Journal of the House - 80th Day - Tuesday, April 1, 2014

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APPROPRIATIONS

Available for the Year

Ending June 30

A quorum was present.

Abeler; Anderson, M.; Atkins; Gruenhagen; Hoppe; Howe; Kieffer; Lohmer; Mack; McDonald; O'Neill; Persell; Sanders and Zellers were excused.

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

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REPORTS OF CHIEF CLERK

S. F. No. 1509 and H. F. No. 1631, which had been referred to the Chief Clerk for comparison, were examined and found to be identical with certain exceptions.

SUSPENSION OF RULES

Mariani moved that the rules be so far suspended that S. F. No. 1509 be substituted for H. F. No. 1631 and that the House File be indefinitely postponed. The motion prevailed.

REPORTS OF STANDING COMMITTEES AND DIVISIONS

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

H. F. No. 2180, A bill for an act relating to insurance; amending provisions relating to health coverage for school district employees; amending Minnesota Statutes 2012, sections 43A.316, subdivision 10, by adding a subdivision; 123B.09, subdivision 12; 123B.75, by adding a subdivision; 471.6161, subdivisions 1, 3, by adding a subdivision; 471.895, subdivision 1; Minnesota Statutes 2013 Supplement, section 124D.10, subdivisions 4a, 11, 21.

Reported the same back with the following amendments:

Page 3, delete lines 21 to 24, and insert:

"(f) A charter school board member, employee, or officer is a local official for purposes of section 471.895 with regard to receipt of gifts as defined under section 10A.071, subdivision 1, paragraph (b). A board member, employee, or officer must not receive compensation from a group health insurance provider."

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

The report was adopted.

Lesch from the Committee on Civil Law to which was referred:

H. F. No. 2281, A bill for an act relating to public safety; specifying that driving while impaired constitutes a breach of the peace for purposes of the Constitution; proposing coding for new law in Minnesota Statutes, chapter 169A.

Reported the same back with the following amendments:

Page 1, after line 5, insert:

"Section 1. [3.022] REVIEW OF ARREST.

Any documentation issued by a government agency which reproduces the text of the Minnesota Constitution, article IV, section 10, must include the following language: "Any arrest under this provision is immediately reviewable before a neutral judicial officer."

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Sec. 2. Minnesota Statutes 2012, section 3.151, is amended to read:

3.151 DISTURBING LEGISLATURE OR INTIMIDATING MEMBER.

(a) A person is guilty of a gross misdemeanor who:

(1) willfully disturbs the legislature, or either house of it, while in session;

(2) commits disorderly conduct in the presence and view of either house, tending to interrupt its proceedings or impair the respect due to its authority; or

(3) willfully, by intimidation or otherwise, prevents a member of the legislature from attending a session of the member's house, or of a committee of it, or from giving the member's vote upon a question which may come before the house, or from performing any other official act, including an arrest, or attempted arrest, of a member of the legislature by a licensed peace officer for the primary purpose of delaying or preventing the performance of any official act.

(b) Nothing in this section limits the authority of a licensed peace officer to arrest or detain a member of the legislature, upon probable cause that the member has violated any provision of chapter 169A while traveling to a session of the member's house, or of a committee of it, provided that the arrest or detention is processed in an expedited manner and the member is delivered to the sergeant-at-arms of the house of representatives or the senate without unreasonable delay."

Renumber the sections in sequence

Amend the title as follows:

Page 1, line 2, after the semicolon, insert "clarifying legislators' privilege from arrest;"

Correct the title numbers accordingly

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

The report was adopted.

Nelson from the Committee on Government Operations to which was referred:

H. F. No. 2313, A bill for an act relating to public employment; changing the definition of a confidential employee; amending Minnesota Statutes 2012, section 179A.03, subdivision 4.

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

The report was adopted.

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

H. F. No. 2658, A bill for an act relating to workers' compensation; adopting the recommendations of the Workers' Compensation Advisory Council; amending Minnesota Statutes 2012, sections 176.129, subdivisions 2a, 7; 176.135, subdivision 7; 176.136, subdivision 1a; 176.231, subdivision 2; 176.305, subdivision 1a; Minnesota Statutes 2013 Supplement, section 176.011, subdivision 15; repealing Minnesota Statutes 2012, sections 175.006, subdivision 1; 175.08; 175.14; 175.26; 176.1311; 176.136, subdivision 3; 176.2615; 176.641.

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

The report was adopted.

Nelson from the Committee on Government Operations to which was referred:

H. F. No. 2724, A bill for an act relating to state government; regulating agency rulemaking; amending Minnesota Statutes 2012, sections 3.842, subdivision 4a; 14.05, subdivisions 5, 6, by adding a subdivision; 14.07, subdivision 4; 14.08; 14.101, subdivision 1; 14.116; 14.125; 14.126, subdivision 2; 14.131; 14.14, subdivisions 1a, 2a; 14.15, subdivision 1; 14.16, subdivisions 1, 3; 14.22; 14.25; 14.26; 14.365; 14.388, subdivision 1; 14.389, subdivision 1; proposing coding for new law in Minnesota Statutes, chapter 14; repealing Minnesota Statutes 2012, sections 14.04; 14.101, subdivisions 3, 4; 14.14, subdivision 1b; 14.23; 14.3895.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. Minnesota Statutes 2012, section 3.842, subdivision 4a, is amended to read:

Subd. 4a. Objections to rules. (a) For purposes of this subdivision, "committee" means the house of representatives policy committee or senate policy committee with primary jurisdiction over state governmental operations. The commission or a committee may object to a rule as provided in this subdivision. If the commission or a committee objects to all or some portion of a rule because the commission or committee considers it to be beyond the procedural or substantive authority delegated to the agency, including a proposed rule submitted under section 14.15, subdivision 4, or 14.26, subdivision ~~3, paragraph (c)~~ 6, the commission or committee may file that objection in the Office of the Secretary of State. The filed objection must contain a concise statement of the commission's or committee's reasons for its action. An objection to a proposed rule submitted by the commission or a committee under section 14.15, subdivision 4, or 14.26, subdivision ~~3, paragraph (c)~~ 6, may not be filed before the rule is adopted.

(b) The secretary of state shall affix to each objection a certification of the date and time of its filing and as soon after the objection is filed as practicable shall transmit a certified copy of it to the agency issuing the rule in question and to the revisor of statutes. The secretary of state shall also maintain a permanent register open to public inspection of all objections by the commission or committee.

(c) The commission or committee shall publish and index an objection filed under this section in the next issue of the State Register. The revisor of statutes shall indicate the existence of the objection adjacent to the rule in question when that rule is published in Minnesota Rules.

(d) Within 14 days after the filing of an objection by the commission or committee to a rule, the issuing agency shall respond in writing to the objecting entity. After receipt of the response, the commission or committee may withdraw or modify its objection.

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(e) After the filing of an objection by the commission or committee that is not subsequently withdrawn, the burden is upon the agency in any proceeding for judicial review or for enforcement of the rule to establish that the whole or portion of the rule objected to is valid.

(f) The failure of the commission or a committee to object to a rule is not an implied legislative authorization of its validity.

(g) In accordance with sections 14.44 and 14.45, the commission or a committee may petition for a declaratory judgment to determine the validity of a rule objected to by the commission or committee. The action must be started within two years after an objection is filed in the Office of the Secretary of State.

(h) The commission or a committee may intervene in litigation arising from agency action. For purposes of this paragraph, agency action means the whole or part of a rule, or the failure to issue a rule.

Sec. 2. Minnesota Statutes 2012, section 14.05, is amended by adding a subdivision to read:

Subd. 5a. Review and repeal of rules. By December 1 of each odd-numbered year, beginning December 1, 2015, an agency must submit to the governor, the Legislative Coordinating Commission, the policy and funding committees and divisions with jurisdiction over the agency, and the revisor of statutes, a list of any rules or portions of rules that are obsolete, unnecessary, or duplicative of other state or federal statutes or rules. The list must also include an explanation of why the rule or portion of the rule is obsolete, unnecessary, or duplicative of other state or federal statutes or rules. The agency must either report a timetable for repeal of the rule or portion of the rule, or must develop a bill for submission to the appropriate policy committee to repeal the obsolete, unnecessary, or duplicative rule. A report submitted under this subdivision must be signed by the person in the agency who is responsible for identifying and initiating repeal of obsolete rules. The report also must identify the status of any rules identified in the prior report as obsolete, unnecessary, or duplicative. If none of an agency's rules are obsolete, unnecessary, or duplicative, an agency's report must state that conclusion.

Sec. 3. Minnesota Statutes 2012, section 14.05, subdivision 6, is amended to read:

Subd. 6. Veto of adopted rules. The governor may veto all or a severable portion of a rule of an agency as defined in section 14.02, subdivisions 2 and 4, by submitting notice of the veto to the State Register within 14 days of receiving a copy of the rule from the secretary of state under section 14.16, subdivision 3, 14.26, subdivision 3, or 14.386 or the agency under section 14.389, subdivision 3~~, or section 14.3895~~. The veto is effective when the veto notice is submitted to the State Register. This authority applies only to the extent that the agency itself would have authority, through rulemaking, to take such action. If the governor vetoes a rule or portion of a rule under this section, the governor shall notify the chairs of the legislative committees having jurisdiction over the agency whose rule was vetoed.

Sec. 4. Minnesota Statutes 2012, section 14.05, is amended by adding a subdivision to read:

Subd. 7. Electronic notices permitted. If sections 14.05 to 14.389 require an agency to provide notice or documents to the public, the legislature, or another state agency, the agency may send the notice or document, or a link to the notice or document, using any reliable method of electronic transmission. An agency may file rule-related documents with the Office of Administrative Hearings by electronic transmission in the manner approved by that office and the Office of the Revisor of Statutes by electronic transmission in the manner approved by that office.

Sec. 5. Minnesota Statutes 2012, section 14.07, subdivision 4, is amended to read:

Subd. 4. Incorporations by reference. (a) An agency may incorporate by reference into its rules the text from Minnesota Statutes, Minnesota Rules, United States Statutes at Large, United States Code, Laws of Minnesota, Code of Federal Regulations, the Federal Register, and other publications and documents which are determined by the

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revisor of statutes, to be conveniently available to the public. If the rule incorporates by reference other publications and documents, the rule must contain a statement of incorporation. The statement of incorporation by reference must include the words "incorporated by reference"; must identify by title, author, publisher, and, if applicable, date of publication of the standard or material to be incorporated; must state whether the material is subject to frequent change; and must contain a statement of availability. When presented with a rule for certification pursuant to subdivision 2 and this subdivision, the revisor of statutes should indicate in the certification that the rule incorporates by reference text from other publications or documents. If the revisor certifies that the form of a rule is approved, that approval constitutes the revisor's finding that the publication or other document other than one listed by name in this subdivision, and which is incorporated by reference into the rules, is conveniently available to the public.

(b) For the purposes of paragraph (a), "conveniently available to the public" means available on the Internet without charge, or available for loan or inspection and copying to a person living anywhere in Minnesota through a statewide interlibrary loan system or in a public library without charge except for reasonable copying fees and mailing costs.

Sec. 6. Minnesota Statutes 2012, section 14.08, is amended to read:

14.08 APPROVAL OF RULE AND RULE FORM; COSTS.

(a) One copy of a rule adopted under section 14.26 must be submitted by the agency to the chief administrative law judge. The chief administrative law judge shall request from the revisor certified copies of the rule when it is submitted by the agency under section 14.26. Within five days after the request for certification of the rule is received by the revisor, excluding weekends and holidays, the revisor shall either return the rule with a certificate of approval of the form of the rule to the chief administrative law judge or notify the chief administrative law judge and the agency that the form of the rule will not be approved.

If the chief administrative law judge disapproves a rule, the agency may modify it and the agency shall submit one copy of the modified rule, approved as to form by the revisor, to the chief administrative law judge.

(b) One copy of a rule adopted after a public hearing must be submitted by the agency to the chief administrative law judge. The chief administrative law judge shall request from the revisor certified copies of the rule when it is submitted by the agency. Within five working days after receipt of the request, the revisor shall either return the rule with a certificate of approval to the chief administrative law judge or notify the chief administrative law judge and the agency that the form of the rule will not be approved.

(c) If the revisor refuses to approve the form of the rule, the revisor's notice must revise the rule so it is in the correct form.

(d) After the agency has notified the chief administrative law judge that it has adopted the rule, the chief administrative law judge shall promptly file four paper copies or an electronic copy of the adopted rule in the Office of the Secretary of State. The secretary of state shall forward one copy of each rule filed to the agency, to the revisor of statutes, and to the governor.

~~(d)~~ (e) The chief administrative law judge shall assess an agency for the actual cost of processing rules under this section. Each agency shall include in its budget money to pay the assessments. Receipts from the assessment must be deposited in the administrative hearings account established in section 14.54.

Sec. 7. Minnesota Statutes 2012, section 14.101, subdivision 1, is amended to read:

Subdivision 1. Required notice. In addition to seeking information by other methods designed to reach persons or classes of persons who might be affected by the proposal, an agency, at least 60 days before publication of a notice of intent to adopt or a notice of hearing, shall solicit comments from the public on the subject matter of a

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possible rulemaking proposal under active consideration within the agency by causing notice to be published in the State Register. The notice must include a description of the subject matter of the proposal and the types of groups and individuals likely to be affected, and must indicate where, when, and how persons may comment on the proposal and whether and how drafts of any proposal may be obtained from the agency.

This notice must be published within 60 days of the effective date of any new or amendatory law requiring rules to be adopted, amended, or repealed.

An agency intending to adopt an expedited rule under section 14.389 is exempt from the requirements of this section.

Sec. 8. [14.105] RULE NOTIFICATION.

Subdivision 1. Rule notification list. (a) Each agency shall maintain a list of all persons who have registered with the agency for the purpose of receiving notice of rule proceedings. A person may register to receive notice of rule proceedings by submitting to the agency:

(1) the person's electronic mail address; or

(2) the person's name and United States mail address, along with a request to receive copies of the notices by mail.

(b) The agency shall post information on its Web site describing the registration process.

(c) The agency may inquire as to whether those persons on the list in paragraph (a) wish to remain on it and may remove persons for whom there is a negative reply or no reply within 60 days.

Subd. 2. Additional notice. (a) Each agency shall make reasonable efforts to notify persons or classes of persons who may be significantly affected by the rule being proposed by giving notice of its rule proceedings in newsletters, newspapers, or other publications, or through other means of communication.

(b) For each rulemaking, the agency shall develop an additional notice plan describing its efforts to provide additional notification to persons or classes of persons who may be affected by the proposed rule or must explain why these efforts were not made. The additional notice plan must be submitted to the administrative law judge with the other submissions required by section 14.14, subdivision 2a, or 14.26. The agency also may seek prior approval of the additional notice plan under the rules of the Office of Administrative Hearings.

Sec. 9. Minnesota Statutes 2012, section 14.116, is amended to read:

14.116 NOTICE TO LEGISLATURE.

(a) By January 15 each year, each agency must submit its current rulemaking docket maintained under section 14.366~~, and the official rulemaking record required under section 14.365 for any rule adopted during the preceding calendar year,~~ to the chairs and ranking minority members of the legislative policy and budget committees with jurisdiction over the subject matter of the proposed rule.

(b) When an agency ~~mails~~ sends a notice of ~~intent to adopt rules~~ hearing under section 14.14 or a notice of intent to adopt rules under section 14.22, the agency must send a copy of the same notice ~~and a copy of the statement of need and reasonableness~~ to the chairs and ranking minority party members of the legislative policy and budget committees with jurisdiction over the subject matter of the proposed rules and to the Legislative Coordinating Commission.

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(c) In addition, if the mailing of the notice is within two years of the effective date of the law granting the agency authority to adopt the proposed rules, the agency shall make reasonable efforts to send a copy of the notice and the statement to all sitting legislators who were chief house of representatives and senate authors of the bill granting the rulemaking authority. If the bill was amended to include this rulemaking authority, the agency shall make reasonable efforts to send the notice and the statement to the chief house of representatives and senate authors of the amendment granting rulemaking authority, rather than to the chief authors of the bill.

Sec. 10. Minnesota Statutes 2012, section 14.125, is amended to read:

14.125 TIME LIMIT ON AUTHORITY TO ADOPT, AMEND, OR REPEAL RULES.

An agency shall publish a ~~notice of intent to adopt rules or a~~ notice of hearing under section 14.14 or a notice of intent to adopt rules under section 14.22 within 18 months of the effective date of the law authorizing or requiring rules to be adopted, amended, or repealed. If the notice is not published within the time limit imposed by this section, the authority for the rules expires. The agency shall not use other law in existence at the time of the expiration of rulemaking authority under this section as authority to adopt, amend, or repeal these rules agency shall report to the Legislative Coordinating Commission, other appropriate committees of the legislature, and the governor its failure to publish a notice and the reasons for that failure.

An agency that publishes a notice of intent to adopt rules or a notice of hearing within the time limit specified in this section may subsequently amend or repeal the rules without additional legislative authorization.

Sec. 11. Minnesota Statutes 2012, section 14.126, subdivision 2, is amended to read:

Subd. 2. Vote. A committee vote under this section must be by a majority of the committee. The vote may occur any time after the publication of the rulemaking notice under section 14.14, subdivision 1a, 14.22, or 14.389, subdivision 2, ~~or 14.3895, subdivision 3,~~ and before notice of adoption is published in the State Register under section 14.18, 14.27, or 14.389, subdivision 3~~, or 14.3895, subdivision 3~~. A committee voting under this section shall notify the agency, the revisor of statutes, and the chief administrative law judge of the vote as soon as possible. The committee shall publish notice of the vote in the State Register as soon as possible.

Sec. 12. Minnesota Statutes 2012, section 14.131, is amended to read:

14.131 STATEMENT OF NEED AND REASONABLENESS.

By the date of the section 14.14, subdivision 1a, notice, the agency must prepare, review, and make available for public review a statement of the need for and reasonableness of the rule. The statement of need and reasonableness must be prepared under rules adopted by the chief administrative law judge and must include a citation to the most specific statutory authority for the rule and the following to the extent the agency, through reasonable effort, can ascertain this information:

(1) a description of the classes of persons who probably will be affected by the proposed rule, including classes that will bear the costs of the proposed rule and classes that will benefit from the proposed rule;

~~(2) the probable costs to the agency and to any other agency of the implementation and enforcement of the proposed rule and any anticipated effect on state revenues;~~

~~(3) a determination of whether there are less costly methods or less intrusive methods for achieving the purpose of the proposed rule;~~

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(4) a description of any alternative methods for achieving the purpose of the proposed rule that were seriously considered by the agency and the reasons why they were rejected in favor of the proposed rule;

(5) the probable costs of complying with the proposed rule, including the portion of the total costs that will be borne by identifiable categories of affected parties, such as separate classes of governmental units, businesses, or individuals;

(6) the probable costs or consequences of not adopting the proposed rule, including those costs or consequences borne by identifiable categories of affected parties, such as separate classes of government units, businesses, or individuals;

(1) a description of the persons or classifications of persons who will probably be affected by the proposed rule;

(2) the probable costs of the rule to affected persons and the agency, including those costs or consequences borne by identifiable categories of affected parties, such as separate classes of government units, businesses, or individuals, and the probable benefits of adopting the rule;

~~(7)~~ (3) an assessment of any differences between the proposed rule and existing federal regulations and a specific analysis of the need for and reasonableness of each difference; and

~~(8)~~ (4) an assessment of the cumulative effect of the rule with other federal and state regulations related to the specific purpose of the rule.

~~The statement must describe how the agency, in developing the rules, considered and implemented the legislative policy supporting performance-based regulatory systems set forth in section 14.002.~~

For purposes of clause ~~(8)~~ (4), "cumulative effect" means the impact that results from incremental impact of the proposed rule in addition to other rules, regardless of what state or federal agency has adopted the other rules. Cumulative effects can result from individually minor but collectively significant rules adopted over a period of time.

The statement must also describe the agency's efforts to provide additional notification under section 14.14, subdivision 1a, to persons or classes of persons who may be affected by the proposed rule or must explain why these efforts were not made.

The agency must consult with the commissioner of management and budget to help evaluate the fiscal impact and fiscal benefits of the proposed rule on units of local government. The agency must send a copy of the statement of need and reasonableness to the Legislative Reference Library no later than when the notice of hearing is ~~mailed under section 14.14, subdivision 1a~~ sent.

Sec. 13. Minnesota Statutes 2012, section 14.14, subdivision 1a, is amended to read:

Subd. 1a. Notice of rule hearing. (a) Each agency shall maintain a list of all persons who have registered with the agency for the purpose of receiving notice of rule proceedings. Persons may register to receive notice of rule proceedings by submitting to the agency:

~~(1) their electronic mail address; or~~

~~(2) their name and United States mail address.~~

~~The agency may inquire as to whether those persons on the list wish to remain on it and may remove persons for whom there is a negative reply or no reply within 60 days.~~ The agency shall, at least 30 days before the date set for the hearing, give notice of its intention to ~~adopt~~ hold a hearing on the proposed rules by United States mail or electronic mail to all persons ~~on its list~~ who have registered their names with the agency under section 14.105, and by publication in the State Register.

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The mailed notice must include either a copy of the proposed rule or an easily readable and understandable description of its nature and effect and an announcement that a free copy of the proposed rule is available on request from the agency. In addition, each agency shall make reasonable efforts to notify persons or classes of persons who may be significantly affected by the rule being proposed by giving notice of its intention in newsletters, newspapers, or other publications, or through other means of communication. The notice in the State Register must include the proposed rule or an amended rule in the form required by the revisor under section 14.07, together with an easily readable and understandable summary of the overall nature and effect of the proposed rule, a citation to the most specific statutory authority for the proposed rule, a statement of the place, date, and time of the public hearing, a statement that a free copy of the proposed rule and the statement of need and reasonableness may be requested from the agency, a statement that persons may register with the agency for the purpose of receiving notice of rule proceedings ~~and notice that the agency intends to adopt a rule~~ and other information required by law or rule. When an entire rule is proposed to be repealed, the agency need only publish that fact, along with an easily readable and understandable summary of the overall nature of the rules proposed for repeal, and a citation to the rule to be repealed.

The mailed notice of hearing must be the same as the notice published in the State Register, except that the mailed notice may omit the text of the proposed rule.

(b) The chief administrative law judge may authorize an agency to omit from the notice of rule hearing the text of any proposed rule, the publication of which would be unduly cumbersome, expensive, or otherwise inexpedient if:

(1) knowledge of the rule is likely to be important to only a small class of persons;

(2) the notice of rule hearing states that a free copy of the entire rule is available upon request to the agency; and

(3) the notice of rule hearing states in detail the specific subject matter of the omitted rule, cites the statutory authority for the proposed rule, and details the proposed rule's purpose and motivation.

Sec. 14. Minnesota Statutes 2012, section 14.14, subdivision 2a, is amended to read:

Subd. 2a. Hearing procedure. When a hearing is held on a proposed rule, it shall be conducted by an administrative law judge assigned by the chief administrative law judge. The administrative law judge shall ensure that all persons involved in the rule hearing are treated fairly and impartially. The agency shall submit into the record the jurisdictional documents, including the statement of need and reasonableness, comments and hearing requests received, and any written exhibits in support of the proposed rule. The agency may also present additional oral evidence. Interested persons may present written and oral evidence. The administrative law judge shall allow questioning of agency representatives or witnesses, or of interested persons making oral statements, in order to explain the purpose or intended operation of a proposed rule, or a suggested modification, or for other purposes if material to the evaluation or formulation of the proposed rule. The administrative law judge may limit repetitive or immaterial oral statements and questioning.

Sec. 15. Minnesota Statutes 2012, section 14.16, subdivision 3, is amended to read:

Subd. 3. Filing. After the agency has ~~adopted~~ provided the chief administrative law judge with a signed order adopting the rule, the ~~agency~~ chief administrative law judge shall promptly file ~~three~~ four paper copies or an electronic copy of it the adopted rule in the Office of the Secretary of State. The secretary of state shall forward one copy of each rule filed to the agency, to the revisor of statutes, and to the governor.

Sec. 16. Minnesota Statutes 2012, section 14.22, is amended to read:

14.22 NOTICE OF PROPOSED ADOPTION OF RULES.

Subdivision 1. Contents. (a) Unless an agency proceeds directly to a public hearing on a proposed rule and gives the notice prescribed in section 14.14, subdivision 1a, the agency shall give notice of its intention to adopt a rule without public hearing. The agency shall give the notice required by this section, unless the agency gives notice

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of a hearing under section 14.14. The agency shall give notice ~~must be given~~ of its intention to adopt a rule by publication in the State Register and by United States mail or electronic mail to persons who have registered their names with the agency under section ~~14.14, subdivision 1a~~ 14.105. The mailed notice must include either a copy of the proposed rule or an easily readable and understandable description of its nature and effect and an announcement that a free copy of the proposed rule is available on request from the agency. In addition, each agency shall make reasonable efforts to notify persons or classes of persons who may be significantly affected by the rule by giving notice of its intention in newsletters, newspapers, or other publications, or through other means of communication. The notice in the State Register must include the proposed rule or ~~the~~ amended rule in the form required by the revisor under section 14.07,; an easily readable and understandable summary of the overall nature and effect of the proposed rule,; a citation to the most specific statutory authority for the proposed rule,; a statement that persons may register with the agency ~~for the purpose of receiving~~ to receive notice of rule proceedings ~~and notice that a rule has been submitted to the chief administrative law judge,~~; and other information required by law or rule. When an entire rule is proposed to be repealed, the notice need only state that fact, along with an easily readable and understandable summary of the overall nature of the ~~rules~~ rule proposed for repeal, and a citation to the rule to be repealed. The notice must include a statement advising the public:

(1) that the public has at least 30 days in which to submit comment in support of or in opposition to the proposed rule and that comment is encouraged;

(2) that each comment should identify the portion of the proposed rule addressed, the reason for the comment, and any change proposed;

(3) that the requester is encouraged to propose any change desired;

~~(3)~~ (4) that if 25 50 or more persons submit a written request for a public hearing within the ~~30-day~~ comment period, a public hearing will be held and the agency will use the process under section 14.14;

~~(4)~~ (5) of the manner in which persons must request a public hearing on the proposed rule, including the requirements contained in section 14.25 relating to a written request for a public hearing; and

~~(5) of the requirements contained in section 14.25 relating to a written request for a public hearing, and that the requester is encouraged to propose any change desired;~~

(6) that the agency may modify the proposed rule ~~may be modified~~ if the modifications are supported by the data and views submitted~~; and~~.

(7) that if a hearing is not required, notice of the date of submission of the proposed rule to the chief administrative law judge for review will be mailed to any person requesting to receive the notice.

In connection with the statements required in clauses (1) and ~~(3)~~ (4), the notice must also include the date on which the ~~30-day~~ comment period ends. The mailed notice of intent to adopt a rule must be the same as the notice published in the State Register, except that the mailed notice may omit the text of the proposed rule if it includes an announcement of where a copy of the proposed rule may be obtained.

(b) The chief administrative law judge may authorize an agency to omit from the notice of intent to adopt the text of any proposed rule, the publication of which would be unduly cumbersome, expensive, or otherwise inexpedient if:

(1) knowledge of the rule is likely to be important to only a small class of persons;

(2) the notice of intent to adopt states that a free copy of the entire rule is available upon request to the agency; and

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(3) the notice of intent to adopt states in detail the specific subject matter of the omitted rule, cites the statutory authority for the proposed rule, and details the proposed rule's purpose and motivation.

Subd. 2. Dual notices. The agency may, at the same time notice is given under subdivision 1, give notice of a public hearing and of its intention to proceed under sections 14.14 to 14.20, if one is required under section 14.25. The notice must include a statement advising the public of its intention to cancel the public hearing if 25 50 or more persons do not request one. If a hearing is required, there must be at least ten calendar days between the last day for requesting a hearing and the day of the hearing.

