures and appeal rights within the medical assistance program, and has in place an adequate system for the collection of data, quality of care monitoring and improvement, enrollee education, and the management of services in coordination with local human services agencies and providers of related services that are not covered under this chapter. To the extent that requirements are waived under subdivision 8, the commissioner must assure that any alternative plan provides for the health and safety of enrollees and protects the right to privacy and to provide informed consent.

Subd. 4. [PAYMENT RATES.] The commissioner shall develop capitation payment rates for the initial contract period for health care service delivery networks, in consultation with an independent actuary, for each category of disabled persons under medical assistance based on current fiscal year expenditures, to ensure that the cost of services under these demonstration projects do not exceed the estimated cost for medical assistance services for the covered population under the fee-for-service system. If the managed care entity chooses to establish a demonstration project serving more than one category of disabled persons, the commissioner shall collect from service providers, and report to the legislature, information on expenditures for each category of disabled persons. Rates will be adjusted within the limits of the available risk adjustment technology. The commissioner may implement appropriate risk and profit sharing provisions. For successive contract periods, the commissioner may implement a payment system that is based on a competitive bid process that includes considerations of access, quality, accountability, and affordability.

Subd. 5. [ENROLLMENT AND CONSUMER CHOICE.] (a) The commissioner may designate geographic areas in which these demonstration projects may be implemented. The commissioner may require all individuals who are eligible for medical assistance based on a disability and individuals who are excluded from participation in the prepaid medical assistance program according to section 256B.69, subdivision 4, clauses (6) and (7), and who reside in the designated geographic area to obtain services covered under this chapter through providers participating in the designated health care service delivery network. The commissioner may phase in enrollment of persons with disabilities under these demonstration projects.

(b) Enrollment into networks shall be conducted according to the terms of the federal waiver and the Minnesota Medicaid state plan. A choice of at least two health care service delivery networks will be offered, when possible. One option will be offered only in geographic areas where there is only one health care service delivery network that is qualified to participate. In geographic areas where there is more than one qualified health care service delivery

network, consumers will be given the option to change their choice of networks once within the first 12 months of enrollment in the program. Consumers will also be given the option to change networks during an annual open enrollment period.

Subd. 6. [CONSUMER ROLE.] The health care service delivery network must demonstrate that enrollees have choices within the existing network of services. The health care service delivery network must also ensure that consumer representatives are involved in the planning process for the design of these demonstration projects. Enrollees will have access to the state managed care ombudsman services authorized under section 256B.69.

Subd. 7. [COORDINATION WITH LOCAL GOVERNMENT.] (a) The commissioner may conduct these demonstration projects using different alternative service delivery models. The commissioner may waive requirements in administrative rules and law that the commissioner determines are incompatible with the implementation of these demonstration projects if the commissioner determines that adequate alternative measures are in place to protect the health, safety, and rights of consumers, and to provide quality of care. The commissioner may not waive rights or procedural protections under sections 245.825; 245.91 to 245.97; 252.41, subdivision 9; 256.045; 626.556; and 626.557, and administrative rules adopted thereunder. The commissioner may waive requirements under section 256B.092, provided that the pilot project assures that consumers have access to a personal support plan that documents and modifies supports and outcomes as consumer needs are identified, have access to personal support plan coordination and a choice of options for personal support plan coordination, have access to supports that are designed to assist them to live and work in settings that enhance opportunities for growth and development, and, when a consumer is prescribed a psychotropic medication, the personal support plan must assign responsibility for implementing the psychotropic medication monitoring checklist. The commissioner may not waive requirements regarding the reporting of maltreatment of minors or vulnerable adults under sections 626.556 and 626.557, and administrative rules adopted thereunder. Prior to granting any waiver under this subdivision, the commissioner must convene a panel to review the request for waiver and the proposed alternatives to the requirements being waived and make recommendations to the commissioner regarding such a waiver. The commissioner shall invite representatives from diverse stakeholder groups, including county human services agencies, the ombudsman for mental health and mental retardation, legal services, and advocates, and consumers. The commissioner may exempt the participating counties from their social services obligations and fiscal sanctions for noncompliance with requirements in laws and rules to the extent that the commissioner determines those obligations are met under this section and are incompatible with the implementation of these demonstration projects.

(b) For demonstration projects in which the health care service delivery network is not a county, the commissioner may require evidence of a contract with the county human services agency that delineates the county's role and the network's role in providing and coordinating health and social services. For individuals enrolled in such a demonstration project, notwithstanding provisions to the contrary, the health care service delivery network will be responsible for authorizing the provision of health care services under the medical assistance program.

Subd. 8. [DATA COLLECTION AND EVALUATION.] The commissioner shall require contractors to collect, and submit to the commissioner in the form specified by the commissioner, all data required by the commissioner to evaluate the effect of the demonstration projects on the costs, quality, and utilization of services provided through health care service delivery networks. The data must be collected separately for different disability categories and major disability diagnoses, in a manner that allows comparisons on costs, quality, and utilization across these disability categories and diagnoses. The commissioner shall present the results of this evaluation to the legislature, within six months of the completion of the demonstration projects.

Sec. 59. Minnesota Statutes 1995 Supplement, section 256D.03, subdivision 4, is amended to read:

Subd. 4. [GENERAL ASSISTANCE MEDICAL CARE; SERVICES.] (a) For a person who is eligible under subdivision 3, paragraph (a), clause (3), general assistance medical care covers, except as provided in paragraph (c):

(1) inpatient hospital services;

(2) outpatient hospital services;

(3) services provided by Medicare certified rehabilitation agencies;

(4) prescription drugs and other products recommended through the process established in section 256B.0625, subdivision 13;

(5) equipment necessary to administer insulin and diagnostic supplies and equipment for diabetics to monitor blood sugar level;

(6) eyeglasses and eye examinations provided by a physician or optometrist;

(7) hearing aids;

(8) prosthetic devices;

(9) laboratory and X-ray services;

(10) physician's services;

(11) medical transportation;

(12) chiropractic services as covered under the medical assistance program;

(13) podiatric services;

(14) dental services;

(15) outpatient services provided by a mental health center or clinic that is under contract with the county board and is established under section 245.62;

(16) day treatment services for mental illness provided under contract with the county board;

(17) prescribed medications for persons who have been diagnosed as mentally ill as necessary to prevent more restrictive institutionalization;

(18) case management services for a person with serious and persistent mental illness who would be eligible for medical assistance except that the person resides in an institution for mental diseases;

(19) psychological services, medical supplies and equipment, and Medicare premiums, coinsurance and deductible payments;

(20) medical equipment not specifically listed in this paragraph when the use of the equipment will prevent the need for costlier services that are reimbursable under this subdivision;

(21) services performed by a certified pediatric nurse practitioner, a certified family nurse practitioner, a certified adult nurse practitioner, a certified obstetric/gynecological nurse practitioner, or a certified geriatric nurse practitioner in independent practice, if the services are otherwise covered under this chapter as a physician service, and if the service is within the scope of practice of the nurse practitioner's license as a registered nurse, as defined in section 148.171; and

(22) services of a certified public health nurse or a registered nurse practicing in a public health nursing clinic that is a department of, or that operates under the direct authority of, a unit of government, if the service is within the scope of practice of the public health nurse's license as a registered nurse, as defined in section 148.171.

(b) Except as provided in paragraph (c), for a recipient who is eligible under subdivision 3, paragraph (a), clause (1) or (2), general assistance medical care covers the services listed in paragraph (a) with the exception of special transportation services.

(c) Gender reassignment surgery and related services are not covered services under this subdivision unless the individual began receiving gender reassignment services prior to July 1, 1995.

(d) In order to contain costs, the commissioner of human services shall select vendors of medical care who can provide the most economical care consistent with high medical standards and shall where possible contract with organizations on a prepaid capitation basis to provide these services. The commissioner shall consider proposals by counties and vendors for prepaid health plans, competitive bidding programs, block grants, or other vendor payment mechanisms designed to provide services in an economical manner or to control utilization, with safeguards to ensure

that necessary services are provided. Before implementing prepaid programs in counties with a county operated or affiliated public teaching hospital or a hospital or clinic operated by the University of Minnesota, the commissioner shall consider the risks the prepaid program creates for the hospital and allow the county or hospital the opportunity to participate in the program in a manner that reflects the risk of adverse selection and the nature of the patients served by the hospital, provided the terms of participation in the program are competitive with the terms of other participants considering the nature of the population served. Payment for services provided pursuant to this subdivision shall be as provided to medical assistance vendors of these services under sections 256B.02, subdivision 8, and 256B.0625, and for contracts beginning on or after July 1, 1995, shall be discounted ten percent from comparable fee for service payments. For payments made during fiscal year 1990 and later years, the commissioner shall consult with an independent actuary in establishing prepayment rates, but shall retain final control over the rate methodology. Notwithstanding the provisions of subdivision 3, an individual who becomes ineligible for general assistance medical care because of failure to submit income reports or recertification forms in a timely manner, shall remain enrolled in the prepaid health plan and shall remain eligible for general assistance medical care coverage through the last day of the month in which the enrollee became ineligible for general assistance medical care.

(e) The commissioner of human services may reduce payments provided under sections 256D.01 to 256D.21 and 261.23 in order to remain within the amount appropriated for general assistance medical care, within the following restrictions.

For the period July 1, 1985 to December 31, 1985, reductions below the cost per service unit allowable under section 256.966, are permitted only as follows: payments for inpatient and outpatient hospital care provided in response to a primary diagnosis of chemical dependency or mental illness may be reduced no more than 30 percent; payments for all other inpatient hospital care may be reduced no more than 20 percent. Reductions below the payments allowable under general assistance medical care for the remaining general assistance medical care services allowable under this subdivision may be reduced no more than ten percent.

For the period January 1, 1986 to December 31, 1986, reductions below the cost per service unit allowable under section 256.966 are permitted only as follows: payments for inpatient and outpatient hospital care provided in response to a primary diagnosis of chemical dependency or mental illness may be reduced no more than 20 percent; payments for all other inpatient hospital care may be reduced no more than 15 percent. Reductions below the payments allowable under general assistance medical care for the remaining general assistance medical care services allowable under this subdivision may be reduced no more than five percent.

For the period January 1, 1987 to June 30, 1987, reductions below the cost per service unit allowable under section 256.966 are permitted only as follows: payments for inpatient and outpatient hospital care provided in response to a primary diagnosis of chemical dependency or mental illness may be reduced no more than 15 percent; payments for all other inpatient hospital care may be reduced no more than ten percent. Reductions below the payments allowable under medical assistance for the remaining general assistance medical care services allowable under this subdivision may be reduced no more than five percent.

For the period July 1, 1987 to June 30, 1988, reductions below the cost per service unit allowable under section 256.966 are permitted only as follows: payments for inpatient and outpatient hospital care provided in response to a primary diagnosis of chemical dependency or mental illness may be reduced no more than 15 percent; payments for all other inpatient hospital care may be reduced no more than five percent. Reductions below the payments allowable under medical assistance for the remaining general assistance medical care services allowable under this subdivision may be reduced no more than five percent.

For the period July 1, 1988 to June 30, 1989, reductions below the cost per service unit allowable under section 256.966 are permitted only as follows: payments for inpatient and outpatient hospital care provided in response to a primary diagnosis of chemical dependency or mental illness may be reduced no more than 15 percent; payments for all other inpatient hospital care may not be reduced. Reductions below the payments allowable under medical assistance for the remaining general assistance medical care services allowable under this subdivision may be reduced no more than five percent.

There shall be no copayment required of any recipient of benefits for any services provided under this subdivision. A hospital receiving a reduced payment as a result of this section may apply the unpaid balance toward satisfaction of the hospital's bad debts.

(f) Any county may, from its own resources, provide medical payments for which state payments are not made.

(g) Chemical dependency services that are reimbursed under chapter 254B must not be reimbursed under general assistance medical care.

(h) The maximum payment for new vendors enrolled in the general assistance medical care program after the base year shall be determined from the average usual and customary charge of the same vendor type enrolled in the base year.

(i) The conditions of payment for services under this subdivision are the same as the conditions specified in rules adopted under chapter 256B governing the medical assistance program, unless otherwise provided by statute or rule.

Sec. 60. Minnesota Statutes 1994, section 256D.16, is amended to read:

256D.16 [GENERAL ASSISTANCE TO BE ALLOWED AS CLAIM IN PROBATE COURT.]

(a) On the death of any person who received any general assistance under sections 256D.01 to 256D.21, or on the death of the survivor of a married couple, either or both of whom received general assistance, the total amount paid as general assistance to either or both, without interest, shall be allowed as a claim against the estate of such person or persons by the court having jurisdiction to probate the estate.

(b) Notwithstanding anything else to the contrary in any other statutes, payment of claims filed pursuant to this section shall have priority over payment of any and all amounts payable under section 524.2-403.

Sec. 61. Minnesota Statutes 1994, section 256I.04, subdivision 1, is amended to read:

Subdivision 1. [INDIVIDUAL ELIGIBILITY REQUIREMENTS.] An individual is eligible for and entitled to a group residential housing payment to be made on the individual's behalf if the county agency has approved the individual's residence in a group residential housing setting and the individual meets the requirements in paragraph (a) or (b).

(a) The individual is aged, blind, or is over 18 years of age and disabled as determined under the criteria used by the title II program of the Social Security Act, and meets the resource restrictions and standards of the supplemental security income program, and the individual's countable income after deducting the exclusions and disregards of the SSI program and the medical assistance personal needs allowance under section 256B.35 is less than the monthly rate specified in the county agency's agreement with the provider of group residential housing in which the individual resides.

(b) The individual meets a category of eligibility under section 256D.05, subdivision 1, paragraph (a), and the individual's resources are less than the standards specified by section 256D.08, and the individual's countable income as determined under sections 256D.01 to 256D.21, less the medical assistance personal needs allowance under section 256B.35 is less than the monthly rate specified in the county agency's agreement with the provider of group residential housing in which the individual resides.

Sec. 62. Minnesota Statutes 1995 Supplement, section 256I.04, subdivision 2b, is amended to read:

Subd. 2b. [GROUP RESIDENTIAL HOUSING AGREEMENTS.] Agreements between county agencies and providers of group residential housing must be in writing and must specify the name and address under which the establishment subject to the agreement does business and under which the establishment, or service provider, if different from the group residential housing establishment, is licensed by the department of health or the department of human services; the specific license or registration from the department of health or the department of human services held by the provider and the number of beds subject to that license; the address of the location or locations at which group residential housing is provided under this agreement; the per diem and monthly rates that are to be paid from group residential housing funds for each eligible resident at each location; the number of beds at each location which are subject to the group residential housing agreement; whether the license holder is a not-for-profit corporation under section 501(c)(3) of the Internal Revenue Code; and a statement that the agreement is subject to the provisions of sections 256I.01 to 256I.06 and subject to any changes to those sections. Group residential housing agreements may be terminated with or without cause by either the county or the provider with two calendar months prior notice.

Sec. 63. Minnesota Statutes 1995 Supplement, section 256I.04, subdivision 3, is amended to read:

Subd. 3. [MORATORIUM ON THE DEVELOPMENT OF GROUP RESIDENTIAL HOUSING BEDS.] (a) County agencies shall not enter into agreements for new group residential housing beds with total rates in excess of the MSA equivalent rate except: (1) for group residential housing establishments meeting the requirements of subdivision 2a,

clause (2) with department approval; (2) for group residential housing establishments licensed under Minnesota Rules, parts 9525.0215 to 9525.0355, provided the facility is needed to meet the census reduction targets for persons with mental retardation or related conditions at regional treatment centers; (3) to ensure compliance with the federal Omnibus Budget Reconciliation Act alternative disposition plan requirements for inappropriately placed persons with mental retardation or related conditions or mental illness; (4) up to 80 beds in a single, specialized facility located in Hennepin county that will provide housing for chronic inebriates who are repetitive users of detoxification centers and are refused placement in emergency shelters because of their state of intoxication. Planning for the specialized facility must have been initiated before July 1, 1991, in anticipation of receiving a grant from the housing finance agency under section 462A.05, subdivision 20a, paragraph (b); or (5) notwithstanding the provisions of subdivision 2a, for up to 180 supportive housing units in Anoka, Dakota, Hennepin, or Ramsey county for homeless adults with a mental illness, a history of substance abuse, or human immunodeficiency virus or acquired immunodeficiency syndrome. For purposes of this section, "homeless adult" means a person who is living on the street or in a shelter or is about to be or, within the previous six months, has been evicted from a dwelling unit or is about to be or, within the previous six months, has been discharged from a regional treatment center, community hospital, or residential treatment program and has no appropriate housing available and lacks the resources and support necessary to access appropriate housing. At least 70 percent of the supportive housing units must serve homeless adults with mental illness, substance abuse problems, or human immunodeficiency virus or acquired immunodeficiency syndrome who are about to be or, within the previous six months, has been discharged from a regional treatment center, or a state-contracted psychiatric bed in a community hospital, or a residential mental health or chemical dependency treatment program. If a person meets the requirements of subdivision 1, paragraph (a), and receives a federal Section 8 housing subsidy, the group residential housing rate for that person is limited to the supplementary rate under section 256I.05, subdivision 1a, and is determined by subtracting the amount of the person's countable income that exceeds the MSA equivalent rate from the group residential housing supplementary rate. A resident in a demonstration project site who no longer participates in the demonstration program shall retain eligibility for a group residential housing payment in an amount determined under section 256I.06, subdivision 8, using the MSA equivalent rate. Service funding under section 256I.05, subdivision 1a, must end June 30, 1997. Effective July 1, 1997, services to persons in these settings must be provided through a managed care entity. This provision is subject to the availability of matching federal funds.

(b) A county agency may enter into a group residential housing agreement for beds with rates in excess of the MSA equivalent rate in addition to those currently covered under a group residential housing agreement if the additional beds are only a replacement of beds with rates in excess of the MSA equivalent rate which have been made available due to closure of a setting, a change of licensure or certification which removes the beds from group residential housing payment, or as a result of the downsizing of a group residential housing setting. The transfer of available beds from one county to another can only occur by the agreement of both counties.

Sec. 64. Minnesota Statutes 1994, section 256I.05, subdivision 1c, is amended to read:

Subd. 1c. [RATE INCREASES.] A county agency may not increase the rates negotiated for group residential housing above those in effect on June 30, 1993, except: as provided in paragraphs (a) to (g).

(a) A county may increase the rates for group residential housing settings to the MSA equivalent rate for those settings whose current rate is below the MSA equivalent rate.

(b) A county agency may increase the rates for residents in adult foster care whose difficulty of care has increased. The total group residential housing rate for these residents must not exceed the maximum rate specified in subdivisions 1 and 1a. County agencies must not include nor increase group residential housing difficulty of care rates for adults in foster care whose difficulty of care is eligible for funding by home and community-based waiver programs under title XIX of the Social Security Act.

(c) The room and board rates will be increased each year when the MSA equivalent rate is adjusted for SSI cost-of-living increases by the amount of the annual SSI increase, less the amount of the increase in the medical assistance personal needs allowance under section 256B.35.

(d) When a group residential housing rate is used to pay for an individual's room and board, or other costs necessary to provide room and board, the rate payable to the residence must continue for up to 18 calendar days per incident that the person is temporarily absent from the residence, not to exceed 60 days in a calendar year, if the absence or absences have received the prior approval of the county agency's social service staff. Prior approval is not required for emergency absences due to crisis, illness, or injury.

(e) For facilities meeting substantial change criteria within the prior year. Substantial change criteria exists if the group residential housing establishment experiences a 25 percent increase or decrease in the total number of its beds, if the net cost of capital additions or improvements is in excess of 15 percent of the current market value of the residence, or if the residence physically moves, or changes its licensure, and incurs a resulting increase in operation and property costs.

(f) Until June 30, 1994, a county agency may increase by up to five percent the total rate paid for recipients of assistance under sections 256D.01 to 256D.21 or 256D.33 to 256D.54 who reside in residences that are licensed by the commissioner of health as a boarding care home, but are not certified for the purposes of the medical assistance program. However, an increase under this clause must not exceed an amount equivalent to 65 percent of the 1991 medical assistance reimbursement rate for nursing home resident class A, in the geographic grouping in which the facility is located, as established under Minnesota Rules, parts 9549.0050 to 9549.0058.

(g) For the rate year beginning July 1, 1996, a county agency may increase the total rate paid for recipients of assistance under sections 256D.01 to 256D.21 or 256D.33 to 256D.54 who reside in residences that meet the following criteria:

(1) they are licensed by the commissioner of health as a boarding care home;

(2) they are not certified for the purposes of the medical assistance program;

(3) at least 50 percent of their residents are diagnosed with mental illness;

(4) at least 16 beds; and

(5) they provide medication administration to residents.

An increase under this paragraph must not exceed an amount equivalent to the 1995 medical assistance reimbursement rate for nursing home resident class A, in the geographic grouping in which the facility is located, as established under Minnesota Rules, parts 9520.0500 to 9549.0058.

Sec. 65. Minnesota Statutes 1994, section 256I.05, is amended by adding a subdivision to read:

Subd. 7c. [DEMONSTRATION PROJECT.] The commissioner is authorized to pursue a demonstration project under federal food stamp regulation for the purpose of gaining federal reimbursement of food and nutritional costs currently paid by the state group residential housing program. Any revenues received from this demonstration project may be retained to offset the costs of development, implementation, administration, and group residential housing expenditures.

Sec. 66. Laws 1995, chapter 207, article 8, section 42, subdivision 5, is amended to read:

Subd. 5. [REPORTING AND EVALUATION.] Each participating local managing entity shall submit information as required by the commissioner, including data required for assessing client satisfaction, quality of care, cost, and utilization of services for purposes of project evaluation. The data must be collected separately for different disability categories and major disability diagnoses, in a manner that allows comparisons on costs, quality, and utilization across these disability categories and diagnoses. The commissioner shall present the results of this evaluation to the legislature, within six months of the completion of the demonstration projects.

Sec. 67. [JOINT PURCHASER DEMONSTRATION PROJECTS.]

Subdivision 1. [OBJECTIVES.] The objectives of the demonstration project are to promote the development of local provider networks and retain the availability and accountability of local service providers; further define the county and state roles, authorities, and functions related to publicly reimbursed and publicly provided health and social services, including services funded by county property tax revenues; promote better coordination of services for all enrollees and target populations; further define an outcome-based system, including definitions of outcomes and processes for collecting, publicizing, and utilizing outcome data; facilitate appropriate competition, consumer choice, and entry of providers into the marketplace while defining appropriate publicly operated safety net services; identify mechanisms to ensure short-term and long-term control of costs and avoidance of cost shifting; define adequate financing within a capitated allocation; develop state-county risk-sharing strategies, which may include stop-loss protection, reinsurance, and retrospective risk adjustment; and define state-county shares of the cost savings achieved for a return on the public investment.

Subd. 2. [AUTHORIZATION.] A county or group of counties may establish a county-based joint purchaser demonstration project, for services provided to eligible individuals under medical assistance, except medical assistance recipients who are age 65 or older who reside in the Twin Cities seven-county metropolitan area, general assistance medical care, MinnesotaCare, state health and social service grants, and county-funded programs for these or other participants. As part of a project, the county may explore the option of direct contracting with local providers, provider networks, or public providers. If a county or group of counties implement direct contracting, the county or counties shall be considered a health plan company for purposes of Minnesota Statutes, section 62Q.19, and must meet the requirements of Minnesota Statutes, section 62Q.19. At the option of the county board, the project may include county employees, other units of local government, and private employers. For nonacute care services, including residential services and day training and habilitation services, local providers shall be offered the opportunity to contract if they agree to the terms of the contract offered other providers or networks.

Subd. 3. [LONG-TERM CARE OPTIONS PROJECT EXCEPTION.] Medical assistance recipients who are age 65 or older who reside in the seven-county metropolitan area shall not be included in a joint purchaser demonstration project. Medical assistance recipients who are age 65 or older who reside outside the seven-county metropolitan area may be included in a joint purchaser demonstration project. A county board or group of county boards, other than the seven metropolitan counties, that notify the commissioner of intent to participate in a demonstration project, in accordance with subdivision 8, must include notice of their intent and preference for participation in the long-term care options project. Counties participating in the long-term care options project must meet all requirements of the federal waivers governing the long-term care options project demonstration.

Subd. 4. [PROJECT SCOPE.] A county or group of counties may establish a demonstration project or projects to purchase acute care services to the categorically and medically needy families with children and adults without children. A county or group of counties may establish a separate demonstration project or projects to purchase mental health services, chemical dependency services, or services for persons with developmental disabilities, or any combination thereof, or, if the county is located outside the Twin Cities seven-county metropolitan area, services to the elderly. If the county establishes a demonstration project to purchase mental health services and the county is participating in a mental health collaborative under Minnesota Statutes, sections 245.491 to 245.496, families must have the opportunity to be enrolled in one network.

Subd. 5. [SERVICE REQUIREMENTS.] A demonstration project shall continue to be subject to the current eligibility, benefits, enrollee protection, and appeal process requirements under the prepaid medical assistance, general assistance medical care, and MinnesotaCare programs. The project shall institute recipient grievance procedures utilizing applicable requirements of Minnesota Statutes, section 256B.69.

Subd. 6. [CONSUMER CHOICE.] In order to maintain an opportunity for choice, a county or counties must contract with two or more service delivery networks, unless there are less than two managed care organizations, as defined in Minnesota Statutes, section 62Q.01, or health provider cooperatives, as defined in Minnesota Statutes, section 62R.04, willing to provide services in the county or counties. If only one network is providing services within the county or counties, the project must demonstrate that enrollees have a choice of providers within the existing network.

Subd. 7. [PROJECT DESIGN AND IMPLEMENTATION.] The demonstration project must ensure that consumer representatives are involved in the planning process for the design of the demonstration projects. A participating county or group of counties shall issue a request for proposals to provide services to eligible individuals residing within the participating county or counties. The participating county board shall review the proposals and shall approve all contracts. Individual county staff who are employed by a publicly owned health plan that intends to respond to a request for proposal are prohibited from reviewing, critiquing, or approving any proposals submitted in this subdivision. Before a participating county can enter into a contract with a service delivery network, the commissioner must review the contract and determine whether the contracting network offers adequate services to recipients. If the commissioner determines that the contract does not provide adequate services, the commissioner and county board shall continue negotiations with the network to ensure the provision of all necessary services.