Sec. 17. Minnesota Statutes 2012, section 14.23, is amended to read:

14.23 STATEMENT OF NEED AND REASONABLENESS.

By the date of the section 14.22 notice, the agency shall prepare a statement of need and reasonableness, which must be available to the public. The statement of need and reasonableness must include the ~~analysis~~ information required in section 14.131. The statement must also describe the agency's efforts to provide additional notification under section 14.22 to persons or classes of persons who may be affected by the proposed rules or must explain why these efforts were not made. For at least 30 days following the notice, the agency shall afford the public an opportunity to request a public hearing and to submit data and views on the proposed rule in writing.

The agency shall send a copy of the statement of need and reasonableness to the Legislative Reference Library no later than when the notice of intent to adopt is ~~mailed~~ sent.

Sec. 18. Minnesota Statutes 2012, section 14.25, is amended to read:

14.25 PUBLIC HEARING.

Subdivision 1. Requests for hearing. If, during the ~~30-day~~ period allowed for comment under section 14.22, 25 50 or more persons submit to the agency a written request for a public hearing of the proposed rule, the agency shall proceed under the provisions of sections 14.14 to 14.20. The written request must include: (1) the name and address of the person requesting the public hearing; ~~and~~ (2) the portion or portions of the rule to which the person objects or a statement that the person opposes the entire rule. If not previously published under section 14.22, subdivision 2, a notice of the public hearing must be published in the State Register and mailed to those persons who submitted a written request for the public hearing. Unless the agency has modified the proposed rule, the notice need not include the text of the proposed rule but only a citation to the State Register pages where the text appears; and (3) the reasons for the objection to each portion of the rule identified.

A written request for a public hearing that does not comply with the requirements of this section is invalid and may not be counted by the agency for purposes of determining whether a public hearing must be held.

Subd. 2. Withdrawal of hearing requests. If a request for a public hearing has been withdrawn so as to reduce the number of requests below 25 50, the agency must give written notice of that fact to all persons who have requested the public hearing. No public hearing may be canceled by an agency within three working days of the hearing. The notice must explain why the request is being withdrawn, and must include a description of any action the agency has taken or will take that affected or may have affected the decision to withdraw the requests. The notice must also invite persons to submit written comments within five working days to the agency relating to the withdrawal. The notice and any written comments received by the agency is part of the rulemaking record submitted to the administrative law judge under section 14.14 or 14.26. The administrative law judge shall review the notice and any comments received and determine whether the withdrawal is consistent with section 14.001, clauses (2), (4), and (5).

This subdivision applies only to a withdrawal of a hearing request that affects whether a public hearing must be held and only if the agency has taken any action to obtain the withdrawal of the hearing request.

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Sec. 19. Minnesota Statutes 2012, section 14.26, is amended to read:

14.26 ADOPTION OF PROPOSED RULE; SUBMISSION TO ADMINISTRATIVE LAW JUDGE.

Subdivision 1. Submission. If no hearing is required, the agency shall submit to an administrative law judge assigned by the chief administrative law judge the proposed rule and notice as published, the rule as adopted, any written comments received by the agency, and a statement of need and reasonableness for the rule. The agency shall give notice to all persons who requested to be informed that these materials have been submitted to the administrative law judge. This notice must be given on the same day that the record is submitted. If the proposed rule has been modified, the notice must state that fact, and must also state that a free copy of the proposed rule, as modified, is available upon request from the agency. The rule and these materials must be submitted to the administrative law judge within 180 days of the day that the comment period for the rule is over or the rule is automatically withdrawn. The agency may not adopt the withdrawn rules without again following the procedures of sections 14.05 to 14.28, with the exception of section 14.101, if the noncompliance is approved by the chief administrative law judge. The agency shall report its failure to adopt the rules and the reasons for that failure to the Legislative Coordinating Commission, other appropriate legislative committees, and the governor.

Subd. 2. Resubmission. Even if the 180-day period expires while the administrative law judge reviews the rule, if the administrative law judge rejects the rule, the agency may resubmit it after taking corrective action. The resubmission must occur within 30 days of when the agency receives written notice of the disapproval. If the rule is again disapproved, the rule is withdrawn. An agency may resubmit at any time before the expiration of the 180-day period. If the agency withholds some of the proposed rule, it may not adopt the withheld portion without again following the procedures of sections 14.14 to 14.28.

Subd. 3. Review. ~~(a)~~ Within 14 days of receiving a submission under subdivision 1, the administrative law judge shall approve or disapprove the rule as to its legality and its form to the extent that the form relates to legality, including the issues of whether the rule if modified is substantially different, as determined under section 14.05, subdivision 2, from the rule as originally proposed, whether the agency has the authority to adopt the rule, and whether the record demonstrates a rational basis for the need for and reasonableness of the proposed rule. If the rule is approved, the administrative law judge shall promptly file four copies of it in the Office of the Secretary of State. The secretary of state shall forward one copy of each rule to the revisor of statutes, one to the agency, and one to the governor. If the rule is disapproved, the administrative law judge shall state in writing the reasons for the disapproval and make recommendations to overcome the defects.

Subd. 4. Harmless error. The administrative law judge shall disregard any error or defect in the proceeding due to the agency's failure to satisfy any procedural requirements imposed by law or rule if the administrative law judge finds:

(1) that the failure did not deprive any person or entity of an opportunity to participate meaningfully in the rulemaking process; or

(2) that the agency has taken corrective action to cure the error or defect so that the failure did not deprive any person or entity of an opportunity to participate meaningfully in the rulemaking process.

Subd. 5. Correction of defects. ~~(b)~~ (a) The written disapproval must be submitted to the chief administrative law judge for approval. If the chief administrative law judge approves of the findings of the administrative law judge, the chief administrative law judge shall send the statement of the reasons for disapproval of the rule to the agency, the Legislative Coordinating Commission, the house of representatives and senate policy committees with primary jurisdiction over state governmental operations, and the revisor of statutes and advise the agency and the revisor of statutes of actions that will correct the defects. The rule may not be filed in the Office of the Secretary of State, nor be published, until the chief administrative law judge determines that the defects have been corrected or, if applicable, that the agency has satisfied the rule requirements for the adoption of a substantially different rule.

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(b) The agency may resubmit the disapproved rule under paragraph (a) to the chief administrative law judge after correcting the defects. If the 180-day period expires while the chief administrative law judge is reviewing the rule, the agency may resubmit the rule within 30 days of the date the agency received written notice of disapproval. In all other cases, the agency may resubmit the rule at any time before the expiration of the 180-day period in subdivision 1. If the resubmitted rule is disapproved by the chief administrative law judge, the rule is withdrawn. If the agency does not resubmit a portion of the rule, it may not adopt that portion of the rule without again following the procedures of sections 14.14 to 14.28.

Subd. 6. Need or reasonableness not established. ~~(c)~~ If the chief administrative law judge determines that the need for or reasonableness of the rule has not been established, and if the agency does not elect to follow the suggested actions of the chief administrative law judge to correct that defect, then the agency shall submit the proposed rule to the Legislative Coordinating Commission and to the house of representatives and senate policy committees with primary jurisdiction over state governmental operations for advice and comment. The agency may not adopt the rule until it has received and considered the advice of the commission and committees. However, the agency need not wait for advice for more than 60 days after the commission and committees have received the agency's submission.

(d) The administrative law judge shall disregard any error or defect in the proceeding due to the agency's failure to satisfy any procedural requirements imposed by law or rule if the administrative law judge finds:

~~(1) that the failure did not deprive any person or entity of an opportunity to participate meaningfully in the rulemaking process; or~~

Subd. 7. Filing. If the rule is approved, the administrative law judge shall promptly file four paper copies or an electronic copy of it in the Office of the Secretary of State. The secretary of state shall forward one copy of each rule to the revisor of statutes, one to the agency, and one to the governor.

Subd. 4 8. Costs. The Office of Administrative Hearings shall assess an agency for the actual cost of processing rules under this section. Each agency shall include in its budget money to pay the assessment. Receipts from the assessment must be deposited in the administrative hearings account created in section 14.54.

Sec. 20. Minnesota Statutes 2012, section 14.388, subdivision 1, is amended to read:

Subdivision 1. Requirements. If an agency for good cause finds that the rulemaking provisions of this chapter are unnecessary, impracticable, or contrary to the public interest when adopting, amending, or repealing a rule to:

(1) address a serious and immediate threat to the public health, safety, or welfare;

(2) comply with a court order or a requirement in federal law in a manner that does not allow for compliance with sections 14.14 to 14.28;

(3) incorporate specific changes set forth in applicable statutes when no interpretation of law is required; or

(4) make changes that do not alter the sense, meaning, or effect of a rule,

the agency may adopt, amend, or repeal the rule after satisfying the requirements of subdivision 2 and section 14.386, paragraph (a), clauses (1) to (4). The agency shall incorporate its findings and a brief statement of its supporting reasons in its order adopting, amending, or repealing the rule.

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After considering the agency's statement and any comments received, the Office of Administrative Hearings shall determine whether the agency has provided adequate justification for its use of this section.

Rules adopted, amended, or repealed under ~~clauses~~ clause (1) ~~and (2)~~ are effective for a period of two years from the date of publication of the rule in the State Register.

Rules adopted, amended, or repealed under clause (2), (3), or (4) are effective upon publication in the State Register.

Sec. 21. Minnesota Statutes 2012, section 14.389, is amended to read:

14.389 EXPEDITED PROCESS.

Subdivision 1. Application. (a) This section applies when a law requiring or authorizing rules to be adopted states that this section must or may be used to adopt the rules. When a law refers to this section, the process in this section is the only process an agency must follow for its rules to:

(1) a law requiring or authorizing rules to be adopted states that this section must or may be used to adopt the rules;

(2) an agency is adopting or incorporating by reference a specific code or standard referenced in a law requiring or authorizing rules to be adopted under this chapter;

(3) an agency is adopting or modifying a rule to conform to a change in federal law or regulation that is binding on the state or a state law or rule; or

(4) an agency is repealing rules that are obsolete, unnecessary, or duplicative of other state or federal statutes or rules.

(b) An agency may also use this process to adopt rules it determines are noncontroversial if there is other law authorizing the rules.

(c) Rules adopted under this section have the force and effect of law. Sections 14.19 and 14.366 apply to rules adopted under this section.

Subd. 2. Notice and comment. (a) The agency must publish notice of the proposed rule in the State Register and must mail the notice by United States mail or electronic mail to persons who have registered with the agency to receive mailed notices.

(b) The notice for rules adopted under the authority granted in subdivision 1, paragraph (b), must include a statement that if 50 or more persons request that the agency follow all of the requirements for rules adopted with or without a public hearing, as appropriate, except section 14.101, the agency shall adopt the rule only after complying with all of the requirements for rules adopted with or without a public hearing, as appropriate, except section 14.101. The notice must also include an easily readable and understandable description of the purpose, nature, and effect of the proposed rules, including a description of the persons or classes of persons who are likely to be affected by the proposed rulemaking. A hearing request made pursuant to this subdivision must be in writing and include: (1) the name and address of the person requesting the agency to adopt the rule in compliance with the procedures under sections 14.05 to 14.28; and (2) the portion or portions of the rule to which the person objects or a statement that the person is opposed to the entire rule.

(c) The mailed notice must include either a copy of the proposed rule or a description of the nature and effect of the proposed rule and a statement that a free copy is available from the agency upon request.

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(d) The notice in the State Register must include the proposed rule or the amended rule in the form required by the revisor under section 14.07, an easily readable and understandable summary of the overall nature and effect of the proposed rule, and a citation to the most specific statutory authority for the rule, including authority for the rule to be adopted under the process in this section.

(e) The agency must allow 30 days after publication in the State Register for comment on the rule.

Subd. 3. Adoption. The agency may modify a proposed rule if the modifications do not result in a substantially different rule, as defined in section 14.05, subdivision 2, paragraphs (b) and (c). If the final rule is identical to the rule originally published in the State Register, the agency must publish a notice of adoption in the State Register. If the final rule is different from the rule originally published in the State Register, the agency must publish a copy of the changes in the State Register. The agency must also file a copy of the rule with the governor. The rule is effective upon publication in the State Register.

Subd. 4. Legal review. Before publication of the final rule in the State Register, the agency must submit the rule and its order adopting, amending, or repealing the rule to an administrative law judge in the Office of Administrative Hearings. The agency's order must include the agency's findings and a brief statement summarizing its reasons for using this expedited process. The administrative law judge shall make a determination that the agency's submission establishes the need for and reasonableness of the proposed rules and fulfills any relevant substantive or procedural requirements imposed on the agency by law or rule. This shall not be construed to mean that the agency must submit a statement of need and reasonableness as required in section 14.131. The administrative law judge shall within 14 days approve or disapprove the rule as to its legality and its form to the extent the form relates to legality.

Subd. 5. Option. A law authorizing or requiring rules to be adopted under this section may refer specifically to this subdivision. If the law contains a specific reference to this subdivision, as opposed to a general reference to this section:

(1) the notice required in subdivision 2 must include a statement that a public hearing will be held if 100 or more people request a hearing. The request must be in the manner specified in section 14.25; and

(2) if 100 or more people submit a written request for a public hearing, the agency may adopt the rule only after complying with all of the requirements of chapter 14 for rules adopted after a public hearing, except for section 14.101.

Subd. 6. Additional notice plan. An agency proposing expedited rules under subdivision 1 must give notice by methods designed to reach persons or classes of persons who might be affected by the proposal before publication of the notice required by subdivision 2 in the State Register. The agency must submit its additional notice plan to the Office of Administrative Hearings and receive approval of the plan before publication. The request for approval must include a description of the proposed additional notice plan; a description or a draft of the proposed rules; and an explanation of why the agency believes that its additional notice plan provides sufficient notice. The administrative law judge must approve or disapprove the plan within five working days after the office receives it.

Sec. 22. REPEALER.

Minnesota Statutes 2012, sections 14.04; 14.05, subdivision 5; 14.14, subdivision 1b; and 14.3895, are repealed.

Sec. 23. EFFECTIVE DATE; APPLICATION.

This act is effective August 1, 2014, and applies to rules for which a notice of hearing under Minnesota Statutes, section 14.14; a notice of intent to adopt under Minnesota Statutes, section 14.22; or a dual notice under Minnesota Statutes, section 14.225, is published in the State Register on or after that date."

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Delete the title and insert:

"A bill for an act relating to state government; regulating agency rulemaking; amending Minnesota Statutes 2012, sections 3.842, subdivision 4a; 14.05, subdivision 6, by adding subdivisions; 14.07, subdivision 4; 14.08; 14.101, subdivision 1; 14.116; 14.125; 14.126, subdivision 2; 14.131; 14.14, subdivisions 1a, 2a; 14.16, subdivision 3; 14.22; 14.23; 14.25; 14.26; 14.388, subdivision 1; 14.389; proposing coding for new law in Minnesota Statutes, chapter 14; repealing Minnesota Statutes 2012, sections 14.04; 14.05, subdivision 5; 14.14, subdivision 1b; 14.3895."

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

The report was adopted.

Atkins from the Committee on Commerce and Consumer Protection Finance and Policy to which was referred:

H. F. No. 2853, A bill for an act relating to commerce; regulating certain licensees; modifying education requirements; repealing obsolete rules; making technical changes; modifying enforcement provisions; authorizing certain protective and restraining orders; regulating insurance holding company systems by enacting changes proposed by the National Association of Insurance Commissioners; amending Minnesota Statutes 2012, sections 45.027, subdivision 7; 58.12, subdivision 1; 60A.10, subdivision 1; 60D.09; 60D.15, by adding a subdivision; 60D.17, subdivisions 1, 2, 4, 6, 7; 60D.18, subdivisions 2, 6; 60D.19, subdivisions 1, 2, 3, 11, 12, by adding a subdivision; 60D.20, subdivisions 1, 3; 60D.21, subdivision 1, by adding subdivisions; 60D.22; 60D.23; 60K.54, subdivision 2; 62A.65, by adding a subdivision; 66A.01; 68A.01, subdivision 2; 68A.02, subdivision 1; 68A.04, subdivision 1; 82.55, subdivision 4; 82.641, subdivision 6; 82.81, subdivision 8; 82B.135, subdivision 1; 82B.19, subdivisions 1, 3, by adding a subdivision; 115C.02, subdivision 16; 115C.09, subdivisions 1, 2a, 3; 239.785, subdivision 6; 297I.01, subdivision 9; 327C.095, subdivision 11; 386.66; 507.401, subdivisions 1, 2, 3, 4, 5; 507.45, subdivision 4; 515B.4-109; Minnesota Statutes 2013 Supplement, sections 239.761, subdivision 8; 332A.02, subdivision 8; 559.202, subdivision 3; proposing coding for new law in Minnesota Statutes, chapters 60D; 82B; 609; repealing Minnesota Statutes 2012, section 82B.10, subdivision 7; Laws 2013, chapter 84, article 1, sections 25; 30; Minnesota Rules, parts 3300.0800; 3300.0900; 3300.1000; 3300.1100; 3300.1200; 3300.1300; 3300.1400; 3300.1500; 3300.1600; 3300.1700; 3300.1800; 3300.1900; 7607.0100; 7607.0110; 7607.0120; 7607.0130; 7607.0140; 7607.0150; 7607.0160; 7607.0170; 7607.0180; 7610.0300; 7685.0100; 7685.0120; 7685.0130; 7685.0140.

Reported the same back with the following amendments:

Page 1, after line 29, insert:

"Section 1. Minnesota Statutes 2012, section 45.32, is amended by adding a subdivision to read:

Subd. 2a. Qualifications for instructors of the Minnesota Supervisor/Trainee Appraiser Course. In addition to qualifying under subdivision 2, an instructor of the Minnesota Supervisor/Trainee Appraiser Course offered as continuing education must:

(1) be licensed in good standing as either a certified residential real property appraiser or a certified general real property appraiser, and must have been so licensed for the three-year period immediately preceding the individual's application to become an instructor of the Minnesota Supervisor/Trainee Appraiser Course; and

(2) not have been the subject of any license or certificate suspension or revocation, or been prohibited from supervising activities in this state or any other state within the three years immediately preceding the individual's application to become an instructor of the Minnesota Supervisor/Trainee Appraiser Course.

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Sec. 2. Minnesota Statutes 2012, section 45.32, is amended by adding a subdivision to read:

Subd. 3a. Qualifications for instructors of the Minnesota Supervisor/Trainee Appraiser Course. In addition to qualifying under subdivision 3, an instructor of the Minnesota Supervisor/Trainee Appraiser Course offered as prelicense education must:

Sec. 3. Minnesota Statutes 2013 Supplement, section 82B.094, is amended to read:

82B.094 SUPERVISION OF TRAINEE REAL PROPERTY APPRAISERS.

(a) A certified residential real property appraiser or a certified general real property appraiser, in good standing, may engage a trainee real property appraiser to assist in the performance of real estate appraisals, provided that the certified residential real property appraiser or a certified general real property appraiser:

(1) has been licensed in good standing as either a certified residential real property appraiser or a certified general real property appraiser for ~~a total of at least three years~~ the three-year period immediately preceding the individual's application to become a supervisor;

(2) has completed a six-hour course, approved in advance by the commissioner and provided by an education provider approved by the commissioner, that is specifically oriented to the requirements and responsibilities of supervisory appraisers and trainee appraisers. A course approved by the commissioner for the purposes of this section must be given the course title "Minnesota Supervisor/Trainee Appraiser Course";

(3) has not been the subject of any license or certificate suspension or revocation or has not been prohibited from supervising activities in this state or any other state within the ~~previous two~~ three years immediately preceding the individual's application to become a supervisor;

(4) has no more than three trainee real property appraisers working under supervision at any one time;

(5) actively and personally supervises the trainee real property appraiser, which includes ensuring that research of general and specific data has been adequately conducted and properly reported, application of appraisal principles and methodologies has been properly applied, that the analysis is sound and adequately reported, and that any analyses, opinions, or conclusions are adequately developed and reported so that the appraisal report is not misleading;

(6) discusses with the trainee real property appraiser any necessary and appropriate changes that are made to a report, involving any trainee appraiser, before it is transmitted to the client. Changes not discussed with the trainee real property appraiser that are made by the supervising appraiser must be provided in writing to the trainee real property appraiser upon completion of the appraisal report;

(7) accompanies the trainee real property appraiser on the inspections of the subject properties and drive-by inspections of the comparable sales on all appraisal assignments for which the trainee will perform work until the trainee appraiser is determined to be competent, in accordance with the competency rule of USPAP for the property type;

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(8) accepts full responsibility for the appraisal report by signing and certifying that the report complies with USPAP; and

(9) reviews and signs the trainee real property appraiser's appraisal report or reports or if the trainee appraiser is not signing the report, states in the appraisal the name of the trainee and scope of the trainee's significant contribution to the report.

(b) The supervising appraiser must review and sign the applicable experience log required to be kept by the trainee real property appraiser.

(c) The supervising appraiser must notify the commissioner within ten days when the supervision of a trainee real property appraiser has terminated or when the trainee appraiser is no longer under the supervision of the supervising appraiser.

(d) The supervising appraiser must maintain a separate work file for each appraisal assignment.

(e) The supervising appraiser must verify that any trainee real property appraiser that is subject to supervision is properly licensed and in good standing with the commissioner."

Page 2, after line 3, insert:

"Sec. 5. Minnesota Statutes 2013 Supplement, section 82B.13, subdivision 1, is amended to read:

Subdivision 1. Trainee real property appraiser. (a) As a prerequisite for licensing as a trainee real property appraiser, an applicant must present evidence satisfactory to the commissioner that the person has successfully completed:

(1) at least 75 hours of prelicense courses approved by the commissioner. Fifteen of the 75 hours must include successful completion of the 15-hour national USPAP course; and

(2) in addition to the required hours under clause (1), a six-hour course that is specifically oriented to the requirements and responsibilities of supervisory appraisers and trainee appraisers. A course approved by the commissioner for the purposes of this subdivision must be given the course title "Minnesota Supervisor/Trainee Appraiser Course." This course must not be counted toward qualifying education to upgrade to a higher level appraiser license.

(b) All qualifying education must be completed within the five-year period prior to the date of submission of a trainee real property appraiser license application."

Page 3, after line 24, insert:

"Sec. 10. MONEY TRANSMITTERS; NO TRANSIT LIST; DELAYED EFFECTIVE DATE.

Notwithstanding Laws 2013, chapter 50, Minnesota Statutes 2013 Supplement, section 53B.27, subdivision 3, is effective January 1, 2016."

Page 4, delete section 2

Page 8, delete section 1

Page 9, delete section 4

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Page 9, delete section 1 and insert:

"Section 1. Minnesota Statutes 2012, section 45.027, subdivision 7, is amended to read:

Subd. 7. Actions against licensees. (a) In addition to any other actions authorized by this section, the commissioner may, by order, deny, suspend, or revoke the authority or license of a person subject to the duties and responsibilities entrusted to the commissioner, as described under section 45.011, subdivision 4, or censure that person if the commissioner finds that:

(1) the order is in the public interest; and

(2) the person has violated any law, rule, or order related to the duties and responsibilities entrusted to the commissioner; or

(3) the person has provided false, misleading, or incomplete information to the commissioner or has refused to allow a reasonable inspection of records or premises; or

(4) the person has engaged in an act or practice, whether or not the act or practice directly involves the business for which the person is licensed or authorized, which demonstrates that the applicant or licensee is untrustworthy, financially irresponsible, or otherwise incompetent or unqualified to act under the authority or license granted by the commissioner.

(b) (1) The commissioner shall issue an order requiring a licensee or applicant for a license to show cause why the license should not be revoked or suspended, or the licensee censured, or the application denied and provide the licensee or applicant an opportunity to request a hearing under the contested case provisions of chapter 14. The order must be calculated to give reasonable notice of the time and place for a hearing on the action, and must state the reasons for the entry of the order. The commissioner may, by order, summarily suspend a license pending final determination of an order to show cause. If a license is suspended pending final determination of an order to show cause, a hearing on the merits must be held within 30 days of the issuance of the order of suspension. The order must: (i) state the reasons that an order is being sought and whether a civil penalty is sought; and (ii) inform the licensee or applicant that unless the licensee or applicant requests a hearing on the matter within 30 days of receipt of the order, it becomes final by operation of law and that a final order will be issued under paragraph (a). If a hearing is requested by the licensee or applicant pursuant to item (ii): (A) the commissioner shall, within 15 days of receiving the request, set the date and time for the hearing and notify the licensee or applicant of those facts; and (B) the commissioner may modify, vacate, or extend the order, until the commissioner issues a final order under paragraph (a).

(2) The commissioner may, by order, summarily suspend a license pending final determination of an order to show cause issued under clause (1). If a license is suspended pending final determination of an order to show cause and the licensee requests a hearing on the matter within 30 days of receipt of the order to show cause, a hearing on the merits must be held within 30 days of receipt of the hearing request. The summary suspension or summary revocation procedure does not apply to action by the commissioner against the certificate of authority of an insurer authorized to do business in Minnesota.

(c) All hearings must be conducted according to chapter 14. After the hearing, the commissioner shall enter an a final order disposing of the matter as the facts require. If the licensee or applicant fails to appear at a hearing after having been duly notified of it, the person is considered in default, and the proceeding may be determined against the licensee or applicant upon consideration of the order to show cause, the allegations of which may be considered true. The summary suspension or summary revocation procedures does not apply to action by the commissioner against the certificate of authority of an insurer authorized to do business in Minnesota.

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(d) If an order becomes final because a person subject to an order does not timely request a hearing as provided in paragraph (b) or if the petition for judicial review is not timely filed after a hearing and a final order is issued by the commissioner as provided in paragraph (a), the commissioner may file a certified copy of the final order with the clerk of a court of competent jurisdiction. The final order so filed has the same effect as a judgment of the court and may be recorded, enforced, or satisfied in the same manner as a judgment of the court.

(e) If a person does not comply with a final order under this section, the commissioner may petition a court of competent jurisdiction to enforce the order. The court may not require the commissioner to post a bond in an action or proceeding under this section. If the court finds, after service and opportunity for hearing, that the person was not in compliance with the order, the court may adjudge the person in civil contempt of the order. The court may impose a further civil penalty against the person for contempt in an amount up to $10,000 for each violation and may grant any other relief the court determines is just and proper in the circumstances.

(f) Except for information classified as confidential under sections 60A.03, subdivision 9; 60A.031; 60A.93; and 60D.22, the commissioner may make any data otherwise classified as private or confidential pursuant to this section accessible to an appropriate person or agency if the commissioner determines that the access will aid the law enforcement process, promote public health or safety, or dispel widespread rumor or unrest. If the commissioner determines that private or confidential information should be disclosed, the commissioner shall notify the attorney general as to the information to be disclosed, the purpose of the disclosure, and the need for the disclosure. The attorney general shall review the commissioner's determination. If the attorney general believes that the commissioner's determination does not satisfy the purpose and intent of this ~~provision~~ paragraph, the attorney general shall advise the commissioner in writing that the information may not be disclosed. If the attorney general believes the commissioner's determination satisfies the purpose and intent of this provision, the attorney general shall advise the commissioner in writing, accordingly.

After disclosing information pursuant to this provision, the commissioner shall advise the chairs of the senate and house of representatives judiciary committees of the disclosure and the basis for it."

Page 13, after line 9, insert:

"Sec. 3. Minnesota Statutes 2012, section 60A.0789, subdivision 3, is amended to read:

Subd. 3. Declaratory judgment action. (a) If, prior to payment of death benefits, the insurer believes the policy was initiated by STOLI practices, the insurer may bring a declaratory judgment action seeking a court order declaring the policy void.

(b) A life insurance policy owner, who believes in good faith that the insurer may challenge the policy for lack of insurable interest, may bring a declaratory judgment action seeking a court order declaring the policy valid.

(c) The right of a life insurance policy owner to bring a declaratory judgment action applies only to policies issued in Minnesota prior to the effective date of the Insurable Interest Act and that have a death benefit equal to or greater than one million dollars. Only the owner of record of a life insurance policy on the effective date of this section may bring a declaratory judgment action under this section.

EFFECTIVE DATE. This section is effective the day following final enactment and shall sunset on December 31, 2016."

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Page 14, after line 4, insert:

"Sec. 6. Minnesota Statutes 2012, section 61A.282, subdivision 1, is amended to read:

Subdivision 1. Requirements. A company's investments shall be held in its corporate name or its nominee name, except that:

(a) Investments may be held in the name of a clearing corporation or of a custodian bank or in the name of the nominee of either under the following conditions:

(1) The clearing corporation, custodian bank, or nominee must be legally authorized to hold the particular investment for the account of others;

(2) Where the investment is evidenced by a certificate and held in the name of a custodian bank or the nominee of a custodian bank, a written agreement shall provide that certificates so deposited shall at all times be kept separate and apart from other deposits with the depository, so that at all times they may be identified as belonging solely to the company making the deposit; or

(3) Where a clearing corporation is to act as depository, the investment may be merged or held in bulk in the clearing corporation's name, or in the name of its nominee, together with any other investments deposited with the clearing corporation by any other person, if a written agreement provides that adequate evidence of the deposit will be obtained and retained by the company or a custodian bank.

As used in this subdivision, the term "custodian bank" means a bank or trust company licensed by the United States or any state thereof.

(b) A company may participate, through a bank or trust company which is a member of the Federal Reserve System, in the Federal Reserve's book-entry system, if the records of the member bank or trust company at all times show that the investments are held for the company and/or for specific accounts of the company.

(c) If an investment consists of an individual interest in a pool of obligations, or of a fractional interest in a single obligation, the certificate of participation or interest, or the confirmation of participation or interest in the investment, shall be held in the manner set forth in paragraph (a) or held in the name of the company.

(d) Where an investment is not evidenced by a certificate, except as provided in paragraph (b), adequate evidence of the company's investment shall be obtained from the issuer or its transfer or recording agent and retained by the company, a custodian bank, or clearing corporation. Adequate evidence, for purposes of this section, shall mean a written receipt or other verification issued by the depository or issuer or a custodian bank which shows that the investment is held for the company. Transfers of ownership of investments held as described in paragraphs (a)(3), (b), and (c) may be evidenced by bookkeeping entry on the books of the issuer of the investment or its transfer or recording agent or the clearing corporation without physical delivery of certificates, if any, evidencing the company's investment.

(e) Investments or cash posted as collateral or variation margin (other than initial margin amounts) in connection with qualified financial contracts, as defined in section 60B.03, subdivision 22, are not subject to this subdivision.

Sec. 7. [65A.285] SURCHARGE PROHIBITION.

Subdivision 1. Surcharge prohibition. An insurer may not impose a surcharge on homeowners insurance solely as a result of a consumer inquiry.

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Subd. 2. Definitions. For purposes of this section:

(1) "consumer inquiry" means a telephone call or other communication made to an insurer that does not result in a paid claim and that is in regard to the general terms or conditions of or coverage offered under an insurance policy. The term includes a question concerning the process for filing a claim and whether a policy will cover a loss; and

(2) "surcharge" means an increase in premium for a policy, including the removal of a claim-free discount."

Page 15, line 31, before "agent's" insert "insurance"

Page 15, lines 32 and 33, before "agent" insert "insurance"

Page 16, lines 10, 12, and 18, before "agent" insert "insurance"

Page 24, delete section 24

Page 27, line 33, delete "subdivision" and insert "subdivisions 1 and"

Page 37, line 20, delete "(5)" and insert "(7)"

Page 39, line 29, strike "audit"

Page 44, line 10, delete "may" and insert "shall"

Page 45, delete section 23

Page 46, line 23, after "request" insert "and no more than once per year"

Page 50, line 1, delete "may" and insert "shall"

Renumber the sections in sequence

Amend the title as follows:

Page 1, line 3, delete "repealing obsolete rules;"

Page 1, line 4, after "provisions" insert "and other actions" and delete everything after the first semicolon and insert "prohibiting certain homeowners policy surcharges;"

Correct the title numbers accordingly

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

The report was adopted.

Nelson from the Committee on Government Operations to which was referred:

H. F. No. 3169, A bill for an act relating to state government; modifying a proposed constitutional amendment to stop lawmakers from raising their own pay; amending Laws 2013, chapter 124, section 2.

Reported the same back with the following amendments:

Journal of the House - 80th Day - Tuesday, April 1, 2014 - Top of Page 8614

Delete everything after the enacting clause and insert:

"Section 1. [15A.0825] LEGISLATIVE SALARY COUNCIL.

Subdivision 1. Membership. (a) The Legislative Salary Council consists of the following members:

(1) one person, who is not a judge, from each congressional district, appointed by the chief justice of the Supreme Court; and

(2) one person from each congressional district, appointed by the governor.

(b) If Minnesota has an odd number of congressional districts, the governor and the chief justice must each appoint an at-large member, in addition to a member from each congressional district.

(c) One-half of the members appointed by the governor and one-half of the members appointed by the chief justice must belong to the political party that has the most members in the legislature. One-half of the members appointed by the governor and one-half of the members appointed by the chief justice must belong to the political party that has the second most members in the legislature.

(d) None of the members of the council may be:

(1) a current or former legislator, or the spouse of a current legislator;

(2) a current or former lobbyist registered under Minnesota law; or

(3) a current employee of the legislature.

Subd. 2. Initial appointment; convening authority; first meeting. Appointing authorities must make their initial appointments by November 30, 2016. The governor shall designate one member to convene and chair the first meeting of the council. The first meeting must be before January 15, 2017. At its first meeting, the council must elect a chair from among its members. Members that reside in an even-numbered congressional district serve a first term ending January 15, 2019. Members residing in an odd-numbered congressional district serve a first term ending January 15, 2021.

Subd. 3. Terms. (a) Except for initial terms, a term is four years or until new appointments are made after congressional redistricting as provided in subdivision 4. Members may serve no more than two full terms or portions of two consecutive terms.

(b) If a member ceases to reside in the congressional district that the member resided in at the time of appointment as a result of moving or redistricting, the appointing authority who appointed the member must appoint a replacement who resides in the congressional district to serve the unexpired term.

Subd. 4. Appointments following redistricting. Appointing authorities shall make appointments within three months after a congressional redistricting plan is adopted.

Subd. 5. Removal; vacancies. Members may be removed only for cause, after notice and a hearing, for missing three consecutive meetings, or as a result of redistricting. The chair of the council or a designee shall inform the appointing authority of a member missing three consecutive meetings. After the second consecutively missed meeting and before the next meeting, the chair or a designee shall notify the member in writing that the member may be removed for missing the next meeting. In the case of a vacancy on the board, the appointing authority shall appoint a person to fill the vacancy for the remainder of the unexpired term.

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Subd. 6. Compensation. Members shall be compensated under section 15.059, subdivision 3.

Subd. 7. Duties. By March 31 of each odd-numbered year, the council must prescribe salaries for legislators to take effect July 1 of that year. In setting salaries, the council must take into account any other legislative compensation provided to the legislators by the state. The council must submit a report by March 31 of each odd-numbered year with the prescribed salaries to the governor, the majority and minority leaders of the senate and house of representatives, the chairs of the committees in the senate and house of representatives with jurisdiction over the legislature's budget, and the chairs of the committees in the senate and house of representatives with jurisdiction over finance. The report must describe the council's rationale for selecting the prescribed salaries.

Subd. 8. Chair. The commission shall elect a chair from among its members.

Subd. 9. Staffing. The Legislative Coordinating Commission shall provide administrative and support services for the council.

EFFECTIVE DATE. This section is effective upon adoption of the constitutional amendment proposed under Laws 2013, chapter 124.

Sec. 2. Laws 2013, chapter 124, section 1, is amended to read:

Section 1. CONSTITUTIONAL AMENDMENT PROPOSED.

An amendment to the Minnesota Constitution is proposed to the people. If the amendment is adopted, article IV, section 9, will read:

Sec. 9. The salary of senators and representatives shall be prescribed by a council consisting of the following members: one person who is not a judge from each congressional district appointed by the chief justice of the Supreme Court, and one member from each congressional district appointed by the governor. If Minnesota has an odd number of congressional districts, the governor and the chief justice must each appoint an at-large member in addition to a member from each congressional district. One-half of the members appointed by the governor and one-half of the members appointed by the chief justice must belong to the political party that has the most members in the legislature. One-half of the members appointed by the governor and one-half of the members appointed by the chief justice must belong to the political party that has the second-most members in the legislature. None of the members of the council may be current or former legislators, or the spouse of a current legislator. None of the members of the council may be current or former lobbyists registered under Minnesota law. None of the members of the council may be a current employee of the legislature. Membership terms, removal, and compensation of members shall be as provided by law. The council must prescribe salaries by March 31 of each odd-numbered year, taking into account any other legislative compensation provided to legislators by the state of Minnesota, with any changes in salary to take effect on July 1 of that year.

Sec. 3. Laws 2013, chapter 124, section 2, is amended to read:

Sec. 2. SCHEDULE AND QUESTION.

(a) The proposed amendment must be submitted to the people at the 2016 general election. The question submitted must be:

Journal of the House - 80th Day - Tuesday, April 1, 2014 - Top of Page 8616

"Shall the Minnesota Constitution be amended to remove state legislators' ability to set their own salaries, and instead establish an independent, citizens-only council to prescribe salaries for state legislators?

	Yes ……………
	No ……………"

(b) The title required under Minnesota Statutes, section 204D.15, subdivision 1, for the question submitted to the people under paragraph (a) shall be: "Remove Legislators' Power to Set Their Own Pay.""

Delete the title and insert:

"A bill for an act relating to state government; establishing a Legislative Salary Council; modifying a proposed constitutional amendment to stop lawmakers from setting their own pay; amending Laws 2013, chapter 124, sections 1; 2; proposing coding for new law in Minnesota Statutes, chapter 15A."

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

The report was adopted.

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

H. F. No. 3172, A bill for an act relating to state government; making supplemental appropriations for higher education, economic development, transportation, public safety, corrections, state government, health and human services, and early childhood, kindergarten through grade 12, and adult education; modifying certain statutory provisions and laws; providing for certain programs; regulating the carrying of pistols in the capitol area; making forecast adjustments; setting and modifying fees; providing for rate increases; regulating certain accounts; providing for conformity with federal law; authorizing the issuance of state bonds; appropriating money; amending Minnesota Statutes 2012, sections 13.46, subdivision 4; 122A.415, subdivision 1; 123A.05, subdivision 2; 124D.09, subdivision 13; 124D.111, by adding a subdivision; 124D.522; 124D.531, subdivision 3; 125A.76, subdivision 2; 126C.10, subdivisions 25, 26; 165.15, subdivision 2; 171.02, subdivision 3; 171.06, subdivision 2; 174.02, by adding a subdivision; 245C.03, by adding a subdivision; 245C.04, by adding a subdivision; 245C.05, subdivision 5; 245C.10, by adding a subdivision; 245C.33, subdivisions 1, 4; 252.451, subdivision 2; 254B.12; 256.01, by adding a subdivision; 256.9685, subdivisions 1, 1a; 256.9686, subdivision 2; 256.969, subdivisions 1, 2, 2b, 2c, 3a, 3b, 6a, 9, 10, 14, 17, 30, by adding subdivisions; 256B.0625, subdivision 30; 256B.199; 256B.5012, by adding a subdivision; 256I.05, subdivision 2; 257.85, subdivision 11; 260C.212, subdivision 1; 260C.515, subdivision 4; 260C.611; 268.057, subdivision 5; 268.18, subdivision 2b; 473.39, by adding a subdivision; 609.66, subdivision 1g; Minnesota Statutes 2013 Supplement, sections 124D.11, subdivision 1; 124D.111, subdivision 1; 124D.531, subdivision 1; 124D.862, subdivisions 1, 2; 125A.11, subdivision 1; 125A.76, subdivisions 1, 2a, 2b, 2c; 125A.79, subdivisions 1, 5, 8; 126C.05, subdivision 15; 126C.10, subdivisions 2a, 24, 31; 126C.17, subdivisions 6, 7b, 9, 9a; 126C.44; 127A.47, subdivision 7; 174.12, subdivision 2; 245.8251; 245A.042, subdivision 3; 245C.08, subdivision 1; 245D.02, subdivisions 3, 4b, 8b, 11, 15b, 29, 34, 34a, by adding a subdivision; 245D.03, subdivisions 1, 2, 3, by adding a subdivision; 245D.04, subdivision 3; 245D.05, subdivisions 1, 1a, 1b, 2, 4, 5; 245D.051; 245D.06, subdivisions 2, 4, 6, 7, 8; 245D.071, subdivisions 3, 4, 5; 245D.081, subdivision 2; 245D.09, subdivisions 3, 4a; 245D.091, subdivisions 2, 3, 4; 245D.10, subdivision 3; 245D.11, subdivision 2; 256B.04, subdivision 21; 256B.055, subdivision 1; 256B.439, subdivisions 1, 7; 256B.4912, subdivision 1; 256B.85, subdivisions 2, 3, 5, 6, 7, 8, 9, 10, 11, 12, 13, 15, 16, 17, 18, 23, 24, by adding subdivisions; 256N.02, by adding a subdivision; 256N.21, subdivision 2, by adding a subdivision; 256N.22, subdivisions 1, 2, 4, 6; 256N.23, subdivisions 1, 4; 256N.24, subdivisions 9, 10; 256N.25, subdivisions 2, 3; 256N.26, subdivision 1; 256N.27, subdivision 4; Laws 2009, chapter 83, article 1, section 10, subdivision 7; Laws 2010, chapter 189, section 15, subdivision 12; Laws 2012, chapter 287, article 2, section 1; Laws 2012, First Special Session chapter 1, article 1, section 28; Laws 2013, chapter 1, section

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6, as amended; Laws 2013, chapter 85, article 1, section 3, subdivision 2; Laws 2013, chapter 99, article 1, section 4, subdivision 3; article 3, section 3; Laws 2013, chapter 108, article 7, section 49; article 14, sections 2, subdivisions 5, 6; 3, subdivisions 1, 4; 12; Laws 2013, chapter 116, article 1, section 58, subdivisions 2, 3, 4, 5, 6, 7, 11; article 3, section 37, subdivisions 3, 4, 5, 6, 8, 20; article 4, section 9, subdivision 2; article 5, section 31, subdivisions 2, 3, 4; article 6, section 12, subdivisions 2, 3, 4, 6; article 7, section 21, subdivisions 2, 3, 4, 6, 7, 9; article 8, section 5, subdivisions 2, 3, 4, 10, 11, 14; article 9, section 2; Laws 2013, chapter 117, article 1, sections 3, subdivisions 2, 3, 6; 4; proposing coding for new law in Minnesota Statutes, chapters 144A; 171; repealing Minnesota Statutes 2012, sections 245.825, subdivisions 1, 1b; 256.969, subdivisions 8b, 9a, 9b, 11, 13, 20, 21, 22, 25, 26, 27, 28; 256.9695, subdivisions 3, 4; Minnesota Statutes 2013 Supplement, sections 245D.02, subdivisions 2b, 2c, 3b, 5a, 8a, 15a, 15b, 23b, 28, 29, 34a; 245D.06, subdivisions 5, 6, 7, 8; 245D.061, subdivisions 1, 2, 3, 4, 5, 6, 7, 8, 9; 256N.26, subdivision 7; Minnesota Rules, parts 4830.7500, subpart 2a; 9525.2700; 9525.2810.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"ARTICLE 1

HIGHER EDUCATION

Section 1. MINNESOTA STATE COLLEGES AND UNIVERSITIES; SETTLEMENT OF EMPLOYMENT CONTRACTS.

$17,000,000 in fiscal year 2015 is appropriated from the general fund to the Board of Trustees of the Minnesota State Colleges and Universities for compensation costs associated with the settlement of employment contracts for fiscal year 2014. The board's appropriation base is increased by $14,000,000 in fiscal years 2016 and 2017.

ARTICLE 2

HOUSING

Section 1. Laws 2013, chapter 85, article 1, section 4, subdivision 1, is amended to read:

Subdivision 1. Total Appropriation

$58,748,000

$42,748,000

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

Unless otherwise specified, this appropriation is for transfer to the housing development fund for the programs specified in this section. Except as otherwise indicated, this transfer is part of the agency's permanent budget base.

The Housing Finance Agency will make continuous improvements to its ongoing efforts to reduce the racial and ethnic inequalities in homeownership rates and will seek opportunities to deploy increasing levels of resources toward these efforts.

Sec. 2. Laws 2013, chapter 85, article 1, section 4, subdivision 2, is amended to read:

Subd. 2. Challenge Program

19,203,000

9,203,000

(a) This appropriation is for the economic development and housing challenge program under Minnesota Statutes, section 462A.33. The agency must continue to strengthen its efforts to

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address the disparity rate between white households and indigenous American Indians and communities of color. Of this amount, $1,208,000 each year shall be made available during the first 11 months of the fiscal year exclusively for housing projects for American Indians. Any funds not committed to housing projects for American Indians in the first 11 months of the fiscal year shall be available for any eligible activity under Minnesota Statues, section 462A.33.

(b) Of this amount, $10,000,000 is a onetime appropriation and is targeted for housing in communities and regions that have:

(1)(i) low housing vacancy rates; and

(ii) cooperatively developed a plan that identifies current and future housing needs; and

(2)(i) experienced job growth since 2005 and have at least 2,000 jobs within the commuter shed;

(ii) evidence of anticipated job expansion; or

(iii) a significant portion of area employees who commute more than 30 miles between their residence and their employment.

(c) Priority shall be given to programs and projects that are land trust programs and programs that work in coordination with a land trust program.

(d) Of this amount, $500,000 is for homeownership opportunities for families who have been evicted or been given notice of an eviction due to a disabled child in the home, including adjustments for the incremental increase in costs of addressing the unique housing needs of those households. Any funds not expended for this purpose may be returned to the challenge fund after October 31, 2014.

~~(d)~~ (e) The base funding for this program in the 2016-2017 biennium is $12,925,000 each year.

Sec. 3. Laws 2013, chapter 85, article 1, section 4, subdivision 3, is amended to read:

Subd. 3. Housing Trust Fund

~~13,276,000~~ 12,776,000

10,276,000

(a) This appropriation is for deposit in the housing trust fund account created under Minnesota Statutes, section 462A.201, and may be used for the purposes provided in that section. To the extent that these funds are used for the acquisition of housing, the agency shall give priority among comparable projects to projects that focus on creating safe and stable housing for homeless youth or projects that provide housing to trafficked women and children.

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(b) $2,000,000 in the first year is a onetime appropriation for temporary rental assistance for families with school-age children who have changed school or home at least once in the last school year. The agency, in consultation with the Department of Education, may establish additional targeting criteria.

(c) Of this amount, $500,000 the first year is a onetime appropriation for temporary rental assistance for adults who are in the process of being released from state correctional facilities or on supervised release in the community who are homeless or at risk of becoming homeless. The agency, in consultation with the Department of Corrections, may establish additional targeting criteria to identify those adults most at risk of reentering state correctional facilities.

(d) Of this amount, $500,000 the first year is a onetime appropriation for a grant to the nonprofit organization selected to administer the state demonstration project for high-risk adults established under Laws 2007, chapter 54, article 1, section 19.

~~(e)~~ (d) The base funding for this program in fiscal years 2016 and 2017 is $11,471,000 each year.

Sec. 4. AFFORDABLE HOUSING PLAN; DISPARITIES REPORT.

(a) The Housing Finance Agency shall provide the chairs and ranking minority members of the house of representatives and senate committees with jurisdiction over the agency with the draft and final versions of its affordable housing plan before and after it has been submitted to the agency board for consideration.

(b) The Housing Finance Agency shall annually report to the chairs and ranking minority members of the house of representatives and senate committees with jurisdiction over the agency on the progress, if any, the agency has made in closing the racial disparity gap and low-income concentrated housing disparities.

JOBS AND ECONOMIC DEVELOPMENT

ARTICLE 3

DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT;

DEPARTMENT OF LABOR AND INDUSTRY APPROPRIATIONS

Section 1. APPROPRIATIONS.

The sums shown in the columns under "Appropriations" are added to or, if shown in parentheses, subtracted from the appropriations in Laws 2013, chapter 85, article 1, or other law to the specified agencies. The appropriations are from the general fund, or another named fund, and are available for the fiscal years indicated for each purpose. The figures "2014" and "2015" used in this article mean that the appropriations listed under them are available for the fiscal year ending June 30, 2014, or June 30, 2015, respectively. Appropriations for the fiscal year ending June 30, 2014, are effective the day following final enactment. Reductions may be taken in either fiscal year.

Journal of the House - 80th Day - Tuesday, April 1, 2014 - Top of Page 8620		APPROPRIATIONS
		Available for the Year
		Ending June 30
	2014		2015

Sec. 2. DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT

Subdivision 1. Total Appropriation

$38,350,000

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

Subd. 2. Business and Community Development

36,250,000

(a) $25,000,000 in fiscal year 2015 is for grants for the development of broadband infrastructure under Minnesota Statutes, section 116J.395, or to supplement revenues raised by bonds sold by local units of government for broadband infrastructure development. This is a onetime appropriation and is available until June 30, 2017.

(b) $450,000 in fiscal year 2015 is from the general fund for one or more contracts with an independent organization to continue to:

(1) collect broadband deployment data from Minnesota providers, verify its accuracy through on-the-ground testing, and create state and county maps available to the public showing the availability of broadband service at various upload and download speeds throughout Minnesota, in order to measure progress in achieving the state's broadband goals established in Minnesota Statutes, section 237.012;

(2) analyze the deployment data collected to help inform future investments in broadband infrastructure; and

(3) conduct business and residential surveys that measure broadband adoption and use in the state.

Data provided by a broadband provider to the contractor under this paragraph is nonpublic data under Minnesota Statutes, section 13.02, subdivision 9. Maps produced under this paragraph are public data under Minnesota Statutes, section 13.03. This is a onetime appropriation and is available until expended.

(c) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the Southwest Initiative Foundation for business revolving loans or other lending programs. This is a onetime appropriation and is available until expended.

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(d) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the West Central Initiative Foundation for business revolving loans or other lending programs. This is a onetime appropriation and is available until expended.

(e) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the Southern Minnesota Initiative Foundation for business revolving loans or other lending programs. This is a onetime appropriation and is available until expended.

(f) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the Northwest Minnesota Foundation for business revolving loans or other lending programs. This is a onetime appropriation and is available until expended.

(g) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the Initiative Foundation for business revolving loans or other lending programs. This is a onetime appropriation and is available until expended.

(h) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the Northland Foundation for business revolving loans or other lending programs. This is a onetime appropriation and is available until expended.

(i) $1,000,000 in fiscal year 2015 is from the general fund for a grant to the Urban Initiative Board under Minnesota Statutes, chapter 116M, for business technical assistance or organizational capacity building. Funds available under this paragraph must be allocated as follows: (1) 50 percent of the funds must be allocated for projects in the counties of Dakota, Ramsey, and Washington; and (2) 50 percent of the funds must be allocated for projects in the counties of Anoka, Carver, Hennepin, and Scott. This is a onetime appropriation and is available until expended.

(j) $500,000 in fiscal year 2015 is from the general fund for grants to small business development centers under Minnesota Statutes, section 116J.68. Funds made available under this paragraph may be used to match funds under the federal Small Business Development Center (SBDC) program under United States Code, title 15, section 648, to provide consulting and technical services, or to build additional SBDC network capacity to serve entrepreneurs and small businesses. The commissioner shall allocate funds equally among the nine regional centers and lead center. This is a onetime appropriation and is available until expended.

(k) $750,000 in fiscal year 2015 is from the general fund for the innovation voucher pilot program in article 4, section 9. This is a onetime appropriation and is available until expended. Of this amount, up to five percent may be used for administration. Vouchers require a 50 percent match by recipients.

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(l) $1,600,000 in fiscal year 2015 is from the general fund for the Minnesota Jobs Skills Partnership program under Minnesota Statutes, section 116L.02. Of this appropriation, $600,000 is onetime and is available until expended and $1,000,000 is added to the agency's base budget each year for fiscal years 2016 and 2017.

(m) $450,000 in fiscal year 2015 is from the general fund for the Office of Regenerative Medicine under Minnesota Statutes, sections 116J.886 to 116J.8862. This is a onetime appropriation and is available until expended.

Subd. 3. Workforce Development

1,600,000

(a) $75,000 in fiscal year 2015 is from the general fund for workforce program outcome activities under Minnesota Statutes, section 116L.98. Up to five percent of this appropriation may be used by the commissioner for administration of the program. This is a onetime appropriation and is available until expended.

(b) $1,000,000 in fiscal year 2015 is from the general fund for training rebates under article 4, section 11. This is a onetime appropriation and is available until expended.

(c) $25,000 in fiscal year 2015 is from the general fund for the information technology apprenticeship pilot program under article 4, section 13. This is a onetime appropriation and is available until expended.

Subd. 4. General Support Services

500,000

$500,000 in fiscal year 2015 is for establishing and operating the interagency Olmstead Implementation Office. This is a onetime appropriation and is available until expended.

Sec. 3. DEPARTMENT OF LABOR AND INDUSTRY

Subdivision 1. Total Appropriation

$275,000

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

Subd. 2. Labor Standards and Apprenticeship

275,000

(a) The base for the department is increased by $70,000 each year for implementing and administering a minimum wage inflation adjustment. This adjustment is available only if a law is enacted in the 2014 legislative session that includes an automatic inflation adjustment to the state minimum wage. The availability of this appropriation is effective in the same fiscal year that the inflation adjustment is first effective.

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(b) $25,000 in fiscal year 2015 is from the general fund for the precision manufacturing and health care services pilot program under article 4, section 12. This is a onetime appropriation and is available until expended.

Sec. 4. Laws 2013, chapter 85, article 1, section 3, subdivision 2, is amended to read:

Subd. 2. Business and Community Development

53,642,000

45,407,000

Appropriations by Fund

General	52,942,000	44,707,000
Remediation	700,000	700,000

(a)(1) $15,000,000 each year is for the Minnesota investment fund under Minnesota Statutes, section 116J.8731. Of this amount, the commissioner of employment and economic development may use up to three percent for administrative expenses. This appropriation is available until spent.

(2) Of the amount available under clause (1), up to $3,000,000 in fiscal year 2014 is for a loan to facilitate initial investment in the purchase and operation of a biopharmaceutical manufacturing facility. This loan is not subject to the loan limitations under Minnesota Statutes, section 116J.8731, and shall be forgiven by the commissioner of employment and economic development upon verification of meeting performance goals. Purchases related to and for the purposes of this loan award must be made between January 1, 2013, and June 30, 2015. The amount under this clause is available until expended.

(3) Of the amount available under clause (1), up to $2,000,000 is available for subsequent investment in the biopharmaceutical facility project in clause (2). The amount under this clause is available until expended. Loan thresholds under clause (2) must be achieved and maintained to receive funding. Loans are not subject to the loan limitations under Minnesota Statutes, section 116J.8731, and shall be forgiven by the commissioner of employment and economic development upon verification of meeting performance goals. Purchases related to and for the purposes of loan awards must be made during the biennium the loan was received.

(4) Notwithstanding any law to the contrary, the biopharmaceutical manufacturing facility in this paragraph shall be deemed eligible for the Minnesota job creation fund under Minnesota Statutes, section 116J.8748, by having at least $25,000,000 in capital investment and 190 retained employees.

(5) For purposes of clauses (1) to (4), "biopharmaceutical" and "biologics" are interchangeable and mean medical drugs or medicinal preparations produced using technology that uses

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biological systems, living organisms, or derivatives of living organisms, to make or modify products or processes for specific use. The medical drugs or medicinal preparations include but are not limited to proteins, antibodies, nucleic acids, and vaccines.

(b) $12,000,000 each year is for the Minnesota job creation fund under Minnesota Statutes, section 116J.8748. Of this amount, the commissioner of employment and economic development may use up to three percent for administrative expenses. This appropriation is available until spent. The base funding for this program shall be $12,500,000 each year in the fiscal year 2016-2017 biennium.

(c) $1,272,000 each year is from the general fund for contaminated site cleanup and development grants under Minnesota Statutes, sections 116J.551 to 116J.558. This appropriation is available until expended.

(d) $700,000 each year is from the remediation fund for contaminated site cleanup and development grants under Minnesota Statutes, sections 116J.551 to 116J.558. This appropriation is available until expended.

(e) $1,425,000 the first year and $1,425,000 the second year are from the general fund for the business development competitive grant program. Of this amount, up to five percent is for administration and monitoring of the business development competitive grant program. All grant awards shall be for two consecutive years. Grants shall be awarded in the first year.