Subd. 8. [NOTICE OF INTENT; PROJECT PROPOSALS.] (a) In counties where the state has entered into a managed care contract, a county board or a group of county boards shall notify the commissioner of their intent to participate in a joint purchaser demonstration project no later than June 20, 1996. The notice of intent must include a transition plan describing the county or counties' plan for moving the enrollees into the demonstration project. The transition plan may not propose returning current prepaid medical assistance, prepaid general assistance medical care, or prepaid MinnesotaCare enrollees to fee-for-service coverage for any period of time during the transition period. In counties where recipients were enrolled in health plans under state prepayment programs as of March 1, 1996,

recipients must continue to be offered the choice of enrolling in a health plan under contract with the state through state prepayment programs in addition to any enrollment options established under a county demonstration project. In counties where the prepayment program is not currently being implemented, a county board or group of county boards shall notify the commissioner of their intent to participate in a joint purchaser demonstration project by July 1, 1996.

(b) For any geographic area, and for any population for which the state has not received a notice of intent by July 1, 1996, nothing shall prohibit the implementation of the prepaid medical assistance, prepaid general assistance medical care, or prepaid MinnesotaCare programs in accordance with Minnesota Statutes, section 256B.69, subdivision 3a, unless the county board has adopted a resolution, by July 1, 1996, opposing the implementation of the prepaid medical assistance or prepaid general assistance medical care.

(c) By February 1, 1997, each county board that has submitted a notice of intent in accordance with this subdivision shall submit a final proposal that demonstrates the ability to provide services beginning on January 1, 1998, in accordance with this section. For any geographic area and for any population for which the state has not received a final proposal satisfying the requirements of this section by February 1, 1997, nothing shall prohibit the implementation of the prepaid medical assistance, prepaid general assistance medical care, and prepaid MinnesotaCare programs unless the county board has adopted a resolution opposing implementation as provided in paragraph (b). The commissioner must accept or reject final proposals on or before May 1, 1997. The commissioner must authorize any proposal that complies with the requirements of this section and satisfies the criteria listed in subdivision 15. The commissioner must negotiate the contract for the joint purchaser demonstration project with the appropriate county or counties by July 1, 1997, for implementation effective January 1, 1998.

(d) In counties in which the prepaid medical assistance, prepaid general assistance medical care, or prepaid MinnesotaCare program is operating, the commissioner may continue or extend those contracts until the county negotiated contracts become effective and enrollment begins. In counties where recipients were enrolled in health plans under state prepayment programs as of March 1, 1996, recipients must continue to be offered the choice of enrolling in a health plan under contract with the state through state prepayment programs in addition to any enrollment options established under a county demonstration project. In counties in which the prepaid medical assistance or prepaid general assistance medical care programs are not currently operating, and enrollment under this section does not begin by January 1, 1998, nothing shall prohibit the implementation of the prepaid medical assistance, prepaid general assistance medical care, and prepaid MinnesotaCare programs.

Subd. 9. [PROJECT REPORTING AND EVALUATION.] County-based purchasing demonstration projects shall report to the legislature by January 15, 1997, with recommendations for reserve requirements for local provider networks; county reporting, including data required to assess client needs, satisfaction, outcomes, and quality of care, cost, and utilization of services for purposes of project evaluation; state and county functions and financing, including funding recommendations for county eligibility determinations, enrollment, advocacy, and public health and social services functions; risk-sharing methodologies, purchasing arrangements, and development of geographic service areas; and other recommendations related to project objectives. Interim reports by the county-based projects shall be presented to the legislative commission on health care access. The commissioner of human services shall contract for an independent evaluation of the demonstration projects and submit the results of the evaluation in a report to the legislature no later than January 15, 1999. The evaluation must determine the impact of each joint purchasing demonstration project on quality of care, costs, and access to services. Each evaluation must also compare demonstration project outcomes to outcomes under the prepaid medical assistance program.

Subd. 10. [PAYMENT RATES.] The commissioner shall determine rates to be paid by the state to county joint purchaser demonstration projects according to categories in paragraphs (a) to (c).

(a) For families and children and adults without children, the total payment shall be determined according to the department's methodology for determining prepaid medical assistance demonstration rates for families and children. The commissioner shall develop per member, per month, payment rates for each project year, in consultation with an independent actuary, to ensure that the cost of services under these demonstration projects does not exceed the prepaid medical assistance, prepaid general assistance medical care, and the prepaid MinnesotaCare program rates.

(b) The payment rate for Medicare and medical assistance recipients over age 65 shall be determined according to the methodology of the long-term care options project.

(c) The payment rate for projects involving medical assistance recipients who are disabled shall be developed in consultation with an independent actuary to ensure that the costs do not exceed 95 percent of the estimated cost for medical assistance services for the covered population under the fee-for-service system. Payments to counties shall be made in accordance with Minnesota Statutes, section 256B.69. This payment is in addition to the state administrative allocation to participating counties for eligibility enrollment and advocacy functions.

Subd. 11. [ASSURANCES.] If the county chooses to establish a demonstration project serving more than one category of disabled persons, the entity must provide assurances to the commissioner that the established payment rates for each category of disabled persons are only used to meet the needs of recipients within that category of persons.

Subd. 12. [FEDERAL WAIVER.] The commissioner of human services shall apply by August 1, 1996, for any new federal waivers or any modifications to existing waivers necessary to implement this section. The chairs of the senate health care committee and health care and family services finance division, house of representatives health and human services committee and health and human services finance division, and one minority member from the house of representatives and senate appointed by the rules of the house and senate, and three county commissioners appointed by the association of Minnesota counties shall participate in developing the waiver application and in all waiver negotiations, including negotiations to interpret the current waivers.

Subd. 13. [ALTERNATIVE METHODS.] Upon federal waiver approval to proceed with these projects for persons with developmental disabilities, the commissioner may approve alternative methods to meet the intent of existing rules and statutes relating to services for eligible persons. The commissioner shall ensure that in no case are the rights and protections afforded under these rules and statutes abridged. The commissioner shall not waive the rights or procedural protections under Minnesota Statutes, sections 245.825; 245.91 to 245.97; 252.41, subdivision 9; 256.045; 256B.092; 626.556; and 626.557, including the county agency's responsibility to arrange for appropriate services and procedures for the monitoring of psychotropic medications.

Subd. 14. [ACTUARIAL STUDY.] The commissioner of human services shall contract with an independent actuary to prepare an analysis of the amount of funding for mental health services, which is included in the capitated payment to health plans compared to the utilization amount of expenditures for mental health services.

Subd. 15. [STANDARDS AND CRITERIA.] Any demonstration project must demonstrate the ability to:

(1) purchase all covered services for a fixed amount that does not exceed the estimated cost that would have occurred under the prepaid medical assistance, prepaid general assistance medical care, and the prepaid MinnesotaCare programs;

(2) ensure that covered services are accessible to all enrollees and that enrollees have a choice of providers whenever possible;

(3) issue payments to participating vendors or networks in a timely manner;

(4) establish a process to ensure and improve the quality of the care received;

(5) provide appropriate quality and other required data in a format required by the state that will allow comparisons between plans and providers; and

(6) provide an advocacy and enrollee protection and complaints and appeals system that is independent from care providers or other risk bearers and complies with Minnesota Statutes, section 256B.69.

Sec. 68. [FEDERAL APPROVAL.]

The amendments to Minnesota Statutes, sections 256B.0575, and 256B.058, subdivision 2, shall be effective July 1, 1996, to the extent permitted under federal law. If these provisions are not permitted under federal law, the commissioner of human services shall seek the necessary federal waivers to implement the changes.

Sec. 69. [DAY TRAINING AND HABILITATION SERVICES.]

Day training and habilitation license holders are exempt from the requirements of Minnesota Rules, part 9525.1630, subparts 3 (review of progress toward individual habilitation plan goals), 4 (initial assessment), and 5 (reassessment) for persons for whom progress reviews, initial assessments, and reassessments are completed by the license holder according to requirements established in the person's individual service plan developed by the county case manager under Minnesota Statutes, section 256B.092, subdivision 1b.

Sec. 70. [RECOMMENDATIONS ON HOME CARE PROVIDED IN FOSTER CARE SETTINGS.]

The commissioner of human services, in consultation with counties, home care providers, foster care providers, and representatives of home care recipients who are both children and adults, shall review the provision of home care services to children and adults living in licensed foster care settings. By November 15, 1996, the commissioner shall

report to the legislature on recommendations for standards to determine home care service authorization for foster care residents, which will ensure appropriate care for recipients while avoiding duplication of services and payment.

Sec. 71. [COMMISSIONER'S TASK FORCE TO CONSOLIDATE MINNESOTA RULES; CONSUMER INFORMATION SYSTEM AND EDUCATIONAL MATERIALS.]

The commissioner, in consultation with representatives of affected organizations, including counties, providers, and advocacy groups shall develop proposed legislation consolidating Minnesota Rules, parts 9525.0215 to 9525.0355; 9525.0500 to 9525.0660; 9525.1500 to 9525.1690; and 9525.2000 to 9525.2140, new regulatory strategies to determine compliance with the new consolidated standard, and strategies to develop a consumer information system and educational materials. The purpose of the rule consolidation and regulatory strategies are to eliminate duplication, outmoded provisions and unnecessary paperwork, while protecting safety, health, rights and protection for persons using the services licensed under the above parts. The purpose of the consumer information systems and educational materials are to provide easy access to information for consumers and interested parties to make informed choices about service delivery. The commissioner shall provide recommended legislation to consolidate these rules and regulate the provisions of the rules more efficiently to the legislative commission on health care access by November 15, 1996.

Sec. 72. [VENDOR RATE ADJUSTMENT.]

Notwithstanding the requirements of Minnesota Statutes, section 252.46, subdivisions 3 and 6, the commissioner of human services shall, at the request of the responsible board of county commissioners and subject to conditions the commissioner finds appropriate consistent with the service principles in Minnesota Statutes, section 252.42, grant a variance to the payment rate for vendors defined in Minnesota Statutes, section 252.41, subdivision 9, and located in Hennepin county that serve persons with very severe self-injurious or assaultive behavior, as those terms are used in Minnesota Statutes, section 252.46, subdivision 4, paragraph (b). The adjusted rate shall:

(1) be limited to provisions of services to no more than 42 such persons;

(2) not exceed 200 percent of the statewide average rate as calculated in accordance with Minnesota Statutes, section 252.46, subdivision 4, paragraph (b);

(3) become effective July 1, 1996; and

(4) be used as the basis for calculating the rate maximum for that vendor for calendar year 1997 in accordance with the requirements of Minnesota Statutes, section 252.46, subdivision 3.

Sec. 73. [DELIVERY OF SERVICES FOR PERSONS WITH DEVELOPMENTAL DISABILITIES.]

The legislature finds that the delivery of services for persons with developmental disabilities can benefit from initiatives, including those related to funding, that maintain and enhance the quality of these services, maintain eligibility and proportionate funding, provide opportunities for consumer control, and develop new purchasing and service delivery models for these services. It is therefore the intent of this legislation to provide a framework for the delivery of services that will continue to enhance the quality of life for people with mental retardation and related developmental disabilities and refine and expand on the initiatives referred to in this section.

Sec. 74. [PCA REPORT.]

The commissioner of human services, in cooperation with advocates, consumers, counties and providers, shall develop recommendations to the 1997 legislature to align services under the personal care assistant program to more closely meet client needs. The report shall include recommendations for the delivery of personal care assistant and other services to families and children with behavioral and mental health needs. The recommendations shall also address the need for training and oversight for personal care assistants providing services to persons who are not able to direct their own care.

Sec. 75. [REIMBURSEMENT INCREASE.]

The reimbursement rate increase for personal care assistant services scheduled to go into effect on April 1, 1996, under Laws 1995, chapter 207, article 6, section 117, shall go into effect on October 1, 1997. The reimbursement rate increase for home and community-based services scheduled to go into effect on April 1, 1996, under Laws 1995, chapter 207, article 6, section 117, shall go into effect on October 1, 1996.

Sec. 76. [REPORT ON COMPENSATING CLIENTS ON PUBLIC HEALTH CARE PROGRAMS.]

The commissioner of human services shall study and report to the legislature by January 15, 1997, the advisability and feasibility of compensating clients on the public health care programs if a client has successfully reversed a private insurer's denial of health insurance. The report shall also include recommendations on reducing the parental fees under Minnesota Statutes, section 252.27, subdivision 2a, if a parent has successfully reversed a private insurer's denial of insurance. The commissioner shall ask clients, advocates, other interested persons, and the parental fee advisory committee to assist with the study.

Sec. 77. [REPEALER.]

Minnesota Statutes 1995 Supplement, section 256B.69, subdivision 4a, is repealed.

Minnesota Rules, part 9505.5230, is repealed effective July 1, 1996.

Sec. 78. [EFFECTIVE DATES.]

Section 18 (256B.03, subd. 3) is effective October 1, 1996, or upon receipt of any necessary federal approval, whichever date is later.

Sections 1 and 2 (62D.04, subd. 5 and 62N.10, subd. 4) are effective for requests for proposals issued on or after July 1, 1996.

Section 30, subdivision 3 (256B.07, subd. 3), is effective upon federal approval of this requirement.

Sections 43, 44, and 60 (256B.15, subd. 6 and 7; 256D.16) are effective for deaths occurring on or after the day following final enactment.

Section 53 (256B.69, subd. 4) is effective upon approval by the health care financing administration.

Sections 20 and 45 (256B.0575 and 256B.35, subdivision 1) are retroactive to May 1, 1995.

Section 1. Minnesota Statutes 1994, section 144.551, subdivision 1, is amended to read:

Subdivision 1. [RESTRICTED CONSTRUCTION OR MODIFICATION.] (a) The following construction or modification may not be commenced:

(1) any erection, building, alteration, reconstruction, modernization, improvement, extension, lease, or other acquisition by or on behalf of a hospital that increases the bed capacity of a hospital, relocates hospital beds from one physical facility, complex, or site to another, or otherwise results in an increase or redistribution of hospital beds within the state; and

(2) the establishment of a new hospital.

(b) This section does not apply to:

(1) construction or relocation within a county by a hospital, clinic, or other health care facility that is a national referral center engaged in substantial programs of patient care, medical research, and medical education meeting state and national needs that receives more than 40 percent of its patients from outside the state of Minnesota;

(2) a project for construction or modification for which a health care facility held an approved certificate of need on May 1, 1984, regardless of the date of expiration of the certificate;

(3) a project for which a certificate of need was denied before July 1, 1990, if a timely appeal results in an order reversing the denial;

(4) a project exempted from certificate of need requirements by Laws 1981, chapter 200, section 2;

(5) a project involving consolidation of pediatric specialty hospital services within the Minneapolis-St. Paul metropolitan area that would not result in a net increase in the number of pediatric specialty hospital beds among the hospitals being consolidated;

(6) a project involving the temporary relocation of pediatric-orthopedic hospital beds to an existing licensed hospital that will allow for the reconstruction of a new philanthropic, pediatric-orthopedic hospital on an existing site and that will not result in a net increase in the number of hospital beds. Upon completion of the reconstruction, the licenses of both hospitals must be reinstated at the capacity that existed on each site before the relocation;

(7) the relocation or redistribution of hospital beds within a hospital building or identifiable complex of buildings provided the relocation or redistribution does not result in:

(i) an increase in the overall bed capacity at that site;

(ii) relocation of hospital beds from one physical site or complex to another; or

(iii) redistribution of hospital beds within the state or a region of the state;

(8) relocation or redistribution of hospital beds within a hospital corporate system that involves the transfer of beds from a closed facility site or complex to an existing site or complex provided that: (i) no more than 50 percent of the capacity of the closed facility is transferred; (ii) the capacity of the site or complex to which the beds are transferred does not increase by more than 50 percent; (iii) the beds are not transferred outside of a federal health systems agency boundary in place on July 1, 1983; and (iv) the relocation or redistribution does not involve the construction of a new hospital building;

(9) a construction project involving up to 35 new beds in a psychiatric hospital in Rice county that primarily serves adolescents and that receives more than 70 percent of its patients from outside the state of Minnesota;

(10) a project to replace a hospital or hospitals with a combined licensed capacity of 130 beds or less if: (i) the new hospital site is located within five miles of the current site; and (ii) the total licensed capacity of the replacement hospital, either at the time of construction of the initial building or as the result of future expansion, will not exceed 70 licensed hospital beds, or the combined licensed capacity of the hospitals, whichever is less;

(11) the relocation of licensed hospital beds from an existing state facility operated by the commissioner of human services to a new or existing facility, building, or complex operated by the commissioner of human services; from one regional treatment center site to another; or from one building or site to a new or existing building or site on the same campus; or

(12) the construction or relocation of hospital beds operated by a hospital having a statutory obligation to provide hospital and medical services for the indigent that does not result in a net increase in the number of hospital beds.; or

(13) the redistribution of hospital beds within a hospital building or identifiable complex of buildings to a new hospital located within the same building or identifiable complex of buildings if:

(i) the hospital from which the beds are redistributed has a licensed capacity of over 400 beds;

(ii) the number of beds redistributed to the new hospital does not exceed 30;

(iii) the number of licensed beds in the hospital from which the beds are redistributed is reduced by 50, exclusive of the beds redistributed;

(iv) the patients to be served by the new hospital will need hospital care and will possess the clinical characteristics of patients assignable to diagnostic categories under Medicare's diagnosis related group system;

(v) the new hospital will qualify, after satisfaction of any Medicare-required waiting period, for an exclusion from the Medicare prospective payment system as a long-term care hospital pursuant to section 1886(d)(1)(B)(iv) of Title XVIII of the Social Security Act;

(vi) the new hospital agrees, under the medical assistance and general assistance medical care programs, to payment as an acute care hospital and to forego any positive difference in inpatient rates over acute care hospital rates that would otherwise be associated with its designation as a long-term care hospital, including those rates specified under section 256.969, subdivision 25;

(vii) the result of the redistribution is not an increase in the number of licensed hospital beds in this state; and

(viii) the new hospital complies with the applicable provisions of sections 144.50 to 144.55 and any applicable rules adopted thereunder.

Sec. 2. Minnesota Statutes 1995 Supplement, section 144A.071, subdivision 3, is amended to read:

Subd. 3. [EXCEPTIONS AUTHORIZING AN INCREASE IN BEDS.] The commissioner of health, in coordination with the commissioner of human services, may approve the addition of a new certified bed or the addition of a new licensed nursing home bed, under the following conditions:

(a) to license or certify a new bed in place of one decertified after July 1, 1993, as long as the number of certified plus newly certified or recertified beds does not exceed the number of beds licensed or certified on July 1, 1993, or to address an extreme hardship situation, in a particular county that, together with all contiguous Minnesota counties, has fewer nursing home beds per 1,000 elderly than the number that is ten percent higher than the national average of nursing home beds per 1,000 elderly individuals. For the purposes of this section, the national average of nursing home beds shall be the most recent figure that can be supplied by the federal health care financing administration and the number of elderly in the county or the nation shall be determined by the most recent federal census or the most recent estimate of the state demographer as of July 1, of each year of persons age 65 and older, whichever is the most recent at the time of the request for replacement. An extreme hardship situation can only be found after the county documents the existence of unmet medical needs that cannot be addressed by any other alternatives;

(b) to certify or license new beds in a new facility that is to be operated by the commissioner of veterans affairs or when the costs of constructing and operating the new beds are to be reimbursed by the commissioner of veterans affairs or the United States Veterans Administration;

(c) to license or certify beds in a facility that has been involuntarily delicensed or decertified for participation in the medical assistance program, provided that an application for relicensure or recertification is submitted to the commissioner within 120 days after delicensure or decertification; or

(d) to certify two existing beds in a facility with 66 licensed beds on January 1, 1994, that had an average occupancy rate of 98 percent or higher in both calendar years 1992 and 1993, and which began construction of four attached assisted living units in April 1993; or

(e) to certify four existing beds in a facility in Winona with 139 beds, of which 129 beds are certified.

Sec. 3. Minnesota Statutes 1995 Supplement, section 256B.431, subdivision 25, is amended to read:

Subd. 25. [CHANGES TO NURSING FACILITY REIMBURSEMENT BEGINNING JULY 1, 1995.] The nursing facility reimbursement changes in paragraphs (a) to (g) (h) shall apply in the sequence specified to Minnesota Rules, parts 9549.0010 to 9549.0080, and this section, beginning July 1, 1995.

(a) The eight-cent adjustment to care-related rates in subdivision 22, paragraph (e), shall no longer apply.

(b) For rate years beginning on or after July 1, 1995, the commissioner shall limit a nursing facility's allowable operating per diem for each case mix category for each rate year as in clauses (1) to (3).

(1) For the rate year beginning July 1, 1995, the commissioner shall group nursing facilities into two groups, freestanding and nonfreestanding, within each geographic group, using their operating cost per diem for the case mix A classification. A nonfreestanding nursing facility is a nursing facility whose other operating cost per diem is subject to the hospital attached, short length of stay, or the rule 80 limits. All other nursing facilities shall be considered freestanding nursing facilities. The commissioner shall then array all nursing facilities in each grouping by their allowable case mix A operating cost per diem. In calculating a nursing facility's operating cost per diem for this purpose, the commissioner shall exclude the raw food cost per diem related to providing special diets that are based

on religious beliefs, as determined in subdivision 2b, paragraph (h). For those nursing facilities in each grouping whose case mix A operating cost per diem:

(i) is at or below the median minus 1.0 standard deviation of the array, the commissioner shall limit the nursing facility's allowable operating cost per diem for each case mix category to the lesser of the prior reporting year's allowable operating cost per diems plus the inflation factor as established in paragraph (f) (g), clause (2), increased by six percentage points, or the current reporting year's corresponding allowable operating cost per diem;

(ii) is between minus .5 standard deviation and minus 1.0 standard deviation below the median of the array, the commissioner shall limit the nursing facility's allowable operating cost per diem for each case mix category to the lesser of the prior reporting year's allowable operating cost per diems plus the inflation factor as established in paragraph (f) (g), clause (2), increased by four percentage points, or the current reporting year's corresponding allowable operating cost per diem; or

(iii) is equal to or above minus .5 standard deviation below the median of the array, the commissioner shall limit the nursing facility's allowable operating cost per diem for each case mix category to the lesser of the prior reporting year's allowable operating cost per diems plus the inflation factor as established in paragraph (f) (g), clause (2), increased by three percentage points, or the current reporting year's corresponding allowable operating cost per diem.

(2) For the rate year beginning on July 1, 1996, the commissioner shall index the prior reporting year's limit as computed in clause (1) for each nursing facility by the inflation factor as established in paragraph (g), clause (2), plus one percentage point. The commissioner shall limit the nursing facility's allowable operating cost per diem for each case mix category to the lesser of the prior reporting year's allowable operating cost per diems plus the inflation factor as established in paragraph (f), clause (2), increased by one percentage point facility's indexed limit or the current reporting year's corresponding allowable operating cost per diems; and

(3) For rate years beginning on or after July 1, 1997, the commissioner shall limit the nursing facility's allowable operating cost per diem for each case mix category to the lesser of the reporting year prior to the current reporting year's allowable operating cost per diems plus the inflation factor as established in paragraph (f) (g), clause (2), or the current reporting year's corresponding allowable operating cost per diems.

(c) For rate years beginning on July 1, 1995, the commissioner shall limit the allowable operating cost per diems for high cost nursing facilities. After application of the limits in paragraph (b) to each nursing facility's operating cost per diems, the commissioner shall group nursing facilities into two groups, freestanding or nonfreestanding, within each geographic group. A nonfreestanding nursing facility is a nursing facility whose other operating cost per diems are subject to hospital attached, short length of stay, or rule 80 limits. All other nursing facilities shall be considered freestanding nursing facilities. The commissioner shall then array all nursing facilities within each grouping by their allowable case mix A operating cost per diems. In calculating a nursing facility's operating cost per diem for this purpose, the commissioner shall exclude the raw food cost per diem related to providing special diets that are based on religious beliefs, as determined in subdivision 2b, paragraph (h). For those nursing facilities in each grouping whose case mix A operating cost per diem exceeds 1.0 standard deviation above the median, the commissioner shall reduce their allowable operating cost per diems by two percent. For those nursing facilities in each grouping whose case mix A operating cost per diem exceeds 0.5 standard deviation above the median but is less than or equal to 1.0 standard deviation above the median, the commissioner shall reduce their allowable operating cost per diems by one percent.

(d) For the rate year beginning July 1, 1996, the commissioner shall limit the allowable operating cost per diems for high cost nursing facilities. After application of the limits in paragraph (b) to each nursing facility's operating cost per diems, the commissioner shall group nursing facilities into two groups, freestanding or nonfreestanding, within each geographic group. A nonfreestanding nursing facility is a nursing facility whose other operating cost per diems are subject to hospital attached, short length-of-stay, or rule 80 limits. The commissioner shall index each of the high cost limits determined for the prior rate year by the inflation factor in paragraph (g), clause (2), plus one percentage point. If a nursing facility's case mix A operating cost per diem exceeds the limit for its group which corresponded to 1.0 standard deviation of the median, the commissioner shall reduce their allowable operating cost per diems by two percent. If a nursing facility's case mix A operating cost per diem exceeds the limit for its group which corresponded to .5 standard deviation of the median but is less than the limit at 1.0 standard deviation above the median, the commissioner shall reduce their allowable operating cost per diems by one percent. In no case shall the amount of the reduction result in the nursing facility's allowable operating cost per diem less than its limit.