(f) $4,195,000 each year is from the general fund for the Minnesota job skills partnership program under Minnesota Statutes, sections 116L.01 to 116L.17. If the appropriation for either year is insufficient, the appropriation for the other year is available. This appropriation is available until spent.

(g) $6,000,000 the first year is from the general fund for the redevelopment program under Minnesota Statutes, section 116J.571. This is a onetime appropriation and is available until spent.

(h) $12,000 each year is from the general fund for a grant to the Upper Minnesota Film Office.

(i) $325,000 each year is from the general fund for the Minnesota Film and TV Board. The appropriation in each year is available only upon receipt by the board of $1 in matching contributions of money or in-kind contributions from nonstate sources for every $3 provided by this appropriation, except that each year up to $50,000 is available on July 1 even if the required matching contribution has not been received by that date.

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(j) $100,000 each year is for a grant to the Northern Lights International Music Festival.

(k) $5,000,000 each year is from the general fund for a grant to the Minnesota Film and TV Board for the film production jobs program under Minnesota Statutes, section 116U.26. This appropriation is available until expended. The base funding for this program shall be $1,500,000 each year in the fiscal year 2016-2017 biennium.

(l) $375,000 each year is from the general fund for a grant to Enterprise Minnesota, Inc., for the small business growth acceleration program under Minnesota Statutes, section 116O.115. This is a onetime appropriation.

(m) $160,000 each year is from the general fund for a grant to develop and implement a southern and southwestern Minnesota initiative foundation collaborative pilot project. Funds available under this paragraph must be used to support and develop entrepreneurs in diverse populations in southern and southwestern Minnesota. This is a onetime appropriation and is available until expended.

(n) $100,000 each year is from the general fund for the Center for Rural Policy and Development. This is a onetime appropriation.

(o) $250,000 each year is from the general fund for the Broadband Development Office.

(p) $250,000 the first year is from the general fund for a onetime grant to the St. Paul Planning and Economic Development Department for neighborhood stabilization use in NSP3.

(q) $1,235,000 the first year is from the general fund for a onetime grant to a city of the second class that is designated as an economically depressed area by the United States Department of Commerce. The appropriation is for economic development, redevelopment, and job creation programs and projects. This appropriation is available until expended.

(r) $875,000 each year is from the general fund for the Host Community Economic Development Program established in Minnesota Statutes, section 116J.548.

(s) $750,000 the first year is from the general fund for a onetime grant to the city of Morris for loans or grants to agricultural processing facilities for energy efficiency improvements. Funds available under this section shall be used to increase conservation and promote energy efficiency through retrofitting existing systems and installing new systems to recover waste heat from industrial processes and reuse energy. This appropriation is not

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available until the commissioner determines that ~~at least $1,250,000~~ a match of $750,000 is committed to the project from nonpublic sources. This appropriation is available until expended.

EFFECTIVE DATE. This section is effective retroactively from July 1, 2013.

Sec. 5. Laws 2013, chapter 85, article 1, section 3, subdivision 5, is amended to read:

Subd. 5. Minnesota Trade Office

2,322,000

2,292,000

(a) $330,000 in fiscal year 2014 and $300,000 in fiscal year 2015 are for the STEP grants in Minnesota Statutes, section 116J.979. Of the fiscal year 2014 appropriation, $30,000 is available for expenditure until June 30, 2015, and is for a grant to Voice of East African Women, Inc., for establishing trade, export, and cultural exchange relations between the state of Minnesota and east African nations.

(b) $180,000 in fiscal year 2014 and $180,000 in fiscal year 2015 are for the Invest Minnesota marketing initiative in Minnesota Statutes, section 116J.9781. Notwithstanding any other law, this provision does not expire.

(c) $270,000 each year is from the general fund for the expansion of Minnesota Trade Offices under Minnesota Statutes, section 116J.978.

(d) $50,000 each year is from the general fund for the trade policy advisory group under Minnesota Statutes, section 116J.9661.

(e) The commissioner of employment and economic development, in consultation with the commissioner of agriculture, shall identify and increase export opportunities for Minnesota agricultural products.

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

Sec. 6. Laws 2013, chapter 85, article 1, section 3, subdivision 6, is amended to read:

Subd. 6. Vocational Rehabilitation

27,691,000

Appropriations by Fund

General	20,861,000	20,861,000
Workforce Development	6,830,000	6,830,000

(a) $10,800,000 each year is from the general fund for the state's vocational rehabilitation program under Minnesota Statutes, chapter 268A.

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(b) $2,261,000 each year is from the general fund for grants to centers for independent living under Minnesota Statutes, section 268A.11.

(c) $5,745,000 each year from the general fund and $6,830,000 each year from the workforce development fund is for extended employment services for persons with severe disabilities under Minnesota Statutes, section 268A.15. The allocation of extended employment funds to Courage Center from July 1, 2012 to June 30, 2013 must be contracted to Allina Health systems from July 1, 2013 to June 30, ~~2014~~ 2015 to provide extended employment services in accordance with Minnesota Rules, parts 3300.2005 to 3300.2055.

(d) $2,055,000 each year is from the general fund for grants to programs that provide employment support services to persons with mental illness under Minnesota Statutes, sections 268A.13 and 268A.14. The base appropriation for this program is $1,555,000 each year in the fiscal year 2016-2017 biennium.

Sec. 7. Laws 2013, chapter 85, article 1, section 13, subdivision 5, is amended to read:

Subd. 5. Telecommunications

1,949,000

2,249,000

Appropriations by Fund

General	1,009,000	1,009,000
Special Revenue	940,000	1,240,000

$940,000 in fiscal year 2014 and $1,240,000 in fiscal year 2015 are appropriated to the commissioner from the telecommunication access fund for the following transfers. This appropriation is added to the department's base.

(1) $500,000 in fiscal year 2014 and $800,000 in fiscal year 2015 to the commissioner of human services to supplement the ongoing operational expenses of the Commission of Deaf, DeafBlind, and Hard-of-Hearing Minnesotans;

(2) $290,000 in fiscal year 2014 and $290,000 in fiscal year 2015 to the chief information officer for the purpose of coordinating technology accessibility and usability; and

(3) $150,000 in fiscal year 2014 and $150,000 in fiscal year 2015 to the Legislative Coordinating Commission for captioning of legislative coverage and for a consolidated access fund for other state agencies. These transfers are subject to Minnesota Statutes, section 16A.281.

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ARTICLE 4

ECONOMIC DEVELOPMENT AND WORKFORCE DEVELOPMENT

Section 1. [116J.394] DEFINITIONS.

(a) For the purposes of sections 116J.394 to 116J.396, the following terms have the meanings given them.

(b) "Broadband" or "broadband service" has the meaning given in section 116J.39, subdivision 1, paragraph (b).

(c) "Broadband infrastructure" means networks of deployed telecommunications equipment and technologies necessary to provide high-speed Internet access and other advanced telecommunications services for end users.

(d) "Commissioner" means the commissioner of employment and economic development.

(e) "Last-mile infrastructure" means broadband infrastructure that serves as the final leg connecting the broadband service provider's network to the end-use customer's on-premises telecommunications equipment.

(f) "Middle-mile infrastructure" means broadband infrastructure that links a broadband service provider's core network infrastructure to last-mile infrastructure.

(g) "Political subdivision" means any county, city, town, school district, special district or other political subdivision, or public corporation.

(h) "Underserved areas" means areas of Minnesota in which households or businesses lack access to wire-line broadband service at speeds that meet the state broadband goals of ten to 20 megabits per second download and five to ten megabits per second upload.

(i) "Unserved areas" means areas of Minnesota in which households or businesses lack access to wire-line broadband service at speeds that meet a Federal Communications Commission threshold of four megabits per second download and one megabit per second upload.

Sec. 2. [116J.395] BORDER-TO-BORDER BROADBAND DEVELOPMENT GRANT PROGRAM.

Subdivision 1. Establishment. A grant program is established under the Department of Employment and Economic Development to award grants to eligible applicants in order to promote the expansion of access to broadband service in unserved or underserved areas of the state.

Subd. 2. Eligible expenditures. Grants may be awarded under this section to fund the acquisition and installation of middle-mile and last-mile infrastructure that support broadband service scalable to speeds of at least 100 megabits per second download and 100 megabits per second upload.

Subd. 3. Eligible applicants. Eligible applicants for grants awarded under this section include:

(1) an incorporated business or a partnership;

(2) a political subdivision;

(3) an Indian tribe;

(4) a Minnesota nonprofit organization organized under chapter 317A;

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(5) a Minnesota cooperative association organized under chapter 308A or 308B; and

(6) a Minnesota limited liability corporation organized under chapter 322B for the purpose of expanding broadband access.

Subd. 4. Application process. An eligible applicant must submit an application to the commissioner on a form prescribed by the commissioner. The commissioner shall develop administrative procedures governing the application and grant award process. The commissioner shall act as fiscal agent for the grant program and shall be responsible for receiving and reviewing grant applications and awarding grants under this section.

Subd. 5. Application contents. An applicant for a grant under this section shall provide the following information on the application:

(1) the location of the project;

(2) the kind and amount of broadband infrastructure to be purchased for the project;

(3) evidence regarding the unserved or underserved nature of the community in which the project is to be located;

(4) the number of households passed that will have access to broadband service as a result of the project, or whose broadband service will be upgraded as a result of the project;

(5) significant community institutions that will benefit from the proposed project;

(6) evidence of community support for the project;

(7) the total cost of the project;

(8) sources of funding or in-kind contributions for the project that will supplement any grant award; and

(9) any additional information requested by the commissioner.

Subd. 6. Awarding grants. (a) In evaluating applications and awarding grants, the commissioner shall give priority to applications that are constructed in areas identified by the director of the Office of Broadband Development as unserved.

(b) In evaluating applications and awarding grants, the commissioner may give priority to applications that:

(1) are constructed in areas identified by the director of the Office of Broadband Development as underserved;

(2) offer new or substantially upgraded broadband service to important community institutions including, but not limited to, libraries, educational institutions, public safety facilities, and healthcare facilities;

(3) facilitate the use of telemedicine and electronic health records;

(4) serve economically distressed areas of the state, as measured by indices of unemployment, poverty, or population loss that are significantly greater than the statewide average;

(5) provide technical support and train residents, businesses, and institutions in the community served by the project to utilize broadband service;

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(6) include a component to actively promote the adoption of the newly available broadband services in the community;

(7) provide evidence of strong support for the project from citizens, government, businesses, and institutions in the community;

(8) provide access to broadband service to a greater number of unserved or underserved households and businesses; or

(9) leverage greater amounts of funding for the project from other private and public sources.

(c) The commissioner shall endeavor to award grants under this section to qualified applicants in all regions of the state.

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

Sec. 3. [116J.396] BORDER-TO-BORDER BROADBAND FUND.

Subdivision 1. Account established. The border-to-border broadband fund account is established as a separate account in the special revenue fund in the state treasury. The commissioner shall credit to the account appropriations and transfers to the account. Earnings, such as interest, dividends, and any other earnings arising from assets of the account, must be credited to the account. Funds remaining in the account at the end of a fiscal year are not canceled to the general fund, but remain in the account until expended. The commissioner shall manage the account.

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

(1) for grant awards made under section 116J.395, including up to three percent of the total amount appropriated for grants awarded under that section for costs incurred by the Department of Employment and Economic Development to administer that section; or

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

Subd. 3. Restrictions. (a) Except as provided in paragraph (c), in any fiscal year, no more than one-third of the funds expended from the account established in this section shall be awarded to applicants located in areas whose household density exceeds 100 households per square mile, as determined by the state demographer.

(b) Except as provided in paragraph (c), in any fiscal year, no more than two-thirds of the funds expended from the account established in this section shall be awarded to applicants located in areas whose household density is less than 100 households per square mile, as determined by the state demographer.

(c) If applications are insufficient to exhaust all funds available in a given grant round under the restrictions imposed in paragraph (a) or (b), the unexpended funds may be awarded to eligible applicants, as determined by the commissioner, irrespective of the population density of the area in which the applicant is located.

Subd. 4. Appropriation. Money in the account is appropriated to the commissioner for the purposes of subdivision 2.

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

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Sec. 4. [116J.886] CITATION; REGENERATIVE MEDICINE DEVELOPMENT ACT.

Sections 116J.886 to 116J.8862 shall be known as the Regenerative Medicine Development Act to promote private sector investment in regenerative medicine to strengthen the state's economy, reduce the long-term costs related to treating debilitating illnesses, advance the regenerative medicine industry, and facilitate and expand clinical research opportunities in the state.

Sec. 5. [116J.8861] DEFINITIONS.

Subdivision 1. Definitions. For the purposes of sections 116J.886 to 116J.8862, the following terms have the meanings given them.

Subd. 2. Business development services. "Business development services" means business incubator services and services to facilitate access to existing publicly or privately financed grants, loans, or loan guarantees, and to support basic or applied research, development of therapies, and development of pharmacologies and treatments through preclinical or clinical trials.

Subd. 3. Commissioner. "Commissioner" means the commissioner of employment and economic development.

Subd. 4. Office. "Office" means the Office of Regenerative Medicine Development established under section 116J.8862.

Subd. 5. Regenerative medicine. "Regenerative medicine" means the process of creating or using living, functional tissue to augment, repair, replace, or regenerate organs and tissue that have been damaged by disease, injury, aging, or other biological processes.

Subd. 6. Regenerative medicine development project or project. "Regenerative medicine development project" or "project" means any research, product development, or commercial venture relating to basic, preclinical, or clinical work to produce a drug, biological or chemical material, compound, or medical device designed to augment, repair, replace, or regenerate organs and tissue that have been damaged by disease, injury, aging, or other biological processes.

Sec. 6. [116J.8862] OFFICE OF REGENERATIVE MEDICINE DEVELOPMENT.

Subdivision 1. Established. The commissioner shall establish an Office of Regenerative Medicine Development to provide business development services and outreach to promote and expand the regenerative medicine industry in Minnesota.

Subd. 2. Consultation. The office must regularly consult with external stakeholders, and must conduct public meetings to gather input. For the purposes of this section, external stakeholders must include:

(1) the director of the Minnesota Stem Cell Institute at the University of Minnesota;

(2) a representative of a Minnesota-based trade association with the largest number of bioscience companies as its membership;

(3) a representative of a Minnesota-based trade association with the largest number of hospitals as its membership; and

(4) a representative of the largest private entity in Minnesota conducting research into the benefits and uses of regenerative medicine.

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Subd. 3. Outside funding. The commissioner, on behalf of the office, may accept appropriations, gifts, grants, and bequests.

Subd. 4. Public infrastructure grant program. The commissioner shall coordinate the services and activities of the office with the innovative business development public infrastructure program under section 116J.435.

Subd. 5. Fiscal planning. By December 15, 2014, the commissioner shall develop a long-term budget proposal for the office for fiscal years 2016 to 2024 to provide business development services to regenerative medicine development projects.

Subd. 6. Project applications; selection. (a) The office shall provide business development services to eligible regenerative medicine development projects approved by the commissioner. To be eligible for business development services under this section, a regenerative medicine development project must:

(1) demonstrate that at least 70 percent of the project costs are paid from nonstate sources. The nonstate share may include federal funds and the prior purchase of scientific equipment and materials incidental to the project, provided the purchase is completed not more than two years prior to the approval of funding by the commissioner;

(2) not duplicate or supplant any other research or other project already conducted by the federal government, or for which federal funding is available; and

(3) demonstrate that project activities are carried out directly by the grant recipient.

(b) The commissioner shall establish an application and process for approving projects. Project applications must include the following information:

(1) evidence that the required match is available and committed;

(2) a detailed estimate, along with necessary supporting evidence, of the total cost of the project;

(3) an assessment of the potential to attract new or continue existing public and private research grant awards resulting from the project;

(4) a detailed risk analysis projecting the likelihood of clinical success resulting in revenues or royalty payments from the project;

(5) an assessment of the likelihood for and potential cost savings for publicly funded health care and long-term care programs from the project as a result of reducing the incidence or lowering the treatment costs of debilitating illnesses and diseases over the next ten years;

(6) a timeline indicating the major milestones of research projects and their anticipated completion dates, including any previously completed similar research; and

(7) an estimate of any potential current and future employment opportunities within the state, stimulation of economic growth, and the possibility for advancing the development of commercially successful and affordable regenerative medicine products, processes, or services. The application requirements are not in priority order and the commissioner may weigh each item, depending upon the facts and circumstances, as the commissioner considers appropriate.

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Subd. 7. Report. The commissioner, on behalf of the office, must report to the legislative chairs with jurisdiction over economic development by January 1 of each odd-numbered year on successful economic development projects implemented or initiated since their last report and on plans for the upcoming year.

Subd. 8. Sunset. The office established under this section expires June 30, 2024.

Sec. 7. Minnesota Statutes 2012, section 116L.98, is amended to read:

116L.98 WORKFORCE PROGRAM OUTCOMES.

Subdivision 1. Requirements. The commissioner shall develop and implement a set of standard approaches for assessing the outcomes of workforce programs under this chapter. The outcomes assessed must include, but are not limited to, periodic comparisons of workforce program participants and nonparticipants uniform outcome measurement and reporting system for adult workforce-related programs funded in whole or in part by the workforce development fund.

The commissioner shall also monitor the activities and outcomes of programs and services funded by legislative appropriations and administered by the department on a pass-through basis and develop a consistent and equitable method of assessing recipients for the costs of its monitoring activities.

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

(b) "Credential" means postsecondary degrees, diplomas, licenses, and certificates awarded in recognition of an individual's attainment of measurable technical or occupational skills necessary to obtain employment or advance with an occupation. This definition does not include certificates awarded by workforce investment boards or work-readiness certificates.

(c) "Exit" means to have not received service under a workforce program for 90 consecutive calendar days. The exit date is the last date of service.

(d) "Net impact" means the use of matched control groups and regression analysis to estimate the impacts attributable to program participation net of other factors, including observable personal characteristics and economic conditions.

(e) "Pre-enrollment" means the period of time before an individual was enrolled in a workforce program.

Subd. 3. Uniform outcome report card; reporting by commissioner. (a) By December 31 of each even-numbered year, the commissioner must report to the chairs and ranking minority members of the committees of the house of representatives and the senate having jurisdiction over economic development and workforce policy and finance the following information separately for each of the previous two fiscal or calendar years, for each program subject to the requirements of subdivision 1:

(1) the total number of participants enrolled;

(2) the median pre-enrollment wages based on participant wages for the second through the fifth calendar quarters immediately preceding the quarter of enrollment excluding those with zero income;

(3) the total number of participants with zero income in the second through fifth calendar quarters immediately preceding the quarter of enrollment;

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(4) the total number of participants enrolled in training;

(5) the total number of participants enrolled in training by occupational group;

(6) the total number of participants that exited the program and the average enrollment duration of participants that have exited the program during the year;

(7) the total number of exited participants who completed training;

(8) the total number of exited participants who attained a credential;

(9) the total number of participants employed during three consecutive quarters immediately following the quarter of exit, by industry;

(10) the median wages of participants employed during three consecutive quarters immediately following the quarter of exit;

(11) the total number of participants employed during eight consecutive quarters immediately following the quarter of exit, by industry; and

(12) the median wages of participants employed during eight consecutive quarters immediately following the quarter of exit.

(b) The report to the legislature must contain participant information by education level, race and ethnicity, gender, and geography, and a comparison of exited participants who completed training and those who did not.

(c) The requirements of this section apply to programs administered directly by the commissioner or administered by other organizations under a grant made by the department.

Subd. 4. Data to commissioner; uniform report card. (a) A recipient of a future or past grant or direct appropriation made by or through the department must report data to the commissioner by September 1 of each even-numbered year on each of the items in subdivision 3 for each program it administers except wages and number employed, which the department shall provide. The data must be in a format prescribed by the commissioner.

(b) Beginning July 1, 2014, the commissioner shall provide notice to grant applicants and recipients regarding the data collection and reporting requirements under this subdivision and must provide technical assistance to applicants and recipients to assist in complying with the requirements of this subdivision.

Subd. 5. Information. The information collected and reported under subdivisions 3 and 4 shall be made available on the department's Web site.

Subd. 6. Limitations on future appropriations. (a) A program that is a recipient of public funds and subject to the requirements of this section as of May 1, 2014, is not eligible for additional state appropriations for any fiscal year beginning after June 30, 2015, unless all of the reporting requirements under subdivision 4 have been satisfied.

(b) A program with an initial request for funds on or after the effective date of this section may be considered for receipt of public funds for the first two fiscal years only if a plan that demonstrates how the data collection and reporting requirements under subdivision 4 will be met has been submitted and approved by the commissioner. Any subsequent request for funds after an initial request is subject to the requirements of paragraph (a).

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Subd. 7. Workforce program net impact analysis. (a) The commissioner shall contract with an independent entity to conduct a net impact analysis for adult workforce-related programs funded in whole or in part by the workforce development fund. The requirements of this section apply to programs administered directly by the commissioner or administered by other employment organizations under a grant made by the department. The net impact methodology used by the independent entity should be based on the methodology and evaluation design used in paragraph (c) and must include:

(1) standardized statistical methods for estimating the net impacts of workforce services on individual employment, earnings, incarceration avoidance where appropriate, and public benefits usage outcomes; and

(2) standardized cost-benefit analysis for understanding the monetary impacts of workforce services from the participant and taxpayer points of view.

(b) By January 15 of the odd year of every other biennium, the commissioner must report to the chairs and ranking minority members of the committees of the house of representatives and senate having jurisdiction over economic development and workforce policy and finance the following information for each program subject to this subdivision:

(1) the net impact of workforce services on individual employment, earnings, and public benefits usage outcomes; and

(2) cost-benefit analyses for understanding the monetary impacts of workforce services from the participant and taxpayer points of view. The report must be made available to the public in an electronic format on the Department of Employment and Economic Development's Web site.

The department is authorized to create and maintain data-sharing agreements with other departments, including corrections, human services, and any other department that are necessary to complete the analysis. The department shall supply the information collected for use by the independent entity conducting net impact analysis pursuant to the data practices requirements under chapters 13, 13A, 13B, and 13C.

(c) By January 15, 2015, the commissioner, in partnership with the Governor's Workforce Development Council, must report to the chairs and ranking minority members of the committees of the house of representatives and senate having jurisdiction over economic development and workforce policy and finance the results of the net impact pilot project already underway.

Sec. 8. Minnesota Statutes 2012, section 181A.07, is amended by adding a subdivision to read:

Subd. 7. Approved training programs. The commissioner may grant exemptions from any provisions of sections 181A.01 to 181A.12 for minors participating in training programs approved by the commissioner; or students in a valid apprenticeship program taught by or required by a trade union, the commissioner of education, the commissioner of employment and economic development, the Board of Trustees of the Minnesota State Colleges and Universities, or the Board of Regents of the University of Minnesota.

Sec. 9. INNOVATION VOUCHER PILOT PROGRAM.

(a) The commissioner of employment and economic development shall develop and implement an innovation voucher pilot program to provide financing to small businesses to purchase technical assistance and services from public higher education institutions and nonprofit entities to assist in the development or commercialization of innovative new products or services.

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(b) Funds available under this section may be used by a small business to access technical assistance and other services including, but not limited to: research, technical development, product development, commercialization, technology exploration, and improved business practices.

(c) To be eligible for a voucher under this section, a business must enter into an agreement with the commissioner that includes:

(1) a list of the technical assistance and services the business proposes to purchase and from whom the services will be purchased; and

(2) deliverable outcomes in one of the following areas:

(i) research and development;

(ii) business model development;

(iii) market feasibility;

(iv) operations; or

(v) other outcomes determined by the commissioner.

As part of the agreement, the commissioner must approve the technical assistance and services to be purchased, and the entities from which the services or technical assistance will be purchased.

(d) For the purposes of this section, a small business means a business with fewer than 25 employees.

(e) A voucher award must not exceed $25,000 per business.

(f) The commissioner must report to the chairs of the committees of the house of representatives and senate having jurisdiction over economic development and workforce policy and finance issues by December 1, 2014, on the vouchers awarded to date.

Sec. 10. COMMISSIONER'S ACCOUNTABILITY PLAN.

By December 1, 2014, the commissioner shall report to the committees of the house of representatives and senate having jurisdiction over workforce development and economic development policy and finance issues, on the department's plan, and any request for funding, to design and implement a performance accountability outcome measurement system for programs under Minnesota Statutes, chapters 116J and 116L.

Sec. 11. NEW EMPLOYEE TRAINING PARTNERSHIP.

Subdivision 1. Training partnership initiative. (a) The commissioner of employment and economic development shall develop and implement a new employee training partnership to provide rebates to employers that hire and train new employees. To be eligible for a rebate under this section, an employer must enter into an agreement with the commissioner under subdivision 3. The commissioner shall give priority to employers in counties in which the county unemployment rate over the preceding 12 months exceeded the state average unemployment rate by 1.5 percentage points over the same period.

(b) Before entering into an agreement with an employer, the commissioner must investigate the applicability of other training programs and determine whether the job skills partnership grant program is a more suitable source of funding for the training and whether the training can be completed in a timely manner that meets the needs of the employer.

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The investigation must be completed within 15 days or as soon as reasonably possible after the employer has provided the commissioner with all the requested information.

(c) The commissioner shall prescribe the form of all applications for rebates, the timing for submission of applications, the execution of agreements with the commissioner, and the payment of rebates.

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

(b) "Agreement" means the agreement between an employer and the commissioner for a training partnership.

(d) "Cost of training" means all necessary and incidental costs of providing training services. The term does not include the cost of purchasing equipment to be owned or used by the training or educational institution or service.

(e) "Disability" has the meaning given under United States Code, title 42, chapter 126.

(f) "Employee" means an individual employed in a new job.

(g) "Employer" means an individual, corporation, partnership, limited liability company, or association providing new jobs and entering into an agreement.

(h) "Long-term unemployed" has the meaning given by the United States Department of Labor, Bureau of Labor Standards.

(i) "New job" means a job:

(1) that is provided by a new or expanding business at a location outside of the metropolitan area, as defined in Minnesota Statutes, section 473.121, subdivision 2;

(2) that provides 32 hours of work per week for a minimum of nine months of the year and is permanent with no planned termination date; and

(3) for which the employee hired was not (i) formerly employed by the employer in the state or (ii) a replacement worker, including a worker newly hired as a result of a labor dispute.

(j) "Rebate" means a payment by the commissioner to an employer for the cost of training an employee. Rebates are limited to a maximum of $3,000 per employee, except that the maximum rebate for the training costs of an employee with a disability, an employee who was considered long-term unemployed, or an employee who is a veteran, is $4,000 per employee.

(k) "Training partnership" means a training services and rebate arrangement that is the subject of an agreement entered into between the commissioner and an employer.

(l) "Training services" means training and education specifically directed to new jobs, determined to be appropriate by the commissioner, including in-house training; services provided by institutions of higher education, or federal, state, or local agencies; or private training or educational services. Administrative services, assessment, and testing costs may be considered as training services.

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Subd. 3. Agreements; required terms. To be eligible for a rebate under this section, an employer must enter into an agreement with the commissioner that:

(1) identifies the training costs to be incurred by the employer, who will provide the training services, and the amount of the rebate to be provided by the commissioner;

(2) provides for a guarantee by the employer of payment for all training costs; and

(3) provides that each employee must be paid wages of at least $13 per hour, plus benefits, except that during a period not to exceed three weeks, during which an employee is receiving training services, the employee may be paid wages of at least $11 per hour, plus benefits.

Subd. 4. Verification prior to payment of rebate. The commissioner shall not pay any rebate until all training costs and payment of the training costs by the employer have been verified.

Subd. 5. Allocation. (a) The commissioner shall allocate payment for rebates to employers only after receipt of a complete application for the rebate, including the provision of all of the required information and the execution of an agreement and approval by the commissioner. In approving applications, the commissioner must give priority to employers in counties with high seasonally adjusted unemployment rates.

(b) The commissioner may utilize existing on-the-job training rebate or payment processes or procedures.