(e) For rate years beginning on or after July 1, 1996 1997, the commissioner shall limit the allowable operating cost per diems for high cost nursing facilities. After application of the limits in paragraph (b) to each nursing facility's operating cost per diems, the commissioner shall group nursing facilities into two groups, freestanding or nonfreestanding, within each geographic group. A nonfreestanding nursing facility is a nursing facility whose other

operating cost per diems are subject to hospital attached, short length of stay, or rule 80 limits. All other nursing facilities shall be considered freestanding nursing facilities. The commissioner shall then array all nursing facilities within each grouping by their allowable case mix A operating cost per diems. In calculating a nursing facility's operating cost per diem for this purpose, the commissioner shall exclude the raw food cost per diem related to providing special diets that are based on religious beliefs, as determined in subdivision 2b, paragraph (h). In those nursing facilities in each grouping whose case mix A operating cost per diem exceeds 1.0 standard deviation above the median, the commissioner shall reduce their allowable operating cost per diems by three percent. For those nursing facilities in each grouping whose case mix A operating cost per diem exceeds 0.5 standard deviation above the median but is less than or equal to 1.0 standard deviation above the median, the commissioner shall reduce their allowable operating cost per diems by two percent.

(e) (f) For rate years beginning on or after July 1, 1995, the commissioner shall determine a nursing facility's efficiency incentive by first computing the allowable difference, which is the lesser of $4.50 or the amount by which the facility's other operating cost limit exceeds its nonadjusted other operating cost per diem for that rate year. The commissioner shall compute the efficiency incentive by:

(1) subtracting the allowable difference from $4.50 and dividing the result by $4.50;

(2) multiplying 0.20 by the ratio resulting from clause (1), and then;

(3) adding 0.50 to the result from clause (2); and

(4) multiplying the result from clause (3) times the allowable difference.

The nursing facility's efficiency incentive payment shall be the lesser of $2.25 or the product obtained in clause (4).

(f) (g) For rate years beginning on or after July 1, 1995, the forecasted price index for a nursing facility's allowable operating cost per diems shall be determined under clauses (1) to (3) using the change in the Consumer Price Index-All Items (United States city average) (CPI-U) or the change in the Nursing Home Market Basket, both as forecasted by Data Resources Inc., whichever is applicable. The commissioner shall use the indices as forecasted in the fourth quarter of the calendar year preceding the rate year, subject to subdivision 2l, paragraph (c). If, as a result of federal legislative or administrative action, the methodology used to calculate the Consumer Price Index-All Items (United States city average) (CPI-U) changes, the commissioner shall develop a conversion factor or other methodology to convert the CPI-U index factor that results from the new methodology to an index factor that approximates, as closely as possible, the index factor that would have resulted from application of the original CPI-U methodology prior to any changes in methodology. The commissioner shall use the conversion factor or other methodology to calculate an adjusted inflation index. The adjusted inflation index must be used to calculate payment rates under this section instead of the CPI-U index specified in paragraph (d) (e). If the commissioner is required to develop an adjusted inflation index, the commissioner shall report to the legislature as part of the next budget submission the fiscal impact of applying this index.

(1) The CPI-U forecasted index for allowable operating cost per diems shall be based on the 21-month period from the midpoint of the nursing facility's reporting year to the midpoint of the rate year following the reporting year.

(2) The Nursing Home Market Basket forecasted index for allowable operating costs and per diem limits shall be based on the 12-month period between the midpoints of the two reporting years preceding the rate year.

(3) For rate years beginning on or after July 1, 1996, the forecasted index for operating cost limits referred to in subdivision 21, paragraph (b), shall be based on the CPI-U for the 12-month period between the midpoints of the two reporting years preceding the rate year.

(g) (h) After applying these provisions for the respective rate years, the commissioner shall index these allowable operating costs per diems by the inflation factor provided for in paragraph (f) (g), clause (1), and add the nursing facility's efficiency incentive as computed in paragraph (e) (f).

Sec. 4. Minnesota Statutes 1995 Supplement, section 256B.501, subdivision 5b, is amended to read:

Subd. 5b. [ICF/MR OPERATING COST LIMITATION AFTER SEPTEMBER 30, 1995.] (a) For rate years beginning on or after October 1, 1995, and October 1, 1996, the commissioner shall limit the allowable operating cost per diems, as determined under this subdivision and the reimbursement rules, for high cost ICF's/MR. Prior to indexing each

facility's operating cost per diems for inflation, the commissioner shall group the facilities into eight groups. The commissioner shall then array all facilities within each grouping by their general operating cost per service unit per diems.

(b) The commissioner shall annually review and adjust the general operating costs incurred by the facility during the reporting year preceding the rate year to determine the facility's allowable historical general operating costs. For this purpose, the term general operating costs means the facility's allowable operating costs included in the program, maintenance, and administrative operating costs categories, as well as the facility's related payroll taxes and fringe benefits, real estate insurance, and professional liability insurance. A facility's total operating cost payment rate shall be limited according to paragraphs (c) and (d) as follows:

(c) A facility's total operating cost payment rate shall be equal to its allowable historical operating cost per diems for program, maintenance, and administrative cost categories multiplied by the forecasted inflation index in subdivision 3c, clause (1), subject to the limitations in paragraph (d).

(d) For the rate years beginning on or after October 1, 1995, the commissioner shall establish maximum overall general operating cost per service unit limits for facilities according to clauses (1) to (8). Each facility's allowable historical general operating costs and client assessment information obtained from client assessments completed under subdivision 3g for the reporting year ending December 31, 1994 (the base year), shall be used for establishing the overall limits. If a facility's proportion of temporary care resident days to total resident days exceeds 80 percent, the commissioner must exempt that facility from the overall general operating cost per service unit limits in clauses (1) to (8). For this purpose, "temporary care" means care provided by a facility to a client for less than 30 consecutive resident days.

(1) The commissioner shall determine each facility's weighted service units for the reporting year by multiplying its resident days in each client classification level as established in subdivision 3g, paragraph (d), by the corresponding weights for that classification level, as established in subdivision 3g, paragraph (i), and summing the results. For the reporting year ending December 31, 1994, the commissioner shall use the service unit score computed from the client classifications determined by the Minnesota department of health's annual review, including those of clients admitted during that year.

(2) The facility's service unit score is equal to its weighted service units as computed in clause (1), divided by the facility's total resident days excluding temporary care resident days, for the reporting year.

(3) For each facility, the commissioner shall determine the facility's cost per service unit by dividing its allowable historical general operating costs for the reporting year by the facility's service unit score in clause (2) multiplied by its total resident days, or 85 percent of the facility's capacity days times its service unit score in clause (2), if the facility's occupancy is less than 85 percent of licensed capacity. If a facility reports temporary care resident days, the temporary care resident days shall be multiplied by the service unit score in clause (2), and the resulting weighted resident days shall be added to the facility's weighted service units in clause (1) prior to computing the facility's cost per service unit under this clause.

(4) The commissioner shall group facilities based on class A or class B licensure designation, number of licensed beds, and geographic location. For purposes of this grouping, facilities with six beds or less shall be designated as small facilities and facilities with more than six beds shall be designated as large facilities. If a facility has both class A and class B licensed beds, the facility shall be considered a class A facility for this purpose if the number of class A beds is more than half its total number of ICF/MR beds; otherwise the facility shall be considered a class B facility. The metropolitan geographic designation shall include Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington counties. All other Minnesota counties shall be designated as the nonmetropolitan geographic group. These characteristics result in the following eight groupings:

(i) small class A metropolitan;

(ii) large class A metropolitan;

(iii) small class B metropolitan;

(iv) large class B metropolitan;

(v) small class A nonmetropolitan;

(vi) large class A nonmetropolitan;

(vii) small class B nonmetropolitan; and

(viii) large class B nonmetropolitan.

(5) The commissioner shall array facilities within each grouping in clause (4) by each facility's cost per service unit as determined in clause (3).

(6) In each array established under clause (5), facilities with a cost per service unit at or above the median shall be limited to the lesser of:

(i) the current reporting year's cost per service unit; or

(ii) the prior reporting year's allowable historical general operating cost per service unit plus the inflation factor as established in subdivision 3c, clause (2), increased by three percentage points. For the rate year beginning on October 1, 1996, the commissioner shall array facilities within each grouping in clause (4) by each facility's cost-per-resident day. A facility's cost-per-resident day shall be determined by dividing its allowable historical general operating cost for the reporting year by the facility's resident days for that reporting year. Facilities with a cost-per-resident day at or above the median shall be limited to the lesser of:

(a) the current reporting year's cost-per-resident day; or

(b) the prior reporting year's cost-per-resident day plus the inflation factor as established in subdivision 3c, clause (2), increased by three percentage points.

(7) The overall operating cost per service unit limit for each group shall be established as follows:

(i) each array established under clause (5) shall be arrayed again after the application of clause (6);

(ii) in each array established in clause (5), two general operating cost limits shall be determined. The first cost per service unit limit shall be established at 0.5 and less than or equal to 1.0 standard deviation above the median of that array. The second cost per service unit limit shall be established at 1.0 standard deviation above the median of the array; and

(iii) the overall operating cost per service unit limits shall be indexed for inflation annually beginning with the reporting year ending December 31, 1995, using the forecasted inflation index in subdivision 3c, clause (2).

(8) Annually, facilities shall be arrayed using the method described in clauses (5) and (7). Each facility with a cost per service unit at or above its group's first cost per service unit limit, but less than the second cost per service unit limit for that group, shall be limited to 98 percent of its total operating cost per diems then add the forecasted inflation index in subdivision 3c, clause (1). Each facility with a cost per service unit at or above the second cost per service unit limit will be limited to 97 percent of its total operating cost per diems, then add the forecasted inflation index in subdivision 3c, clause (1). For the rate year beginning on October 1, 1996, each facility with a cost-per-service unit at or above its group limits shall have its total operating cost per diem reduced according to the percentages below:

Facility's # of .5 Std. Dev. Greater than

Licensed Beds to 1 Std. Dev. 1 Std. Dev.

1 to 16 0.5% 1%

17 or more 1.0% 2%

In no case shall the amount of the high cost reduction result in a facility's cost per service unit being reduced below its applicable limit. The commissioner shall then add the inflation index in subdivision 3c, clause (1).

(9) The commissioner may rebase these overall limits, using the method described in this subdivision but no more frequently than once every three years.

(e) For rate years beginning on or after October 1, 1995, the facility's efficiency incentive shall be determined as provided in the reimbursement rule.

(f) The total operating cost payment rate shall be the sum of paragraphs (c) and (e).

(g) For rate years beginning on or after October 1, 1996, the commissioner shall exempt a facility from the reductions in this subdivision if the facility is involved in a bed relocation project where more than 25 percent of the facility's beds are transferred to another facility.

(h) For rate years beginning on or after October 1, 1997, the commissioner shall use the methodology in this section in effect on March 1, 1996, in rules promulgated pursuant to subdivision 3. The commissioner may use the client assessment system in subdivision 3g and is not required to adopt through rulemaking the provision in subdivision 3g. However, the commissioner, in consultation with the commissioner of health, may consider changes to the classifications, weights, assessment points, documentation requirements, or other provisions of the client assessment process and shall propose recommendations to the legislature as necessary.

Sec. 5. Minnesota Statutes 1995 Supplement, section 256B.501, subdivision 5c, is amended to read:

Subd. 5c. [OPERATING COSTS AFTER SEPTEMBER 30, 1979 1999.] (a) In general, the commissioner shall establish maximum standard rates for the prospective reimbursement of facility costs. The maximum standard rates must take into account the level of reimbursement which is adequate to cover the base-level costs of economically operated facilities. In determining the base-level costs, the commissioner shall consider geographic location, types of facilities (class A or class B), minimum staffing standards, resident assessment under subdivision 3g, and other factors as determined by the commissioner.

(b) The commissioner shall may also develop additional incentive-based payments which, if achieved for specified outcomes, will be added to the maximum standard rates. The specified outcomes must be measurable and shall be based on criteria to be developed by the commissioner during fiscal year 1996. The commissioner may establish various levels of achievement within an outcome. Once the outcomes are established, the commissioner shall assign various levels of payment associated with achieving the outcome. In establishing the specified outcomes and the related criteria, the commissioner shall consider the following state policy objectives:

(1) resident transitioned into cost-effective community alternatives;

(2) the results of a uniform consumer satisfaction survey;

(3) the achievement of no major licensure or certification deficiencies; or

(4) any other outcomes the commissioner finds desirable. The commissioner may also consider the findings of projects examining services to persons with developmental disabilities, including outcome-based quality assurance methods, and the inclusion of persons with developmental disabilities in managed care alternative service delivery models.

(c) In developing the maximum standard rates and the incentive-based payments, desirable outcomes, and related criteria, the commissioner, in collaboration with the commissioner of health, shall form an advisory committee. The membership of the advisory committee shall include representation from the consumers advocacy groups (3), the two facility trade associations (3 each), counties (3), commissioner of finance (1), the legislature (2 each from both the house and senate), and others the commissioners find appropriate.

(d) Beginning July 1, 1996 1998, the commissioner shall collect the data from the facilities, the department of health, or others as necessary to determine the extent to which a facility has met any of the outcomes and related criteria. Payment rates under this subdivision shall be effective October 1, 1997 1999.

(e) The commissioner shall report to the legislature on the progress of the advisory committee by January 31, 1996, any necessary changes to the reimbursement methodology proposed under this subdivision 1998. By January 15, 1997 1999, the commissioner shall recommend to the legislature legislation which will implement this reimbursement methodology for rate years beginning on or after the proposed effective date of October 1, 1997 1999.

Sec. 6. Minnesota Statutes 1994, section 256B.501, is amended by adding a subdivision to read:

Subd. 5d. [ADJUSTMENT FOR OUTREACH CRISIS SERVICES.] An ICF/MR with crisis services developed under the authority of Laws 1992, chapter 513, article 9, section 40, shall have its operating cost per diem calculated according to paragraphs (a) and (b).

(a) Effective for rate years beginning on or after October 1, 1995, the maintenance limitation in Minnesota Rules, part 9553.0050, subpart 1, item A, subitem (2), shall be calculated to reflect capacity as of October 1, 1992. The maintenance limit shall be the per diem limitation otherwise in effect adjusted by the ratio of licensed capacity days as of October 1, 1992, divided by resident days in the reporting year ending December 31, 1993.

(b) Effective for rate years beginning on or after October 1, 1995, the operating cost per service unit, for purposes of the cost per service unit limit in section 256B.501, subdivision 5b, paragraph (d), clauses (7) and (8), shall be calculated after excluding the costs directly identified to the provision of outreach crisis services and a four-bed crisis unit.

(c) The efficiency incentive paid to an ICF/MR shall not be increased as a result of this subdivision.

Section 1. [62J.69] [MEDICAL EDUCATION AND RESEARCH TRUST FUND.]

Subdivision 1. [PURPOSE.] Since all health care stakeholders, as well as society at large, benefit from medical education and health care research, and the costs of these activities should be fairly allocated across the health care system, the commissioner of health shall appoint an advisory commission to assist in the development and implementation of a mechanism by which to administer a special trust fund to be set up for funding the activities of medical education and research.

Subd. 2. [DEFINITIONS.] For purposes of this section, the following definitions apply:

(a) "Medical education" means the accredited clinical training of physicians (medical students and residents), dentists, advanced practice nurses (clinical nurse specialist, certified registered nurse anesthetists, nurse practitioners, and certified nurse midwives), and physician assistants.

(b) "Clinical training" means accredited training that occurs in both inpatient and ambulatory care settings.

(c) "Trainee" means students involved in an accredited clinical training program for medical education as defined in paragraph (a).

(d) "Health care research" means approved clinical, outcomes, and health services investigations that are funded by patient out-of-pocket expenses or a third-party payor.

(e) "Commissioner" means the commissioner of health.

(f) "Teaching institution" means any hospital, medical center, clinic, or other organization that currently sponsors or conducts accredited medical education programs or clinical research in Minnesota.

Subd. 3. [ALLOCATION AND FUNDING FOR MEDICAL EDUCATION AND RESEARCH.] (a) The commissioner shall establish a trust fund for the purposes of funding medical education and research activities in the state of Minnesota.

(b) By January 1, 1997, the commissioner shall appoint a commission to provide advice and oversight on the distribution of funds from the medical education and research trust fund. The commissioner shall: (1) consider the interest of all stakeholders when selecting commission members; (2) select members that represent both urban and rural interest; and (3) select members that include ambulatory care as well as inpatient perspectives. The commissioner shall appoint to the commission representatives of the following groups: medical researchers, public and private academic medical centers, managed care organizations, Blue Cross and Blue Shield of Minnesota, commercial carriers, Minnesota Medical Association, Minnesota Nurses Association, employers, and other relevant stakeholders, including consumers. The commission is governed by section 15.059 for membership terms and removal of members and will sunset on June 30, 1999.

(c) Eligible applicants for funds include teaching institutions or consortia directly involved in an accredited medical education training. Applications must be received by September 30 of each year for distribution by January 1 of the following year. An application for funds must include the following:

(1) the official name and address of the institution, facility, or program that is applying for funding;

(2) the name, title, and business address of those persons responsible for administering the funds;

(3) the total number, type, and specialty orientation of eligible trainees in each accredited medical education program applying for funds;

(4) audited clinical training costs per trainee for each medical education program;

(5) a description of current sources of funding for medical education costs including a description and dollar amount of all state and federal financial support;

(6) other revenue received for the purposes of clinical training;

(7) a statement identifying unfunded costs; and

(8) other supporting information the commissioner, with advice from the advisory commission, determines is necessary for the equitable distribution of funds.

(d) The commissioner shall distribute medical education funds to all qualifying applicants based on the following basic criteria: (1) total medical education funds available; (2) total trainees in each eligible education program; (3) the statewide average cost per trainee, by type of trainee, in each medical education program. Funds distributed shall not be used to displace current funding appropriations from federal or state sources.

(e) Medical education programs receiving funds from the trust fund must submit annual cost and program reports based on criteria established by the commissioner. The reports must include:

(1) the total number of eligible trainees in the program;

(2) the type of programs and residencies funded;

(3) the average cost per trainee and a detailed breakdown of the components of those costs;

(4) other state or federal appropriations received for the purposes of clinical training;

(5) other revenue received for the purposes of clinical training; and

(6) other information the commissioner, with advice from the advisory commission, deems appropriate to evaluate the effectiveness of the use of funds for clinical training.

The commissioner, with advice from the advisory commission, will provide an annual summary report to the legislature on program implementation due February 15 of each year.

(f) The commissioner is authorized to distribute additional funds made available through:

(1) voluntary contributions by employers or other entities;

(2) allocations for the department of human services to support medical education and research; and

(3) other sources as identified and deemed appropriate by the legislature for inclusion in the trust fund.

(g) The commission shall continue to study and make recommendations on:

(1) the funding of medical research consistent with work currently mandated by the legislature and under way at the department of health; and

(2) the costs and benefits associated with medical education and research.

Sec. 2. Minnesota Statutes 1994, section 62Q.075, subdivision 2, is amended to read:

Subd. 2. [REQUIREMENT.] Beginning July 1, 1995 October 31, 1997, all managed care organizations shall annually file biennially with the action plans required under section 62Q.07 a plan describing the actions the managed care organization has taken and those it intends to take to contribute to achieving public health goals for each service area

in which an enrollee of the managed care organization resides. This plan must be jointly developed in collaboration with the local public health units, appropriate regional coordinating boards, and other community organizations providing health services within the same service area as the managed care organization. Local government units with responsibilities and authority defined under chapters 145A and 256E may designate individuals to participate in the collaborative planning with the managed care organization to provide expertise and represent community needs and goals as identified under chapters 145A and 256E.

Sec. 3. Minnesota Statutes 1995 Supplement, section 62Q.19, subdivision 1, is amended to read:

Subdivision 1. [DESIGNATION.] The commissioner shall designate essential community providers. The criteria for essential community provider designation shall be the following:

(1) a demonstrated ability to integrate applicable supportive and stabilizing services with medical care for uninsured persons and high-risk and special needs populations as defined in section 62Q.07, subdivision 2, paragraph (e), underserved, and other special needs populations; and

(2) a commitment to serve low-income and underserved populations by meeting the following requirements:

(i) has nonprofit status in accordance with chapter 317A;

(ii) has tax exempt status in accordance with the Internal Revenue Service Code, section 501(c)(3);

(iii) charges for services on a sliding fee schedule based on current poverty income guidelines; and

(iv) does not restrict access or services because of a client's financial limitation; or

(3) status as a local government unit as defined in section 62D.02, subdivision 11, an Indian tribal government, an Indian health service unit, or community health board as defined in chapter 145A; or

(4) a former state hospital that specializes in the treatment of cerebral palsy, spina bifida, epilepsy, closed head injuries, specialized orthopedic problems, and other disabling conditions.

Prior to designation, the commissioner shall publish the names of all applicants in the State Register. The public shall have 30 days from the date of publication to submit written comments to the commissioner on the application. No designation shall be made by the commissioner until the 30-day period has expired.

The commissioner may designate an eligible provider as an essential community provider for all the services offered by that provider or for specific services designated by the commissioner.

For the purpose of this subdivision, supportive and stabilizing services include at a minimum, transportation, child care, cultural, and linguistic services where appropriate.

Sec. 4. Minnesota Statutes 1995 Supplement, section 62Q.19, subdivision 5, is amended to read:

Subd. 5. [CONTRACT PAYMENT RATES.] An essential community provider and a health plan company may negotiate the payment rate for covered services provided by the essential community provider. This rate must be at least the same rate per unit of service as is paid to other health plan providers for the same or similar services.

Sec. 5. Minnesota Statutes 1995 Supplement, section 62R.17, is amended to read:

62R.17 [PROVIDER COOPERATIVE DEMONSTRATION.]

(a) A health provider cooperative incorporated and having adopted bylaws before May 1, 1995, that has members who provide services in Sibley, Nicollet, Blue Earth, Brown, Watonwan, Martin, Faribault, Waseca, and LeSueur counties, may contract with a qualified employer or self-insured employer plan to provide health care services in accordance with sections 62R.17 to 62R.26.

(b) A health provider cooperative incorporated and having adopted bylaws before July 1, 1995, that has members who provide services in Big Stone, Chippewa, Cottonwood, Jackson, Kandiyohi, Lac Qui Parle, Lincoln, Lyon, McLeod, Meeker, Murray, Nobles, Pipestone, Redwood, Renville, Rock, Swift, and Yellow Medicine counties, may contract with a qualified employer or self-insured employer plan to provide health care services in accordance with sections 62R.17 to 62R.26.

(c) The health provider cooperative, the qualified employer, or the self-insured employer plan shall not, solely on account of that contract, be subject to any provision of Minnesota Statutes relating to health carriers except as provided in section 62R.21. The grant of contracting power under this section shall not be interpreted to permit or prohibit any other lawful arrangement between a health care provider and a self-insured employee welfare benefit plan or its sponsor.

Sec. 6. Minnesota Statutes 1995 Supplement, section 144.122, is amended to read:

144.122 [LICENSE AND PERMIT FEES.]

(a) The state commissioner of health, by rule, may prescribe reasonable procedures and fees for filing with the commissioner as prescribed by statute and for the issuance of original and renewal permits, licenses, registrations, and certifications issued under authority of the commissioner. The expiration dates of the various licenses, permits, registrations, and certifications as prescribed by the rules shall be plainly marked thereon. Fees may include application and examination fees and a penalty fee for renewal applications submitted after the expiration date of the previously issued permit, license, registration, and certification. The commissioner may also prescribe, by rule, reduced fees for permits, licenses, registrations, and certifications when the application therefor is submitted during the last three months of the permit, license, registration, or certification period. Fees proposed to be prescribed in the rules shall be first approved by the department of finance. All fees proposed to be prescribed in rules shall be reasonable. The fees shall be in an amount so that the total fees collected by the commissioner will, where practical, approximate the cost to the commissioner in administering the program. All fees collected shall be deposited in the state treasury and credited to the state government special revenue fund unless otherwise specifically appropriated by law for specific purposes.

(b) The commissioner may charge a fee for voluntary certification of medical laboratories and environmental laboratories, and for environmental and medical laboratory services provided by the department, without complying with paragraph (a) or chapter 14. Fees charged for environment and medical laboratory services provided by the department must be approximately equal to the costs of providing the services.

(c) The commissioner may develop a schedule of fees for diagnostic evaluations conducted at clinics held by the services for children with handicaps program. All receipts generated by the program are annually appropriated to the commissioner for use in the maternal and child health program.

(d) The commissioner, for fiscal years 1996 and beyond, shall set license fees for hospitals and nursing homes that are not boarding care homes at the following levels:

Joint Commission on Accreditation of Healthcare

Organizations (JCAHO hospitals) $1,017

Non-JCAHO hospitals $762 plus $34 per bed

Nursing home $78 plus $19 per bed

For fiscal years 1996 and beyond, the commissioner shall set license fees for outpatient surgical centers, boarding care homes, and supervised living facilities at the following levels:

Outpatient surgical centers $517

Boarding care homes $78 plus $19 per bed

Supervised living facilities $78 plus $19 per bed.

(e) Unless prohibited by federal law, the commissioner of health shall charge applicants the following fees to cover the cost of any initial certification surveys required to determine a provider's eligibility to participate in the Medicare or Medicaid program:

Prospective payment surveys for hospitals $ 900

Swing bed surveys for nursing homes $1200

Psychiatric hospitals $1400

Rural health facilities $1100

Portable X-ray providers $ 500

Home health agencies $1800

Outpatient therapy agencies $ 800

End stage renal dialysis providers $2100

Independent therapists $ 800

Comprehensive rehabilitation outpatient facilities$1200

Hospice providers $1700

Ambulatory surgical providers $1800

Hospitals $4200

Other provider categories or Actual surveyor costs:

additional resurveys required average surveyor cost x

to complete initial certification number of hours for the

survey process.

These fees shall be submitted at the time of the application for federal certification and shall not be refunded. All fees collected shall be deposited in the state treasury and credited to the state government special revenue fund.

Sec. 7. [144.2215] [BIRTH DEFECTS REGISTRY SYSTEM.]

The commissioner of health shall develop a statewide birth defects registry system to provide for the collection, analysis, and dissemination of birth defects information. The commissioner shall consult with representatives and experts in epidemiology, medicine, insurance, health maintenance organizations, genetics, consumers, and voluntary organizations in developing the system and may phase in the implementation of the system.

Sec. 8. Minnesota Statutes 1994, section 144.71, subdivision 1, is amended to read:

Subdivision 1. [HEALTH AND SAFETY.] The purpose of sections 144.71 to 144.74 is to protect the health and safety of children persons in attendance at children's youth camps.