Subd. 6. Report. By February 1, 2015, the commissioner shall report to the committees of the house of representatives and the senate having jurisdiction over economic development policy and finance. The report must include the following information:

(1) the total amount of rebates issued;

(2) the number of individuals receiving training, including disaggregate data for employees who are individuals with disabilities, veterans, or who were long-term unemployed;

(3) an analysis of the effectiveness of the rebate in encouraging employment; and

(4) any other information the commissioner determines appropriate.

Sec. 12. PILOT PROGRAMS; PRECISION MANUFACTURING AND HEALTH CARE SERVICES.

The commissioner of labor and industry shall establish pilot programs to develop competency standards for apprenticeship programs in precision manufacturing and health care services. The pilot programs shall be administered by the registered apprenticeship program within the Department of Labor and Industry. In establishing the pilot programs, the commissioner may convene recognized industry experts and representative employers to assist in defining credible competency standards acceptable to the information technology and health care services industries.

Sec. 13. PILOT PROGRAM; INFORMATION TECHNOLOGY.

The commissioner of employment and economic development shall establish a pilot program to develop competency standards for an information technology apprenticeship program. In establishing the pilot program, the commissioner may convene recognized industry experts and representative employers to define credible competency standards acceptable to the information technology industry.

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Sec. 14. OUTCOMES.

The outcomes expected from each of the pilot programs listed in sections 12 and 13 include:

(1) establishment of competency standards for entry level and at least two additional higher skill levels for apprenticeship training in each industry;

(2) verification of competency standards and skill levels and their transferability by representatives of each respective industry;

(3) clarification of ways for Minnesota educational institutions to engage in providing training to meet the competency standards established; and

(4) participation from the identified industry sectors.

Sec. 15. REPEALER.

Minnesota Statutes 2012, section 116J.997, is repealed.

ARTICLE 5

WORKERS' COMPENSATION

Section 1. Minnesota Statutes 2013 Supplement, section 176.011, subdivision 15, is amended to read:

Subd. 15. Occupational disease. (a) "Occupational disease" means a mental impairment as defined in paragraph (d) or physical disease arising out of and in the course of employment peculiar to the occupation in which the employee is engaged and due to causes in excess of the hazards ordinary of employment and shall include undulant fever. Physical stimulus resulting in mental injury and mental stimulus resulting in physical injury shall remain compensable. Mental impairment is not considered a disease if it results from a disciplinary action, work evaluation, job transfer, layoff, demotion, promotion, termination, retirement, or similar action taken in good faith by the employer. Ordinary diseases of life to which the general public is equally exposed outside of employment are not compensable, except where the diseases follow as an incident of an occupational disease, or where the exposure peculiar to the occupation makes the disease an occupational disease hazard. A disease arises out of the employment only if there be a direct causal connection between the conditions under which the work is performed and if the occupational disease follows as a natural incident of the work as a result of the exposure occasioned by the nature of the employment. An employer is not liable for compensation for any occupational disease which cannot be traced to the employment as a direct and proximate cause and is not recognized as a hazard characteristic of and peculiar to the trade, occupation, process, or employment or which results from a hazard to which the worker would have been equally exposed outside of the employment.

(b) If immediately preceding the date of disablement or death, an employee was employed on active duty with an organized fire or police department of any municipality, as a member of the Minnesota State Patrol, conservation officer service, state crime bureau, as a forest officer by the Department of Natural Resources, state correctional officer, or sheriff or full-time deputy sheriff of any county, and the disease is that of myocarditis, coronary sclerosis, pneumonia or its sequel, and at the time of employment such employee was given a thorough physical examination by a licensed doctor of medicine, and a written report thereof has been made and filed with such organized fire or police department, with the Minnesota State Patrol, conservation officer service, state crime bureau, Department of Natural Resources, Department of Corrections, or sheriff's department of any county, which examination and report negatived any evidence of myocarditis, coronary sclerosis, pneumonia or its sequel, the disease is presumptively an occupational disease and shall be presumed to have been due to the nature of employment. If immediately preceding the date of disablement or death, any individual who by nature of their position provides emergency

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medical care, or an employee who was employed as a licensed police officer under section 626.84, subdivision 1; firefighter; paramedic; state correctional officer; emergency medical technician; or licensed nurse providing emergency medical care; and who contracts an infectious or communicable disease to which the employee was exposed in the course of employment outside of a hospital, then the disease is presumptively an occupational disease and shall be presumed to have been due to the nature of employment and the presumption may be rebutted by substantial factors brought by the employer or insurer. Any substantial factors which shall be used to rebut this presumption and which are known to the employer or insurer at the time of the denial of liability shall be communicated to the employee on the denial of liability.

(c) A firefighter on active duty with an organized fire department who is unable to perform duties in the department by reason of a disabling cancer of a type caused by exposure to heat, radiation, or a known or suspected carcinogen, as defined by the International Agency for Research on Cancer, and the carcinogen is reasonably linked to the disabling cancer, is presumed to have an occupational disease under paragraph (a). If a firefighter who enters the service after August 1, 1988, is examined by a physician prior to being hired and the examination discloses the existence of a cancer of a type described in this paragraph, the firefighter is not entitled to the presumption unless a subsequent medical determination is made that the firefighter no longer has the cancer.

(d) For the purposes of this chapter, "mental impairment" means a diagnosis of post-traumatic stress disorder by a licensed psychiatrist or psychologist. For the purposes of this chapter, "post-traumatic stress disorder" means the condition as described in the most recently published edition of the Diagnostic and Statistical Manual of Mental Disorders by the American Psychiatric Association. For purposes of section 79.34, subdivision 2, one or more compensable mental impairment claims arising out of a single event or occurrence shall constitute a single loss occurrence.

EFFECTIVE DATE. This section is effective for employees with dates of injury on or after October 1, 2013.

Sec. 2. Minnesota Statutes 2012, section 176.129, subdivision 2a, is amended to read:

Subd. 2a. Payments to fund. (a) On or before April 1 of each year, all self-insured employers shall report paid indemnity losses and insurers shall report paid indemnity losses and standard workers' compensation premium in the form and manner prescribed by the commissioner. On June 1 of each year, the commissioner shall determine the total amount needed to pay all estimated liabilities, including administrative expenses, of the special compensation fund for the following fiscal year. The commissioner shall assess this amount against self-insured employers and insurers. The total amount of the assessment must be allocated between self-insured employers and insured employers based on paid indemnity losses for the preceding calendar year, as provided by paragraph (b). The method of assessing self-insured employers must be based on paid indemnity losses, as provided by paragraph (c). The method of assessing insured employers is based on standard workers' compensation premium, as provided by paragraph (c). Each insurer shall collect the assessment through a policyholder surcharge as provided by paragraph (d). On or before June 30 of each year, the commissioner shall provide notification to each self-insured employer and insurer of amounts due. Each self-insured employer and each insurer shall pay at least one-half of the amount due to the commissioner for deposit into the special compensation fund on or before August 1 of the same calendar year. The remaining balance is due on February 1 of the following calendar year. Each insurer must pay the full amount due as stated in the commissioner's notification, regardless of the amount the insurer actually collects from the ~~premium~~ policyholder surcharge.

(b) The portion of the total assessment that is allocated to self-insured employers is the proportion that paid indemnity losses made by all self-insured employers bore to the total paid indemnity losses made by all self-insured employers and insured employers during the preceding calendar year. The portion of the total assessment that is allocated to insured employers is the proportion that paid indemnity losses made on behalf of all insured employers bore to the total paid indemnity losses made by all self-insured employers and insured employers during the preceding calendar year.

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(c) The portion of the total assessment allocated to self-insured employers that shall be paid by each self-insured employer must be based upon paid indemnity losses made by that self-insured employer during the preceding calendar year. The portion of the total assessment allocated to insured employers that is paid by each insurer must be based on standard workers' compensation premium earned in the state by that insurer during the ~~preceding~~ current calendar year. If the current calendar year earned standard workers' compensation premium is not available, the commissioner shall estimate the portion of the total assessment allocated to insured employers that is paid by each insurer using the earned standard workers' compensation premium from the preceding calendar year. The commissioner shall then perform a reconciliation and final determination of the portion of the total assessment to be paid by each insurer when the earned standard workers' compensation premium for the current calendar year is calculable, but the final determination must not be made after December 1 of the following calendar year. An employer who has ceased to be self-insured shall continue to be liable for assessments based on paid indemnity losses arising out of injuries occurring during periods when the employer was self-insured, unless the self-insured employer has purchased a replacement policy covering those losses. An insurer who assumes a self-insured employer's obligation under a replacement policy shall separately report and pay assessments based on indemnity losses paid by the insurer under the replacement policy. The replacement policy may provide for reimbursement of the assessment to the insurer by the self-insured employer.

(d) Insurers shall collect the assessments from their insured employers through a surcharge based on standard workers' compensation premium for each employer. Assessments when collected do not constitute an element of loss for the purpose of establishing rates for workers' compensation insurance but for the purpose of collection are treated as separate costs imposed on insured employers. The ~~premium~~ policyholder surcharge is included in the definition of gross premium as defined in section 297I.01 only for premium tax purposes. An insurer may cancel a policy for nonpayment of the ~~premium~~ policyholder surcharge. The ~~premium~~ policyholder surcharge is excluded from the definition of premium for all other purposes, except as otherwise provided in this paragraph.

(e) For purposes of this section, the workers' compensation assigned risk plan established under section 79.252, shall report and pay assessments on standard workers' compensation premium in the same manner as an insurer.

EFFECTIVE DATE. This section is effective for assessments due under Minnesota Statutes, section 176.129, subdivision 2a, paragraph (a), on August 1, 2013, and February 1, 2014, and for the first reconciliation and final determination under Minnesota Statutes, section 176.129, subdivision 2a, paragraph (c), due on or before December 1, 2014.

Sec. 3. Minnesota Statutes 2012, section 176.129, subdivision 7, is amended to read:

Subd. 7. Refunds. In case deposit is or has been made pursuant to subdivision 2a by mistake or inadvertence, or under circumstances that justice requires a refund, the commissioner of management and budget is authorized to refund the deposit under order of the commissioner, a compensation judge, the Workers' Compensation Court of Appeals, or a district court. Claims for refunds must be submitted to the commissioner within three years of the ~~assessment due~~ date of reconciliation and final determination under subdivision 2a. There is appropriated to the commissioner from the fund an amount sufficient to make the refund and payment.

Sec. 4. Minnesota Statutes 2012, section 176.135, subdivision 7, is amended to read:

Subd. 7. Medical bills and records. (a) Health care providers shall submit to the insurer an itemized statement of charges in the standard electronic transaction format when required by section 62J.536 or, if there is no prescribed standard electronic transaction format, on a billing form prescribed by the commissioner. Health care providers

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shall also submit copies of medical records or reports that substantiate the nature of the charge and its relationship to the work injury. Health care providers may charge for copies of any records or reports that are in existence and directly relate to the items for which payment is sought under this chapter. The commissioner shall adopt a schedule of reasonable charges by rule.

A health care provider shall not collect, attempt to collect, refer a bill for collection, or commence an action for collection against the employee, employer, or any other party until the information required by this section has been furnished.

A United States government facility rendering health care services to veterans is not subject to the uniform billing form requirements of this subdivision.

(b) For medical services provided under this section on or after October 1, 2014, the codes from the International Classification of Diseases, Tenth Edition, Clinical Modification/Procedure Coding System (ICD-10), must be used to report medical diagnoses and hospital inpatient procedures. The commissioner must replace the codes from the International Classification of Diseases, Ninth Edition, Clinical Modification/Procedure Coding System (ICD-9), with equivalent ICD-10 codes wherever the ICD-9 codes appear in rules adopted under this chapter. The commissioner must use the General Equivalence Mappings established by the Centers for Medicare and Medicaid Services to replace the ICD-9 diagnostic codes with ICD-10 codes in the rules.

Sec. 5. Minnesota Statutes 2012, section 176.136, subdivision 1a, is amended to read:

Subd. 1a. Relative value fee schedule. (a) The liability of an employer for services included in the medical fee schedule is limited to the maximum fee allowed by the schedule in effect on the date of the medical service, or the provider's actual fee, whichever is lower. The commissioner shall adopt permanent rules regulating fees allowable for medical, chiropractic, podiatric, surgical, and other health care provider treatment or service, including those provided to hospital outpatients, by implementing a relative value fee schedule. The commissioner may adopt by reference, according to the procedures in paragraph (h), clause (2), the relative value fee schedule tables adopted for the federal Medicare program. The relative value fee schedule must contain reasonable classifications including, but not limited to, classifications that differentiate among health care provider disciplines. The conversion factors for the original relative value fee schedule must reasonably reflect a 15 percent overall reduction from the medical fee schedule most recently in effect. The reduction need not be applied equally to all treatment or services, but must represent a gross 15 percent reduction.

(b) Effective October 1, 2005, the commissioner shall remove all scaling factors from the relative value units and establish four separate conversion factors according to paragraphs (c) and (d) for each of the following parts of Minnesota Rules:

(1) medical/surgical services in Minnesota Rules, part 5221.4030, as defined in part 5221.0700, subpart 3, item C, subitem (2);

(2) pathology and laboratory services in Minnesota Rules, part 5221.4040, as defined in part 5221.0700, subpart 3, item C, subitem (3);

(3) physical medicine and rehabilitation services in Minnesota Rules, part 5221.4050, as defined in part 5221.0700, subpart 3, item C, subitem (4); and

(4) chiropractic services in Minnesota Rules, part 5221.4060, as defined in part 5221.0700, subpart 3, item C, subitem (5).

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(c) The four conversion factors established under paragraph (b) shall be calculated so that there is no change in each maximum fee for each service under the current fee schedule, except as provided in paragraphs (d) and (e).

(d) By October 1, 2006, the conversion factor for chiropractic services described in paragraph (b), clause (4), shall be increased to equal 72 percent of the conversion factor for medical/surgical services described in paragraph (b), clause (1). Beginning October 1, 2005, the increase in chiropractic conversion factor shall be phased in over two years by approximately equal percentage point increases.

(e) When adjusting the conversion factors in accordance with paragraph (g) on October 1, 2005, and October 1, 2006, the commissioner may adjust by no less than zero, all of the conversion factors as necessary to offset any overall increase in payments under the fee schedule resulting from the increase in the chiropractic conversion factor.

(f) The commissioner shall give notice of the relative value units and conversion factors established under paragraphs (b), (c), and (d) according to the procedures in section 14.386, paragraph (a). The relative value units and conversion factors established under paragraphs (b), (c), and (d) are not subject to expiration under section 14.386, paragraph (b).

~~(g)~~ (c) The conversion factors shall be adjusted as follows:

(1) After permanent rules have been adopted to implement this section, the conversion factors must be adjusted annually on October 1 by no more than the percentage change computed under section 176.645, but without the annual cap provided by that section.

(2) Each time the workers' compensation relative value fee schedule tables are updated under paragraph (h), the commissioner shall adjust the conversion factors so that, for services in both fee schedules, there is no difference between the overall payment in each category of service listed in paragraph (b) under the new schedule and the overall payment for that category under the workers' compensation fee schedule most recently in effect. This adjustment must be made before making any additional adjustment under clause (1).

~~(h)~~ (d) The commissioner shall give notice of the adjusted conversion factors and updates to the relative value fee schedule as follows:

(1) The commissioner shall annually give notice in the State Register of the adjusted conversion factors and any amendments to rules to implement Medicare relative value tables incorporated by reference under this subdivision. The notices of the adjusted conversion factors and amended rules to implement the relative value tables are subject to the requirements of section 14.386, paragraph (a). The annual adjustments to the conversion factors and the medical fee schedules adopted under this section, including all previous fee schedules, are not subject to expiration under section 14.386, paragraph (b).

(2) The commissioner shall periodically, but at least once every three years, update the workers' compensation relative value tables by incorporating by reference the relative value tables in the national physician fee schedule relative value file established by the Centers for Medicare and Medicaid Services. The commissioner shall publish the notices of the incorporation by reference in the State Register at least 60 days before the tables are to become effective for purposes of payment under this section. Each notice of incorporation must state the date the incorporated tables will become effective and must include information on how the Medicare relative value tables may be obtained. The published notices of incorporation by reference and the incorporated tables are not rules subject to section 14.386 or other provisions of chapter 14, but have the force and effect of law as of the date specified in the notices.

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Sec. 6. Minnesota Statutes 2012, section 176.231, subdivision 2, is amended to read:

Subd. 2. Initial report, written report. Where subdivision 1 requires an injury to be reported within 48 hours, the employer may make an initial report by telephone~~, telegraph,~~ or personal notice, and file a written report of the injury within seven days from its occurrence or within such time as the commissioner of labor and industry designates. All written reports of injuries required by subdivision 1 shall include the date of injury. The reports shall be on a form designed by the commissioner, with a clear copy suitable for imaging to the commissioner, one copy to the insurer, and one copy to the employee.

The employer must give the employee the "Minnesota Workers' Compensation System Employee Information Sheet" at the time the employee is given a copy of the first report of injury.

If an insurer or self-insurer repeatedly fails to pay benefits within three days of the due date, pursuant to section 176.221, the insurer or self-insurer shall be ordered by the commissioner to explain, in person, the failure to pay benefits due in a reasonable time. If prompt payments are not thereafter made, the commissioner shall refer the insurer or self-insurer to the commissioner of commerce for action pursuant to section 176.225, subdivision 4.

Sec. 7. Minnesota Statutes 2012, section 176.305, subdivision 1a, is amended to read:

Subd. 1a. Settlement and pretrial conferences; summary decision. The chief administrative law judge shall promptly assign the petition to a compensation judge under section 176.307, and shall schedule a settlement conference before a compensation judge, to be held no later than 180 days after a claim petition was filed, or 45 days after a petition to discontinue, objection to discontinuance, or request for formal hearing was filed.

All parties must appear at the settlement conference, either personally or by representative, must be prepared to discuss settlement of all issues, and must be prepared to discuss or present the information required by the joint rules of the division and the office. If a representative appears on behalf of a party, the representative must have authority to fully settle the matter. The parties shall serve and file a pretrial statement no fewer than five days before the settlement conference.

If settlement is not reached, the chief administrative law judge shall schedule a hearing to be held within 90 days from the scheduled settlement conference. However, the hearing must be held earlier than 90 days from the scheduled settlement conference if this chapter requires an expedited hearing to be held at an earlier date. The hearing must be held before a compensation judge other than the compensation judge who conducted the settlement conference. The compensation judge assigned to hold the hearing may choose to conduct a pretrial conference to clarify the issues and evidence that will be presented at the hearing.

Cancellations and continuations of proceedings are disfavored but may be granted upon the showing of good cause under section 176.341, subdivision 4.

The compensation judge conducting the settlement conference may require the parties to present copies of all documentary evidence not previously filed and a summary of the evidence they will present at a formal hearing. If appropriate, a written summary decision shall be issued within ten days after the conference stating the issues and a determination of each issue. If a party fails to appear at the conference, all issues may be determined contrary to the absent party's interest, provided the party in attendance presents a prima facie case.

The summary decision is final unless a written request for a formal hearing is served on all parties and filed with the commissioner within 30 days after the date of service and filing of the summary decision. Within ten days after receipt of the request, the commissioner shall certify the matter to the office for a de novo hearing. ~~In proceedings under section 176.2615, the summary decision is final and not subject to appeal or de novo proceedings.~~

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Sec. 8. REPEALER.

Minnesota Statutes 2012, sections 175.006, subdivision 1; 175.08; 175.14; 175.26; 176.1311; 176.136, subdivision 3; 176.2615; and 176.641, are repealed.

ARTICLE 6

MISCELLANEOUS FOR JOBS AND ECONOMIC DEVELOPMENT

Section 1. Minnesota Statutes 2012, section 179.02, is amended by adding a subdivision to read:

Subd. 6. Receipt of gifts, money; appropriation. (a) The commissioner may apply for, accept, and disburse gifts, bequests, grants, or payments for services from the United States, the state, private foundations, or any other source.

(b) Money received by the commissioner under this subdivision must be deposited in a separate account in the state treasury and invested by the State Board of Investment. The amount deposited, including investment earnings, is appropriated to the commissioner to carry out duties of the commissioner.

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

Sec. 2. Minnesota Statutes 2012, section 469.084, is amended by adding a subdivision to read:

Subd. 1a. Meetings by telephone or other electronic means. The port authority may conduct meetings as provided by section 13D.015.

ARTICLE 7

COMMERCE

Section 1. Laws 2013, chapter 85, article 1, section 5, is amended to read:

Sec. 5. EXPLORE MINNESOTA TOURISM

$13,988,000

(a) To develop maximum private sector involvement in tourism, $500,000 in fiscal year 2014 and $500,000 in fiscal year 2015 must be matched by Explore Minnesota Tourism from nonstate sources. Each $1 of state incentive must be matched with $6 of private sector funding. Cash match is defined as revenue to the state or documented cash expenditures directly expended to support Explore Minnesota Tourism programs. Up to one-half of the private sector contribution may be in-kind or soft match. The incentive in fiscal year 2014 shall be based on fiscal year 2013 private sector contributions. The incentive in fiscal year 2015 shall be based on fiscal year 2014 private sector contributions. This incentive is ongoing.

Funding for the marketing grants is available either year of the biennium. Unexpended grant funds from the first year are available in the second year.

(b) $100,000 of the second year appropriation is for a grant to the Mille Lacs Tourism Council to enhance marketing activities related to tourism promotion in the Mille Lacs Lake area.

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Sec. 2. RACING COMMISSION.

$100,000 in fiscal year 2014 and $85,000 in fiscal year 2015 are appropriated from the racing and card playing regulation account in the special revenue fund to the Minnesota Racing Commission. These appropriations are onetime and are available either year of the biennium.

PUBLIC SAFETY AND CORRECTIONS

ARTICLE 8

PUBLIC SAFETY AND CORRECTIONS APPROPRIATIONS

Section 1. SUMMARY OF APPROPRIATIONS.

The amounts shown in this section summarize direct appropriations, by fund, made in this article.

	2014	2015	Total

General	$-0-	$36,475,000	$36,496,000
State Government Special Revenue	6,359,000	6,865,000	13,224,000

Total	$6,359,000	$43,361,000	$49,720,000

Sec. 2. APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are added to the appropriations in Laws 2013, chapter 86, article 1, to the agencies and for the purposes specified in this article. The appropriations are from the general fund, or another named fund, and are available for the fiscal years indicated for each purpose. The figures "2014" and "2015" used in this article mean that the addition to the appropriation listed under them is available for the fiscal year ending June 30, 2014, or June 30, 2015, respectively. Supplemental appropriations for the fiscal year ending June 30, 2014, are effective the day following final enactment.

	APPROPRIATIONS
	Available for the Year
	Ending June 30
2014		2015

Sec. 3. DEPARTMENT OF PUBLIC SAFETY

Subdivision 1. Total Appropriation	$6,359,000	$13,126,000

Appropriations by Fund

General	-0-	6,261,000
State Government Special Revenue	6,359,000	6,865,000

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

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Subd. 2. Emergency Communication Networks

5,059,000

6,865,000

This appropriation is from the state government special revenue fund for 911 emergency telecommunications services.

Subd. 3. Office of Justice Programs

-0-

600,000

(a) $300,000 in 2015 is for grants to fund emergency shelter, housing, or advocacy services targeted to culturally specific programming for newer immigrant populations. The funds must be awarded to a program or programs that demonstrate leadership in the community to be served. This appropriation is added to the base.

(b) $300,000 in 2015 is for grants to sexual assault advocacy programs for sexual violence community prevention networks. For purposes of this section, "sexual assault" means a violation of Minnesota Statutes, sections 609.342 to 609.3453. This appropriation is added to the base.

Subd. 4. Emergency Management

-0-

5,661,000

$5,661,000 in 2015 is for the disaster assistance contingency account in Minnesota Statutes, section 12.221. These funds are available until spent.

Subd. 5. Fire Safety Account

1,300,000

-0-

$1,300,000 in 2014 is appropriated from the fire safety account in the special revenue fund to the commissioner of public safety for activities and programs under Minnesota Statutes, section 299F.012. This is a onetime appropriation. By January 15, 2015, the commissioner shall report to the chairs and ranking minority members of the legislative committees with jurisdiction over the fire safety account regarding the balances and uses of the account.

Sec. 4. CORRECTIONS

Subdivision 1. Total Appropriation

$-0-

$30,164,000

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

Subd. 2. Correctional Institutions

-0-

27,321,000

This includes a onetime appropriation of $11,089,000.

Subd. 3. Community Services

-0-

1,900,000

Subd. 4. Operations Support

-0-

900,000

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Sec. 5. PEACE OFFICER STANDARDS AND TRAINING (POST) BOARD

-0-

50,000

$50,000 in 2015 is for training state and local community safety personnel in the use of crisis de-escalation techniques for use with Minnesota veterans following their return from active military service in a combat zone. The director may consult with any other state or local governmental official or nongovernmental authority the director determines to be relevant, to include postsecondary institutions, when selecting a service provider for this training. The training provider must have a demonstrated understanding of the transitions and challenges that veterans may experience during their re-entry into society following combat service. The training opportunities provided must be reasonably distributed statewide. This is a onetime appropriation.

Sec. 6. Laws 2009, chapter 83, article 1, section 10, subdivision 7, is amended to read:

Subd. 7. Emergency Communication Networks

66,470,000

70,233,000

This appropriation is from the state government special revenue fund for 911 emergency telecommunications services.

(a) Public Safety Answering Points. $13,664,000 each year is to be distributed as provided in Minnesota Statutes, section 403.113, subdivision 2.

(b) Medical Resource Communication Centers. $683,000 each year is for grants to the Minnesota Emergency Medical Services Regulatory Board for the Metro East and Metro West Medical Resource Communication Centers that were in operation before January 1, 2000.

(c) ARMER Debt Service. $17,557,000 the first year and $23,261,000 the second year are to the commissioner of finance to pay debt service on revenue bonds issued under Minnesota Statutes, section 403.275.

Any portion of this appropriation not needed to pay debt service in a fiscal year may be used by the commissioner of public safety to pay cash for any of the capital improvements for which bond proceeds were appropriated by Laws 2005, chapter 136, article 1, section 9, subdivision 8, or Laws 2007, chapter 54, article 1, section 10, subdivision 8.

(d) Metropolitan Council Debt Service. $1,410,000 each year is to the commissioner of finance for payment to the Metropolitan Council for debt service on bonds issued under Minnesota Statutes, section 403.27.

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(e) ARMER State Backbone Operating Costs. $5,060,000 each year is to the commissioner of transportation for costs of maintaining and operating the statewide radio system backbone.

(f) ARMER Improvements. $1,000,000 each year is for the Statewide Radio Board for costs of design, construction, maintenance of, and improvements to those elements of the statewide public safety radio and communication system that support mutual aid communications and emergency medical services or provide enhancement of public safety communication interoperability.

(g) Next Generation 911. $3,431,000 the first year and $6,490,000 the second year are to replace the current system with the Next Generation Internet Protocol (IP) based network. This appropriation is available until expended. The base level of funding for fiscal year 2012 shall be $2,965,000.

(h) Grants to Local Government. $5,000,000 the first year is for grants to local units of government to assist with the transition to the ARMER system. This appropriation is available until June 30, 2012.

Sec. 7. Laws 2013, chapter 86, article 1, section 12, subdivision 3, as amended by Laws 2013, chapter 140, section 2, is amended to read:

Subd. 3. Criminal Apprehension

47,588,000

47,197,000

Appropriations by Fund

General	42,315,000	42,924,000
Special Revenue	3,000,000	2,000,000
State Government Special Revenue	7,000	7,000
Trunk Highway	2,266,000	2,266,000

(a) DWI Lab Analysis; Trunk Highway Fund

Notwithstanding Minnesota Statutes, section 161.20, subdivision 3, $1,941,000 each year is from the trunk highway fund for laboratory analysis related to driving-while-impaired cases.

(b) Criminal History System

$50,000 the first year and $580,000 the second year from the general fund and, notwithstanding Minnesota Statutes, section 299A.705, subdivision 4, $3,000,000 the first year and $2,000,000 the second year from the vehicle services account in the special revenue fund are to replace the state criminal history system. This appropriation is available until expended. Of this amount, $2,980,000 the first year and $2,580,000 the second year are for a onetime transfer to the Office of Enterprise Technology for start-up costs. Service level

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agreements must document all project-related transfers under this paragraph. Ongoing operating and support costs for this system shall be identified and incorporated into future service level agreements.