Sec. 9. Minnesota Statutes 1994, section 144.71, subdivision 2, is amended to read:

Subd. 2. [DEFINITION.] For the purpose of such sections a children's youth camp is defined as a parcel or parcels of land with permanent buildings, tents or other structures together with appurtenances thereon, established or maintained as living quarters where both food and beverage service and lodging or the facilities therefor are provided for ten or more people, operated continuously for a period of five days or more each year for educational, recreational or vacation purposes, and the use of the camp is offered to minors free of charge or for payment of a fee.

Sec. 10. Minnesota Statutes 1994, section 144.72, subdivision 1, is amended to read:

Subdivision 1. [PERMITS.] The state commissioner of health is authorized to issue permits for the operation of such children's youth camps and such camps which are required to obtain such the permits.

Sec. 11. Minnesota Statutes 1994, section 144.72, subdivision 2, is amended to read:

Subd. 2. [APPLICATION.] On or before June first annually, every person, partnership, limited liability company or corporation, operating or seeking to operate a children's youth camp, shall make application in writing to the commissioner for a permit to conduct a children's youth camp. Such application shall be in such form and shall

contain such information as the commissioner may find necessary to determine that the children's youth camp will be operated and maintained in such a manner as to protect and preserve the health and safety of the persons using the camp. Where a person, partnership, limited liability company or corporation operates or is seeking to operate more than one children's youth camp, a separate application shall be made for each camp.

Sec. 12. Minnesota Statutes 1994, section 144.73, subdivision 1, is amended to read:

Subdivision 1. [INSPECTION OF CAMPS.] It shall be the duty of the state commissioner of health to make an annual inspection of each children's youth camp, and where, upon inspection it is found that there is a failure to protect the health and safety of the persons using the camp, or a failure to comply with the camp rules prescribed by the commissioner, the commissioner shall give notice to the camp operator of such failure, which notice shall set forth the reason or reasons for such failure.

Sec. 13. Minnesota Statutes 1994, section 144.74, is amended to read:

144.74 [RULES, STANDARDS.]

The state commissioner of health is authorized to adopt and enforce such reasonable rules and standards as the commissioner determines necessary to protect the health and safety of children persons in attendance at children's youth camps. Such rules and standards may include reasonable restrictions and limitations on the following:

(1) Camp sites and buildings, including location, layout, lighting, ventilation, heating, plumbing, drainage and sleeping quarters;

(2) Sanitary facilities, including water supply, toilet and shower facilities, sewage and excreta disposal, waste and garbage disposal, and the control of insects and rodents, and

(3) Food service, including storage, refrigeration, sanitary preparation and handling of food, the cleanliness of kitchens and the proper functioning of equipment.

Sec. 14. Minnesota Statutes 1995 Supplement, section 144.9503, subdivision 6, is amended to read:

Subd. 6. [VOLUNTARY LEAD HAZARD REDUCTION.] The commissioner shall monitor the lead hazard reduction methods adopted under section 144.9508 in cases of voluntary lead hazard reduction. All contractors hired to do voluntary lead hazard reduction must be licensed lead contractors. If a property owner does not use a lead contractor for voluntary lead hazard reduction, the property owner shall provide the commissioner with a plan for lead hazard reduction at least ten working days before beginning the lead hazard reduction. The plan must include the details required in section 144.9505, and notice as to when lead hazard reduction activities will begin. Within the limits of appropriations, the commissioner shall review plans and shall approve or disapprove them as to compliance with the requirements in section 144.9505. No penalty shall be assessed against a property owner for discontinuing voluntary lead hazard reduction before completion of the plan, provided that the property owner discontinues the plan in a manner that leaves the property in a condition no more hazardous than its condition before the plan implementation.

Sec. 15. Minnesota Statutes 1995 Supplement, section 144.9503, subdivision 8, is amended to read:

Subd. 8. [CERTIFICATION FOR LEAD-SAFE HOUSING.] The commissioner shall propose to the legislature a program to certify residences as lead safe by February 15, 1996 1997.

Sec. 16. Minnesota Statutes 1995 Supplement, section 144.9503, subdivision 9, is amended to read:

Subd. 9. [LANDLORD TENANT STUDY.] Within the limits of appropriations, the commissioner of health shall conduct or contract for a study of the legal responsibilities of tenants and landlords in the prevention of lead hazards, and shall report the findings to the legislature, along with recommendations as to any changes needed to clarify or modify current law by January 15, 1996. In conducting the study, the commissioner shall convene any public meetings necessary to hear the testimony and recommendations of interested parties, and shall invite and consider written public comments.

Sec. 17. Minnesota Statutes 1995 Supplement, section 144.9504, subdivision 2, is amended to read:

Subd. 2. [LEAD INSPECTION.] (a) An inspecting agency shall conduct a lead inspection of a residence according to the venous blood lead level and time frame set forth in clauses (1) to (4) for purposes of secondary prevention:

(1) within 48 hours of a child or pregnant female in the residence being identified to the agency as having a venous blood lead level equal to or greater than 70 micrograms of lead per deciliter of whole blood;

(2) within five working days of a child or pregnant female in the residence being identified to the agency as having a venous blood lead level equal to or greater than 45 micrograms of lead per deciliter of whole blood;

(3) within ten working days of a child or pregnant female in the residence being identified to the agency as having a venous blood lead level equal to or greater than 20 micrograms of lead per deciliter of whole blood; or

(4) within ten working days of a child or pregnant female in the residence being identified to the agency as having a venous blood lead level that persists in the range of 15 to 19 micrograms of lead per deciliter of whole blood for 90 days after initial identification.

(b) Within the limits of available state and federal appropriations, an inspecting agency may also conduct a lead inspection for children with any elevated blood lead level.

(c) In a building with two or more dwelling units, an inspecting agency shall inspect the individual unit in which the conditions of this section are met and shall also inspect all common areas. If a child visits one or more other sites such as another residence, or a residential or commercial child care facility, playground, or school, the inspecting agency shall also inspect the other sites. The inspecting agency shall have one additional day added to the time frame set forth in this subdivision to complete the lead inspection for each additional site.

(d) Within the limits of appropriations, the inspecting agency shall identify the known addresses for the previous 12 months of the child or pregnant female with elevated blood lead levels; notify the property owners, landlords, and tenants at those addresses that an elevated blood lead level was found in a person who resided at the property; and give them a copy of the lead inspection guide. This information shall be classified as private data on individuals as defined under section 13.02, subdivision 12.

(e) The inspecting agency shall conduct the lead inspection according to rules adopted by the commissioner under section 144.9508. An inspecting agency shall have lead inspections performed by lead inspectors licensed by the commissioner according to rules adopted under section 144.9508. If a property owner refuses to allow an inspection, the inspecting agency shall begin legal proceedings to gain entry to the property and the time frame for conducting a lead inspection set forth in this subdivision no longer applies. An inspector or inspecting agency may observe the performance of lead hazard reduction in progress and shall enforce the provisions of this section under section 144.9509. Deteriorated painted surfaces, bare soil, dust, and drinking water must be tested with appropriate analytical equipment to determine the lead content, except that deteriorated painted surfaces or bare soil need not be tested if the property owner agrees to engage in lead hazard reduction on those surfaces.

(f) A lead inspector shall notify the commissioner and the board of health of all violations of lead standards under section 144.9508, that are identified in a lead inspection conducted under this section.

(g) Each inspecting agency shall establish an administrative appeal procedure which allows a property owner to contest the nature and conditions of any lead order issued by the inspecting agency. Inspecting agencies must consider appeals that propose lower cost methods that make the residence lead safe.

(h) Sections 144.9501 to 144.9509 neither authorize nor prohibit an inspecting agency from charging a property owner for the cost of a lead inspection.

Sec. 18. Minnesota Statutes 1995 Supplement, section 144.9504, subdivision 7, is amended to read:

Subd. 7. [RELOCATION OF RESIDENTS.] (a) An Within the limits of appropriations, the inspecting agency shall ensure that residents are relocated from rooms or dwellings during a lead hazard reduction process that generates leaded dust, such as removal or disruption of lead-based paint or plaster that contains lead. Residents shall not remain in rooms or dwellings where the lead hazard reduction process is occurring. An inspecting agency is not required to pay for relocation unless state or federal funding is available for this purpose. The inspecting agency shall

make an effort to assist the resident in locating resources that will provide assistance with relocation costs. Residents shall be allowed to return to the residence or dwelling after completion of the lead hazard reduction process. An inspecting agency shall use grant funds under section 144.9507 if available, in cooperation with local housing agencies, to pay for moving costs and rent for a temporary residence for any low-income resident temporarily relocated during lead hazard reduction. For purposes of this section, "low-income resident" means any resident whose gross household income is at or below 185 percent of federal poverty level.

(b) A resident of rental property who is notified by an inspecting agency to vacate the premises during lead hazard reduction, notwithstanding any rental agreement or lease provisions:

(1) shall not be required to pay rent due the landlord for the period of time the tenant vacates the premises due to lead hazard reduction;

(2) may elect to immediately terminate the tenancy effective on the date the tenant vacates the premises due to lead hazard reduction; and

(3) shall not, if the tenancy is terminated, be liable for any further rent or other charges due under the terms of the tenancy.

(c) A landlord of rental property whose tenants vacate the premises during lead hazard reduction shall:

(1) allow a tenant to return to the dwelling unit after lead hazard reduction and clearance inspection, required under this section, is completed, unless the tenant has elected to terminate the tenancy as provided for in paragraph (b); and

(2) return any security deposit due under section 504.20 within five days of the date the tenant vacates the unit, to any tenant who terminates tenancy as provided for in paragraph (b).

Sec. 19. Minnesota Statutes 1995 Supplement, section 144.9504, subdivision 8, is amended to read:

Subd. 8. [PROPERTY OWNER RESPONSIBILITY.] Property owners shall comply with lead orders issued under this section within 60 days or be subject to enforcement actions as provided under section 144.9509. For orders or portions of orders concerning external lead hazards, property owners shall comply within 60 days, or as soon thereafter as weather permits. If the property owner does not use a lead contractor for compliance with the lead orders, the property owner shall submit a plan for approval by to the inspecting agency within 30 days after receiving the orders. The plan must include the details required in section 144.9505 as to how the property owner intends to comply with the lead orders and notice as to when lead hazard reduction activities will begin. Within the limits of appropriations, the commissioner shall review plans and shall approve or disapprove them as to compliance with the requirements in section 144.9505, subdivision 5.

Sec. 20. Minnesota Statutes 1995 Supplement, section 144.9505, subdivision 4, is amended to read:

Subd. 4. [NOTICE OF LEAD ABATEMENT OR LEAD HAZARD REDUCTION WORK.] (a) At least five working days before starting work at each lead abatement or lead hazard reduction worksite, the person performing the lead abatement or lead hazard reduction work shall give written notice and an approved work plan as required in this section to the commissioner and the appropriate board of health. Within the limits of appropriations, the commissioner shall review plans and shall approve or disapprove them as to compliance with the requirements in section 144.9505, subdivision 5.

(b) This provision does not apply to swab team workers performing work under an order of an inspecting agency.

Sec. 21. Minnesota Statutes 1994, section 145.61, subdivision 5, is amended to read:

Subd. 5. "Review organization" means a nonprofit organization acting according to clause (k) or a committee whose membership is limited to professionals, administrative staff, and consumer directors, except where otherwise provided for by state or federal law, and which is established by one or more of the following: a hospital, a clinic, a nursing home, one or more state or local associations of professionals, an organization of professionals from a particular area or medical institution, a health maintenance organization as defined in chapter 62D, a nonprofit health service plan corporation as defined in chapter 62C, a preferred provider organization, a professional standards review organization established pursuant to United States Code, title 42, section 1320c-1 et seq., a medical review agent established to meet

the requirements of section 256B.04, subdivision 15, or 256D.03, subdivision 7, paragraph (b), the department of human services, a health provider cooperative operating under sections 62R.17 to 62R.26, or a corporation organized under chapter 317A that owns, operates, or is established by one or more of the above referenced entities, to gather and review information relating to the care and treatment of patients for the purposes of:

(a) evaluating and improving the quality of health care rendered in the area or medical institution or by the entity or organization that established the review organization;

(b) reducing morbidity or mortality;

(c) obtaining and disseminating statistics and information relative to the treatment and prevention of diseases, illness and injuries;

(d) developing and publishing guidelines showing the norms of health care in the area or medical institution or in the entity or organization that established the review organization;

(e) developing and publishing guidelines designed to keep within reasonable bounds the cost of health care;

(f) reviewing the quality or cost of health care services provided to enrollees of health maintenance organizations, health service plans, preferred provider organizations, and insurance companies;

(g) acting as a professional standards review organization pursuant to United States Code, title 42, section 1320c-1 et seq.;

(h) determining whether a professional shall be granted staff privileges in a medical institution, membership in a state or local association of professionals, or participating status in a nonprofit health service plan corporation, health maintenance organization, preferred provider organization, or insurance company, or whether a professional's staff privileges, membership, or participation status should be limited, suspended or revoked;

(i) reviewing, ruling on, or advising on controversies, disputes or questions between:

(1) health insurance carriers, nonprofit health service plan corporations, health maintenance organizations, self-insurers and their insureds, subscribers, enrollees, or other covered persons;

(2) professional licensing boards and health providers licensed by them;

(3) professionals and their patients concerning diagnosis, treatment or care, or the charges or fees therefor;

(4) professionals and health insurance carriers, nonprofit health service plan corporations, health maintenance organizations, or self-insurers concerning a charge or fee for health care services provided to an insured, subscriber, enrollee, or other covered person;

(5) professionals or their patients and the federal, state, or local government, or agencies thereof;

(j) providing underwriting assistance in connection with professional liability insurance coverage applied for or obtained by dentists, or providing assistance to underwriters in evaluating claims against dentists;

(k) acting as a medical review agent under section 256B.04, subdivision 15, or 256D.03, subdivision 7, paragraph (b);

(l) providing recommendations on the medical necessity of a health service, or the relevant prevailing community standard for a health service;

(m) reviewing a provider's professional practice as requested by the data analysis unit under section 62J.32;

(n) providing quality assurance as required by United States Code, title 42, sections 1396r(b)(1)(b) and 1395i-3(b)(1)(b) of the Social Security Act;

(o) providing information to group purchasers of health care services when that information was originally generated within the review organization for a purpose specified by this subdivision; or

(p) providing information to other, affiliated or nonaffiliated review organizations, when that information was originally generated within the review organization for a purpose specified by this subdivision, and as long as that information will further the purposes of a review organization as specified by this subdivision.

Sec. 22. [145.951] [CHILDREN HELPED IN LONG-TERM DEVELOPMENT; IMPLEMENTATION PLAN.]

The commissioner of health, in consultation with the commissioners of children, families, and learning; and human services, shall develop an implementation plan for the establishment of a statewide program to assist families in developing the full potential of their children. The program must be designed to strengthen the family, to reduce the risk of abuse to children, and to promote the long-term development of children in their home environments. The program must also be designed to use volunteers to provide support to parents, and to link parents with existing public health, education, and social services as appropriate.

Sec. 23. [145.952] [DEFINITIONS.]

Subdivision 1. [SCOPE.] The definitions in this section apply to sections 145.951 to 145.957.

Subd. 2. [ABUSE.] "Abuse" means physical abuse, sexual abuse, neglect, mental injury, and threatened injury, as those terms are defined in section 626.556, subdivision 2.

Subd. 3. [CHILD PROGRAM OR PROGRAM.] "CHILD program" or "program" means the children helped in long-term development program that the commissioner shall plan to be implemented under sections 145.951 to 145.957.

Subd. 4. [COMMISSIONER.] "Commissioner" means the commissioner of health or the commissioner's designee.

Subd. 5. [LOCAL ORGANIZATION.] "Local organization" means an organization that contracts with the commissioner under section 145.953, subdivision 1, to administer the CHILD program on a local level.

Sec. 24. [145.953] [PROGRAM STRUCTURE.]

Subdivision 1. [LOCAL ADMINISTRATION OF PROGRAM.] The implementation plan must require the commissioner to contract with private nonprofit and governmental organizations to administer the CHILD program on a local level. The local organization shall be responsible for recruiting, screening training, and overseeing volunteers for the program.

Subd. 2. [VOLUNTEER COMPONENT.] The implementation plan must provide that a volunteer will be matched with a family to provide ongoing support in parenting. The volunteer shall provide the family with information on the CHILD program and other social services available. Through home visits and frequent contact, the volunteer shall provide support and guidance on raising the child and coping with stresses that may increase the risk of abuse. The volunteer shall also assist the family in obtaining other needed services from existing social services programs.

Sec. 25. [145.954] [STANDARDS FOR PROGRAM.]

In planning for the implementation of the program, the commissioner shall:

(1) establish mechanisms to encourage families to participate in the CHILD program;

(2) establish mechanisms to identify families who may wish to participate in the CHILD program and to match volunteers with these families either before or as soon as possible after a child is born;

(3) ensure that local organizations coordinate with services already provided by the departments of health, human services, and children, families, and learning to ensure that participating families receive a continuum of care;

(4) coordinate with local social services agencies, local health boards, and community health boards;

(5) ensure that services provided through the program are community-based and that the special needs of minority communities are addressed;

(6) develop and implement appropriate systems to gather data on participating families and to monitor and evaluate their progress; and

(7) evaluate the program's effectiveness.

Sec. 26. [145.955] [DUTIES OF LOCAL ORGANIZATION.]

The implementation plan shall require the local organizations to:

(1) recruit and train volunteers to serve families under the program, according to section 145.956;

(2) provide ongoing supervision and consultation to volunteers; and

(3) develop resource and referral booklets that volunteers can distribute to families served by the program. The booklets shall contain comprehensive information on the spectrum of services available to assist the family and to reduce the risk of abuse.

Sec. 27. [145.956] [TRAINING AND RECRUITMENT OF VOLUNTEERS.]

Subdivision 1. [TRAINING REQUIREMENTS.] (a) The implementation plan shall require the local organization to carefully screen and train volunteers to provide program services. Training must prepare volunteers to:

(1) identify signs of abuse or other indications that a child may be at risk of abuse;

(2) help families develop communications skills;

(3) teach and reinforce healthy discipline techniques;

(4) provide other support a family needs to cope with stresses that increase the risk of abuse; and

(5) refer the family to other appropriate public health, education, and social services.

(b) The implementation plan shall also include procedures whereby the local agency will provide ongoing support, supervision, and training for all volunteers. Training must be culturally appropriate and community-based, and must incorporate input from parents who will be using the program's services.

Subd. 2. [RECRUITMENT OF VOLUNTEERS.] The implementation plan must require that the local organization recruit minority volunteers to serve communities of color.

Sec. 28. [145.957] [ELIGIBILITY.]

The implementation plan must ensure that all residents of Minnesota are eligible for services under the program. The plan must make services available on a sliding fee basis. The commissioner shall develop a sliding fee scale for the program.

Sec. 29. Minnesota Statutes 1995 Supplement, section 148C.01, subdivision 12, is amended to read:

Subd. 12. [SUPERVISED ALCOHOL AND DRUG COUNSELING EXPERIENCE.] Except during the transition period, "supervised alcohol and drug counseling experience" means practical experience gained by a student, volunteer, or intern, and supervised by a person either licensed under this chapter or exempt under its provisions; either before, during, or after the student completes a program from an accredited school or education educational program of alcohol and drug counseling.

Sec. 30. Minnesota Statutes 1995 Supplement, section 148C.01, subdivision 13, is amended to read:

Subd. 13. [ALCOHOL AND DRUG COUNSELING PRACTICUM.] "Alcohol and drug counseling practicum" means formal experience gained by a student and supervised by a person either licensed under this chapter or exempt under its provisions, in an accredited school or educational program of alcohol and drug counseling as part of the education requirements of this chapter.

Sec. 31. Minnesota Statutes 1994, section 148C.01, is amended by adding a subdivision to read:

Subd. 17. [ALCOHOL AND DRUG COUNSELOR INTERNSHIP.] "Alcohol and drug counselor internship" means supervised, practical, on-the-job training as an intern, volunteer, or employee in alcohol and drug counseling.

Sec. 32. Minnesota Statutes 1995 Supplement, section 148C.02, subdivision 1, is amended to read:

Subdivision 1. [MEMBERSHIP.] The alcohol and drug counselors licensing advisory council consists of 13 members. The commissioner shall appoint:

(1) except for those members initially appointed, seven members who must be licensed alcohol and drug dependency counselors;

(2) three members who must be public members as defined by section 214.02;

(3) one member who must be a director or coordinator of an accredited alcohol and drug dependency training program; and

(4) one member who must be a former consumer of alcohol and drug dependency counseling service and who must have received the service more than three years before the person's appointment.

The American Indian advisory committee to the department of human services chemical dependency office shall appoint the remaining member.

Sec. 33. Minnesota Statutes 1995 Supplement, section 148C.02, subdivision 2, is amended to read:

Subd. 2. [DUTIES.] (a) The advisory council shall:

(1) provide advice and recommendations to the commissioner on the development of rules for the licensure of alcohol and drug counselors;

(2) provide advice and recommendations to the commissioner on the development of standards and procedures for the competency testing, licensing, and review of alcohol and drug counselors' professional conduct;

(3) provide advice and recommendations to the commissioner in disciplinary cases in the areas of counselor competency issues, counselor practice issues, and counselor impairment issues.

(b) The advisory council shall form an education committee, including a chair, and shall advise the commissioner on the administration of education requirements in section 148C.05, subdivision 2.

Sec. 34. Minnesota Statutes 1995 Supplement, section 148C.03, subdivision 1, is amended to read:

Subdivision 1. [GENERAL.] The commissioner shall, after consultation with the advisory council or a subcommittee or the special licensing criteria committee established under section 148C.11, subdivision 3, paragraph (b):

(a) adopt and enforce rules for licensure of alcohol and drug counselors, including establishing standards and methods of determining whether applicants and licensees are qualified under section 148C.04. The rules must provide for examinations and establish standards for the regulation of professional conduct. The rules must be designed to protect the public;

(b) hold or contract for the administration of examinations at least twice a year to assess applicants' knowledge and skills. The examinations must be written and oral and may be administered by the commissioner or by a private organization under contract with the commissioner to administer the licensing examinations. Examinations must minimize cultural bias and must be balanced in various theories relative to practice of alcohol and drug counseling;

(c) issue licenses to individuals qualified under sections 148C.01 to 148C.11;

(d) issue copies of the rules for licensure to all applicants;

(e) adopt rules to establish and implement procedures, including a standard disciplinary process and rules of professional conduct;

(f) carry out disciplinary actions against licensees;

(g) establish, with the advice and recommendations of the advisory council, written internal operating procedures for receiving and investigating complaints and for taking disciplinary actions as appropriate. Establishment of the operating procedures are not subject to rulemaking procedures under chapter 14;

(h) educate the public about the existence and content of the rules for chemical dependency alcohol and drug counselor licensing to enable consumers to file complaints against licensees who may have violated the rules;

(i) evaluate the rules in order to refine and improve the methods used to enforce the commissioner's standards;

(j) set, collect, and adjust license fees for alcohol and drug counselors so that the total fees collected will as closely as possible equal anticipated expenditures during the biennium, as provided in section 16A.1285; fees for initial and renewal application and examinations; late fees for counselors who submit license renewal applications after the renewal deadline; and a surcharge fee. The surcharge fee must include an amount necessary to recover, over a five-year period, the commissioner's direct expenditures for the adoption of the rules providing for the licensure of alcohol and drug counselors. All fees received shall be deposited in the state treasury and credited to the special revenue fund; and

(k) prepare reports on activities related to the licensure of alcohol and drug counselors according to this subdivision by October 1 of each even-numbered year. Copies of the reports shall be delivered to the legislature in accordance with section 3.195 and to the governor. The reports shall contain the following information on the commissioner's activities relating to the licensure of chemical dependency alcohol and drug counselors, for the two-year period ending the previous June 30:

(1) a general statement of the activities;

(2) the number of staff hours spent on the activities;

(3) the receipts and disbursements of funds;

(4) the names of advisory council members and their addresses, occupations, and dates of appointment and reappointment;

(5) the names and job classifications of employees;

(6) a brief summary of rules proposed or adopted during the reporting period with appropriate citations to the State Register and published rules;

(7) the number of persons having each type of license issued by the commissioner as of June 30 in the year of the report;

(8) the locations and dates of the administration of examinations by the commissioner;

(9) the number of persons examined by the commissioner with the persons subdivided into groups showing age categories, sex, and states of residency;

(10) the number of persons licensed by the commissioner after taking the examinations referred to in clause (8) with the persons subdivided by age categories, sex, and states of residency;

(11) the number of persons not licensed by the commissioner after taking the examinations referred to in clause (8) with the persons subdivided by age categories, sex, and states of residency;

(12) the number of persons not taking the examinations referred to in clause (8) who were licensed by the commissioner or who were denied licensing, the reasons for the licensing or denial, and the persons subdivided by age categories, sex, and states of residency;

(13) the number of persons previously licensed by the commissioner whose licenses were revoked, suspended, or otherwise altered in status with brief statements of the reasons for the revocation, suspension, or alteration;

(14) the number of written and oral complaints and other communications received by the commissioner which allege or imply a violation of a statute or rule which the commissioner is empowered to enforce;

(15) a summary, by specific category, of the substance of the complaints and communications referred to in clause (14) and, for each specific category, the responses or dispositions; and

(16) any other objective information which the commissioner believes will be useful in reviewing the commissioner's activities.

Sec. 35. Minnesota Statutes 1995 Supplement, section 148C.04, subdivision 3, is amended to read:

Subd. 3. [LICENSING REQUIREMENTS FOR ALCOHOL AND DRUG COUNSELORS; EVIDENCE FOR THE FIRST FIVE YEARS.] (a) For five years after the effective date of the rules authorized in section 148C.03, the applicant, unless qualified for initial licensure under this subdivision under section 148C.06 during the two-year period authorized therein, under section 148C.07, or under subdivision 4, must furnish evidence satisfactory to the commissioner that the applicant has met all the requirements in clauses (1) to (3). The applicant must have:

(1) Except as provided in subdivision 4, the applicant must have received an associate degree including 270 clock hours of alcohol and drug counseling education from an accredited school or educational program and 880 clock hours of chemical dependency alcohol and drug counseling practicum;

(2) The applicant must have completed a written case presentation and satisfactorily passed an oral examination that demonstrates competence in the core functions; and

(3) The applicant must have satisfactorily passed a written examination as established by the commissioner.

(b) Unless the applicant qualifies for licensure under this subdivision, an applicant must furnish evidence satisfactory to the commissioner that the applicant has met the requirements of paragraph (a), clauses (1) to (3).

Beginning two years after the effective date of the rules authorized in section 148C.03, subdivision 1, no person may be licensed without meeting the requirements in section 148C.04, subdivision 4, paragraph (a), clauses (2) and (3), or the special licensing criteria established pursuant to section 148C.11, subdivision 4.

Sec. 36. Minnesota Statutes 1995 Supplement, section 148C.04, subdivision 4, is amended to read:

Subd. 4. [ADDITIONAL LICENSING REQUIREMENTS AFTER FIVE YEARS.] Beginning five years after the effective date of the rules authorized in section 148C.03, subdivision 1, an applicant for licensure must have received submit evidence to the commissioner that the applicant has met one of the following requirements:

(1) The applicant must have:

(i) received a bachelor's degree from an accredited school or educational program, and must have completed including 480 clock hours of alcohol and drug counseling education from an accredited school or educational program and 880 clock hours of alcohol and drug counseling practicum,

(ii) satisfactorily passed a written examination as established by the commissioner, and

(iii) completed a written case presentation and satisfactorily passed an oral examination that demonstrates competence in the core functions; or

(2) The applicant must meet the requirements of section 148C.07.

Sec. 37. Minnesota Statutes 1995 Supplement, section 148C.04, is amended by adding a subdivision to read:

Subd. 5. [ADDITIONAL LICENSING REQUIREMENTS.] Applicants must also meet the special licensing requirements in section 148C.11, subdivision 4, and in the rules authorized in section 148C.03, subdivision 1, when applicable.

Sec. 38. Minnesota Statutes 1995 Supplement, section 148C.05, subdivision 1, is amended to read:

Subdivision 1. [RENEWAL REQUIREMENTS.] To renew a license, an applicant must:

(1) annually complete a renewal application every two years on a form provided by the commissioner and submit the annual biennial renewal fee by the deadline; and

(2) submit additional information if requested by the commissioner to clarify information presented in the renewal application. This information must be submitted within 30 days of the commissioner's request.

Sec. 39. Minnesota Statutes 1995 Supplement, section 148C.06, is amended to read:

148C.06 [TRANSITION PERIOD.]

For two years from the effective date of the rules authorized in section 148C.03, subdivision 1, the commissioner shall issue a license to an applicant if the applicant meets one of the following qualifications:

(a) is credentialed as a certified chemical dependency counselor (CCDC) or certified chemical dependency counselor reciprocal (CCDCR) by the Institute for Chemical Dependency Professionals of Minnesota, Inc.;

(b) has 6,000 hours of supervised alcohol and drug counselor experience as defined by the core functions, 270 clock hours of alcohol and drug training with a minimum of 60 hours of this training occurring within the past five years, 300 hours of alcohol and drug practicum counselor internship, and has successfully completed the requirements in section 148C.04, subdivision 3, paragraph (a), clauses (2) and (3);

(c) has 10,000 hours of supervised alcohol and drug counselor experience as defined by the core functions, 270 clock hours of alcohol and drug training with a minimum of 60 hours of this training occurring within the past five years, and has successfully completed the requirements in section 148C.04, subdivision 3, paragraph (a), clause (2) or (3), or is credentialed as a certified chemical dependency practitioner (CCDP) by the Institute for Chemical Dependency Professionals of Minnesota, Inc.;

(d) has 14,000 hours of supervised alcohol and drug counselor experience as defined by the core functions and 270 clock hours of alcohol and drug training with a minimum of 60 hours of this training occurring within the past five years; or

(e) has met the special licensing criteria established pursuant to section 148C.11.

Sec. 40. Minnesota Statutes 1994, section 148C.09, is amended by adding a subdivision to read:

Subd. 1a. [BACKGROUND INVESTIGATION.] The applicant must sign a release authorizing the commissioner to obtain information from the bureau of criminal apprehension, the Federal Bureau of Investigation, the office of mental health practice, the department of human services, the office of health facilities complaints, and other agencies specified in the rules. After the commissioner has given written notice to an individual who is the subject of a background investigation, the agencies shall assist the commissioner with the investigation by giving the commissioner criminal conviction data, reports about abuse or neglect of clients, and other information specified in the rules.

Sec. 41. Minnesota Statutes 1995 Supplement, section 148C.11, subdivision 1, is amended to read:

Subdivision 1. [OTHER PROFESSIONALS.] Nothing in sections 148C.01 to 148C.10 shall prevent members of other professions or occupations from performing functions for which they are qualified or licensed. This exception includes, but is not limited to, licensed physicians, registered nurses, licensed practical nurses, licensed psychological practitioners, members of the clergy, American Indian medicine men and women, licensed attorneys, probation officers, licensed marriage and family therapists, licensed social workers, licensed professional counselors, school counselors employed by a school district while acting within the scope of their employment as a school counselor, and registered occupational therapists or certified occupational therapist therapy assistants. These persons must not, however, use a title incorporating the words "alcohol and drug counselor" or "licensed alcohol and drug counselor" or otherwise hold themselves out to the public by any title or description stating or implying that they are licensed to engage in the practice of alcohol and drug counseling.

Sec. 42. Minnesota Statutes 1995 Supplement, section 148C.11, subdivision 3, is amended to read:

Subd. 3. [FEDERALLY RECOGNIZED TRIBES.] (a) Alcohol and drug counselors licensed to practice alcohol and drug counseling according to standards established by federally recognized tribes, while practicing under tribal jurisdiction, are exempt from the requirements of this chapter. In practicing alcohol and drug counseling under tribal jurisdiction, individuals licensed under that authority shall be afforded the same rights, responsibilities, and recognition as persons licensed pursuant to this chapter.

(b) The commissioner shall develop special licensing criteria for issuance of a license to alcohol and drug counselors who: (1) are members of ethnic minority groups; or (2) are employed by private, nonprofit agencies, including agencies operated by private, nonprofit hospitals, whose primary agency service focus addresses ethnic minority

populations. These licensing criteria may differ from the licensing criteria specified in section 148C.04. To develop these criteria, the commissioner shall establish a committee comprised of but not limited to representatives from the council on hearing impaired, the council on affairs of Spanish-speaking people, the council on Asian-Pacific Minnesotans, the council on Black Minnesotans, and the Indian affairs council.

Sec. 43. Minnesota Statutes 1995 Supplement, section 157.011, subdivision 1, is amended to read:

Subdivision 1. [ESTABLISHMENTS.] The commissioner shall adopt rules establishing standards for food, and beverage service establishments, and hotels, motels, lodging establishments, and resorts.

Sec. 44. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 4, is amended to read:

Subd. 4. [BOARDING ESTABLISHMENT.] "Boarding establishment" means a building, structure, enclosure, or any part thereof used as, maintained as, advertised as, or held out to be a place food and beverage service establishment where food or nonalcoholic beverages, or both, are furnished to five or more regular boarders, whether with or without sleeping accommodations, for periods of one week or more.

Sec. 45. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 5, is amended to read:

Subd. 5. [FOOD AND BEVERAGE SERVICE ESTABLISHMENT.] "Food and beverage service establishment" means a restaurant, alcoholic beverage establishment, boarding establishment, mobile food unit, seasonal food stand, food cart, or special event food stand building, structure, enclosure, or any part of a building, structure, or enclosure used as, maintained as, advertised as, or held out to be an operation that prepares, serves, or otherwise provides food or beverages, or both, for human consumption.

Sec. 46. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 6, is amended to read:

Subd. 6. [FOOD CART.] "Food cart" means a food and beverage service establishment that is a nonmotorized vehicle limited to serving food that is not defined by rule as potentially hazardous food, except precooked frankfurters and other ready-to-eat link sausages self-propelled by the operator.

Sec. 47. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 9, is amended to read:

Subd. 9. [MOBILE FOOD UNIT.] "Mobile food unit" means a food and beverage service establishment that is a vehicle mounted unit, either motorized or trailered, operating no more than 14 days annually at any one place, and readily movable, without disassembling, for transport to another location and remaining for no more than 14 days, annually, at any one place.

Sec. 48. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 12, is amended to read:

Subd. 12. [RESTAURANT.] "Restaurant" means a building, structure, enclosure, or any part thereof used as, maintained as, advertised as, or held out to be a place where food or nonalcoholic beverages are served or prepared for service to the public food and beverage service establishment, whether the establishment serves alcoholic or nonalcoholic beverages, which operates from a location for more than 14 days annually. Restaurant does not include a food cart.

Sec. 49. Minnesota Statutes 1995 Supplement, section 157.15, is amended by adding a subdivision to read:

Subd. 12a. [SEASONAL PERMANENT FOOD STAND.] "Seasonal permanent food stand" means a food and beverage service establishment which is a permanent food service stand or building, but which operates no more than 14 days annually.

Sec. 50. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 13, is amended to read:

Subd. 13. [SEASONAL TEMPORARY FOOD STAND.] "Seasonal temporary food stand" means a food and beverage service establishment that is a food stand that which is disassembled and moved from location to location, remaining but which operates no more than 14 days, annually, at any one place; or a permanent food service stand or building that operates no more than 14 days annually location.

Sec. 51. Minnesota Statutes 1995 Supplement, section 157.15, subdivision 14, is amended to read:

Subd. 14. [SPECIAL EVENT FOOD STAND.] "Special event food stand" means a food and beverage service establishment which is used in conjunction with celebrations and special events, used not more than twice annually, and remaining and which operates once or twice annually for no more than three consecutive seven total days at any one location.

Sec. 52. Minnesota Statutes 1995 Supplement, section 157.15, is amended by adding a subdivision to read:

Subd. 15. [SPECIAL EVENT FOOD STAND-LIMITED.] "Special event food stand-limited" means a fee category where food is served at special events that is prepared at another licensed location and is only held and served with no additional preparation at the serving site of the special event, and which operates once or twice annually for no more than seven total days.

Sec. 53. Minnesota Statutes 1995 Supplement, section 157.16, is amended to read:

157.16 [LICENSES REQUIRED; FEES.]

Subdivision 1. [LICENSE REQUIRED ANNUALLY.] A license is required annually for every person, firm, or corporation engaged in the business of conducting a food and beverage service establishment hotel, motel, restaurant, alcoholic beverage establishment, boarding establishment, lodging establishment, or resort, mobile food unit, seasonal food stand, food cart, or special event food stand or who thereafter engages in conducting any such business. Any person wishing to operate a place of business licensed in this section shall first make application, pay the required fee specified in this section, and receive approval for operation, including plan review approval. Seasonal and temporary food stands and special event food stands are not required to submit plans. Application shall be made on forms provided by the commissioner and shall require the applicant to state the full name and address of the owner of the building, structure, or enclosure, the lessee and manager of the food and beverage service establishment, hotel, motel, restaurant, alcoholic beverage establishment, boarding establishment, lodging establishment, or resort, mobile food unit, seasonal food stand, food cart, or special event food stand; the name under which the business is to be conducted; and any other information as may be required by the commissioner to complete the application for license.

Subd. 2. [LICENSE RENEWAL.] Initial and renewal licenses for all food and beverage service establishments, hotels, motels, restaurants, alcoholic beverage establishments, lodging establishments, boarding establishments, and resorts, mobile food units, seasonal food stands, and food carts shall be issued for the calendar year for which application is made and shall expire on December 31 of such year. Any person who operates a place of business after the expiration date of a license or without having submitted an application and paid the fee shall be deemed to have violated the provisions of this chapter and shall be subject to enforcement action, as provided in the health enforcement consolidation act, sections 144.989 to 144.993. In addition, a penalty of $25 shall be added to the total of the license fee for any food and beverage service establishment operating without a license as a mobile food unit, a seasonal temporary or seasonal permanent food stand, and food cart operating without a license or a special event food stand, and a penalty of $50 shall be added to the total of the license fee for all other food, beverage, and restaurants, food carts, hotels, motels, lodging establishments, and resorts operating without a license.

Subd. 3. [ESTABLISHMENT FEES; DEFINITIONS.] For the purposes of establishing food, beverage, and lodging establishment fees, the following definitions have the meanings given them. (a) The following fees are required for food and beverage service establishments, hotels, motels, lodging establishments, and resorts licensed under this chapter. Unless section 157.165 applies, food and beverage service establishments must pay the highest applicable fee under paragraph (e), clause (1), (2), (3), or (4), and establishments serving alcohol must pay the highest applicable fee under paragraph (e), clause (6) or (7).

(b) All food and beverage service establishments, except special event food stands, and all hotels, motels, lodging establishments, and resorts shall pay an annual base fee of $100.

(c) A special event food stand shall pay a flat fee of $60 annually. "Special event food stand" means a fee category where food is prepared or served in conjunction with celebrations, county fairs, or special events from a special event food stand as defined in section 157.15.

(d) A special event food stand-limited shall pay a flat fee of $30.

(e) In addition to the base fee in paragraph (b), each food and beverage service establishment, other than a special event food stand, and each hotel, motel, lodging establishment, and resort shall pay an additional annual fee for each fee category as specified in this paragraph:

(1) Limited food menu selection, $30.

(a) "Limited food menu selection" means a fee category that provides one or more of the following:

(1) (i) prepackaged food that receives heat treatment and is served in the package;

(2) (ii) frozen pizza that is heated and served;

(3) (iii) a continental breakfast such as rolls, coffee, juice, milk, and cold cereal;

(4) (iv) soft drinks, coffee, or nonalcoholic beverages; or

(5) does not prepare food on site, however serves food that was prepared elsewhere and provides (v) cleaning of for eating, drinking, or cooking utensils, when the only food served is prepared off site.

(2) Small menu selection with limited equipment, including boarding establishments, $55.

(b) "Small menu selection with limited equipment" means a fee category that has no salad bar and provides meets one or more of the following:

(1) (i) possesses food service equipment that is limited to consists of no more than a deep fat fryer, a grill, two hot holding containers, and one or more microwave ovens;

(2) service of (ii) serves dipped ice cream or soft serve frozen desserts;

(3) service of (iii) serves breakfast in an owner-occupied bed and breakfast establishment; or

(4) (iv) is a boarding establishment.

(3) Small establishment with full menu selection, $150.

(c) "Small establishment with full menu selection" means a fee category that provides meets one or more of the following:

(1) (i) possesses food service equipment that includes a range, oven, steam table, salad bar, or salad preparation area;

(2) (ii) possesses food service equipment that includes more than one deep fat fryer, one grill, or two hot holding containers; or

(3) (iii) is an establishment where food is prepared at one location and served at one or more separate locations.

(4) Large establishment with full menu selection, $250.

(d) "Large establishment with full menu selection" means either:

(i) a fee category that (1) meets the criteria in paragraph (c), clause (1) or (2) clause (3), subclause (i) or (ii), for a small establishment with full menu selection and: (1), (2) seats more than 175 people; (2), and (3) offers the full menu selection an average of five or more days a week during the weeks of operation; or means

(ii) a service fee category that (1) meets the criteria in paragraph (c), clause (3), subclause (iii), for a small establishment with full menu selection;, and (3) (2) prepares and serves 500 or more meals per day.

(e) "Temporary food service" means a fee category where food is prepared and served from a mobile food unit, seasonal food stand, or food cart.

(f) "Alcohol service from bar" means a fee category where alcoholic mixed drinks are served, or where beer or wine are served from a bar.

(5) Other food and beverage service, including food carts, mobile food units, seasonal temporary food stands, and seasonal permanent food stands, $30.

(6) Beer or wine table service, $30.

(g) "Beer or wine table service" means a fee category where the only alcoholic beverage service is beer or wine, served to customers seated at tables.

(h) "Individual water" means a fee category with a water supply other than a community public water supply as defined in Minnesota Rules, chapter 4720.

(i) "Individual sewer" means a fee category with an individual sewage treatment system which uses subsurface treatment and disposal.

(7) Alcoholic beverage service, other than beer or wine table service, $75.

"Alcohol service other than beer or wine table service" means a fee category where alcoholic mixed drinks are served or where beer or wine are served from a bar.

(8) Lodging per sleeping accommodation unit, $4, including hotels, motels, lodging establishments, and resorts, up to a maximum of $400.

(j) "Lodging per sleeping accommodation unit" means a fee category including the number of guest rooms, cottages, or other rental units of a hotel, motel, lodging establishment, or resort; or the number of beds in a dormitory.

(9) First public swimming pool, $100; each additional public swimming pool, $50.

(k) "Public swimming pool" means a fee category that has the meaning given in Minnesota Rules, part 4717.0250, subpart 8.

(10) First spa, $50; each additional spa, $25.

(l) "Spa pool" means a fee category that has the meaning given in Minnesota Rules, part 4717.0250, subpart 9.

(m) "Special event food stand" means a fee category where food is prepared and served in conjunction with celebrations or special events, but not more than twice annually, and where the facility is used no more than three consecutive days per event.

(11) Private sewer or water, $30.

"Individual private water" means a fee category with a water supply other than a community public water supply as defined in Minnesota Rules, chapter 4720. "Individual private sewer" means a fee category with an individual sewage treatment system which uses subsurface treatment and disposal.

(f) A fee is not required for a food and beverage service establishment operated by a school as defined in sections 120.05 and 120.101.

(g) A fee of $150 for review of the construction plans must accompany the initial license application for food and beverage service establishments, hotels, motels, lodging establishments, or resorts.

(h) When existing food and beverage service establishments, hotels, motels, lodging establishments, or resorts are extensively remodeled, a fee of $150 must be submitted with the remodeling plans.

(i) Seasonal temporary food stands, special event food stands, and special event food stands-limited are not required to submit construction or remodeling plans for review.

Subd. 4. [POSTING REQUIREMENTS.] Every food and beverage service establishment, hotel, motel, lodging establishment, or resort must have the license posted in a conspicuous place at the establishment.

Sec. 54. [157.165] [SMALL ESTABLISHMENTS; FEES.]

Notwithstanding section 157.16, a food and beverage establishment with 10 or fewer employees shall pay an annual fee of $125. Provided there is no conflict with any collective bargaining agreement, any reduction in Minnesota department of health staff necessitated by this section must only be accomplished through mitigation, attrition, transfer, and other measures as provided in state law or applicable collective bargaining agreements.

Sec. 55. Minnesota Statutes 1995 Supplement, section 157.17, subdivision 2, is amended to read:

Subd. 2. [REGISTRATION.] At the time of licensure or license renewal, a board boarding and lodging establishment or a lodging establishment that provides supportive services or health supervision services must register be registered with the commissioner, and must register annually thereafter. The registration must include the name, address, and telephone number of the establishment, the name of the operator, the types of services that are being provided, a description of the residents being served, the type and qualifications of staff in the facility, and other information that is necessary to identify the needs of the residents and the types of services that are being provided. The commissioner shall develop and furnish to the boarding and lodging establishment or lodging establishment the necessary form for submitting the registration. The requirement for registration is effective until the rules required by sections 144B.01 to 144B.17 are effective.

Sec. 56. Minnesota Statutes 1995 Supplement, section 157.20, subdivision 1, is amended to read:

Subdivision 1. [INSPECTIONS.] It shall be the duty of the commissioner to inspect, or cause to be inspected, every food and beverage service establishment, hotel, motel, restaurant, alcoholic beverage establishment, boarding establishment, lodging establishment, or resort, mobile food unit, seasonal food stand, food cart, and special event food stand in this state. For the purpose of conducting inspections, the commissioner shall have the right to enter and have access thereto at any time during the conduct of business.

Sec. 57. Minnesota Statutes 1994, section 157.20, is amended by adding a subdivision to read:

Subd. 2a. [RISK CATEGORIES.] (a) [HIGH-RISK ESTABLISHMENT.] "High-risk establishment" means any food and beverage service establishment, hotel, motel, lodging establishment, or resort that:

(1) serves potentially hazardous foods that require extensive processing on the premises, including manual handling, cooling, reheating, or holding for service;

(2) prepares foods several hours or days before service;

(3) serves menu items that epidemiologic experience has demonstrated to be common vehicles of food-borne illness;

(4) has a public swimming pool; or

(5) draws its drinking water from a surface water supply.

(b) [MEDIUM-RISK ESTABLISHMENT.] "Medium-risk establishment" means a food and beverage service establishment, hotel, motel, lodging establishment, or resort that:

(1) serves potentially hazardous foods but with minimal holding between preparation and service; or

(2) serves foods, such as pizza, that require extensive handling followed by heat treatment.

(c) [LOW-RISK ESTABLISHMENT.] "Low-risk establishment" means a food and beverage service establishment, hotel, motel, lodging establishment, or resort that is not a high-risk or medium-risk establishment.

(d) [RISK EXCEPTIONS.] Mobile food units, seasonal permanent and seasonal temporary food stands, food carts, and special event food stands are not inspected on an established schedule and therefore are not defined as high-risk, medium-risk, or low-risk establishments.

Sec. 58. Minnesota Statutes 1995 Supplement, section 157.21, is amended to read:

157.21 [INSPECTION RECORDS.]

The commissioner shall keep inspection records for all food and beverage service establishments, hotels, motels, restaurants, alcoholic beverage establishments, boarding establishments, lodging establishments, and resorts, mobile food units, seasonal food stands, food carts, and special event food stands, together with the name of the owner and operator.

Sec. 59. [COST ANALYSIS STUDY; COUNTY IMPLEMENTATION OF FOOD, BEVERAGE, AND LODGING LICENSING.]

Subdivision 1. [COST ANALYSIS STUDY.] The department of health shall conduct a cost analysis study regarding the transfer of food, beverage, and lodging licensing to the counties. The department shall report its findings to the house health and human services committee and both finance divisions, and the senate health care committee, and the senate health care and family services finance division by February 15, 1997.

Subd. 2. [COUNTY PREFERENCE.] By February 1, 1997, each county board shall notify the department of health as to whether the county prefers to implement food, beverage, and lodging licensing and whether the county intends to develop a cooperative implementation program with other counties.

Sec. 60. [STUDY ON IMMUNIZATION.]

By January 15, 1997, the commissioner of health shall report recommendations to the legislature and governor relating to Minnesota immunization law and policy regarding vaccine-preventable diseases for which immunization is not currently required by law, including, but not limited to, hepatitis A, hepatitis B, varicella, and other vaccine preventable diseases identified by the commissioner.

Sec. 61. [REPORT ON BIRTH DEFECTS REGISTRY SYSTEM.]

The commissioner shall report to the legislature annually no later than January 31, 1997, and January 31, 1998, regarding the development of the birth defects registry system, including recommendations for additional statutory authority necessary to implement the system.

Sec. 62. [REPORT ON CHILD PROGRAM IMPLEMENTATION PLAN.]

By February 15, 1997, the commissioner of health shall present to the legislature an implementation plan for the establishment of a statewide CHILD program. The implementation plan must incorporate the requirements for program structure and standards, duties of participating local organizations, training and recruitment of volunteers, and eligibility, as provided in Minnesota Statutes, sections 145.953 to 145.957. The report must also include estimates of the cost of implementing the CHILD program statewide, and of any increase in the complement of the department of health that may be required to oversee the program.

Sec. 63. [PLAN FOR COORDINATION OF HOME VISITING PROGRAMS.]

By February 15, 1997, the commissioner of health, in consultation with the commissioners of children, families, and learning; and human services and the director of the office for strategic and long-range planning, shall recommend to the legislature a plan for coordination of all home visiting programs to prevent child abuse. The recommendations must include the development of minimum standards, coordination of and information exchange between home visiting programs, training requirements for home visiting staff, the development of a coordinated data system for all home visiting programs, and an evaluation for home visiting programs.

Sec. 64. [MERC STUDY.]

The medical education and research cost advisory task force shall make recommendations to the commissioner of health and to the house health and human services committee and both finance divisions, and the senate health care committee and the senate health care and family services finance division by December 15, 1996, on potential sources of funding for medical education and research and on mechanisms for the distribution of such funding sources.

Sec. 65. [STUDY; CORPORATE ADULT FOSTER CARE.]

The commissioner of human services shall conduct a study of the current adult foster care licensure requirements as they are applied to corporate adult foster care homes, and shall recommend any appropriate changes to these licensure requirements following the implementation of the housing with services contract act under Minnesota Statutes, chapter 144D. The commissioner shall submit a report with the results and recommendations of this study to the house health and human services committee, the house health and human services finance division, the senate health care committee, and the senate health care and family services finance division by January 15, 1997.

Sec. 66. [STUDY; HOME CARE AND ELDERLY HOUSING WITH SERVICES ESTABLISHMENTS.]

The commissioner of health shall conduct a study that addresses the following items:

(1) the feasibility of merging Class A and Class E home care license requirements;

(2) any necessary standards for medications management by licensed home care providers; and

(3) the feasibility of expanding the registration requirement for housing with services establishments to all such establishments regardless of the age of their residents, and of repealing the board and lodging with special services registration under Minnesota Statutes, section 157.17 and the residential home care licensure provisions in Minnesota Statutes, chapter 144B.

The commissioner shall submit a report with the results of this study and any recommendations to the house health and human services committee, the house health and human services finance division, the senate health care and family services finance division, and the senate health care committee by January 15, 1997.

Sec. 67. [DAKOTA COUNTY ENHANCED AUTOMATION SYSTEM DEMONSTRATION PROJECT.]

Dakota county may implement a demonstration project to develop an enhanced automation system to educate recipients on their health care options. This project may include a system that combines interactive touch screen video, clinic maps, text and audio both in multiple languages to assist clients in selecting a managed health care provider. The automated system must be located in kiosks in the county. Dakota county shall report to the house health and human services committee, the house health and human services finance division, the senate health care committee, and the senate health care and family services finance division by January 1, 1998, on the results of the demonstration project. The report shall include, at a minimum, information about savings realized by the county from the demonstration project.

Sec. 68. [MIGRANT FARMWORKER DATA RESEARCH.]