The commissioner is authorized to use funds appropriated under this paragraph for the purposes specified in paragraph (c).

The general fund base for this program is $4,930,000 in fiscal year 2016 and $417,000 in fiscal year 2017.

$1,360,000 the first year and $1,360,000 the second year from the general fund are to replace the state's crime reporting system and include one full-time equivalent business analyst. This appropriation is available until expended. Of these amounts, $1,360,000 the first year and ~~$1,360,000~~ $1,290,000 the second year are for a onetime transfer to the Office of Enterprise Technology for start-up costs. Service level agreements must document all project-related transfers under this paragraph. Ongoing operating and support costs for this system shall be identified and incorporated into future service level agreements.

The commissioner is authorized to use funds appropriated under this paragraph for the purposes specified in paragraph (b).

The base funding for this program is $1,360,000 in fiscal year 2016 and $380,000 in fiscal year 2017.

(d) Forensic Laboratory

$125,000 the first year and $125,000 the second year from the general fund and, notwithstanding Minnesota Statutes, section 161.20, subdivision 3, $125,000 the first year and $125,000 the second year from the trunk highway fund are to replace forensic laboratory equipment at the Bureau of Criminal Apprehension.

$200,000 the first year and $200,000 the second year from the general fund and, notwithstanding Minnesota Statutes, section 161.20, subdivision 3, $200,000 the first year and $200,000 the second year from the trunk highway fund are to improve forensic laboratory staffing at the Bureau of Criminal Apprehension.

(e) Livescan Fingerprinting

$310,000 the first year and $389,000 the second year from the general fund are to maintain Livescan fingerprinting machines.

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(f) Report

If the vehicle services special revenue account accrues an unallocated balance in excess of 50 percent of the previous fiscal year's expenditures, the commissioner of public safety shall submit a report to the chairs and ranking minority members of the house of representatives and senate committees with jurisdiction over transportation and public safety policy and finance. The report must contain specific policy and legislative recommendations for reducing the fund balance and avoiding future excessive fund balances. The report is due within three months of the fund balance exceeding the threshold established in this paragraph.

Sec. 8. Laws 2013, chapter 86, article 1, section 13, is amended to read:

Sec. 13. PEACE OFFICER STANDARDS AND TRAINING (POST) BOARD

$3,870,000

(a) Excess Amounts Transferred

This appropriation is from the peace officer training account in the special revenue fund. Any new receipts credited to that account in the first year in excess of $3,870,000 must be transferred and credited to the general fund. Any new receipts credited to that account in the second year in excess of $3,870,000 must be transferred and credited to the general fund.

(b) Peace Officer Training Reimbursements

$2,734,000 each year is for reimbursements to local governments for peace officer training costs.

Of the appropriation in paragraph (b), $100,000 the first year is for reimbursements to local governments for peace officer training costs on sexually exploited and trafficked youth, including effectively identifying sex trafficked victims and traffickers, investigation techniques, and assisting sexually exploited youth. These funds are available until June 30, 2016.

Reimbursement shall be provided on a flat fee basis of $100 per diem per officer.

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

ARTICLE 9

PUBLIC SAFETY AND CORRECTIONS

Section 1. Minnesota Statutes 2012, section 13.84, subdivision 5, is amended to read:

Subd. 5. Disclosure. Private or confidential court services data shall not be disclosed except:

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(a) pursuant to section 13.05;

(b) pursuant to a statute specifically authorizing disclosure of court services data;

(d) to the court services department, parole or probation authority or state or local correctional agency or facility having statutorily granted supervision over the individual subject of the data;

(e) pursuant to subdivision 6; or

(f) pursuant to a valid court order.; or

(g) pursuant to section 611A.06, subdivision 6.

EFFECTIVE DATE. This section is effective January 1, 2015.

Sec. 2. Minnesota Statutes 2012, section 13.84, subdivision 6, is amended to read:

Subd. 6. Public benefit data. (a) The responsible authority or its designee of a parole or probation authority or correctional agency may release private or confidential court services data related to:

(1) criminal acts to any law enforcement agency, if necessary for law enforcement purposes; and

(2) criminal acts or delinquent acts to the victims of criminal or delinquent acts to the extent that the data are necessary for the victim to assert the victim's legal right to restitution.

(b) A parole or probation authority, a correctional agency, or agencies that provide correctional services under contract to a correctional agency may release to a law enforcement agency the following data on defendants, parolees, or probationers: current address, dates of entrance to and departure from agency programs, and dates and times of any absences, both authorized and unauthorized, from a correctional program.

(c) The responsible authority or its designee of a juvenile correctional agency may release private or confidential court services data to a victim of a delinquent act to the extent the data are necessary to enable the victim to assert the victim's right to request notice of release under section 611A.06. The data that may be released include only the name, home address, and placement site of a juvenile who has been placed in a juvenile correctional facility as a result of a delinquent act.

(d) Upon the victim's written or electronic request and, if the victim and offender have been household or family members as defined in section 518B.01, subdivision 1, paragraph (b), the commissioner of corrections or the commissioner's designee may disclose to the victim of an offender convicted of a crime pursuant to section 609.02, subdivision 16, notification of the city and five-digit zip code of the offender's residency upon or after release from a Department of Corrections facility, unless:

(1) the offender is not supervised by the commissioner of corrections or the commissioner's designee at the time of the victim's request;

(2) the commissioner of corrections or the commissioner's designee does not have the city or zip code; or

(3) the commissioner of corrections or the commissioner's designee reasonably believes that disclosure of the city or zip code of the offender's residency creates a risk to the victim, offender, or public safety.

EFFECTIVE DATE. This section is effective January 1, 2015.

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Sec. 3. Minnesota Statutes 2012, section 243.167, subdivision 1, is amended to read:

Subdivision 1. Definition. As used in this section, "crime against the person" means a violation of any of the following or a similar law of another state or of the United States: section 609.165; 609.185; 609.19; 609.195; 609.20; 609.205; 609.221; 609.222; 609.223; 609.2231; 609.224, subdivision 2 or 4; 609.2242, subdivision 2 or 4; 609.2247; 609.235; 609.245, subdivision 1; 609.25; 609.255; 609.3451, subdivision 2 3; 609.498, subdivision 1; 609.582, subdivision 1; or 617.23, subdivision 2; or any felony-level violation of section 609.229; 609.377; 609.749; or 624.713.

Sec. 4. Minnesota Statutes 2012, section 299F.012, subdivision 1, is amended to read:

Subdivision 1. Authorized programs within department. From the revenues appropriated from the fire safety account, established under section 297I.06, subdivision 3, the commissioner of public safety may expend funds for the activities and programs identified by the advisory committee established under subdivision 2 and recommended to the commissioner of public safety. The commissioner shall not expend funds without the recommendation of the advisory committee established under subdivision 2. The commissioner shall not expend funds without the recommendation of the advisory committee established under subdivision 2. These funds are to be used to provide resources needed for identified activities and programs of the Minnesota fire service and to ensure the State Fire Marshal Division responsibilities are fulfilled.

Sec. 5. Minnesota Statutes 2012, section 299F.012, subdivision 2, is amended to read:

Subd. 2. Fire Service Advisory Committee. (a) The Fire Service Advisory Committee shall provide recommendations to the commissioner of public safety on fire service-related issues and shall consist of representatives of each of the following organizations: two appointed by the president of the Minnesota State Fire Chiefs Association, two appointed by the president of the Minnesota State Fire Department Association, two appointed by the president of the Minnesota Professional Fire Fighters, two appointed by the president of the League of Minnesota Cities, one appointed by the president of the Minnesota Association of Townships, one appointed by the president of the Insurance Federation of Minnesota, one appointed jointly by the presidents of the Minnesota Chapter of the International Association of Arson Investigators and the Fire Marshals Association of Minnesota, and the commissioner of public safety or the commissioner's designee. The commissioner of public safety must ensure that at least three of the members of the advisory committee work and reside in counties outside of the seven-county metropolitan area. The committee shall provide funding recommendations to the commissioner of public safety from the fire safety fund for the following purposes:

(1) for the Minnesota Board of Firefighter Training and Education;

(2) for programs and staffing for the State Fire Marshal Division; and

(3) for fire-related regional response team programs and any other fire service programs that have the potential for statewide impact.

(b) The committee under paragraph (a) does not expire.

Sec. 6. Minnesota Statutes 2012, section 609.135, subdivision 2, is amended to read:

Subd. 2. Stay of sentence maximum periods. (a) If the conviction is for a felony other than section 609.21, subdivision 1a, paragraph (b) or (c), the stay shall be for not more than four years or the maximum period for which the sentence of imprisonment might have been imposed, whichever is longer.

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(b) If the conviction is for a gross misdemeanor violation of section 169A.20 or 609.21, subdivision 1a, paragraph (d), or for a felony described in section 609.21, subdivision 1a, paragraph (b) or (c), the stay shall be for not more than six years. The court shall provide for unsupervised probation for the last year of the stay unless the court finds that the defendant needs supervised probation for all or part of the last year.

(c) If the conviction is for a gross misdemeanor violation of section 609.3451, subdivision 1, the stay shall be for not more than six years.

~~(c)~~ (d) If the conviction is for a gross misdemeanor not specified in paragraph (b), the stay shall be for not more than two years.

~~(d)~~ (e) If the conviction is for any misdemeanor under section 169A.20; 609.746, subdivision 1; 609.79; or 617.23; or for a misdemeanor under section 609.2242 or 609.224, subdivision 1, in which the victim of the crime was a family or household member as defined in section 518B.01, the stay shall be for not more than two years. The court shall provide for unsupervised probation for the second year of the stay unless the court finds that the defendant needs supervised probation for all or part of the second year.

~~(e)~~ (f) If the conviction is for a misdemeanor not specified in paragraph ~~(d)~~ (e), the stay shall be for not more than one year.

~~(f)~~ (g) The defendant shall be discharged six months after the term of the stay expires, unless the stay has been revoked or extended under paragraph ~~(g)~~ (h), or the defendant has already been discharged.

~~(g)~~ (h) Notwithstanding the maximum periods specified for stays of sentences under paragraphs (a) to ~~(f)~~ (g), a court may extend a defendant's term of probation for up to one year if it finds, at a hearing conducted under subdivision 1a, that:

(1) the defendant has not paid court-ordered restitution in accordance with the payment schedule or structure; and

(2) the defendant is likely to not pay the restitution the defendant owes before the term of probation expires.

This one-year extension of probation for failure to pay restitution may be extended by the court for up to one additional year if the court finds, at another hearing conducted under subdivision 1a, that the defendant still has not paid the court-ordered restitution that the defendant owes.

Nothing in this subdivision limits the court's ability to refer the case to collections under section 609.104.

~~(h)~~ (i) Notwithstanding the maximum periods specified for stays of sentences under paragraphs (a) to ~~(f)~~ (g), a court may extend a defendant's term of probation for up to three years if it finds, at a hearing conducted under subdivision 1c, that:

(1) the defendant has failed to complete court-ordered treatment successfully; and

(2) the defendant is likely not to complete court-ordered treatment before the term of probation expires.

EFFECTIVE DATE. This section is effective August 1, 2014, and applies to crimes committed on or after that date.

Sec. 7. Minnesota Statutes 2012, section 609.3451, subdivision 3, is amended to read:

Subd. 3. Felony. A person is guilty of a felony and may be sentenced to imprisonment for not more than ~~five~~ ten years or to payment of a fine of not more than $10,000, or both, if the person violates ~~subdivision 1, clause (2),~~ this section within ten years after having been previously convicted of ~~or adjudicated delinquent for~~ violating

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~~subdivision 1, clause (2)~~ this section; sections 609.342 to 609.345; or 609.3453; ~~section~~ 617.23~~, subdivision 2, clause (1)~~; 617.247; or a statute from another state in conformity ~~with subdivision 1, clause (2), or section 617.23, subdivision 2, clause (1)~~ therewith.

EFFECTIVE DATE. This section is effective August 1, 2014, and applies to crimes committed on or after that date.

Sec. 8. Minnesota Statutes 2012, section 611A.06, is amended by adding a subdivision to read:

Subd. 6. Offender location. (a) Upon the victim's written or electronic request and if the victim and offender have been household or family members as defined in section 518B.01, subdivision 2, paragraph (b), the commissioner of corrections or the commissioner's designee shall disclose to the victim of an offender convicted of a crime pursuant to section 609.02, subdivision 16, notification of the city and five-digit zip code of the offender's residency upon release from a Department of Corrections facility, unless:

(1) the offender is not supervised by the commissioner of corrections or the commissioner's designee at the time of the victim's request;

(2) the commissioner of corrections or the commissioner's designee does not have the city or zip code; or

(b) All identifying information regarding the victim including, but not limited to, the notification provided by the commissioner of corrections or the commissioner's designee is classified as private data on individuals as defined in section 13.02, subdivision 12, and is accessible only to the victim.

EFFECTIVE DATE. This section is effective January 15, 2015.

Sec. 9. REVISOR'S INSTRUCTION.

In the next edition of Minnesota Statutes, the revisor of statutes shall change the headnote of section 609.3451, subdivision 2, from "Penalty" to "Gross misdemeanor."

ARTICLE 10

DISASTER ASSISTANCE FOR PUBLIC ENTITIES; FEDERAL AID GRANTED

Section 1. Minnesota Statutes 2012, section 12.03, is amended by adding a subdivision to read:

Subd. 5d. Local government. "Local government" has the meaning given in Code of Federal Regulations, title 44, section 206.2 (2012).

Sec. 2. Minnesota Statutes 2012, section 12.03, is amended by adding a subdivision to read:

Subd. 6b. Nonfederal share. "Nonfederal share" has the meaning given in section 12A.02, subdivision 7.

Sec. 3. Minnesota Statutes 2012, section 12.221, subdivision 4, is amended to read:

Subd. 4. Subgrant agreements; state share. (a) The state director, serving as the governor's authorized representative, may enter into subgrant agreements with eligible applicants to provide federal and state financial assistance made available as a result of a disaster declaration.

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(b) When state funds are used to provide the FEMA Public Assistance Program cost-share requirement for a local government, the state director must award a local government 100 percent of the nonfederal share of the local government's FEMA Public Assistance Program costs.

Sec. 4. Minnesota Statutes 2012, section 12.221, is amended by adding a subdivision to read:

Subd. 6. Disaster assistance contingency account; appropriation. (a) A disaster assistance contingency account is created in the general fund in the state treasury. Money in the disaster assistance contingency account is appropriated to the commissioner of public safety to provide:

(1) cost-share for federal assistance under section 12A.15, subdivision 1; and

(2) state public disaster assistance to eligible applicants under chapter 12B.

(b) For appropriations under paragraph (a), clause (1), the amount appropriated is 100 percent of any nonfederal share for state agencies and local governments. Money appropriated under paragraph (a), clause (1), may be used to pay all or a portion of the nonfederal share for publicly owned capital improvement projects.

(c) For appropriations under paragraph (a), clause (2), the amount appropriated is the amount required to pay eligible claims under chapter 12B, as certified by the commissioner of public safety.

(d) If the amount appropriated is insufficient to cover costs for paragraph (a), clauses (1) and (2), the commissioner of public safety shall pay up to an additional $4,000,000 from the general fund appropriation provided under this paragraph. No payment shall be made under this paragraph until:

(1) the commissioner of public safety has given the commissioner of management and budget an estimate of the additional funds required;

(2) the commissioner of management and budget has reported the estimate to the chairs of the house of representatives Ways and Means Committee and the senate Finance Committee; and

(3) the commissioner of management and budget has approved the payments.

(e) Amounts approved by the commissioner of management and budget, up to $4,000,000 per fiscal year, are appropriated from the general fund to the commissioner of public safety. By January 15 of each year, the commissioner of management and budget shall submit a report to the chairs of the house of representatives Ways and Means Committee and the senate Finance Committee detailing state disaster assistance appropriations and expenditures under this subdivision during the previous calendar year.

(f) The governor's budget proposal submitted to the legislature under section 16A.11 must include recommended appropriations to the disaster assistance contingency account. The governor's appropriation recommendations must be informed by the commissioner of public safety's estimate of the amount of money that will be necessary to:

(1) provide 100 percent of the nonfederal share for state agencies and local governments that will receive federal financial assistance from FEMA during the next biennium; and

(2) fully pay all eligible claims under chapter 12B.

(g) Notwithstanding section 16A.28:

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(1) funds appropriated or transferred to the disaster assistance contingency account do not lapse but remain in the account until appropriated; and

(2) funds appropriated from the disaster assistance contingency account do not lapse and are available until expended.

Sec. 5. Minnesota Statutes 2012, section 12A.02, subdivision 2, is amended to read:

Subd. 2. Appropriation. "Appropriation" means an appropriation provided in law specifically to implement this chapter, including but not limited to a statutory appropriation to provide the required cost-share for federal disaster assistance under section 12.221.

Sec. 6. Minnesota Statutes 2012, section 12A.02, is amended by adding a subdivision to read:

Subd. 6. Local government. "Local government" has the meaning given in section 12.03, subdivision 5d.

Sec. 7. Minnesota Statutes 2012, section 12A.02, is amended by adding a subdivision to read:

Subd. 7. Nonfederal share. "Nonfederal share" means that portion of total FEMA Public Assistance Program costs that is no more than 25 percent and is not eligible for FEMA reimbursement.

Sec. 8. Minnesota Statutes 2012, section 12A.03, subdivision 3, is amended to read:

Subd. 3. Nonduplication of federal assistance. State assistance may not duplicate or supplement eligible FEMA Public Assistance Program assistance. For eligible Public Assistance Program costs, any state ~~matching~~ cost-share money made available for that assistance must be disbursed by the Department of Public Safety to a state agency, local ~~political subdivision, Indian tribe~~ government, or other applicant. State assistance distributed by a state agency, other than the Department of Public Safety, to a ~~political subdivision~~ local government or other applicant for disaster costs that are eligible for FEMA Public Assistance Program assistance constitutes an advance of funds. Such advances must be repaid to the applicable state agency when the applicant has received the FEMA Public Assistance Program assistance, and whatever state ~~matching~~ cost-share money may be made available for that assistance, from the Department of Public Safety.

Sec. 9. Minnesota Statutes 2012, section 12A.15, subdivision 1, is amended to read:

Subdivision 1. State ~~match~~ cost-share for federal assistance. State appropriations may be used ~~for payment of the state match for federal disaster assistance~~ to pay 100 percent of the nonfederal share for state agencies~~. If authorized in law, state appropriations may be used to pay all or a portion of the local share of the match for federal funds for political subdivisions~~ and local governments under section 12.221. An appropriation from the bond proceeds fund may be used ~~to fund federal match obligations~~ as cost-share for federal disaster assistance for publicly owned capital improvement projects ~~resulting from the receipt of federal disaster assistance~~.

Sec. 10. Minnesota Statutes 2012, section 16A.28, is amended by adding a subdivision to read:

Subd. 9. Disaster assistance. (a) The commissioner of management and budget must transfer the unexpended and unencumbered balance of a general fund disaster assistance appropriation that expires as provided under this section or as otherwise provided by law to the disaster assistance contingency account in section 12.221, subdivision 6.

(b) Expired disaster assistance transferred to the disaster assistance contingency account is appropriated as provided under section 12.221, subdivision 6, regardless of the specific disaster event or purpose for which the expired disaster assistance was originally appropriated.

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(c) The commissioner must report each transfer to the chairs of the house of representatives Ways and Means Committee and the senate Finance Committee.

(d) For the purposes of this subdivision, "disaster assistance appropriation" means an appropriation from the general fund to provide cost-share required for federal disaster assistance or to provide other state disaster assistance under chapter 12A or 12B.

Sec. 11. EFFECTIVE DATE.

This article is effective the day following final enactment.

ARTICLE 11

DISASTER ASSISTANCE FOR PUBLIC ENTITIES; ABSENT FEDERAL AID

Section 1. [12B.10] PUBLIC DISASTER ASSISTANCE; ABSENT FEDERAL AID.

This chapter establishes a state public assistance program to provide cost-share assistance to local governments that sustain significant damage on a per capita basis but are not eligible for federal disaster assistance or corresponding state assistance under chapter 12A.

Sec. 2. [12B.15] DEFINITIONS.

Subdivision 1. Application. The definitions in this section apply to this chapter.

Subd. 2. Applicant. "Applicant" means a local government that applies for state disaster assistance under this chapter.

Subd. 3. Commissioner. "Commissioner" means the commissioner of public safety.

Subd. 4. Director. "Director" means the director of the Division of Homeland Security and Emergency Management in the Department of Public Safety.

Subd. 5. Disaster. "Disaster" means any catastrophe, including but not limited to a tornado, storm, high water, wind-driven water, tidal wave, earthquake, volcanic eruption, landslide, mudslide, snowstorm, or drought or, regardless of cause, any fire, flood, or explosion.

Subd. 6. FEMA. "FEMA" means the Federal Emergency Management Agency.

Subd. 7. Incident period. "Incident period" means the time interval of a disaster as delineated by specific start and end dates.

Subd. 8. Local government. "Local government" has the meaning given in section 12A.03, subdivision 5d.

Sec. 3. [12B.25] ELIGIBILITY CRITERIA; CONSIDERATIONS.

Subdivision 1. Payment required; eligibility criteria. The director, serving as the governor's authorized representative, may enter into grant agreements with eligible applicants to provide state financial assistance made available as a result of a disaster that satisfies all of the following criteria:

(1) the state and applicable local government declares a disaster or emergency during the incident period;

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(2) damages suffered and eligible costs incurred are the direct result of the disaster;

(3) federal disaster assistance is not available to the applicant because the governor did not request a presidential declaration of major disaster, the president denied the governor's request, or the applicant is not eligible for federal disaster assistance because the state or county did not meet the per capita impact indicator under FEMA's Public Assistance Program;

(4) the applicant incurred eligible damages that, on a per capita basis, equal or exceed 50 percent of the countywide per capita impact indicator under FEMA's Public Assistance Program;

(5) the applicant assumes responsibility for 25 percent of the applicant's total eligible costs; and

(6) the applicant satisfies all requirements in this chapter.

Subd. 2. Considerations; other resources available. When evaluating applicant eligibility under subdivision 1, the director must consider:

(1) the availability of other resources from federal, state, local, private, or other sources; and

(2) the availability or existence of insurance.

Sec. 4. [12B.30] ELIGIBLE COSTS.

Subdivision 1. Eligible costs. Costs eligible for payment under this chapter are those costs that would be eligible for federal financial assistance under FEMA's Public Assistance Program.

Subd. 2. Ineligible costs. Ineligible costs are all costs not included in subdivision 1, including but not limited to:

(1) ordinary operating expenses, including salaries and expenses of employees and public officials that are not directly related to the disaster response;

(2) costs for which payment has been or will be received from any other funding source;

(3) disaster-related costs that should, in the determination of the director, be covered and compensated by insurance; and

(4) projects and claims totaling less than the minimum FEMA project threshold.

Sec. 5. [12B.35] APPLICANT'S SHARE.

An applicant's share of eligible costs incurred must not be less than 25 percent. The substantiated value of donated materials, equipment, services, and labor may be used as all or part of the applicant's share of eligible costs, subject to the following:

(1) all items and sources of donation must be indicated on the application and any supporting documentation submitted to the commissioner;

(2) the rate for calculating the value of donated, nonprofessional labor is the prevailing federal minimum wage;

(3) the value of donated equipment may not exceed the highway equipment rates approved by the commissioner of transportation; and

(4) the value of donated materials and professional services must conform to market rates and be established by invoice.

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Sec. 6. [12B.40] APPLICATION PROCESS.

(a) The director must develop application materials and may update the materials as needed. Application materials must include instructions and requirements for assistance under this chapter.

(b) An applicant has 30 days from the end of the incident period or the president's official denial of the governor's request for a declaration of a major disaster to provide the director with written notice of intent to apply. The director may deny an application due to a late notice of intent to apply.

(c) Within 60 days after the end of the incident period or the president's official denial of the governor's request for a declaration of a major disaster, the applicant must submit a complete application to the director. A complete application includes the following:

(1) the cause, location of damage, and incident period;

(2) documentation of a local, tribal, county, or state disaster or emergency declaration in response to the disaster;

(3) a description of damages, an initial damage assessment, and the amount of eligible costs incurred by the applicant;

(4) a statement or evidence that the applicant has the ability to pay for at least 25 percent of total eligible costs incurred from the disaster; and

(5) a statement or evidence that the local government has incurred damages equal to or exceeding 50 percent of the federal countywide threshold in effect during the incident period.

(d) The director must review the application and supporting documentation for completeness and may return the application with a request for more detailed information. The director may consult with local public officials to ensure the application reflects the extent and magnitude of the damage and to reconcile any differences. The application is not complete until the director receives all requested information.

(e) If the director returns an application with a request for more detailed information or for correction of deficiencies, the applicant must submit all required information within 30 days of the applicant's receipt of the director's request. The applicant's failure to provide the requested information in a timely manner without a reasonable explanation may be cause for denial of the application.

(f) The director has no more than 60 days from the receipt of a complete application to approve or deny the application, or the application is deemed approved. If the director denies an application, the director must send a denial letter. If the director approves an application or the application is automatically deemed approved after 60 days, the director must notify the applicant of the steps necessary to obtain reimbursement of eligible costs, including submission of invoices or other documentation substantiating the costs submitted for reimbursement.

Sec. 7. [12B.45] CLAIMS PROCESS.

Subdivision 1. Claims; appeal. (a) An applicant must submit to the director completed claims for payment of actual and eligible costs on forms provided by the director. All eligible costs claimed for payment must be documented and consistent with the eligibility provisions of this chapter.

(b) If the director denies an applicant's claim for payment, the applicant has 30 days from receipt of the director's determination to appeal in writing to the commissioner. The appeal must include the applicant's rationale for reversing the director's determination. The commissioner has 30 days from receipt of the appeal to uphold or

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modify the director's determination and formally respond to the applicant. If, within 30 days of receiving the commissioner's decision, the applicant notifies the commissioner that the applicant intends to contest the commissioner's decision, the Office of Administrative Hearings shall conduct a hearing under the contested case provisions of chapter 14.

Subd. 2. Final inspection. Upon completion of all work by an applicant, the director may inspect all work claimed by the applicant. The applicant must provide the director with access to records pertaining to all claimed work and must permit the director to review all records relating to the work.

Subd. 3. Closeout. The director must close out an applicant's disaster assistance application after all of the following occur:

(1) eligible work is complete;

(2) the applicant receives the final amount due or pays any amount owed under section 12B.50; and

(3) any extant or scheduled audits are complete.

Subd. 4. Audit. (a) An applicant must account for all funds received under this chapter in conformance with generally accepted accounting principles and practices. The applicant must maintain detailed records of expenditures to show that grants received under this chapter were used for the purpose for which the payment was made. The applicant must maintain records for five years and make the records available for inspection and audit by the director or the state auditor. The applicant must keep all financial records for five years after the final payment, including but not limited to all invoices and canceled checks or bank statements that support all eligible costs claimed by the applicant.

(b) The director or state auditor may audit all applicant records pertaining to an application or payment under this chapter.

Subd. 5. Reporting payments. The director must post on the division Web site a list of the recipients and amounts of the payments made under this chapter.

Sec. 8. [12B.50] FUNDING FROM OTHER SOURCES; REPAYMENT REQUIRED.

If an applicant subsequently recovers eligible costs from another source after receiving payment under this chapter, the applicant must pay the commissioner an amount equal to the corresponding state funds received within 30 days. The commissioner must deposit any repayment in the disaster response contingency account in section 12.221, subdivision 6.

Sec. 9. EFFECTIVE DATE.

This article is effective the day following final enactment.