(a) The commissioner of health shall collect, analyze, and publish health and socio-economic data about and information on collaborative resources available to migrant farmworkers in Minnesota in consultation with an advisory committee made up of representatives from migrant-serving agencies, county economic assistance program staff, and migrant farmworkers and family members.

(b) The advisory committee members should include representatives from:

(1) Migrant Health;

(2) Migrant Education;

(3) Migrant Head Start;

(4) Migrant Legal Services;

(5) Midwest Farmworkers Employment and Training;

(6) Women, Infants, and Children's Supplemental Feeding Program (WIC);

(7) Tri-Valley Opportunity Council;

(8) Minnesota Food Shelf Association;

(9) at least two county economic assistance offices from counties with large migrant populations during the agricultural season;

(10) the Spanish Speaking Affairs Council; and

(11) at least two migrant community members or advocates.

The advisory committee shall develop the research, collection, and reporting requirements and ensure that the results are shared among all members of the advisory committee and all interested parties.

Sec. 69. [INSTRUCTION TO REVISOR.]

In each section of Minnesota Statutes referred to in column A, the revisor of statutes shall delete the reference in column B and insert the reference in column C. The references in column C may be changed by the revisor to the section of Minnesota Statutes in which the bill sections are compiled.

Column A Column BColumn C

28A.15, subdivision 5 157.03157.16

157.15, subdivision 1 157.03157.011

160.295, subdivision 3 157.03157.16

256B.0913, subdivision 5 157.03157.011

299F.46, subdivision 1 157.03157.011

Sec. 70. [REPEALER.]

Minnesota Statutes 1994, sections 144.691, subdivision 4; 146.14; and 146.20; Minnesota Statutes 1995 Supplement, sections 157.03; 157.15, subdivision 2; 157.18; and 157.19, are repealed.

Sec. 71. [EFFECTIVE DATE.]

Sections 29 to 42 (148C.01, subd. 12; 148C.01, subd. 13; 148C.01, subd. 17; 148C.02, subd. 1; 148C.02, subd. 2; 148C.03, subd. 1; 148C.04, subd. 3; 148C.04, subd. 4; 148C.04, subd. 5; 148C.05, subd. 1; 148C.06; 148C.09, subd. 1a; 148C.11, subd. 1; 148C.11, subd. 3) and 67 are effective the day following final enactment.

Section 1. Minnesota Statutes 1994, section 245.94, subdivision 2a, is amended to read:

Subd. 2a. [MANDATORY REPORTING.] Within 24 hours after a client suffers death or serious injury, the agency, facility, or program director shall notify the ombudsman of the death or serious injury.

Sec. 2. Minnesota Statutes 1994, section 245.94, subdivision 3, is amended to read:

Subd. 3. [COMPLAINTS.] The ombudsman may receive a complaint from any source concerning an action of an agency, facility, or program. After completing a review, the ombudsman shall inform the complainant and the agency, facility, or program. No client may be punished nor may the general condition of the client's treatment be unfavorably altered as a result of an investigation, a complaint by the client, or by another person on the client's behalf. An agency, facility, or program shall not retaliate or take adverse action, as defined in section 626.557, subdivision 17, paragraph (c), against a client or other person, who in good faith makes a complaint or assists in an investigation. The ombudsman may classify as confidential, the identity of a complainant, upon request of the complainant.

Sec. 3. Minnesota Statutes 1994, section 245.95, subdivision 2, is amended to read:

Subd. 2. [GENERAL REPORTS.] In addition to whatever conclusions or recommendations the ombudsman may make to the governor on an ad hoc basis, the ombudsman shall, at the end of each year biennium, report to the governor concerning the exercise of the ombudsman's functions during the preceding year biennium.

Sec. 4. Minnesota Statutes 1994, section 245.97, subdivision 6, is amended to read:

Subd. 6. [TERMS, COMPENSATION, AND REMOVAL AND EXPIRATION.] The membership terms, compensation, and removal of members of the committee and the filling of membership vacancies are governed by section 15.0575. The ombudsman committee and the medical review subcommittee expire on June 30, 1994.

Sec. 5. Minnesota Statutes 1994, section 246.57, is amended by adding a subdivision to read:

Subd. 6. [DENTAL SERVICES.] The commissioner of human services shall authorize any regional treatment center or state- operated nursing home under the commissioner's authority to provide dental services to disabled persons who are eligible for medical assistance and are not residing at the regional treatment center or state-operated nursing

home, provided that the reimbursement received for these services is sufficient to cover actual costs. To provide these services, regional treatment centers and state-operated nursing homes may participate under contract with health networks in their service area. Notwithstanding section 16B.06, subdivision 2, the commissioner of human services may delegate the execution of these dental services contracts to the chief executive officers of the regional centers or state-operated nursing homes. All receipts for these dental services shall be retained by the regional treatment center or state-operated nursing home that provides the services and shall be in addition to other funding the regional treatment center or state-operated nursing home receives.

Sec. 6. Minnesota Statutes 1994, section 256.482, is amended by adding a subdivision to read:

Subd. 8. [SUNSET.] Notwithstanding section 15.059, subdivision 5, the council on disability shall not sunset until June 30, 2001.

Sec. 7. [256.9750] [SENIOR NUTRITION PROGRAMS.]

Subdivision 1. [PROGRAM GOALS.] It is the goal of all agencies on aging and senior nutrition programs to support the physical and mental health of seniors living in the community by:

(1) promoting nutrition programs that serve senior citizens in their homes and communities; and

(2) providing, within the limit of funds available, the support services that will enable the senior citizen to access nutrition programs in the most cost-effective and efficient manner.

Subd. 2. [AUTHORITY.] The Minnesota board on aging shall allocate to area agencies on aging the federal funds which are received for the senior nutrition programs of congregate dining and home-delivered meals in a manner consistent with federal requirements.

Subd. 3. [NUTRITION SUPPORT SERVICES.] Funds allocated to an area agency on aging and money appropriated under section 12 may be used for the following nutrition support services:

(1) transportation of home-delivered meals and purchased food and medications to the residence of a senior citizen;

(2) expansion of home-delivered meals into unserved and underserved areas;

(3) transportation to supermarkets or delivery of groceries from supermarkets to homes;

(4) vouchers for food purchases at selected restaurants in isolated rural areas;

(5) food stamp outreach;

(6) transportation of seniors to congregate dining sites;

(7) nutrition screening assessments and counseling as needed by individuals with special dietary needs, performed by licensed dietitians; and

(8) other appropriate services which support senior nutrition programs, including new service delivery models.

Sec. 8. [256E.20] [KINSHIP CAREGIVER SUPPORT PROGRAM.]

Subdivision 1. [DEFINITIONS.] For the purpose of this section, "kinship caregiver" means:

(1) any of the following persons caring for a minor child who is related to the child by blood, marriage, or adoption: grandparent, great-grandparent, brother, sister, stepbrother, stepsister, niece, nephew, uncle, great-uncle, aunt, or great-aunt; or

(2) a person caring for a minor child who is an important friend of the child and with whom the child has had significant contact.

Subd. 2. [KINSHIP CAREGIVER SUPPORT GRANTS.] (a) A county may establish a program to assist kinship caregivers in providing care to minor kinship children in their care by making one-time support grants available to kinship caregivers. The county may use community social service aids received under this chapter, federal allocations received under this chapter, or other money which the county may make available to fund support grants for this program.

(b) A county may award a grant of up to $2,500 to a kinship caregiver who:

(1) is providing care to one or more kinship children who reside with the kinship caregiver;

(2) requests financial assistance in meeting a portion of the costs incurred in caring for the kinship child or children, including, but not limited to, the cost of items, equipment, or services important for the care or safety of the kinship child or children; and

(3) is not receiving foster care maintenance payments for the care being provided to the kinship child or children.

In determining the amount of a support grant, the county must take into consideration the circumstances of the kinship caregiver and the needs of the kinship child or children being cared for.

(c) A county must not deny a support grant to a kinship caregiver solely on the basis that a child-only AFDC grant payment is made on behalf of the kinship child.

(d) If a kinship caregiver accepts a support grant, and later becomes a relative foster care provider for the kinship child or children, the kinship caregiver must repay the amount of the support grant, plus interest in an amount that is equal to the percentage change in the Consumer Price Index for urban households (CPI-U) for the most recent 12-month period, to the county. The county and the caregiver must agree upon a repayment schedule, but in no case may the kinship caregiver take more than one year to repay the support grant amount.

(e) At county option, a recipient of a kinship caregiver support grant may annually reapply for a support grant under this subdivision.

(f) If an eligible kinship caregiver is a caretaker on an AFDC grant with the kinship child, the county must award any support grant through an in-kind or vendor payment, so as not to make the caretaker and the kinship child ineligible for the AFDC grant due to the receipt of a lump sum.

Subd. 3. [DISTRIBUTION OF KINSHIP CAREGIVER INFORMATION.] A county must give a copy of the informational brochure developed under Laws 1995, chapter 207, article 4, section 42, to a kinship caregiver or potential kinship caregiver who is inquiring about assistance in caring for kinship children.

Subd. 4. [DATA COLLECTION AND WAITING LIST REQUIRED.] Each county that awards grants under this section must keep a written record and report to the commissioner the number of kinship caregivers who have applied for a support grant under this section and the number of kinship caregivers who have received a support grant. A kinship caregiver that appears to be eligible for the program must be put on a waiting list if funds for a support grant are not immediately available.

Sec. 9. Minnesota Statutes 1994, section 327.14, subdivision 8, is amended to read:

Subd. 8. [RECREATIONAL CAMPING AREA.] "Recreational camping area" means any area, whether privately or publicly owned, used on a daily, nightly, weekly, or longer basis for the accommodation of five or more tents or recreational camping vehicles free of charge or for compensation. "Recreational camping area" excludes:

(1) children's camps,;

(2) industrial camps,;

(3) migrant labor camps, as defined in Minnesota Statutes and state commissioner of health rules,;

(4) United States forest service camps,;

(5) state forest service camps,;

(6) state wildlife management areas or state-owned public access areas which are restricted in use to picnicking and boat landing; and

(7) temporary holding areas for self-contained recreational camping vehicles adjacent to motor sports facilities, if the chief law enforcement officer of an affected jurisdiction determines that it is in the interest of public safety to provide a temporary holding area.

Sec. 10. Laws 1995, chapter 207, article 1, section 2, subdivision 4, is amended to read:

Subd. 4. Children's Program 19,860,00021,453,000

The amounts that may be spent from this appropriation for each purpose are as follows:

(a) Children's Trust Fund Grants

247,000 247,000

(b) Families With Children Services Grants and Administration

1,718,000 1,710,000

(c) Family Service Collaborative Grants

1,000,000 1,500,000

(d) Family Preservation, Family Support, and Child Protection Grants

8,573,000 8,573,000

(e) Subsidized Adoption Grants

5,587,000 6,688,000

(f) Other Families with Children Services Grants

2,735,000 2,735,000

[FAMILY SERVICES COLLABORATIVE.] Plans for the expenditure of funds for family services collaboratives must be approved by the children's cabinet according to criteria in Minnesota Statutes, section 121.8355. Money appropriated for these purposes may be expended in either year of the biennium. Money appropriated for family services collaboratives is also available for start-up funds under Minnesota Statutes, section 245.492, subdivision 19, for children's mental health collaboratives.

[HOME CHOICE PROGRAM.] Of this appropriation, $75,000 each year must be used as a grant to the metropolitan council to support the housing and related counseling component of the home choice program.

[FOSTER CARE.] Foster care, as defined in Minnesota Statutes, section 260.015, subdivision 7, is not a community social service as defined in Minnesota Statutes, section 256E.03, subdivision 2, paragraph (a). This paragraph is effective the day following final enactment.

[NEW CHANCE.] Of this appropriation, $100,000 each year is for a grant to the New Chance demonstration project that provides comprehensive services to young AFDC recipients who became pregnant as teenagers and dropped out of high school. The commissioner shall provide an annual report on the progress of the demonstration project, including specific data on participant outcomes in comparison to a control group that received no services. The commissioner shall also include recommendations on whether strategies or methods that have proven successful in the demonstration project should be incorporated into the STRIDE employment program for AFDC recipients.

[HIPPY CARRY FORWARD.] $50,000 in unexpended money appropriated in fiscal year 1995 for the Home Instruction Program for Preschool Youngsters (HIPPY) in Laws 1994, chapter 636, article 1, section 11, does not cancel but is available for the same purposes for fiscal year 1996.

[COMMUNITY COLLABORATIVE MATCHING GRANT.] Of the funds appropriated for family services collaboratives, $75,000 in fiscal year 1996 shall be used for the commissioner of human services to provide a matching grant for community collaborative projects for children and youth developed by a regional organization established under Minnesota Statutes, section 116N.08, to receive rural development challenge grants. The regional organization must include a broad cross-section of public and private sector community representatives to develop programs, services or facilities to address specific community needs of children and youth. The regional organization must also provide a two-to-one match of nonstate dollars for this grant.

[INDIAN CHILD WELFARE GRANTS.] $100,000 is appropriated from the general fund to the commissioner of human services for the purposes of providing compliance grants to an Indian child welfare defense corporation, pursuant to Minnesota Statutes, section 257.3571, subdivision 2a, to be available until June 30, 1997.

Sec. 11. [STUDY OF RESIDENTIAL PROGRAM LICENSING.]

The commissioner of human services shall convene a study group to examine issues related to:

(1) the density of licensed community residential programs serving six or fewer persons which are located in communities which are not cities of the first class;

(2) foster care programs serving more than two individuals which are operated by corporate providers, rather than by individuals or families; and

(3) strategies for avoiding overconcentration of the facilities described in clauses (1) and (2).

In convening the study group, the commissioner shall include consumers of residential services, advocacy groups, community representatives, and providers. The commissioner shall report to the legislature by February 1, 1997, with the results of the study and with recommendations for any changes that may be needed in the licensing system.

Sec. 12. [FINDINGS.]

The legislature finds that:

(1) homicides affect more African American children than any other group;

(2) loss of a loved one due to homicide leaves children uprooted, displaced, abandoned, and isolated;

(3) children who witness a homicide often experience posttraumatic stress, grief, loss, insecurity, conflicting loyalties, and fear of being identified as a witness or fear of retaliation;

(4) community institutions lack the skills necessary to recognize the traumas of these children and provide psychological first aid treatment;

(5) children exposed to community violence can be better served through a program providing psychological first aid and treatment; and

(6) children adversely affected by homicides and other violent crimes cause important and widespread social problems for the state because these children lack the opportunity to learn appropriate problem-solving skills and use violence as a primary problem-solving method to resolve stress in personal conflicts.

Sec. 13. [AUTHORIZATION FOR THE MARTIN LUTHER KING NONVIOLENT INSTITUTIONAL CHILD DEVELOPMENT PILOT PROGRAM.]

(a) The council on Black Minnesotans shall proceed with the planning, designing, and implementation of the Martin Luther King nonviolent institutional child development pilot program which provides:

(1) multi-institutional interdisciplinary community violence prevention programs; and

(2) multi-institutional interdisciplinary intervention programs.

(b) The pilot program may provide service to the following institutions:

(1) elementary and secondary schools;

(2) social service programs and agencies;

(3) youth programs and services;

(4) juvenile delinquency programs;

(5) residential treatment facilities;

(6) foster homes;

(7) law enforcement agencies;

(8) medical centers;

(9) mental health programs; and

(10) religious outreach programs.

(c) The program shall include:

(1) development and implementation of each participating institution's long-range community violence prevention plan for school-age children;

(2) development and implementation of each participating institution's community violence intervention plan for children affected by violence in the community;

(3) identification and implementation of each participating institution's training and staffing needs;

(4) development and implementation of a network among participating institutions to coordinate services, share information, and develop common strategies for violence prevention and intervention; and

(5) funding for participating institution's violence prevention and intervention programs.

(d) The pilot program must be evaluated based on outcome evaluation criteria determined by the executive director of the council on Black Minnesotans in consultation with a community-based advisory council before implementation of the program.

(e) The pilot program must start by January 2, 1997.

(f) The pilot program must be completed by the council on Black Minnesotans by July 1, 1998, and a report presented to the commissioners of human services, public safety, corrections, and children, families, and learning.

Sec. 14. [REPORT ON KINSHIP GRANT PROGRAM.]

The commissioner of human services must report to the legislature by February 15, 1997, on the implementation of the grant program under Minnesota Statutes, section 256E.20. The report must provide information on the number of kinship caregivers who received grants under the program, the average and range of grant amounts awarded, the

purposes to which the kinship caregiver intended to use the grants, the number of grant recipients for whose kinship child an AFDC child-only grant is received, and the extent to which grant recipients later apply for relative foster care maintenance payments. The report must also present information on the satisfaction of kinship caregivers and county social service agencies with the program, and other information which the commissioner finds is relevant to an evaluation of the program.

Sec. 15. [PLANNING FOR RESIDENTIAL FACILITY FOR PARENTS WITH HIV OR AIDS AND THEIR CHILDREN.]

The commissioner of health shall report to the legislature by January 15, 1997, on the planning activities for HIV housing, in cooperation with the Coalition for Housing for People with AIDS, including consideration of appropriate housing options so that parents with HIV or AIDS may live with their children when the disease debilitates the parent so that the parent is not able to care for their children. The report shall also make appropriate recommendations concerning the development of such housing.

Sec. 16. [SAFE HOUSE PROGRAM IN FERGUS FALLS.]

Notwithstanding Minnesota Statutes, section 299A.28, another similar safe house program, primarily focusing on the safety and protection of children, may be developed and operate in the city of Fergus Falls if the program members have completed a criminal background check satisfactory to the Fergus Falls police department. However, the commissioner of public safety is not required to perform the duties listed under Minnesota Statutes, section 299A.28, subdivision 2, with respect to the program in Fergus Falls and is not accountable or liable for any act or failure to act by a member of that program.

Sec. 17. [APPROPRIATIONS; SENIOR SERVICE PROGRAMS.]

Subdivision 1. [VOLUNTEER PROGRAMS.] $150,000 is appropriated from the general fund to the commissioner of human services for volunteer programs for retired senior citizens established under Minnesota Statutes, section 256.9753, to be available for the fiscal year ending June 30, 1997. This appropriation shall be added to the base level appropriation for this activity.

Subd. 2. [FOSTER GRANDPARENT PROGRAM.] $150,000 is appropriated from the general fund to the commissioner of human services for the foster grandparent program established under Minnesota Statutes, section 256.976, to be available for the fiscal year ending June 30, 1997. This appropriation shall be added to the base level appropriation for this activity.

Subd. 3. [SENIOR COMPANION PROGRAM.] $150,000 is appropriated from the general fund to the commissioner of human services for the senior companion program established under Minnesota Statutes, section 256.977, to be available for the fiscal year ending June 30, 1997. This appropriation shall be added to the base level appropriation for this activity.

Sec. 18. [EFFECTIVE DATE.]

Section 10 is effective the day following final enactment."

Delete the title and insert:

"A bill for an act relating to human services; changing provisions to MA and GAMC; providing changes to long-term care; adding provisions to health care and health plan regulations; adding provisions for dental services, senior nutrition programs, and kinship caregiver support programs; authorizing studies and reports; appropriating money; amending Minnesota Statutes 1994, sections 62D.04, subdivision 5; 62N.10, subdivision 4; 62Q.075, subdivision 2; 144.0722, by adding a subdivision; 144.551, subdivision 1; 144.71, subdivisions 1 and 2; 144.72, subdivisions 1 and 2; 144.73, subdivision 1; 144.74; 145.61, subdivision 5; 148C.01, by adding a subdivision; 148C.09, by adding a subdivision; 157.20, by adding a subdivision; 245.462, subdivision 4; 245.4871, subdivision 4; 245.94, subdivisions 2a and 3; 245.95, subdivision 2; 245.97, subdivision 6; 246.57, by adding a subdivision; 253B.11, subdivision 2; 256.482, by adding a subdivision; 256.9355, subdivision 3; 256B.03, by adding a subdivision; 256B.056, subdivision 1a; 256B.058, subdivision 2; 256B.0627, subdivisions 1, as amended, 4, as amended, 5, as amended, and by adding a subdivision; 256B.0913, subdivision 7, and by adding subdivisions; 256B.0915, subdivision 1b, and by adding subdivisions; 256B.15, by adding subdivisions; 256B.35, subdivision 1; 256B.37, subdivision 5; 256B.49, by adding a subdivision; 256B.501, by adding a subdivision; 256B.69, by adding a subdivision; 256D.16; 256I.04,

subdivision 1; 256I.05, subdivision 1c, and by adding a subdivision; and 327.14, subdivision 8; Minnesota Statutes 1995 Supplement, sections 62Q.19, subdivisions 1 and 5; 62R.17; 144.122; 144.9503, subdivisions 6, 8, and 9; 144.9504, subdivisions 2, 7, and 8; 144.9505, subdivision 4; 144A.071, subdivision 3; 148C.01, subdivisions 12 and 13; 148C.02, subdivisions 1 and 2; 148C.03, subdivision 1; 148C.04, subdivisions 3, 4, and by adding a subdivision; 148C.05, subdivision 1; 148C.06; 148C.11, subdivisions 1 and 3; 157.011, subdivision 1; 157.15, subdivisions 4, 5, 6, 9, 12, 13, and 14, and by adding subdivisions; 157.16; 157.17, subdivision 2; 157.20, subdivision 1; 157.21; 252.27, subdivision 2a; 256.045, subdivision 3; 256.969, subdivisions 1, 2b, and 10; 256B.0575; 256B.0625, subdivisions 17, 19a, and 30; 256B.0628, subdivision 2; 256B.0913, subdivisions 5 and 15a; 256B.0915, subdivisions 3 and 3a; 256B.093, subdivision 3; 256B.15, subdivision 5; 256B.431, subdivision 25; 256B.432, subdivision 2; 256B.434, subdivision 10; 256B.49, subdivisions 6 and 7; 256B.501, subdivisions 5b and 5c; 256B.69, subdivisions 3a, 4, 5b, 6, and 21; 256D.03, subdivision 4; and 256I.04, subdivisions 2b and 3; Laws 1995, chapter 207, articles 1, section 2, subdivision 4; and 8, section 42, subdivision 5; proposing coding for new law in Minnesota Statutes, chapters 62J; 144; 145; 157; 252; 256; 256B; and 256E; proposing coding for new law as Minnesota Statutes, chapter 252B; repealing Minnesota Statutes 1994, sections 144.691, subdivision 4; 146.14; 146.20; Minnesota Statutes 1995 Supplement, sections 157.03; 157.15, subdivision 2; 157.18; 157.19; and 256B.69, subdivision 4a; Minnesota Rules, part 9505.5230."

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

The report was adopted.

Rice from the Committee on Economic Development, Infrastructure and Regulation Finance to which was referred:

H. F. No. 2895, A bill for an act relating to drivers' licenses; providing conditions for validity of state contracts; requiring refund of license fee if a qualified applicant does not receive a license, duplicate license, permit, or identification card within six weeks of application; providing for issuance of license without regard to whether the fee has been refunded; requiring legislative audit commission to study driver's license and identification card program; amending Minnesota Statutes 1994, sections 16B.06, subdivision 2; 171.06, by adding a subdivision; and 171.07, subdivisions 1 and 3.

Reported the same back with the following amendments:

Page 2, line 35, delete "1995" and insert "1996"

With the recommendation that when so amended the bill pass and be re-referred to the Committee on Rules and Legislative Administration.

The report was adopted.

Rice from the Committee on Economic Development, Infrastructure and Regulation Finance to which was referred:

H. F. No. 2949, A bill for an act relating to transportation; establishing transportation policy for the metropolitan area; requiring a performance audit of the metropolitan transportation system; expanding the metropolitan council's authority over metropolitan area highways; requiring the council to establish a community-based transit demonstration program; providing a service incentive for opt-outs; providing for legislative auditor to prepare a best practices report; requiring the council to prepare a transit redesign plan for 1997; requiring legislative report; appropriating money; amending Minnesota Statutes 1994, sections 174.03, subdivision 5; 473.167, subdivision 1; and 473.388, by adding a subdivision; proposing coding for new law in Minnesota Statutes, chapter 473.

Reported the same back with the following amendments:

Page 2, line 32, delete "BIENNIAL"

Page 2, line 33, before "The" insert "In 1997 and every four years thereafter,"

Page 3, line 6, delete everything after the period

Page 3, delete line 7 and insert "In 1997 and every two years thereafter, the council must evaluate the performance of the metropolitan transit system's operation in relationship to the regional transit performance standards developed by the council."

Page 3, lines 10 to 15, delete the new language and reinstate the stricken language

Page 3, line 12, after "highway" insert "or other highway that the Minnesota department of transportation functionally classifies as a principal arterial highway,"

Pages 5 to 6, delete section 10 and insert:

"Sec. 10. [PERFORMANCE MEASURES TO BE MET.]

Subdivision 1. [METROPOLITAN COUNCIL.] If the metropolitan council is appropriated money from the general fund for public transit operations for fiscal year 1997, 1.5 percent shall be made available to the council after June 1, 1997, only if the commissioner of finance determines that metropolitan council transit operations passengers per revenue hour productivity has increased in a one-year period between the effective date of this section and June 1, 1997. Another 1.5 percent shall be made available to the council after June 1, 1997, only if the commissioner of finance determines that metropolitan council transit operations subsidy per passenger has decreased in a one-year period between the effective date of this section and June 1, 1997.

Subd. 2. [DEPARTMENT OF TRANSPORTATION.] If the commissioner of transportation is appropriated money from the trunk highway fund in 1996 for state road construction, five percent shall be made available to the commissioner after June 1, 1997, only if the commissioner of finance determines that the department of transportation's administrative costs have decreased as a percentage of construction costs in a one-year period between the effective date of this section and June 1, 1997."

Page 6, line 20, delete "1996" and insert "1997"

Amend the title as follows:

Page 1, lines 12 and 13, delete "appropriating money" and insert "withholding portion of appropriations to council and department of transportation unless certain standards satisfied"

With the recommendation that when so amended the bill pass.

The report was adopted.

Pursuant to Senate Concurrent Resolution No. 12, H. F. No. 2949 was re-referred to the Committee on Rules and Legislative Administration.

Rice from the Committee on Economic Development, Infrastructure and Regulation Finance to which was referred:

H. F. No. 3137, A bill for an act relating to transportation; appropriating money for metropolitan area and transportation purposes.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. [TRANSPORTATION AND OTHER AGENCIES APPROPRIATIONS.]

The sums in the columns headed "APPROPRIATIONS" are appropriated from the general fund, or another named fund, to the agencies and for the purposes specified, to be available for the fiscal year ending June 30, 1997.

1997

General Fund $ 6,697,000

Trunk Highway Fund 42,925,000

Highway User Tax Distribution Fund 127,000

TOTAL $ 49,749,000

APPROPRIATIONS

Available for the Year

Ending June 30

1996 1997

Sec. 2. DEPARTMENT OF TRANSPORTATION 43,145,000

For the purpose of Laws 1995, chapter 254, article 1, section 93, paragraph (a), "contracts for highway construction or maintenance" includes contracts for design engineering and construction engineering.

(a) State Road Construction

35,685,000

This appropriation for fiscal year 1997 is from the trunk highway fund for state road construction and is added to the appropriations in Laws 1995, chapter 265, article 2, section 2, subdivision 7, clause (a).

(b) Design Engineering and Construction Engineering

6,160,000

This appropriation for fiscal year 1997 is from the trunk highway fund for design engineering and construction engineering and is added to the appropriations in Laws 1995, chapter 265, article 2, section 2, subdivision 7, clauses (d) and (e), as needed.

(c) Greater Minnesota Transit Assistance

1,000,000

This appropriation for fiscal year 1997 is for greater Minnesota transit assistance and is added to the appropriation in Laws 1995, chapter 265, article 2, section 2, subdivision 3, clause (a). Any unencumbered balance in that clause for fiscal year 1996 does not cancel but is available for the second year.

(d) Stone Arch Bridge

100,000

This appropriation is for the repair of the Stone Arch Bridge.

(e) Shingobee Township

100,000

This appropriation is for a grant to the town of Shingobee in Cass county. The town board must use this grant to improve a road within the town known as the Ah-Gwah-Ching cutoff road. The commissioner shall make this grant only after determining that the town board has made a commitment to establish the road as a town road upon completion of the improvement project.

(f) Driver Education Programs

100,000

This appropriation is from the trunk highway fund for a grant to the Minnesota highway safety center at St. Cloud State University for driver education programs.

Sec. 3. METROPOLITAN COUNCIL 5,267,000

This appropriation for fiscal year 1997 is for metropolitan transit operations and is added to the appropriation in Laws 1995, chapter 265, article 2, section 3.

Notwithstanding the limit on spending for metro mobility in Laws 1995, chapter 265, article 2, section 3, the metropolitan council may spend up to $1,600,000 of this appropriation for metro mobility.

Sec. 4. PUBLIC SAFETY 1,337,000

(a) State Patrol

150,000

This appropriation for fiscal year 1997 is added to the appropriations in Laws 1995, chapter 265, article 2, section 5, subdivision 3, and is for four additional positions for state patrol communications officers. This appropriation is from the trunk highway fund.

(b) Driver and Vehicle Services

303,000

$14,000 from the highway user tax distribution fund and $65,000 from the trunk highway fund are for costs related to the implementation of Minnesota Statutes, section 168.042.

$113,000 is from the highway user tax distribution fund and is added to the appropriations in Laws 1995, chapter 265, article 2, section 5, subdivision 4. This appropriation is for costs related to driver's license and motor vehicle registration records and is available only to the extent required to comply with a law effective during fiscal year 1997 that substantially changes the data privacy status of these records.

$111,000 is from the general fund to implement Minnesota Statutes, section 171.07, subdivision 11.

(c) Administration and Related Services

884,000

This appropriation for fiscal year 1997 is added to the appropriations in Laws 1995, chapter 265, article 2, section 5, subdivision 2.

This appropriation is for agency critical operations systems. Of this appropriation, $765,000 is from the trunk highway fund.

Sec. 5. Minnesota Statutes 1995 Supplement, section 13.69, subdivision 1, is amended to read:

Subdivision 1. [CLASSIFICATIONS.] (a) The following government data of the department of public safety are private data:

(1) medical data on driving instructors, licensed drivers, and applicants for parking certificates and special license plates issued to physically handicapped persons;

(2) other data on holders of a disability certificate under section 169.345, except that data that are not medical data may be released to law enforcement agencies; and

(3) social security numbers in driver's license and motor vehicle registration records, except that social security numbers must be provided to the department of revenue for purposes of tax administration and the department of labor and industry for purposes of workers' compensation administration and enforcement.; and

(4) data on persons listed as designated parents under section 171.07, subdivision 11, except that the data must be released to:

(i) law enforcement agencies for the purpose of verifying that an individual is a designated parent; or

(ii) law enforcement agencies who state that the license holder is unable to communicate at that time and that the information is necessary for notifying the designated parent of the need to care for a child of the license holder.

(b) The following government data of the department of public safety are confidential data: data concerning an individual's driving ability when that data is received from a member of the individual's family.

Sec. 6. Minnesota Statutes 1994, section 160.85, is amended by adding a subdivision to read:

Subd. 3a. [INFORMATION MEETING.] Before approving or denying a development agreement, the commissioner shall hold a public information meeting in any municipality or county in which any portion of the proposed toll facility runs. The commissioner shall determine the time and place of the information meeting.

Sec. 7. Minnesota Statutes 1994, section 168.013, subdivision 3, is amended to read:

Subd. 3. [APPLICATION; CANCELLATION; EXCESSIVE GROSS WEIGHTS FORBIDDEN.] The applicant for all licenses based on gross weight shall state in writing upon oath, the unloaded weight of the motor vehicle, trailer or semitrailer and the maximum load the applicant proposes to carry thereon, the sum of which shall constitute the gross weight upon which the license tax shall be paid, but in no case shall the declared gross weight upon which the tax is paid be less than 1-1/4 times the declared unloaded weight of the motor vehicle, trailer or semitrailer to be registered, except recreational vehicles taxed under subdivision 1g, school buses taxed under subdivision 18 and tow trucks or towing vehicles defined in section 169.01, subdivision 52. The gross weight of a tow truck or towing vehicle is the actual weight of the tow truck or towing vehicle fully equipped, but does not include the weight of a wrecked or disabled vehicle towed or drawn by the tow truck or towing vehicle.

The gross weight of no motor vehicle, trailer or semitrailer shall exceed the gross weight upon which the license tax has been paid by more than four percent or 1,000 pounds, whichever is greater.

The gross weight of the motor vehicle, trailer or semitrailer for which the license tax is paid shall be indicated by a distinctive character on the license plate or plates except as provided in subdivision 12 and the plate or plates shall be kept clean and clearly visible at all times.

The owner, driver, or user of a motor vehicle, trailer or semitrailer upon conviction for transporting a gross weight in excess of the gross weight for which it was registered or for operating a vehicle with an axle weight exceeding the maximum lawful axle load weight shall be guilty of a misdemeanor and be subject to increased registration or reregistration according to the following schedule:

(1) The owner, driver or user of a motor vehicle, trailer or semitrailer upon conviction for transporting a gross weight in excess of the gross weight for which it is registered by more than four percent or 1,000 pounds, whichever is greater, but less than 25 percent or for operating or using a motor vehicle, trailer or semitrailer with an axle weight exceeding the maximum lawful axle load as provided in section 169.825 by more than four percent or 1,000 pounds, whichever is greater, but less than 25 percent, in addition to any penalty imposed for the misdemeanor shall apply to the registrar to increase the authorized gross weight to be carried on the vehicle to a weight equal to or greater than the gross weight the owner, driver, or user was convicted of carrying, the increase computed for the balance of the calendar year on the basis of 1/12 of the annual tax for each month remaining in the calendar year beginning with the first day of the month in which the violation occurred. If the additional registration tax computed upon that weight, plus the tax already paid, amounts to more than the regular tax for the maximum gross weight permitted for the vehicle under section 169.825, that additional amount shall nevertheless be paid into the highway fund, but the additional tax thus paid shall not permit the vehicle to be operated with a gross weight in excess of the maximum legal weight as provided by section 169.825. Unless the owner within 30 days after a conviction shall apply to increase the authorized weight and pay the additional tax as provided in this section, the registrar shall revoke the registration on the vehicle and demand the return of the registration card and plates issued on that registration.

(2) The owner or driver or user of a motor vehicle, trailer or semitrailer upon conviction for transporting a gross weight in excess of the gross weight for which the motor vehicle, trailer or semitrailer was registered by 25 percent or more, or for operating or using a vehicle or trailer with an axle weight exceeding the maximum lawful axle load as provided in section 169.825 by 25 percent or more, in addition to any penalty imposed for the misdemeanor, shall have the reciprocity privileges on the vehicle involved if the vehicle is being operated under reciprocity canceled by the registrar, or if the vehicle is not being operated under reciprocity, the certificate of registration on the vehicle operated shall be canceled by the registrar and the registrar shall demand the return of the registration certificate and registration plates. The registrar may not cancel the registration or reciprocity privileges for any vehicle found in violation of seasonal load restrictions imposed under section 169.87 unless the axle weight exceeds the year-round weight limit for the highway on which the violation occurred. The registrar may investigate any allegation of gross weight violations and demand that the operator show cause why all future operating privileges in the state should not be revoked unless the additional tax assessed is paid.

(3) Clause (1) does not apply to the first haul of unprocessed or raw farm products or unfinished forest products, when the registered gross weight is not exceeded by more than ten percent. For purposes of this clause "first haul" means (1) the first, continuous transportation of unprocessed or raw farm products from the place of production or on-farm storage site to any other location within 50 miles of the place of production or on-farm storage site, or (2) the first, continuous transportation of unfinished forest products from the place of production to the place of first unloading.

(4) When the registration on a motor vehicle, trailer or semitrailer is revoked by the registrar according to provisions of this section, the vehicle shall not be operated on the highways of the state until it is registered or reregistered, as the case may be, and new plates issued, and the registration fee shall be the annual tax for the total gross weight of the vehicle at the time of violation. The reregistration pursuant to this subdivision of any vehicle operating under reciprocity agreements pursuant to section 168.181 or 168.187 shall be at the full annual registration fee without regard to the percentage of vehicle miles traveled in this state.

Sec. 8. Minnesota Statutes 1994, section 168.042, subdivision 8, is amended to read:

Subd. 8. [REISSUANCE OF REGISTRATION PLATES.] (a) The commissioner shall rescind the impoundment order of a person subject to an order under this section, other than the violator, if a:

(1) the violator had a valid driver's license on the date of the violation and the person subject to an impoundment order under this section, other than the violator, files with the commissioner an acceptable sworn statement containing the following information:

(1) (i) that the person is the registered owner of the vehicle from which the plates have been impounded under this section;

(2) (ii) that the person is the current owner and possessor of the vehicle used in the violation;

(3) (iii) the date on which the violator obtained the vehicle from the registered owner;

(4) (iv) the residence addresses of the registered owner and the violator on the date the violator obtained the vehicle from the registered owner;

(5) (v) that the person was not a passenger in the vehicle at the time of the violation; and

(6) (vi) that the person knows that the violator may not drive, operate, or be in physical control of a vehicle without a valid driver's license; or

(2) the violator did not have a valid driver's license on the date of the violation and the person made a report to law enforcement before the violation stating that the vehicle had been taken from the person's possession or was being used without permission.

(b) The commissioner may not rescind the impoundment order nor reissue registration plates to a registered owner if the owner knew or had reason to know that the violator did not have a valid driver's license on the date the violator obtained the vehicle from the owner. A person who has failed to make a report as provided in paragraph (a), clause (2), may be issued special registration plates under subdivision 12 for a period of one year from the effective date of the impoundment order. At the next registration renewal following this period, the person may apply for regular registration plates.

(c) If the order is rescinded, the owner shall receive new registration plates at no cost, if the plates were seized and destroyed.

Sec. 9. Minnesota Statutes 1994, section 168.042, is amended by adding a subdivision to read:

Subd. 13a. [ACQUIRING ANOTHER VEHICLE.] If during the effective period of the plate impoundment the violator applies to the commissioner for registration plates for any vehicle, the commissioner shall not issue registration plates unless the violator qualifies for special registration plates under subdivision 12 and unless the plates issued are special plates as described in subdivision 12.

Sec. 10. Minnesota Statutes 1994, section 168.12, subdivision 2, is amended to read:

Subd. 2. [AMATEUR RADIO STATION LICENSEE; SPECIAL LICENSE PLATES.] Any applicant who is an owner or joint owner of a passenger automobile, van or pickup truck, or a self-propelled recreational vehicle, and a resident of this state, and who holds an official amateur radio station license, or a citizens radio service class D license, in good standing, issued by the Federal Communications Commission shall upon compliance with all laws of this state relating to registration and the licensing of motor vehicles and drivers, be furnished with license plates for the motor vehicle, as prescribed by law, upon which, in lieu of the numbers required for identification under subdivision 1, shall be inscribed the official amateur call letters of the applicant, as assigned by the Federal Communications Commission., and the words "AMATEUR RADIO." The applicant shall pay in addition to the registration tax required by law, the sum of $10 for the special license plates, and at the time of delivery of the special license plates the applicant shall surrender to the registrar the current license plates issued for the motor vehicle. This provision for the issue of special license plates shall apply only if the applicant's vehicle is already registered in Minnesota so that the applicant has valid regular Minnesota plates issued for that vehicle under which to operate it during the time that it will take to have the necessary special license plates made. If owning or jointly owning more than one motor vehicle of the type specified in this subdivision, the applicant may apply for special plates for each of not more than two vehicles, and, if each application complies with this subdivision, the registrar shall furnish the applicant with the special plates, inscribed with the official amateur call letters and other distinguishing information as the registrar considers necessary, for each of the two vehicles. And the registrar may make reasonable rules governing the use of the special license plates as will assure the full compliance by the owner and holder of the special plates, with all existing laws governing the registration of motor vehicles, the transfer and the use thereof.

Despite any contrary provision of subdivision 1, the special license plates issued under this subdivision may be transferred to another motor vehicle upon the payment of a fee of $5. The registrar must be notified of the transfer and may prescribe a form for the notification.

Fees collected under this subdivision must be paid into the state treasury and credited to the highway user tax distribution fund.

Sec. 11. Minnesota Statutes 1994, section 168.123, subdivision 1, is amended to read:

Subdivision 1. [GENERAL REQUIREMENTS; FEES.] (a) On payment of a fee of $10 for each set of two plates, or for a single plate in the case of a motorcycle plate, payment of the registration tax required by law, and compliance with other laws relating to the registration and licensing of a passenger automobile, pickup truck, van, self-propelled recreational equipment, or motorcycle, as applicable, the registrar shall issue:

(1) special license plates to an applicant who served in the active military service in a branch of the armed forces of the United States or of a nation or society allied with the United States in conducting a foreign war, was discharged under honorable conditions, and is an owner or joint owner of a motor vehicle included within the definition of a passenger automobile or which is, pickup truck, van, or self-propelled recreational equipment, on payment of a fee of $10 for each set of two plates, payment of the registration tax required by law, and compliance with other laws relating to registration and licensing of motor vehicles and drivers; or

(2) a special motorcycle license plate as described in subdivision 2, paragraph (a), or another special license plate designed by the commissioner of public safety, to an applicant who is a Vietnam veteran who served after July 1, 1961, and before July 1, 1978, and who served in the active military service in a branch of the armed forces of the United States in conducting a foreign war, was discharged under honorable conditions, and is an owner or joint owner of a motorcycle. Plates issued under this clause must be the same size as standard motorcycle license plates.

(b) The additional fee of $10 is payable for each set of plates, is payable only when the plates are issued, and is not payable in a year in which tabs or stickers are issued instead of number plates. An applicant must not be issued more than two sets of plates for vehicles listed in paragraph (a) and owned or jointly owned by the applicant.

(c) The veteran shall have a certified copy of the veteran's discharge papers, indicating character of discharge, at the time of application. If an applicant served in the active military service in a branch of the armed forces of a nation or society allied with the United States in conducting a foreign war and is unable to obtain a record of that service and discharge status, the commissioner of veterans affairs may certify the applicant as qualified for the veterans' license plates provided under this section.

Sec. 12. Minnesota Statutes 1994, section 168.123, subdivision 4, is amended to read:

Subd. 4. [PLATE TRANSFERS.] (a) On payment of a fee of $5, plates issued under this section subdivision 1, paragraph (a), clause (1), may be transferred to another motor vehicle passenger automobile, pickup truck, van, or self-propelled recreational equipment owned or jointly owned by the person to whom the plates were issued.

(b) On payment of a fee of $5, a plate issued under subdivision 1, paragraph (a), clause (2), may be transferred to another motorcycle owned or jointly owned by the person to whom the plate was issued.

Sec. 13. [168.1291] [SPECIAL LICENSE PLATES; DESIGN.]

Subdivision 1. [DEFINITION.] For purposes of this section, "special license plates" means license plates issued under sections 168.12, subdivisions 2b to 2e; 168.123; and 168.129.

Subd. 2. [DESIGN OF SPECIAL LICENSE PLATES.] The commissioner shall design a single special license plate that will contain a unique number and a space for a unique symbol. The commissioner shall design a unique symbol related to the purpose of each special license plate. Any provision of section 168.12, subdivision 2b, 2c, 2d, or 2e, or 168.129 that requires the placement of a specified letter or letters on a special license plate applies to those license plates only to the extent that the commissioner includes the letter or letters in the design. Where a law authorizing a special license plate contains a specific requirement for graphic design of that license plate, that requirement applies to the appropriate unique symbol the commissioner designs.

Subd. 3. [ISSUANCE OF SPECIAL LICENSE PLATES WITH UNIQUE SYMBOLS.] Notwithstanding sections 168.12, subdivisions 2b to 2e, and 168.129, beginning with special license plates issued in calendar year 1997, the commissioner shall issue each class of special license plates permanently marked with specific designs under those laws only until the commissioner's supply of those license plates is exhausted. Thereafter, the commissioner shall issue under sections 168.12, subdivisions 2b to 2e, and 168.129 only the license plate authorized under subdivision 2, with the appropriate unique symbol attached.

Subd. 4. [FEES.] Notwithstanding sections 168.12, subdivisions 2b to 2e, and 168.129, the commissioner shall adjust any license plate fee prescribed in those laws to reflect the cost of designing and manufacturing unique symbols under this section.

Sec. 14. [168.1292] [SPECIAL OLYMPIC LICENSE PLATES.]

Subdivision 1. [GENERAL REQUIREMENTS AND PROCEDURES.] The registrar shall issue special Olympic license plates to an applicant who:

(1) is an owner or joint owner of a passenger automobile, pickup truck, or van;

(2) pays a fee determined by the registrar to cover the costs of handling and manufacturing the plates;

(3) pays the registration tax required under section 168.013;

(4) pays the fees required under this chapter;

(5) contributes $15 annually to the Minnesota amateur sports commission account established in subdivision 6; and

(6) complies with laws and rules governing registration and licensing of vehicles and drivers.

Subd. 2. [DESIGN.] After consultation with the United States Olympic Committee, the registrar shall design the special Olympic plates.

In consultation with the registrar, the Minnesota amateur sports commission annually shall indicate the number of plates the commission anticipates will be needed.

Subd. 3. [NO REFUND.] Contributions under this section must not be refunded.

Subd. 4. [PLATE TRANSFERS.] Notwithstanding section 168.12, subdivision 1, on payment of a transfer fee of $5, plates issued under this section may be transferred to another passenger vehicle, pickup truck, or van owned or jointly owned by the person to whom the special plates were issued.

Subd. 5. [FEES CREDITED.] The fees collected under this section must be deposited in the state treasury and credited to the highway user tax distribution fund.

Subd. 6. [MINNESOTA AMATEUR SPORTS COMMISSION ACCOUNT.] A Minnesota amateur sports commission account is created in the state treasury. Money in the account is appropriated to the Minnesota amateur sports commission to support maximum sport and physical fitness opportunities for all residents of this state regardless of gender, age, race, ability, geography, or economic status, and to provide meaningful sport and fitness opportunities for residents of this state who are economically disadvantaged, senior citizens, persons with disabilities, or residents of Greater Minnesota.

Subd. 7. [RECORD.] The registrar shall maintain a record of the number of license plates issued for the United States Olympic Committee.

Subd. 8. [CONTRIBUTIONS.] The registrar shall issue a set of Olympic license plates under this section only to a person who presents at the time of applying for registration a receipt from the Minnesota amateur sports commission that demonstrates that the applicant has contributed at least $15 to the Minnesota amateur sports commission account within 90 days prior to the date of the application. After the issuance of that set of Olympic license plates, the collection of subsequent contributions during the life of that set of license plates is the responsibility of the commission.

Sec. 15. Minnesota Statutes 1994, section 168.15, is amended to read:

168.15 [RIGHTS AS TO REGISTRATION CERTIFICATES AND NUMBER PLATES.]

Subdivision 1. [TRANSFER OF OWNERSHIP.] Except as provided in subdivision 3, upon the transfer of ownership, destruction, theft, dismantling as such, or the permanent removal by the owner thereof from this state of any motor vehicle registered in accordance with the provisions of this chapter, the right of the owner of such vehicle

to use the registration certificate and number plates assigned such vehicle shall expire, and such certificate and any existing plates shall be, by such owner, forthwith returned, with transportation prepaid, to the registrar with a signed notice of the date and manner of termination of ownership, giving the name and post office address, with street and number, if in a city, of the person to whom transferred. No fee may be charged for a return of plates under this section. When the ownership of a motor vehicle shall be transferred to another who shall forthwith register the same in the other's name, the registrar may permit the manual delivery of such plates to the new owner of such vehicle. When seeking to become the owner by gift, trade, or purchase of any vehicle for which a registration certificate has been theretofore issued under the provisions of this chapter, a person shall join with the registered owner in transmitting with the application the registration certificate, with the assignment and notice of sale duly executed upon the reverse side thereof, or, in case of loss of such certificate, with such proof of loss by sworn statement, in writing, as shall be satisfactory to the registrar. Upon the transfer of any motor vehicle by a manufacturer or dealer, for use within the state, whether by sale, lease, or otherwise, such manufacturer or dealer shall, within seven days after such transfer, file with the registrar a notice or report containing the date of such transfer, a description of such motor vehicles, and the name, street and number of residence, if in a city, and the post office address of the transferee, and shall transmit therewith the transferee's application for registration thereof.

Subd. 2. [TRANSFER OF ENGINE.] Upon the transfer of any automobile engine or motor, except a new engine or motor, transferred with intent that the same be installed in a new automobile, and whether such transfer be made by a manufacturer or dealer, or otherwise, and whether by sale, lease or otherwise, the transferor shall, within two days after such transfer, file with the registrar a notice or report containing the date of such transfer and a description, together with the maker's number of the engine or motor, and the name and post office address of the purchaser, lessee, or other transferee.

Subd. 3. [VEHICLES OF LESSORS; TRANSFERS.] Notwithstanding subdivision 1, a motor vehicle lessor licensed under section 168.27, subdivision 2, 3, or 4, may transfer license plates issued to one rental motor vehicle owned by the lessor to another rental motor vehicle owned by the lessor, if within ten days of the transfer the lessor registers the vehicle to which the license plates were transferred. Upon registration, the lessor must pay all taxes and fees due on the registration of the vehicle to which the license plates were transferred, plus a transfer fee of $10. The fee must be deposited in the highway user tax distribution fund. For purposes of this subdivision, "rental motor vehicle" means a vehicle used for rentals or leases of 30 days or less.

Sec. 16. Minnesota Statutes 1995 Supplement, section 168.16, is amended to read:

168.16 [REFUNDS; APPROPRIATION.]

After the tax upon any motor vehicle shall have been paid for any year, refund shall be made for errors made in computing the tax or fees and for the error on the part of an owner who may in error have registered a motor vehicle that was not before, nor at the time of registration, nor at any time thereafter during the current past year, subject to tax in this state as provided by section 168.012. Unless otherwise provided in this chapter, a claim for a refund of an overpayment of registration tax must be filed within 3-1/2 years from the date of payment. The refundment shall be made from any fund in possession of the registrar and shall be deducted from the registrar's monthly report to the commissioner of finance. A detailed report of the refundment shall accompany the report. The former owner of a transferred vehicle by an assignment in writing endorsed upon the registration certificate and delivered to the registrar within the time provided herein may sell and assign to the new owner thereof the right to have the tax paid by the former owner accredited to the owner who duly registers the vehicle. Any owner at the time of such occurrence, whose vehicle shall be is permanently destroyed, or sold to the federal government, the state, or political subdivision thereof, and any owner who sells a rental motor vehicle and transfers the license plates issued to that motor vehicle under section 168.15, subdivision 3, shall upon filing a verified claim be entitled to a refund of the unused portion of the tax paid upon the vehicle, computed as follows:

(1) if the vehicle is registered under the calendar year system of registration, the refund is computed pro rata by the month, 1/12 of the annual tax paid for each month of the year remaining after the month in which the plates and certificate were returned to the registrar;

(2) in the case of a vehicle registered under the monthly series system of registration, the amount of the refund is equal to the sum of the amounts of the license fee attributable to those months remaining in the licensing period after the month in which the plates and certificate were returned to the registrar.

There is hereby appropriated to the persons entitled to a refund, from the fund or account in the state treasury to which the money was credited, an amount sufficient to make the refund and payment. Refunds under this section to licensed motor vehicle lessors must be made annually in a manner the registrar determines.

Sec. 17. Minnesota Statutes 1994, section 168.33, is amended by adding a subdivision to read:

Subd. 8. [TEMPORARY DISABILITY PERMIT AND FEE.] The registrar shall allow deputy registrars to implement and follow procedures for processing applications and accepting and remitting fee payments for 30-day temporary disability permits issued under section 169.345, subdivision 3, paragraph (c), that are identical or substantially similar to the procedures required by rule for motor vehicle registration and titling transactions.