TRANSPORTATION

ARTICLE 12

TRANSPORTATION APPROPRIATIONS

Section 1. APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are added to the appropriations in Laws 2013, chapter 117, article 1, unless otherwise specified, to the agencies and for the purposes specified in this article. Unless otherwise specified, the appropriations are not added to the base appropriation for each purpose. The appropriations

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are from the general fund, or another named fund, and are available for the fiscal years indicated for each purpose. The figures "2014" and "2015" used in this article mean that the appropriations listed under them are available for the fiscal year ending June 30, 2014, or June 30, 2015, respectively. For purposes of this article, "the first year" is fiscal year 2014, "the second year" is fiscal year 2015, and "the biennium" is fiscal years 2014 and 2015.

	APPROPRIATIONS
	Available for the Year
	Ending June 30
2014		2015

Sec. 2. DEPARTMENT OF TRANSPORTATION

Subdivision 1. Total Appropriation

$10,000,000

$42,732,000

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

Subd. 2. Multimodal Systems

(a) Election Day Transit Service

32,000

This appropriation is for allocation to public transit systems under Minnesota Statutes, section 174.24, in amounts that reflect the respective foregone fare revenues from transit service under Minnesota Statutes, section 174.24, subdivision 8.

(b) Safe Routes to School

250,000

This appropriation is for non-infrastructure activities in the safe routes to school program under Minnesota Statutes, section 174.40, subdivision 7a.

5,000,000

This appropriation is for development and implementation of safety improvements at highway grade crossings along rail corridors in which oil or other hazardous materials are transported. The commissioner shall identify highway-rail grade crossing locations and improvements in consultation with railroads and relevant road authorities.

(d) Port Development Assistance Program

500,000

This appropriation is for grants under the port development assistance program in Minnesota Statutes, chapter 457A.

Subd. 3. State Roads

(a) Winter-Related Trunk Highway Repair

10,000,000

This appropriation is from the trunk highway fund for materials and supplies related to road repair resulting from effects of the 2013-2014 winter season.

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(b) Transportation Economic Development Program

4,000,000

This appropriation is for the transportation economic development program under Minnesota Statutes, section 174.12.

10,000,000

This appropriation is for the corridors of commerce program under Minnesota Statutes, section 161.088, and may include right-of-way acquisition for projects included in the program. The commissioner may identify projects based on the most recent selection process or may perform a new selection.

Subd. 4. Local Roads

(a) Winter-Related County State-Aid Road Repair

11,448,000

This appropriation is for materials and supplies related to road repair resulting from effects of the 2013-2014 winter season.

By September 1, 2014, the commissioner shall apportion funds to counties in the same manner as county state-aid highway funds provided for calendar year 2014 under Minnesota Statutes, section 162.07.

(b) Winter-Related Municipal State-Aid Road Repair

3,552,000

This appropriation is for materials and supplies related to road repair resulting from effects of the 2013-2014 winter season.

By September 1, 2014, the commissioner shall apportion funds to cities in the same manner as municipal state-aid street funds provided for calendar year 2014 under Minnesota Statutes, section 162.13.

Subd. 5. Willmar District Headquarters

4,370,000

This appropriation is from the trunk highway fund to complete the Willmar district headquarters and is added to the appropriation in Laws 2012, chapter 287, article 1, section 1, subdivision 2.

Subd. 6. Little Falls Truck Station

3,580,000

This appropriation is from the trunk highway fund to complete the Little Falls truck station and is added to the appropriation in Laws 2010, chapter 189, section 15, subdivision 15.

Sec. 3. METROPOLITAN COUNCIL

Subdivision 1. Total Appropriation

$10,400,000

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

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Subd. 2. Transit Development and Improvements

10,150,000

This appropriation is for:

(1) arterial bus rapid transit development, which may include but is not limited to design, engineering, construction, capital costs, technology, equipment, and rolling stock;

(2) bus rapid transit station development;

(3) transit shelter improvements under Minnesota Statutes, section 473.41; and

(4) foregone fare revenues from transit service under Minnesota Statutes, section 473.408, subdivision 11. The Metropolitan Council shall allocate amounts under this appropriation to transit providers receiving financial assistance under Minnesota Statutes, section 473.388, based on respective foregone fare revenues.

Subd. 3. Suburban Transit Providers

250,000

This appropriation is for allocation to replacement service providers operating under Minnesota Statutes, section 473.388, as provided in this subdivision.

Upon receipt of a prioritized listing of expenditure items and amounts submitted by the Suburban Transit Association, or by all replacement service providers jointly, the Metropolitan Council shall distribute all funds appropriated under this subdivision to each identified replacement service provider, following the priority order in the listing. An expenditure item in the listing must be for nonoperating transit-related expenses.

Sec. 4. DEPARTMENT OF PUBLIC SAFETY

Subdivision 1. Total Appropriation

$2,060,000

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

Subd. 2. Transit Safety Oversight

60,000

$60,000 in the second year is for light rail transit safety oversight under Minnesota Statutes, section 299A.017, and is added to the base appropriation for the administration and related services program.

Subd. 3. Capitol Security

2,000,000

This appropriation is for an increase in the number of State Patrol troopers or other security officers assigned to the Capitol complex, and is added to the base appropriation for the capitol security budget activity.

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Sec. 5. TRANSFER; RAILROAD AND PIPELINE SAFETY.

On or before July 31, 2014, the commissioner of management and budget shall transfer $2,500,000 from the general fund to the railroad and pipeline safety account in the special revenue fund under Minnesota Statutes, section 299A.55. This is a onetime transfer.

Sec. 6. Laws 2010, chapter 189, section 15, subdivision 12, is amended to read:

Subd. 12. Rochester Maintenance Facility

~~26,430,000~~ 24,937,000

This appropriation is from the bond proceeds account in the trunk highway fund.

To prepare a site for and design, construct, furnish, and equip a new maintenance facility in Rochester.

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

Sec. 7. Laws 2010, chapter 189, section 26, subdivision 4, is amended to read:

Subd. 4. Trunk highway fund bond proceeds account. To provide the money appropriated in this act from the bond proceeds account in the trunk highway fund, the commissioner of management and budget shall sell and issue bonds of the state in an amount up to ~~$32,945,000~~ $31,452,000 in the manner, upon the terms, and with the effect prescribed by Minnesota Statutes, sections 167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times and in the amounts requested by the commissioner of transportation. The proceeds of the bonds, except accrued interest and any premium received from the sale of the bonds, must be credited to the bond proceeds account in the trunk highway fund.

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

Sec. 8. Laws 2012, chapter 287, article 2, section 1, is amended to read:

Section 1. ROCHESTER MAINTENANCE FACILITY.

~~$16,100,000~~ $17,593,000 is appropriated to the commissioner of transportation to design, construct, furnish, and equip the maintenance facility in Rochester and corresponding remodeling of the existing district headquarters building. This appropriation is from the bond proceeds account in the trunk highway fund.

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

Sec. 9. Laws 2012, chapter 287, article 2, section 3, is amended to read:

Sec. 3. TRUNK HIGHWAY FUND BOND PROCEEDS ACCOUNT.

To provide the money appropriated in this article from the bond proceeds account in the trunk highway fund, the commissioner of management and budget shall sell and issue bonds of the state in an amount up to ~~$16,120,000~~ $17,613,000 in the manner, upon the terms, and with the effect prescribed by Minnesota Statutes, sections 167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times and in the amounts requested by the commissioner of transportation. The proceeds of the bonds, except accrued interest and any premium received from the sale of the bonds, must be credited to the bond proceeds account in the trunk highway fund.

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

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Sec. 10. Laws 2012, First Special Session chapter 1, article 1, section 28, is amended to read:

Sec. 28. TRANSFERS, REDUCTIONS, CANCELLATIONS, AND BOND SALE AUTHORIZATIONS REDUCED.

(a) The remaining balance of the appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 7, for the economic development and housing challenge program, estimated to be $450,000, is transferred to the general fund.

(b) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 5, for Minnesota investment fund grants pursuant to Minnesota Statutes, section 12A.07, is reduced by $1,358,000.

(c) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 12, subdivision 2, for disaster enrollment impact aid pursuant to Minnesota Statutes, section 12A.06, is reduced by $30,000.

(d) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 12, subdivision 3, for disaster relief facilities grants pursuant to Minnesota Statutes, section 12A.06, is reduced by $392,000.

(e) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 12, subdivision 4, for disaster relief operating grants pursuant to Minnesota Statutes, section 12A.06, is reduced by $2,000.

(f) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 12, subdivision 5, for pupil transportation aid pursuant to Minnesota Statutes, section 12A.06, is reduced by $5,000.

(g) The appropriation in Laws 2010, Second Special Session chapter 1, article 2, section 5, subdivision 3, for pupil transportation aid pursuant to Minnesota Statutes, section 12A.06, is reduced by $271,000.

(h) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 13, for public health activities pursuant to Minnesota Statutes, section 12A.08, is reduced by $103,000.

(i) ~~$1,428,000~~ $534,000 of the appropriation in Laws 2007, First Special Session chapter 2, article 1, section 4, subdivision 3, for reconstruction and repair of trunk highways and trunk highway bridges is canceled. The bond sale authorization in Laws 2007, First Special Session chapter 2, article 1, section 15, subdivision 2, is reduced by ~~$1,428,000~~ $534,000.

(j) $5,680,000 of the appropriation in Laws 2007, First Special Session chapter 2, article 1, section 4, subdivision 4, as amended by Laws 2008, chapter 289, section 2, for grants to local governments for capital costs related to rehabilitation and replacement of local roads and bridges damaged or destroyed by flooding pursuant to Minnesota Statutes, section 174.50, is canceled. The bond sale authorization in Laws 2007, First Special Session chapter 2, article 1, section 15, subdivision 3, is reduced by $5,680,000.

(k) $2,133,000 of the appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 4, subdivision 3, for local road and bridge rehabilitation and replacement pursuant to Minnesota Statutes, section 12A.16, subdivision 3, is canceled. The bond sale authorization in Laws 2010, Second Special Session chapter 1, article 1, section 17, subdivision 2, is reduced by $2,133,000.

(l) The appropriation in Laws 2010, Second Special Session chapter 1, article 1, section 4, subdivision 2, for state road infrastructure operations and maintenance pursuant to Minnesota Statutes, section 12A.16, subdivision 1, is reduced by $819,000.

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

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Sec. 11. Laws 2013, chapter 117, article 1, section 3, subdivision 2, is amended to read:

Subd. 2. Multimodal Systems

(a) Aeronautics

(1) Airport Development and Assistance

~~13,648,000~~ 14,648,000

~~13,648,000~~ 16,648,000

This appropriation is from the state airports fund and must be spent according to Minnesota Statutes, section 360.305, subdivision 4.

The base appropriation for fiscal years 2016 and 2017 is $14,298,000 for each year.

Notwithstanding Minnesota Statutes, section 16A.28, subdivision 6, this appropriation is available for five years after appropriation. If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

For the current biennium, the commissioner of transportation may establish different local contribution rates for airport projects than those established in Minnesota Statutes, section 360.305, subdivision 4.

(2) Aviation Support and Services

6,386,000

Appropriations by Fund

Airports	5,286,000	5,286,000
Trunk Highway	1,100,000	1,100,000

$65,000 in each year is from the state airports fund for the Civil Air Patrol.

(b) Transit

17,226,000

17,245,000

Appropriations by Fund

General	16,451,000	16,470,000
Trunk Highway	775,000	775,000

$100,000 in each year is from the general fund for the administrative expenses of the Minnesota Council on Transportation Access under Minnesota Statutes, section 174.285.

$78,000 in each year is from the general fund for grants to greater Minnesota transit providers as reimbursement for the costs of providing fixed route public transit rides free of charge under Minnesota Statutes, section 174.24, subdivision 7, for veterans certified as disabled.

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500,000

This appropriation is from the general fund for passenger rail system planning, alternatives analysis, environmental analysis, design, and preliminary engineering under Minnesota Statutes, sections 174.632 to 174.636.

(d) Freight

5,653,000

5,153,000

Appropriations by Fund

General	756,000	256,000
Trunk Highway	4,897,000	4,897,000

$500,000 in the first year is from the general fund to pay for the department's share of costs associated with the cleanup of contaminated state rail bank property. This appropriation is available until expended.

(e) Safe Routes to School

250,000

This appropriation is from the general fund for non-infrastructure activities in the safe routes to school program under Minnesota Statutes, section 174.40, subdivision 7a.

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

Sec. 12. Laws 2013, chapter 117, article 1, section 3, subdivision 3, is amended to read:

Subd. 3. State Roads

(a) Operations and Maintenance

~~262,395,000~~ 287,395,000

~~262,395,000~~ 280,395,000

$5,000,000 in each year is for accelerated replacement of snow plowing equipment.

The base appropriation for operations and maintenance for fiscal years 2016 and 2017 is $267,395,000 in each year.

(b) Program Planning and Delivery

206,795,000

~~206,720,000~~ 209,720,000

Appropriations by Fund

	2014	2015

H.U.T.D.	75,000	0
Trunk Highway	206,720,000	~~206,720,000~~ 209,720,000

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The base appropriation for program planning and delivery for fiscal years 2016 and 2017 is $206,720,000 in each year.

$250,000 in each year is for the department's administrative costs for creation and operation of the Joint Program Office for Economic Development and Alternative Finance, including costs of hiring a consultant and preparing required reports.

$130,000 in each year is available for administrative costs of the targeted group business program.

$266,000 in each year is available for grants to metropolitan planning organizations outside the seven-county metropolitan area.

$75,000 in each year is available for a transportation research contingent account to finance research projects that are reimbursable from the federal government or from other sources. If the appropriation for either year is insufficient, the appropriation for the other year is available for it.

$900,000 in each year is available for grants for transportation studies outside the metropolitan area to identify critical concerns, problems, and issues. These grants are available: (1) to regional development commissions; (2) in regions where no regional development commission is functioning, to joint powers boards established under agreement of two or more political subdivisions in the region to exercise the planning functions of a regional development commission; and (3) in regions where no regional development commission or joint powers board is functioning, to the department's district office for that region.

$75,000 in the first year is from the highway user tax distribution fund to the commissioner for a grant to the Humphrey School of Public Affairs at the University of Minnesota for WorkPlace Telework program congestion relief efforts consisting of maintenance of Web site tools and content. This is a onetime appropriation and is available in the second year.

(1) Economic Recovery Funds - Federal Highway Aid

1,000,000

This appropriation is to complete projects using funds made available to the commissioner of transportation under title XII of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, and implemented under Minnesota Statutes, section 161.36, subdivision 7. The base appropriation is $1,000,000 in fiscal year 2016 and $0 in fiscal year 2017.

(2) State Road Construction

~~909,400,000~~ 923,400,000

815,600,000

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It is estimated that these appropriations will be funded as follows:

Appropriations by Fund

Federal Highway Aid	489,200,000	482,200,000
Highway User Taxes	~~420,200,000~~ 434,200,000	333,400,000

The commissioner of transportation shall notify the chairs and ranking minority members of the legislative committees with jurisdiction over transportation finance of any significant events that should cause these estimates to change.

This appropriation is for the actual construction, reconstruction, and improvement of trunk highways, including design-build contracts and consultant usage to support these activities. This includes the cost of actual payment to landowners for lands acquired for highway rights-of-way, payment to lessees, interest subsidies, and relocation expenses.

The base appropriation for state road construction for fiscal years 2016 and 2017 is $645,000,000 in each year.

$10,000,000 in each year is for the transportation economic development program under Minnesota Statutes, section 174.12.

The commissioner may expend up to one-half of one percent of the federal appropriations under this clause as grants to opportunity industrialization centers and other nonprofit job training centers for job training programs related to highway construction.

The commissioner may transfer up to $15,000,000 each year to the transportation revolving loan fund.

The commissioner may receive money covering other shares of the cost of partnership projects. These receipts are appropriated to the commissioner for these projects.

Notwithstanding subdivision 6, the commissioner may transfer up to $6,000,000 from the trunk highway fund under this appropriation to the Stillwater lift bridge endowment account under Minnesota Statutes, section 165.15.

Of this appropriation, $14,000,000 in the first year is for the specific improvements to "Old Highway 14" described in the settlement agreement and release executed January 7, 2014, between the state and Steele and Waseca Counties.

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(d) Highway Debt Service

158,417,000

189,821,000

$148,917,000 in the first year and $180,321,000 in the second year are for transfer to the state bond fund. If an appropriation is insufficient to make all transfers required in the year for which it is made, the commissioner of management and budget shall notify the senate Committee on Finance and the house of representatives Committee on Ways and Means of the amount of the deficiency and shall then transfer that amount under the statutory open appropriation. Any excess appropriation cancels to the trunk highway fund.

(e) Electronic Communications

5,171,000

Appropriations by Fund

General	3,000	3,000
Trunk Highway	5,168,000	5,168,000

The general fund appropriation is to equip and operate the Roosevelt signal tower for Lake of the Woods weather broadcasting.

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

Sec. 13. Laws 2013, chapter 117, article 1, section 4, is amended to read:

Sec. 4. METROPOLITAN COUNCIL

$107,889,000

$~~76,970,000~~ 76,910,000

This appropriation is from the general fund for transit system operations under Minnesota Statutes, sections 473.371 to 473.449.

The base appropriation for fiscal years 2016 and 2017 is ~~$76,686,000~~ $76,626,000 in each year.

$37,000,000 in the first year is for the Southwest Corridor light rail transit line from the Hiawatha light rail transit line in downtown Minneapolis to Eden Prairie, to be used for environmental studies, preliminary engineering, acquisition of real property, or interests in real property, and design. This is a onetime appropriation and is available until expended.

Sec. 14. EFFECTIVE DATE; SUPERSEDING PROVISIONS.

Regardless of order of enactment, sections 1 to 5 of this article are not effective if House File No. 2395 is enacted in the 2014 legislative session.

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ARTICLE 13

RAILROAD AND PIPELINE SAFETY

Section 1. Minnesota Statutes 2012, section 115E.01, is amended by adding a subdivision to read:

Subd. 6a. Incident commander. "Incident commander" means the official at the site of a discharge who has the responsibility for operations at the site, as established following National Incident Management System guidelines.

Sec. 2. Minnesota Statutes 2012, section 115E.01, is amended by adding a subdivision to read:

Subd. 7a. Listed sensitive area. "Listed sensitive area" means an area or location listed as an area of special economic or environmental importance in an Area Contingency Plan or a Sub-Area Contingency Plan prepared under the federal Clean Water Act, United States Code, title 33, section 1321(j)(4).

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

Sec. 3. Minnesota Statutes 2012, section 115E.01, is amended by adding a subdivision to read:

Subd. 11d. Unit train. "Unit train" means a train with more than 25 tanker railcars carrying oil or hazardous substance cargo.

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

Sec. 4. [115E.042] PREPAREDNESS AND RESPONSE FOR CERTAIN RAILROADS AND PIPELINES.

Subdivision 1. Application. In addition to the requirements of section 115E.04, a person who owns or operates railroad car rolling stock transporting a unit train must comply with this section. A person who owns or operates pipeline facilities and is required to show specific preparedness under section 115E.03, subdivision 2, must comply with this section as applicable and with the provisions of chapters 299F and 299J.

Subd. 2. Training. (a) Each railroad must offer training to each fire department having jurisdiction along the route of unit trains. Initial training under this subdivision must be offered to each fire department by June 30, 2016, and refresher training must be offered to each fire department at least once every three years thereafter.

(b) The training must address the general hazards of oil and hazardous substances, techniques to assess hazards to the environment and to the safety of responders and the public, factors an incident commander must consider in determining whether to attempt to suppress a fire or to evacuate the public and emergency responders from an area, and other strategies for initial response by local emergency responders. The training must include suggested protocol or practices for local responders to safely accomplish these tasks.

Subd. 3. Coordination. Beginning June 30, 2015, each railroad and pipeline company must communicate at least annually with each county or city emergency manager and a senior fire department officer of each fire department having jurisdiction along the route of a unit train or a pipeline to ensure coordination of emergency response activities between the railroad or pipeline company and local responders.

Subd. 4. Response capabilities; time limits; drills. (a) Following confirmation of a discharge, a railroad or pipeline company must deliver and deploy sufficient equipment and trained personnel to contain and recover discharged oil or hazardous substances and to protect the environment and public safety.

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(b) Within one hour of confirmation of a discharge, a railroad or pipeline company must provide a qualified company employee to advise the incident commander. The employee may be made available by telephone, and must be authorized to deploy all necessary response resources of the railroad or pipeline company.

(c) Within three hours of confirmation of a discharge, a railroad or pipeline company must be capable of delivering monitoring equipment and a trained operator to assist in protection of responder and public safety. A plan to ensure delivery of monitoring equipment and an operator to a discharge site must be provided each year to the commissioner of public safety.

(d) Within three hours of confirmation of a discharge, a railroad or pipeline company must provide qualified personnel at a discharge site to assess the discharge and to advise the incident commander.

(e) A railroad or pipeline company must be capable of deploying containment boom from land across sewer outfalls, creeks, ditches, and other places where oil or hazardous substances may drain, in order to contain leaked material before it reaches those resources. The arrangement to provide containment boom and staff may be made by:

(1) training and caching equipment with local jurisdictions;

(2) training and caching equipment with a fire mutual-aid group;

(3) means of an industry cooperative or mutual-aid group;

(4) deployment of a contractor;

(5) deployment of a response organization under state contract; or

(6) other dependable means acceptable to the Pollution Control Agency.

(f) Each arrangement under paragraph (e) must be confirmed each year. Each arrangement must be tested by drill at least once every five years.

(g) Within eight hours of confirmation of a discharge, a railroad or pipeline company must be capable of delivering and deploying oil spill containment booms, boats, oil recovery equipment, trained staff, and all other materials needed to provide:

(1) on-site containment and recovery of a volume of oil equal to ten percent of the calculated worst case discharge at any location along the route; and

(2) protection of listed sensitive areas and potable water intakes within one mile of a discharge site and within eight hours of water travel time downstream in any river or stream that the right-of-way intersects.

(h) Within 60 hours of confirmation of a discharge, a railroad or pipeline company must be capable of delivering and deploying additional oil spill containment booms, boats, oil recovery equipment, trained staff, and all other materials needed to provide containment and recovery of a worst-case oil discharge and to protect listed sensitive areas and potable water intakes at any location along the route.

(i) Each railroad and pipeline must conduct at least one oil containment, recovery, and sensitive area protection drill every three years, at a location and time chosen by the Pollution Control Agency.

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Subd. 5. Prevention and response plans. (a) By June 30, 2015, a railroad or pipeline company shall submit the prevention and response plan required under section 115E.04, as necessary to comply with the requirements of this section, to the commissioner of the Pollution Control Agency on a form designated by the commissioner.

(b) By June 30 of every third year following a plan submission under this subdivision, a railroad and pipeline company must update and resubmit the prevention and response plan to the commissioner.

EFFECTIVE DATE. Subdivisions 1 to 3 and 5 are effective the day following final enactment. Subdivision 4 is effective July 1, 2015.

Sec. 5. Minnesota Statutes 2012, section 115E.08, is amended by adding a subdivision to read:

Subd. 3a. Railroad and pipeline preparedness; pollution control. The Pollution Control Agency shall carry out environmental protection activities related to railroad and pipeline discharge preparedness. Duties under this subdivision include, but are not limited to:

(1) assisting local emergency managers and fire officials in understanding the hazards of oil and hazardous substances, as well as general strategies for containment and environmental protection;

(2) assisting railroads and pipeline companies to identify natural resources and sensitive areas, and to devise strategies to contain and recover oil and hazardous substances from land and waters along routes;

(3) facilitating cooperation between railroad and pipeline companies for mutual aid arrangements that provide training, staff, and equipment as required by this chapter;

(4) participating in drills and training sessions;

(5) reviewing each railroad and pipeline company's prevention and response plans for compliance with the requirements of this chapter, and assessing each company's readiness to protect the environment;

(6) conducting inspections and drills as necessary to determine the railroad or pipeline company's compliance with the requirements of this chapter and ability to protect the environment; and

(7) conducting follow-up corrective action directives, orders, and enforcement as necessary based on a finding of inadequate environmental protection preparedness.

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

Sec. 6. Minnesota Statutes 2012, section 115E.08, is amended by adding a subdivision to read:

Subd. 3b. Railroad and pipeline preparedness; public safety. The commissioner of public safety shall carry out public safety protection activities related to railroad and pipeline spill and discharge preparedness. Duties under this subdivision include, but are not limited to:

(1) assisting local emergency managers and fire officials to understand the hazards of oil and hazardous substances, as well as general strategies for hazard identification, initial isolation, and other actions necessary to ensure public safety;

(2) assisting railroads and pipeline companies to develop suggested protocols and practices for local first responder use in protecting the public's safety;

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(3) facilitating cooperation between railroads, pipeline companies, county and city emergency managers, and other public safety organizations;

(4) participating in major exercises and training sessions;

(5) assisting local units of government to incorporate railroad and pipeline hazard and response information into local emergency operations plans;

(6) monitoring the public safety-related training and planning requirements of section 115E.03; and

(7) referring noncompliance with section 115E.03 to the Pollution Control Agency.

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

Sec. 7. Minnesota Statutes 2012, section 219.015, subdivision 1, is amended to read:

Subdivision 1. ~~Position~~ Positions established; duties. (a) The commissioner of transportation shall establish ~~a position of~~ three state rail safety inspector positions in the Office of Freight and Commercial Vehicle Operations of the Minnesota Department of Transportation. On or after July 1, 2015, the commissioner may establish a fourth state rail safety inspector position following consultation with railroad companies. The commissioner shall apply to and enter into agreements with the Federal Railroad Administration (FRA) of the United States Department of Transportation to participate in the federal State Rail Safety ~~Partnership~~ Participation Program for training and certification of an inspector under authority of United States Code, title 49, sections 20103, 20105, 20106, and 20113, and Code of Federal Regulations, title 49, part 212.

~~The~~ (b) A state rail safety inspector shall inspect mainline track, secondary track, and yard and industry track; inspect railroad right-of-way, including adjacent or intersecting drainage, culverts, bridges, overhead structures, and traffic and other public crossings; inspect yards and physical plants; review and enforce safety requirements; review maintenance and repair records; and review railroad security measures.

(c) A state rail safety inspector may perform, but is not limited to, the duties described in the federal State Rail Safety Participation Program. An inspector may train, be certified, and participate in any of the federal State Rail Safety Participation Program disciplines, including track, signal and train control, motive power and equipment, operating practices compliance, hazardous materials, and highway-rail grade crossings.

(d) To the extent delegated by the Federal Railroad Administration and authorized by the commissioner, ~~the~~ an inspector may issue citations for violations of this chapter, or to ensure railroad employee and public safety and welfare.

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

Sec. 8. Minnesota Statutes 2012, section 219.015, subdivision 2, is amended to read:

Subd. 2. Railroad company assessment; account; appropriation. (a) As provided in this subdivision, the commissioner shall annually assess railroad companies that are (1) defined as common carriers under section 218.011,; (2) classified by federal law or regulation as Class I Railroads, or Class I Rail Carriers, Class II Railroads, or Class II Rail Carriers; and (3) operating in this state,.

(b) The assessment must be by a division of state rail safety inspector program costs in equal proportion between carriers based on route miles operated in Minnesota, assessed in equal amounts for 365 days of the calendar year. The commissioner shall assess all start-up or re-establishment costs, ~~and~~ all related costs of initiating the state rail safety inspector program ~~beginning July 1, 2008. The~~, and ongoing state rail inspector duties ~~must begin and be assessed on January 1, 2009~~.

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(c) The assessments must be deposited in a special account in the special revenue fund, to be known as the state rail safety inspection account. Money in the account is appropriated to the commissioner ~~and may be expended to cover the costs incurred~~ for the establishment and ongoing responsibilities of the state rail safety inspector program.

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

Sec. 9. [299A.55] RAILROAD AND PIPELINE SAFETY; OIL AND OTHER HAZARDOUS MATERIALS.

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

(b) "Applicable rail carrier" means a railroad company that is subject to an assessment under section 219.015, subdivision 2.

(d) "Oil" has the meaning given in section 115E.01, subdivision 8.

(e) "Pipeline company" means any individual, partnership, association, or public or private corporation required to show specific preparedness under section 115E.03, subdivision 2.

Subd. 2. Railroad and pipeline safety account. (a) A railroad and pipeline safety account is created in the special revenue fund. The account consists of funds collected under subdivision 4 and funds donated, allotted, transferred, or otherwise provided to the account.