Sec. 18. Minnesota Statutes 1994, section 169.121, subdivision 3, is amended to read:

Subd. 3. [CRIMINAL PENALTIES.] (a) As used in this subdivision:

(1) "prior impaired driving conviction" means a prior conviction under this section; section 84.91, subdivision 1, paragraph (a); 86B.331, subdivision 1, paragraph (a); 169.129; 360.0752; 609.21, subdivision 1, clauses (2) to (4); 609.21, subdivision 2, clauses (2) to (4); 609.21, subdivision 2a, clauses (2) to (4); 609.21, subdivision 3, clauses (2) to (4); 609.21, subdivision 4, clauses (2) to (4); or an ordinance from this state, or a statute or ordinance from another state in conformity with any of them. A prior impaired driving conviction also includes a prior juvenile adjudication that would have been a prior impaired driving conviction if committed by an adult; and

(2) "prior license revocation" means a driver's license suspension, revocation, or cancellation under this section; section 169.123; 171.04; 171.14; 171.16; 171.17; or 171.18 because of an alcohol-related incident; 609.21, subdivision 1, clauses (2) to (4); 609.21, subdivision 2, clauses (2) to (4); 609.21, subdivision 2a, clauses (2) to (4); 609.21, subdivision 3, clauses (2) to (4); or 609.21, subdivision 4, clauses (2) to (4); or an ordinance from this state, or a statute or ordinance from another state in conformity with any of them.

(b) A person who violates subdivision 1 or 1a, or an ordinance in conformity with either of them, is guilty of a misdemeanor.

(c) A person is guilty of a gross misdemeanor under any of the following circumstances:

(1) the person violates subdivision 1 within five years of a prior impaired driving conviction, or within ten years of the first of two or more prior impaired driving convictions;

(2) the person violates subdivision 1a within five years of a prior license revocation, or within ten years of the first of two or more prior license revocations;

(3) the person violates section 169.26 while in violation of subdivision 1; or

(4) the person violates subdivision 1 or 1a while a child under the age of 16 is in the vehicle, if the child is more than 36 months younger than the violator.

(d) The attorney in the jurisdiction in which the violation occurred who is responsible for prosecution of misdemeanor violations of this section shall also be responsible for prosecution of gross misdemeanor violations of this section.

(e) The court must impose consecutive sentences when it sentences a person for a violation of this section or section 169.29 arising out of separate behavioral incidents. The court also must impose a consecutive sentence when it sentences a person for a violation of this section or section 169.129 and the person, at the time of sentencing, is on probation for, or serving, an executed sentence for a violation of this section or section 169.29 and the prior sentence involved a separate behavioral incident. The court also may order that the sentence imposed for a violation of this section or section 169.29 shall run consecutively to a previously imposed misdemeanor, gross misdemeanor or felony sentence for a violation other than this section or section 169.129.

(f) When an attorney responsible for prosecuting gross misdemeanors under this section requests criminal history information relating to prior impaired driving convictions from a court, the court must furnish the information without charge.

(g) A violation of subdivision 1a may be prosecuted either in the jurisdiction where the arresting officer observed the defendant driving, operating, or in control of the motor vehicle or in the jurisdiction where the refusal occurred.

Sec. 19. Minnesota Statutes 1994, section 169.82, subdivision 3, is amended to read:

Subd. 3. [HITCHES; CHAINS; CABLES.] (a) Every trailer or semitrailer must be hitched to the towing motor vehicle by a device approved by the commissioner of public safety.

(b) Every trailer and semitrailer must be equipped with safety chains or cables permanently attached to the trailer except in cases where the coupling device is a regulation fifth wheel and kingpin assembly approved by the commissioner of public safety. In towing, the chains or cables must be carried through a ring on the towbar and attached to the towing attached to the vehicles near the points of bumper attachments to the chassis of each vehicle, and must be of sufficient strength to control the trailer in the event of failure of the towing device. The length of chain or cable must be no more than necessary to permit free turning of the vehicles.

(c) This subdivision does not apply to towed implements of husbandry.

No person may be charged with a violation of this section solely by reason of violating a maximum speed prescribed in section 169.145 or 169.67.

Sec. 20. Minnesota Statutes 1994, section 169.871, is amended by adding a subdivision to read:

Subd. 1b. [CIVIL PENALTY FOR FIRST TWO VIOLATIONS.] Notwithstanding subdivision 1, clauses (a) to (e), a civil penalty under subdivision 1 for a violation in a motor vehicle in the course of a first haul as defined in section 168.013, subdivision 3, clause (3), of a weight limit imposed under sections 169.825, 169.832 to 169.851, and 169.87 that is not preceded by two or more violations of the gross weight limits in those sections in that motor vehicle within the previous 12 months, may not exceed $150.

Sec. 21. Minnesota Statutes 1994, section 169.98, subdivision 1, is amended to read:

Subdivision 1. [COLORS AND MARKINGS.] Except as provided in subdivisions 2 and 2a, all motor vehicles which are primarily used in the enforcement of highway traffic rules by the state patrol or for general uniform patrol assignment by any municipal police department or other law enforcement agency, except conservation officers, shall have uniform colors and markings as provided herein. Motor vehicles of:

(a) Municipal police departments, including the University of Minnesota police department and park police units, and constables shall be predominantly blue, brown, green or white;

(b) The state patrol shall be predominantly maroon or white; and

(c) The county sheriffs' office shall be predominantly brown or white.

The identity of the governmental unit operating the vehicle shall be displayed on both front door panels and on the rear of the vehicle. The identity may be in the form of a shield or emblem, or may be the word "police," "sheriff," or the words "state patrol" or "conservation officer," as appropriate, with letters not less than 2-1/2 inches high, one-inch wide and of a three-eighths inch brush stroke. The identity shall be of a color contrasting with the background color so that the motor vehicle is easily identifiable as belonging to a specific type of law enforcement agency. Each vehicle shall be marked with its own identifying number on the rear of the vehicle. The number shall be printed in the same size and color required pursuant to this subdivision for identifying words which may be displayed on the vehicle.

Sec. 22. Minnesota Statutes 1995 Supplement, section 171.04, subdivision 1, is amended to read:

Subdivision 1. [PERSONS NOT ELIGIBLE.] The department shall not issue a driver's license hereunder:

(1) To any person who is under the age of 16 years; to any person under 18 years unless such person shall have successfully completed a course in driver education, including both classroom and behind-the-wheel instruction, approved by the state board of education for courses offered through the public schools, or, in the case of a course offered by a private, commercial driver education school or institute, by the department of public safety; except when such person has completed a course of driver education in another state or has a previously issued valid license from another state or country; nor to any person under 18 years unless the application of license is approved by either parent when both reside in the same household as the minor applicant, otherwise the parent or spouse of the parent having custody or with whom the minor is living in the event there is no court order for custody, or guardian having the custody of such minor, or in the event a person under the age of 18 has no living father, mother or guardian, the license shall not be issued to such person unless the application therefor is approved by the person's employer. Driver education courses offered in any public school shall be open for enrollment to persons between the ages of 15 and 18 years residing in the school district or attending school therein. Any public school offering driver education courses may charge an enrollment fee for the driver education course which shall not exceed the actual cost thereof to the public school and the school district. The approval required herein shall contain a verification of the age of the applicant;

(2) To any person who is under the age of 18 years unless the person has applied for, been issued, and possessed the appropriate instruction permit for a minimum of six months;

(3) To any person whose license has been suspended during the period of suspension except that a suspended license may be reinstated during the period of suspension upon the licensee furnishing proof of financial responsibility in the same manner as provided in the Minnesota no-fault automobile insurance act;

(3) (4) To any person whose license has been revoked except upon furnishing proof of financial responsibility in the same manner as provided in the Minnesota no-fault automobile insurance act and if otherwise qualified;

(4) (5) To any person who is a drug dependent person as defined in section 254A.02, subdivision 5;

(5) (6) To any person who has been adjudged legally incompetent by reason of mental illness, mental deficiency, or inebriation, and has not been restored to capacity, unless the department is satisfied that such person is competent to operate a motor vehicle with safety to persons or property;

(6) (7) To any person who is required by this chapter to take an examination, unless such person shall have successfully passed such examination;

(7) (8) To any person who is required under the provisions of the Minnesota no-fault automobile insurance act of this state to deposit proof of financial responsibility and who has not deposited such proof;

(8) (9) To any person when the commissioner has good cause to believe that the operation of a motor vehicle on the highways by such person would be inimical to public safety or welfare;

(9) (10) To any person when, in the opinion of the commissioner, such person is afflicted with or suffering from such physical or mental disability or disease as will affect such person in a manner to prevent the person from exercising reasonable and ordinary control over a motor vehicle while operating the same upon the highways; nor to a person who is unable to read and understand official signs regulating, warning, and directing traffic;

(10) (11) To a child for whom a court has ordered denial of driving privileges under section 260.191, subdivision 1, or 260.195, subdivision 3a, until the period of denial is completed; or

(11) (12) To any person whose license has been canceled, during the period of cancellation.

Sec. 23. Minnesota Statutes 1994, section 171.05, is amended by adding a subdivision to read:

Subd. 2a. [PERMIT FOR SIX MONTHS.] An applicant who has applied for and received an instruction permit pursuant to subdivision 2 must possess the instruction permit for not less than six months before qualifying for a driver's license.

Sec. 24. Minnesota Statutes 1994, section 171.07, is amended by adding a subdivision to read:

Subd. 11. [DESIGNATED PARENT.] (a) Upon the written request of the applicant on a form developed by the department, which contains the information specified in paragraph (b), and upon payment of an additional fee of $3.50, the department shall issue a driver's license or Minnesota identification card bearing a symbol or other appropriate identifier indicating that the license holder has appointed an individual to serve as a designated parent under chapter 257A.

(b) The form shall provide as follows:

". . .(Name of parent(s)). . . appoints . . .(name of designated parent). . . to provide care for ...(name of child or children). . . when requested by the parent(s) or when the parent(s) is unable to care for the child (children) and unable to request the designated parent's assistance.

The designated parent will care for the child (children) named in this form for (choose one of the following):

(indicate a specified period of time that is less than one year); or

(indicate that care is to be provided for six months).

The designated parent has the powers and duties to make decisions and meet the child's (children's) needs in the areas checked or specified below:

education . . . . .

health care . . . . .

religion . . . . .

day care . . . . .

recreation . . . . .

other . . . . .

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

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

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

The designated parent (choose one of the following):

is . . .

is not . . .

authorized to make decisions about financial issues and control financial resources provided for the child (children) by the parent.

This designated parent agreement is effective for four years following the date it is signed by the parent(s), designated parent, any child age 14 or older, and any alternate designated parent. However, the agreement may be canceled by a parent, a designated parent, or an alternate designated parent at any time before that date, upon notice to the other parties to the agreement.

(Parent(s) signature(s) and Minnesota driver's license(s) or Minnesota identification card number(s))

(Designated parent signature, Minnesota driver's license or Minnesota identification card number, address, and telephone number)

(Alternate designated parent signature, Minnesota driver's license or Minnesota identification card number, address, and telephone number)

(Child age 14 or older signature . . . . .)

(Date . . . . .)

(Notarization . . . . .)"

(c) The department shall maintain a computerized records system of all persons listed as designated parents by driver's license and identification card applicants. This data shall be released to appropriate law enforcement agencies under section 13.69. Upon a parent's request and payment of a fee of $. . . . . . ., the department shall revise its list of designated parents and alternates to reflect a change in the appointment of a designated parent.

(d) At the request of the license or card holder, the department shall cancel the designated parent indication without additional charge. However, this paragraph does not prohibit a fee that may be applicable for a duplicate or replacement license or card, renewal of a license, or other service applicable to a driver's license or identification card.

(e) Notwithstanding sections 13.08, subdivision 1, and 13.69, the department and department employees are conclusively presumed to be acting in good faith when employees rely on statements made, in person or by telephone, by persons purporting to be law enforcement and subsequently release information described in paragraph (b). When acting in good faith, the department and department personnel are immune from civil liability and not subject to suit for damages resulting from the release of this information.

(f) The department and its employees:

(1) have no duty to inquire or otherwise determine whether a form submitted under this subdivision contains the signatures of all parents who have legal custody of a child; and

(2) are immune from all civil liability and not subject to suit for damages resulting from a claim that any parent with legal custody of a child has not signed the form.

(g) Of the fees received by the department under this subdivision:

(1) The first $111,000 received in fiscal year 1997 and the first $61,000 received in subsequent fiscal years must be deposited in the general fund.

(2) All other fees must be deposited in the trunk highway fund.

Sec. 25. Minnesota Statutes 1994, section 171.26, is amended to read:

171.26 [MONEY CREDITED TO FUNDS.]

All money received under this chapter must be paid into the state treasury and credited to the trunk highway fund, except as provided in sections 171.06, subdivision 2a; 171.07, subdivision 11, paragraph (g); 171.12, subdivision 8; and 171.29, subdivision 2, paragraph (b).

Sec. 26. [257A.01] [DESIGNATED PARENT.]

A parent who has legal custody of a child may name an adult to serve as a designated parent to care for the parent's minor child for a period of time specified in a designated parent agreement, but not to exceed six months.

Sec. 27. [257A.02] [DESIGNATED PARENT; ALTERNATE.]

An individual acting as a designated parent is exempt in that role from any statute or administrative rule requiring a foster care license but must provide the notice required by section 257A.10 if applicable. A parent who has named a guardian by will for the parent's children may name that guardian or another individual as a designated parent for the child. A parent who has legal custody of more than one child may appoint the same or a different designated parent for each child.

A parent may appoint an alternate designated parent who would serve if the designated parent is unwilling or unable to serve. All the provisions of this chapter dealing with a designated parent apply to an alternate designated parent.

Sec. 28. [257A.03] [POWERS AND DUTIES OF DESIGNATED PARENT.]

Subdivision 1. [GENERAL.] A designated parent has all the powers regarding the care, custody, and financial interests of a minor child specified in the designated parent agreement, except as otherwise provided in this section. A designated parent does not have the power to consent to marriage or adoption of the child.

Subd. 2. [CHILD SUPPORT.] A preexisting child support order is not suspended or terminated during the time a child is cared for by a designated parent, unless otherwise provided by court order. A designated parent has a cause of action for child support against an absent parent under section 256.87, subdivision 5.

Sec. 29. [257A.04] [CONSENTS AND NOTICE REQUIRED.]

To be valid, a designated parent agreement must have the consent of:

(1) every parent whose parental rights to the child have not been terminated; and

(2) the designated parent.

In addition, any child to whom the agreement applies and who is 14 years of age or older shall sign the agreement, to indicate that the child has been notified of the agreement.

Sec. 30. [257A.05] [DURATION.]

Subdivision 1. [IN GENERAL.] Unless canceled earlier under section 257A.08 by a parent or the designated parent, a designated parent agreement is effective for four years, after which date a new agreement may be entered. The new agreement may name the same or a different designated parent. A designated parent agreement automatically terminates as to any child when that child reaches age 18 or is lawfully married.

Subd. 2. [DEATH OF A PARENT.] If a parent dies while a designated parent agreement is in effect, and there is no living parent able to care for the child, the designated parent shall care for the child until a guardian appointed by will is able to take custody of the child or until a court order otherwise provides for the care of the child. However, the designated parent may cancel the agreement at any time under section 257A.08.

Sec. 31. [257A.06] [FORM.]

Subdivision 1. [WRITING.] A designated parent agreement must be made in writing and all signatures must be notarized.

Subd. 2. [DESIGNATED PARENT INDICATION ON DRIVER'S LICENSE.] A parent who wishes to have a designated parent indication placed on the parent's driver's license or identification card under section 171.07, subdivision 11, must submit a copy of the notarized designated parent agreement to the department of public safety and pay any required fee.

Sec. 32. [257A.07] [MULTIPLE AGREEMENTS.]

If more than one otherwise valid designated parent agreement exists regarding the same child, the priority among agreements is determined as follows:

(1) if one or more agreements have been submitted to the department of public safety under section 171.07, subdivision 11, the agreement with the most recent date that has been submitted to the department controls; or

(2) if multiple agreements exist, none of which has been submitted to the department of public safety, the agreement with the most recent date controls.

Sec. 33. [257A.08] [CANCELLATION.]

Subdivision 1. [HOW AND BY WHOM.] A parent may cancel a designated parent agreement at any time. The parent shall notify the designated parent of the cancellation. If the designated parent is caring for the child at the time of cancellation, the child must be returned to the parent immediately upon the parent's request.

A designated parent may decline to serve at any time, and the parent must cancel the agreement immediately upon request by the designated parent. If a designated parent is caring for a child when the designated parent cancels the agreement, the parent must take physical custody of the child immediately. If the parent is unable to resume physical custody at that time:

(1) the parent may name a new designated parent to care for the child who shall immediately take custody of the child; or

(2) the designated parent may contact the local social service agency, which shall take custody of the child.

Subd. 2. [NOTICE TO DEPARTMENT OF PUBLIC SAFETY.] A parent who has had a designated parent indication placed on the parent's driver's license or identification card under section 171.07, subdivision 11, has the responsibility to notify the department of public safety in writing whenever a designated parent agreement is canceled or a new designated parent or alternate is chosen.

Sec. 34. [257A.09] [EXTENDING PERIOD OF CARE.]

If a parent is unable to resume caring for a child upon expiration of the period of care indicated in the designated parent agreement, the period of care may be extended for a length of time agreed by the parent and designated

parent, but not to exceed one year. If a parent cannot be contacted or is unable to communicate a decision about the child's care when the agreed period of care expires, the designated parent may:

(1) petition the juvenile court to authorize continued care by the designated parent until the parent is able to resume the child's care, or for one year, whichever is sooner; or

(2) contact the local social service agency, which shall take custody of the child.

Sec. 35. [257A.10] [NOTICE TO LOCAL SOCIAL SERVICE AGENCY; INVESTIGATION.]

If a child has been in the home of a designated parent for 30 days, the designated parent shall promptly notify the local social service agency, any adult siblings of the child, and any living paternal or maternal grandparents, of the following:

(1) the child's name, home address, and the name and home address of the child's parents;

(2) that the child is in the home under a designated parent agreement; and

(3) the length of time the child is expected to remain in the designated parent's home.

The local social service agency may visit the child and the home and may continue to visit and supervise the home and the child or take other appropriate action to assure that the welfare of the child is fully protected.

Sec. 36. [257A.11] [CONTEST OF APPOINTMENT.]

A local social service agency may file a motion in juvenile court to contest a designated parent agreement that applies to a child who is taken into custody under section 260.165 or about whom a petition is filed alleging that the child is in need of protection or services.

Sec. 37. Minnesota Statutes 1994, section 260.173, subdivision 2, is amended to read:

Subd. 2. Notwithstanding the provisions of subdivision 1, if the child had been taken into custody pursuant to section 260.165, subdivision 1, clause (a) or clause (c)(2), and is not alleged to be delinquent, the child shall be detained in the least restrictive setting consistent with the child's health and welfare and in closest proximity to the child's family as possible. Placement may be with a child's relative, a designated parent under chapter 257A, or in a shelter care facility.

Sec. 38. [299D.11] [STATE PATROL VEHICLES; LIGHTING.]

Any motor vehicle of the state patrol that is purchased after July 1, 1996, and used primarily in the enforcement of highway traffic regulations must have all flashing lights authorized under section 169.64, other than turn signals and flashing hazard lights, mounted on the top of the vehicle. This section does not apply to specially marked patrol vehicles described in section 169.98, subdivision 2.

Sec. 39. [APPROPRIATION TO PAY INITIAL COSTS OF OLYMPIC PLATES.]

(a) The Minnesota amateur sports commission shall pay the commissioner an amount determined by the commissioner to equal the administrative, handling, and manufacturing costs of the first production of Olympic license plates. Production of license plates must begin after the commissioner receives payment.

(b) The amount determined by the commissioner under paragraph (a) is appropriated to the commissioner of public safety to pay the costs of the first production of Olympic license plates. The sum is available until spent.

(c) The amount paid by the Minnesota amateur sports commission to the commissioner under paragraph (a) is appropriated to the Minnesota amateur sports commission from the highway user tax distribution fund. This appropriation is available to the extent that Olympic license plates are sold and receipts are credited to the highway user tax distribution fund.

Sec. 40. [DESIGN-BUILD METHOD OF CONSTRUCTION.]

Beginning with the capital budget projects approved by law in 1996, the commissioner of administration or the commissioner of transportation may use a design-build method of project development and construction for projects to construct new vehicle and equipment storage or maintenance facilities. "Design-build method of project

development and construction" means a project delivery system in which a single contractor is responsible for both the design and the construction of the project. The commissioner of administration or the commissioner of transportation may select the projects that will be constructed using the design-build method. Minnesota Statutes, section 16B.33, does not apply to the projects selected. The commissioners must report to the legislature by February 1, 2000, on the use of the design-build method, including comparative cost analysis, quality of product obtained, advantages and disadvantages of using this method, and the commissioners' recommendations for further use of the design-build method.

Sec. 41. [EFFECTIVE DATE.]

Sections 24 to 37 are effective January 1, 1997. All provisions of this act that make appropriations for fiscal year 1996, or that make any appropriation that is specified as being available immediately, are effective the day following final enactment."

Delete the title and insert:

"A bill for an act relating to the organization and operation of state government; appropriating money for the department of transportation and other agencies; setting fees and penalties; regulating and creating related programs and activities; amending Minnesota Statutes 1994, sections 160.85, by adding a subdivision; 168.013, subdivision 3; 168.042, subdivision 8, and by adding a subdivision; 168.12, subdivision 2; 168.123, subdivisions 1 and 4; 168.15; 168.33, by adding a subdivision; 169.121, subdivision 3; 169.82, subdivision 3; 169.871, by adding a subdivision; 169.98, subdivision 1; 171.05, by adding a subdivision; 171.07, by adding a subdivision; 171.26; and 260.173, subdivision 2; Minnesota Statutes 1995 Supplement, sections 13.69, subdivision 1; 168.16; and 171.04, subdivision 1; proposing coding for new law in Minnesota Statutes, chapters 168; and 299D; proposing coding for new law as Minnesota Statutes, chapter 257A."

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

The report was adopted.

H. F. Nos. 2206 and 2781 were read for the second time.

S. F. Nos. 1874, 1981, 1996, 2009, 2020 and 2596 were read for the second time.

The following House Files were introduced:

McCollum introduced:

H. F. No. 3240, A bill for an act relating to veterans; changing certain employment rights; amending Minnesota Statutes 1994, section 197.46.

The bill was read for the first time and referred to the Committee on General Legislation, Veterans Affairs and Elections.

Johnson, V., introduced:

H. F. No. 3241, A bill for an act relating to natural resources; requiring certain vessels transporting oil or hazardous materials on the Mississippi river to be double hulled or accompanied by a tugboat; imposing penalties; proposing coding for new law in Minnesota Statutes, chapter 103F.

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

Murphy and Swenson, D., for the Committee on Judiciary Finance, introduced:

H. F. No. 3242, A bill for an act relating to criminal justice; appropriating money for the judicial branch, public safety, corrections, criminal justice, crime prevention programs, and other related purposes; providing for community notification of the release of certain sex offenders, expanding the sex offender registration act; reconciling various provisions on criminal history background checks; implementing, clarifying, and modifying certain criminal and juvenile provisions; implementing, clarifying, and modifying certain penalty provisions; establishing and expanding pilot programs, grant programs, task forces, committees, and studies; providing for the retention of consultants; amending Minnesota Statutes 1994, sections 8.01; 15.86, by adding a subdivision; 84.91, by adding a subdivision; 86B.331, by adding a subdivision; 144A.46, subdivision 5; 168.041, subdivision 6; 168.042, subdivisions 8, 12, and by adding a subdivision; 169.121, subdivisions 2, 3, and 4; 169.123, subdivision 4; 171.17, subdivision 1; 171.29, subdivision 1; 171.30, subdivisions 1 and 2a; 181.9412; 244.17, subdivision 2, and by adding a subdivision; 244.172, subdivision 2; 268.30, subdivision 2; 299A.35, as amended; 609.115, by adding a subdivision; 609.52, subdivision 2; 611.271; 611A.25, subdivision 3; and 611A.361, subdivision 3; Minnesota Statutes 1995 Supplement, sections 16B.181; 144.057, subdivisions 1, 3, and 4; 171.29, subdivision 2; 243.166, subdivisions 1 and 7; 245A.04, subdivision 3; 299A.326, subdivision 1; 299C.67, subdivision 5; 299C.68, subdivisions 2, 5, and 6; and 609.2325, subdivision 3; Laws 1995, chapter 229, article 3, section 17; proposing coding for new law in Minnesota Statutes, chapters 168; 168A; 244; 299A; and 609.

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

The following message was received from the Senate:

Mr. Speaker:

I hereby announce the passage by the Senate of the following Senate File, herewith transmitted:

S. F. No. 1939.

Patrick E. Flahaven, Secretary of the Senate

S. F. No. 1939, A bill for an act relating to human services; requiring the commissioner of human services to review the adequacy of payment information provided to medical assistance recipient's billing statement for medical assistance recipients.

The bill was read for the first time and referred to the Committee on Health and Human Services.

Carruthers moved that the bill on the Consent Calendar for today be continued. The motion prevailed.

Carruthers moved that the bills on Special Orders for today be continued. The motion prevailed.

Carruthers moved that the bills on General Orders for today be continued. The motion prevailed.

Mariani moved that the names of Tunheim and Rice be added as authors on H. F. No. 2704. The motion prevailed.

Marko moved that the name of Larsen be stricken and the name of Lieder be added as chief author on H. F. No. 2840. The motion prevailed.

Pawlenty moved that the name of Carlson, S., be added as an author on H. F. No. 3235. The motion prevailed.

Delmont moved that the following statement be printed in the Journal of the House: "It was my intention to vote in the negative on Wednesday, February 21, 1996, when the vote was taken on the final passage of H. F. No. 2369, as amended." The motion prevailed.

Leppik moved that the following statement be printed in the Journal of the House: "It was my intention to vote in the affirmative on Thursday, February 22, 1996, when the vote was taken on the final passage of H. F. No. 2478." The motion prevailed.

Carruthers moved that when the House adjourns today it adjourn until 12:30 p.m., Monday, February 26, 1996. The motion prevailed.

Carruthers moved that the House adjourn. The motion prevailed, and the Speaker declared the House stands adjourned until 12:30 p.m., Monday, February 26, 1996.

Edward A. Burdick, Chief Clerk, House of Representatives

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