(b) $208,000 is annually appropriated to the commissioner of the Pollution Control Agency for environmental protection activities related to railroad and pipeline discharge preparedness under chapter 115E.

(c) Following the appropriation in paragraph (b), the remaining money in the account is annually appropriated to the commissioner of public safety for the purposes specified in subdivision 3.

Subd. 3. Allocation of railroad and pipeline safety funds. (a) Subject to funding appropriated for this subdivision, the commissioner shall provide funds for training and response preparedness related to (1) derailments, discharge incidents, or spills involving trains carrying oil or other hazardous substances, and (2) pipeline discharge incidents or spills involving oil or other hazardous substances.

(b) The commissioner shall allocate available funds to the Board of Firefighter Training and Education under section 299N.02 and the Division of Homeland Security and Emergency Management.

(c) Prior to making allocations under paragraph (b), the commissioner shall consult with the Fire Service Advisory Committee under section 299F.012, subdivision 2.

(d) The commissioner and the entities identified in paragraph (b) shall prioritize uses of funds based on:

(1) firefighter training needs;

(2) community risk from discharge incidents or spills;

(3) geographic balance; and

(4) recommendations of the Fire Service Advisory Committee.

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(e) The following are permissible uses of funds provided under this subdivision:

(1) training costs, which may include but are not limited to training curriculum, trainers, trainee overtime salary, other personnel overtime salary, and tuition;

(2) costs of gear and equipment related to hazardous materials readiness, response, and management, which may include but is not limited to original purchase, maintenance, and replacement;

(3) supplies related to the uses under clauses (1) and (2); and

(4) emergency preparedness planning and coordination.

(f) Notwithstanding paragraph (b), from funds in the railroad and pipeline safety account provided for the purposes under this subdivision, the commissioner may retain a balance in the account for budgeting in subsequent fiscal years.

Subd. 4. Assessments; oil and hazardous substances. (a) The commissioner of public safety shall annually assess $2,500,000 to railroad and pipeline companies based on the formula specified in paragraph (b). The commissioner shall deposit funds collected under this subdivision in the railroad and pipeline safety account under subdivision 2.

(b) The assessment for each railroad is 50 percent of the total annual assessment amount, divided in equal proportion between applicable rail carriers based on route miles operated in Minnesota. The assessment for each pipeline company is 50 percent of the total annual assessment amount, divided in equal proportion between companies based on the yearly aggregate gallons of oil and hazardous substance transported in Minnesota. The assessment must be in equal amounts for each day of the fiscal year.

Sec. 10. REPORTS ON INCIDENT PREPAREDNESS FOR OIL AND OTHER HAZARDOUS MATERIALS TRANSPORTATION.

Subdivision 1. Report on response preparedness. By January 15, 2015, the commissioner of public safety shall submit a report on emergency response preparedness in the public and private sectors for incidents involving oil and other hazardous materials transported by rail and pipeline to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation and public safety policy and finance. At a minimum, the report must:

(1) summarize the preparedness and emergency response framework in the state;

(2) provide an assessment of costs and needs of fire departments and other emergency first responders for training and equipment to respond to discharge or spill incidents involving oil and other hazardous materials transported by rail and pipeline;

(3) develop a comprehensive public and private response capacity inventory that, to the extent feasible, includes statewide identification of major emergency response equipment, equipment staging locations, mutual aid agreements, and capacities across industries involved in transportation and storage of oil and other hazardous materials;

(4) provide information and analysis that forms the basis for allocation of funds under Minnesota Statutes, section 299A.55;

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(5) develop benchmarks or assessment criteria for the evaluation under subdivision 2;

(6) assist in long-range oil and other hazardous materials incident preparedness planning; and

(7) make recommendations for any legislative changes.

Subd. 2. Evaluation of response preparedness and funding. By November 1, 2017, the commissioner of public safety shall submit an evaluation of railroad and pipeline safety preparedness and funding related to incidents involving oil and other hazardous materials to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation and public safety policy and finance. At a minimum, the evaluation must:

(1) provide an update to the report under subdivision 1 that identifies notable changes and provides updated information as appropriate;

(2) evaluate the effectiveness of training and response preparedness activities under Minnesota Statutes, section 299A.55, using the criteria established under subdivision 1, clause (5);

(3) identify current sources of funds, funding levels, and any unfunded needs for preparedness activities;

(4) analyze equity in the distribution of funding sources for preparedness activities, which must include but is not limited to (i) examination of the public-private partnership financing model, and (ii) review of balance across industries involved in storage and distribution of oil and other hazardous materials; and

(5) make recommendations for any programmatic or legislative changes.

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

Sec. 11. IMPROVEMENTS STUDY ON GRADE CROSSINGS AND RAIL SAFETY FOR OIL AND OTHER HAZARDOUS MATERIALS TRANSPORTATION.

(a) The commissioner of transportation shall conduct a study on highway-rail grade crossing improvement for oil and other hazardous materials transported by rail, and on rail safety. At a minimum, the study must:

(1) provide information that assists in risk management associated with transportation of oil and other hazardous materials by rail;

(2) develop criteria to prioritize needs and improvements at highway-rail grade crossings;

(3) consider alternatives for safety improvements, including but not limited to active warning devices such as gates and signals, closings, and grade separation;

(4) provide findings and recommendations that serve to direct accelerated investments in highway-rail grade crossing safety improvements; and

(5) analyze state inspection activities and staffing for track and hazardous materials under Minnesota Statutes, section 219.015.

(b) The commissioner shall submit an interim update on the study by August 31, 2014, and a final report by October 31, 2014, to the chairs and ranking minority members of the legislative committees with jurisdiction over transportation policy and finance.

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

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ARTICLE 14

TRANSPORTATION FINANCE PROVISIONS

Section 1. Minnesota Statutes 2012, section 165.15, subdivision 2, is amended to read:

Subd. 2. Use of funds. (a) Income derived from the investment of principal in the account may be used by the commissioner of transportation for operations and routine maintenance, including bridge safety inspections and reactive repairs, of the Stillwater lift bridge. No money from this account may be used for any purposes except those described in this section, and no money from this account may be transferred to any other account in the state treasury without specific legislative authorization. ~~Any money transferred from the trunk highway fund may only be used for trunk highway purposes.~~ For the purposes of this section:

(1) "Income" is the amount of interest on debt securities and dividends on equity securities. Any gains or losses from the sale of securities must be added to the principal of the account.

(2) "Routine maintenance" means activities that are predictable and repetitive, but not activities that would constitute major repairs or rehabilitation.

(b) Investment management fees incurred by the State Board of Investment are eligible expenses for reimbursement from the account.

Sec. 2. Minnesota Statutes 2013 Supplement, section 168.123, subdivision 2, is amended to read:

Subd. 2. Design. (a) The commissioner of veterans affairs shall design the emblem for the veterans' special plates, subject to the approval of the commissioner, that satisfy the following requirements:

~~(a)~~ (b) For a Vietnam veteran who served after July 1, 1961, and before July 1, 1978, in the active military service in a branch of the armed forces of the United States or a nation or society allied with the United States the special plates must bear the inscription "VIETNAM VET."

~~(b)~~ (c) For a veteran stationed on the island of Oahu, Hawaii, or offshore, during the attack on Pearl Harbor on December 7, 1941, the special plates must bear the inscription "PEARL HARBOR SURVIVOR."

~~(c)~~ (d) For a veteran who served during World War II, the plates must bear the inscription "WORLD WAR VET."

~~(d)~~ (e) For a veteran who served during the Korean Conflict, the special plates must bear the inscription "KOREAN VET."

~~(e)~~ (f) For a combat wounded veteran who is a recipient of the Purple Heart medal, the plates must bear the inscription "COMBAT WOUNDED VET" and have a facsimile or an emblem of the official Purple Heart medal.

A member of the United States armed forces who is serving actively in the military and who is a recipient of the Purple Heart medal is also eligible for this license plate. The commissioner of public safety shall ensure that information regarding the required proof of eligibility for any applicant under this paragraph who has not yet been issued military discharge papers is distributed to the public officials responsible for administering this section.

~~(f)~~ (g) For a Persian Gulf War veteran, the plates must bear the inscription "GULF WAR VET." For the purposes of this section, "Persian Gulf War veteran" means a person who served on active duty after August 1, 1990, in a branch of the armed forces of the United States or a nation or society allied with the United States or the United Nations during Operation Desert Shield, Operation Desert Storm, or other military operation in the Persian Gulf area combat zone as designated in United States Presidential Executive Order No. 12744, dated January 21, 1991.

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~~(g)~~ (h) For a veteran who served in the Laos War after July 1, 1961, and before July 1, 1978, the special plates must bear the inscription "LAOS WAR VET."

~~(h)~~ (i) For a veteran who is the recipient of:

(1) the Iraq Campaign Medal, the special plates must be inscribed with a facsimile of that medal and must bear the inscription "IRAQ WAR VET" directly below the special plate number;

(2) the Afghanistan Campaign Medal, the special plates must be inscribed with a facsimile of that medal and must bear the inscription "AFGHAN WAR VET" directly below the special plate number;

(3) the Global War on Terrorism Expeditionary Medal, the special plates must be inscribed with a facsimile of that medal and must bear the inscription "GWOT VETERAN" directly below the special plate number; or

(4) the Armed Forces Expeditionary Medal, the special plates must bear an appropriate inscription that includes a facsimile of that medal.

~~(i)~~ (j) For a veteran who is the recipient of the Global War on Terrorism Service Medal, the special plates must be inscribed with a facsimile of that medal and must bear the inscription "GWOT VETERAN" directly below the special plate number. In addition, any member of the National Guard or other military reserves who has been ordered to federally funded state active service under United States Code, title 32, as defined in section 190.05, subdivision 5b, and who is the recipient of the Global War on Terrorism Service Medal, is eligible for the license plate described in this paragraph, irrespective of whether that person qualifies as a veteran under section 197.447.

~~(j)~~ (k) For a veteran who is the recipient of the Korean Defense Service Medal, the special plates must be inscribed with a facsimile of that medal and must bear the inscription "KOREAN DEFENSE SERVICE" directly below the special plate number.

~~(k)~~ (l) For a veteran who is a recipient of the Bronze Star medal, the plates must bear the inscription "BRONZE STAR VET" and have a facsimile or an emblem of the official Bronze Star medal.

~~(l)~~ (m) For a veteran who is a recipient of the Silver Star medal, the plates must bear the inscription "SILVER STAR VET" and have a facsimile or an emblem of the official Silver Star medal.

(n) For a woman veteran, the plates must bear the inscription "WOMAN VETERAN" and have a facsimile or an emblem as designated by the commissioners of veterans affairs and public safety.

EFFECTIVE DATE. This section is effective January 1, 2015.

Sec. 3. Minnesota Statutes 2012, section 169.826, is amended by adding a subdivision to read:

Subd. 7. Expiration date. Upon request of the permit applicant, the expiration date for a permit issued under this section must be the same as the expiration date of the permitted vehicle's registration.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 4. Minnesota Statutes 2012, section 169.8261, is amended by adding a subdivision to read:

Subd. 3. Expiration date. Upon request of the permit applicant, the expiration date for a permit issued under this section must be the same as the expiration date of the permitted vehicle's registration.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

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Sec. 5. Minnesota Statutes 2012, section 169.86, subdivision 5, is amended to read:

Subd. 5. Fees; proceeds deposited; appropriation. The commissioner, with respect to highways under the commissioner's jurisdiction, may charge a fee for each permit issued. The fee for an annual permit that expires by law on the date of the vehicle registration expiration must be based on the proportion of the year that remains until the expiration date. Unless otherwise specified, all fees for permits issued by the commissioner of transportation must be deposited in the state treasury and credited to the trunk highway fund. Except for those annual permits for which the permit fees are specified elsewhere in this chapter, the fees are:

(a) $15 for each single trip permit.

(b) $36 for each job permit. A job permit may be issued for like loads carried on a specific route for a period not to exceed two months. "Like loads" means loads of the same product, weight, and dimension.

(c) $60 for an annual permit to be issued for a period not to exceed 12 consecutive months. Annual permits may be issued for:

(1) motor vehicles used to alleviate a temporary crisis adversely affecting the safety or well-being of the public;

(2) motor vehicles that travel on interstate highways and carry loads authorized under subdivision 1a;

(3) motor vehicles operating with gross weights authorized under section 169.826, subdivision 1a;

(4) special pulpwood vehicles described in section 169.863;

(5) motor vehicles bearing snowplow blades not exceeding ten feet in width;

(6) noncommercial transportation of a boat by the owner or user of the boat;

(7) motor vehicles carrying bales of agricultural products authorized under section 169.862; and

(8) special milk-hauling vehicles authorized under section 169.867.

(d) $120 for an oversize annual permit to be issued for a period not to exceed 12 consecutive months. Annual permits may be issued for:

(1) mobile cranes;

(2) construction equipment, machinery, and supplies;

(3) manufactured homes and manufactured storage buildings;

(4) implements of husbandry;

(5) double-deck buses;

(6) commercial boat hauling and transporting waterfront structures, including, but not limited to, portable boat docks and boat lifts;

(7) three-vehicle combinations consisting of two empty, newly manufactured trailers for cargo, horses, or livestock, not to exceed 28-1/2 feet per trailer; provided, however, the permit allows the vehicles to be moved from a trailer manufacturer to a trailer dealer only while operating on twin-trailer routes designated under section 169.81, subdivision 3, paragraph (c); and

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(8) vehicles operating on that portion of marked Trunk Highway 36 described in section 169.81, subdivision 3, paragraph (e).

(e) For vehicles that have axle weights exceeding the weight limitations of sections 169.823 to 169.829, an additional cost added to the fees listed above. However, this paragraph applies to any vehicle described in section 168.013, subdivision 3, paragraph (b), but only when the vehicle exceeds its gross weight allowance set forth in that paragraph, and then the additional cost is for all weight, including the allowance weight, in excess of the permitted maximum axle weight. The additional cost is equal to the product of the distance traveled times the sum of the overweight axle group cost factors shown in the following chart:

	Overweight Axle Group Cost Factors

		Cost Per Mile For Each Group Of:

Weight (pounds) exceeding weight limitations on axles		Two consecutive axles spaced within 8 feet or less	Three consecutive axles spaced within 9 feet or less	Four consecutive axles spaced within 14 feet or less

0-2,000		.12	.05	.04
2,001-4,000		.14	.06	.05
4,001-6,000		.18	.07	.06
6,001-8,000		.21	.09	.07
8,001-10,000		.26	.10	.08
10,001-12,000		.30	.12	.09
12,001-14,000		Not permitted	.14	.11
14,001-16,000		Not permitted	.17	.12
16,001-18,000		Not permitted	.19	.15
18,001-20,000		Not permitted	Not permitted	.16
20,001-22,000		Not permitted	Not permitted	.20

The amounts added are rounded to the nearest cent for each axle or axle group. The additional cost does not apply to paragraph (c), clauses (1) and (3).

For a vehicle found to exceed the appropriate maximum permitted weight, a cost-per-mile fee of 22 cents per ton, or fraction of a ton, over the permitted maximum weight is imposed in addition to the normal permit fee. Miles must be calculated based on the distance already traveled in the state plus the distance from the point of detection to a transportation loading site or unloading site within the state or to the point of exit from the state.

(f) As an alternative to paragraph (e), an annual permit may be issued for overweight, or oversize and overweight, mobile cranes; construction equipment, machinery, and supplies; implements of husbandry; and commercial boat hauling. The fees for the permit are as follows:

Gross Weight (pounds) of Vehicle	Annual Permit Fee

90,000 or less	$200
90,001 - 100,000	$300
100,001 - 110,000	$400
110,001 - 120,000	$500
120,001 - 130,000	$600
130,001 - 140,000	$700
140,001 - 145,000	$800
145,001 - 155,000	$900

If the gross weight of the vehicle is more than 155,000 pounds the permit fee is determined under paragraph (e).

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(g) For vehicles which exceed the width limitations set forth in section 169.80 by more than 72 inches, an additional cost equal to $120 added to the amount in paragraph (a) when the permit is issued while seasonal load restrictions pursuant to section 169.87 are in effect.

(h) $85 for an annual permit to be issued for a period not to exceed 12 months, for refuse-compactor vehicles that carry a gross weight of not more than: 22,000 pounds on a single rear axle; 38,000 pounds on a tandem rear axle; or, subject to section 169.828, subdivision 2, 46,000 pounds on a tridem rear axle. A permit issued for up to 46,000 pounds on a tridem rear axle must limit the gross vehicle weight to not more than 62,000 pounds.

(i) $300 for a motor vehicle described in section 169.8261. The fee under this paragraph must be deposited as follows:

(1) the first $50,000 in each fiscal year must be deposited in the trunk highway fund for costs related to administering the permit program and inspecting and posting bridges; and

(2) all remaining money in each fiscal year must be deposited in the bridge inspection and signing account as provided under subdivision 5b.

(j) Beginning August 1, 2006, $200 for an annual permit for a vehicle operating under authority of section 169.824, subdivision 2, paragraph (a), clause (2).

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 6. Minnesota Statutes 2012, section 169.863, is amended by adding a subdivision to read:

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 7. Minnesota Statutes 2012, section 169.865, subdivision 1, is amended to read:

Subdivision 1. Six-axle vehicles. (a) A road authority may issue an annual permit authorizing a vehicle or combination of vehicles with a total of six or more axles to haul raw or unprocessed agricultural products and be operated with a gross vehicle weight of up to:

(1) 90,000 pounds; and

(2) 99,000 pounds during the period set by the commissioner under section 169.826, subdivision 1.

(b) Notwithstanding subdivision 3, paragraph (a), clause (4), a vehicle or combination of vehicles operated under this subdivision and transporting only sealed intermodal containers may be operated on an interstate highway if allowed by the United States Department of Transportation.

(c) The fee for a permit issued under this subdivision is $300, or a proportional amount as provided in section 169.86, subdivision 5.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

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Sec. 8. Minnesota Statutes 2012, section 169.865, subdivision 2, is amended to read:

Subd. 2. Seven-axle vehicles. (a) A road authority may issue an annual permit authorizing a vehicle or combination of vehicles with a total of seven or more axles to haul raw or unprocessed agricultural products and be operated with a gross vehicle weight of up to:

(1) 97,000 pounds; and

(2) 99,000 pounds during the period set by the commissioner under section 169.826, subdivision 1.

(b) Drivers of vehicles operating under this subdivision must comply with driver qualification requirements adopted under section 221.0314, subdivisions 2 to 5, and Code of Federal Regulations, title 49, parts 40 and 382.

(c) The fee for a permit issued under this subdivision is $500, or a proportional amount as provided in section 169.86, subdivision 5.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 9. Minnesota Statutes 2012, section 169.865, is amended by adding a subdivision to read:

Subd. 5. Expiration date. Upon request of the permit applicant, the expiration date for a permit issued under this section must be the same as the expiration date of the permitted vehicle's registration.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 10. Minnesota Statutes 2012, section 169.866, subdivision 3, is amended to read:

Subd. 3. Permit fee; appropriation. Vehicle permits issued under subdivision 1 must be annual permits. The fee is $850 for each vehicle, or a proportional amount as provided in section 169.86, subdivision 5, and must be deposited in the trunk highway fund. An amount sufficient to administer the permit program is appropriated from the trunk highway fund to the commissioner for the costs of administering the permit program.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 11. Minnesota Statutes 2012, section 169.866, is amended by adding a subdivision to read:

Subd. 4. Expiration date. Upon request of the permit applicant, the expiration date for a permit issued under this section must be the same as the expiration date of the permitted vehicle's registration.

EFFECTIVE DATE. This section is effective November 30, 2016, and applies to permits issued on and after that date.

Sec. 12. Minnesota Statutes 2012, section 174.24, is amended by adding a subdivision to read:

Subd. 8. Transit service on election day. An eligible recipient of operating assistance under this section who contracts or has contracted to provide fixed route public transit shall provide fixed route public transit service free of charge on a day a state general election is held.

EFFECTIVE DATE. This section is effective July 1, 2014, and expires November 5, 2014.

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Sec. 13. Minnesota Statutes 2013 Supplement, section 174.42, subdivision 2, is amended to read:

Subd. 2. Funding requirement. In each federal fiscal year, the commissioner shall obtain a total amount in federal authorizations for reimbursement on transportation alternatives projects that is equal to or greater than the annual average of federal authorizations on transportation alternatives projects calculated over ~~the preceding four~~ federal fiscal years 2009 to 2012.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to authorizations for federal fiscal year 2015 and subsequent federal fiscal years.

Sec. 14. [219.375] RAILROAD YARD LIGHTING.

Subdivision 1. General requirements. (a) All railroad common carriers, and their officers, agents, and employees, operating a railroad in this state are required to maintain lighting between sunset and sunrise above switches in railroad yards where:

(1) cars or locomotives are switched or inspected; or

(2) cars are switched to assemble or disassemble trains.

(b) Railroad common carriers shall provide lighting adjacent to those portions of railroad yard tracks where railroad common carrier employees frequently work on the ground performing switching, inspection, and repair activities. For purposes of this section, "frequently work" means at least five days per week.

(1) conform with the guidelines set forth by the American Railway Engineering and Manufacturing Association (AREMA);

(2) include at least one lighting source for each two-yard track switch segment; and

(3) be displayed from a height of at least 30 feet above the railroad yard lead-track area.

(d) Lighting over switches and other light sources within railroad yards or at other railroad locations must be:

(1) maintained to illuminate as designed;

(2) compliant with the National Electrical Code;

(3) kept clear of obstructions; and

(4) focused on the railroad common carrier property designed to be illuminated.

(e) The energy source for lighting is permitted, though not required, to:

(1) be direct wired from a carrier facility power source, have solar panel power with a battery storage source, or have another constant energy source; or

(2) be designed to have standard or light-emitting diode fixtures or electrical circuits that include power saving or ambient atmosphere actuating switches.

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(f) Railroad common carriers must replace damaged or nonoperative lighting within 48 hours after light source damage has been reported to the carrier.

Subd. 2. Allowances for unusual conditions. Railroad common carriers are not required to comply with the requirements of this section during:

(1) maintenance activities;

(2) derailments;

(3) any period of heavy rain or snow, washouts, or similar weather or seismic conditions; or

(4) a reasonable period after any occurrence identified in clauses (1) to (3), but no longer than is necessary to achieve compliance with this section.

Subd. 3. Lighting orders; commissioner authority. (a) When the commissioner finds that railroad common carrier employees who frequently work adjacent to a portion of track performing switching, inspection, maintenance, repair, or fueling activities are exposed to hazard resulting from the lack of lighting, or to the condition of lighting constructed before July 1, 2014, the commissioner may order a railroad common carrier to construct lighting adjacent to a portion of track where employees are performing switching, inspection, maintenance, repair, or fueling activities, or require a railroad common carrier to modify existing lighting to conform with the standards set forth by AREMA lighting standards, within a reasonable period of time.

(b) A railroad common carrier, person, or corporation may appeal an order under this subdivision. An appeal under this paragraph is subject to the processes and requirements of chapter 14.

Subd. 4. Failure to correct. If a railroad common carrier, person, or corporation fails to correct a violation of this section within the time provided in an order issued by the commissioner of transportation under subdivision 3, and the railroad common carrier, person, or corporation does not appeal the order, the failure to correct the violation as ordered by the commissioner constitutes a new and separate offense distinct from the original violation of this section.

Subd. 5. Complaints. No formal complaint of an alleged violation of this section may be filed until the filing party has attempted to address the alleged violations with the railroad common carrier. Any complaint of an alleged violation must contain a written statement that the filing party has made a reasonable, good faith attempt to address the alleged violation.

Subd. 6. Waiver. Upon written request of a railroad common carrier, the commissioner of transportation may waive any portion of this section if conditions do not reasonably permit compliance. The commissioner's decision is subject to section 218.041, and must include an on-site inspection of the area for which the waiver has been requested. The inspection shall occur between sunset and sunrise, and all parties of interest shall be permitted to attend.

Subd. 7. Violations and penalties. A railroad common carrier, corporation, or person who violates this section is subject to a penalty not to exceed $500 for each violation.

Subd. 8. Exceptions; applicability. (a) This section establishes minimum standards for railroad yard lighting. Nothing in this section shall be construed to preclude design of railroad yard towers with multiple lighting sources, a brighter lighting design, or other features that exceed the requirements of this section.

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(b) This section applies to all Class I and Class II railroad common carrier railroad yards. This section does not apply to an entity that owns or operates track in Minnesota that is not a Class I or Class II railroad common carrier as classified by the Federal Railroad Administration.

(c) Railroad yards and other locations where lighting exists on July 1, 2014, are deemed compliant with subdivision 1, paragraphs (b) and (c).

EFFECTIVE DATE. This section is effective November 1, 2016.

Sec. 15. [219.995] MADE IN MINNESOTA SOLAR INSTALLATIONS.

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

(b) "Made in Minnesota" has the meaning given in section 216C.411, paragraph (a).

Subd. 2. Made in Minnesota solar energy system requirement. Notwithstanding any other law to the contrary, if a railroad common carrier engages in any project in Minnesota for the construction, improvement, maintenance, or repair of any building, railroad, railroad yard, railroad facility, or land owned or controlled by the railroad common carrier and the construction, improvement, maintenance, or repair involves installation of one or more solar photovoltaic modules, the railroad common carrier must ensure that the solar photovoltaic modules purchased and installed are "Made in Minnesota" as defined in subdivision 1, paragraph (b).

Subd. 3. Application. Subdivision 2 does not apply if:

(1) as a condition of the receipt of federal financial assistance for a specific project, the railroad common carrier is required to use a procurement method that might result in the award of a contract to a manufacturer that does not meet the "Made in Minnesota" definition in subdivision 1, paragraph (b);

(2) no solar photovoltaic modules are available that meet the "Made in Minnesota" definition and fulfill the function required by the project; or

(3) a railroad common carrier's compliance with the "Made in Minnesota" solar energy system requirement would result in noncompliance with any applicable federal statute or regulation.

Sec. 16. [299A.017] STATE SAFETY OVERSIGHT.

Subdivision 1. Office created. The commissioner of public safety shall establish an Office of State Safety Oversight in the Department of Public Safety for safety oversight of rail fixed guideway public transportation systems within the state. The commissioner shall designate a director of the office.

Subd. 2. Authority. The director shall implement and has regulatory authority to enforce the requirements for the state set forth in United States Code, title 49, sections 5329 and 5330, federal regulations adopted pursuant to those sections, and successor or supplemental requirements.

Sec. 17. Minnesota Statutes 2012, section 473.408, is amended by adding a subdivision to read:

Subd. 11. Transit service on election day. (a) The council shall provide regular route transit, as defined in section 473.385, subdivision 1, paragraph (b), free of charge on a day a state general election is held.

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(b) The requirements under this subdivision apply to operators of regular route transit (1) receiving financial assistance under section 473.388, or (2) operating under section 473.405, subdivision 12.

EFFECTIVE DATE. This section is effective July 1, 2014, and expires November 5, 2014.

Sec. 18. [473.41] TRANSIT SHELTERS AND STOPS.

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

(b) "Transit authority" means:

(1) a statutory or home rule charter city, with respect to rights-of-way at bus stop and train stop locations, transit shelters, and transit passenger seating facilities owned by the city or established pursuant to a vendor contract with the city;

(2) the Metropolitan Council, with respect to transit shelters and transit passenger seating facilities owned by the council or established pursuant to a vendor contract with the council; or

(3) a replacement service provider under section 473.388, with respect to rights-of-way at bus stop and train stop locations, transit shelters, and transit passenger seating facilities owned by the provider or established pursuant to a vendor contract with the provider.

(c) "Transit shelter" means a wholly or partially enclosed structure provided for public use as a waiting area in conjunction with light rail transit, bus rapid transit, or regular route transit.

Subd. 2. Design. (a) A transit authority shall establish design specifications for establishment and replacement of its transit shelters, which must include:

(1) engineering standards, as appropriate;

(2) maximization of protection from the wind, snow, and other elements, including but not limited to entrances that are equivalently sized to regular doorways;

(3) to the extent feasible, inclusion of warming capability at each shelter in which there is a proportionally high number of transit service passenger boardings; and

(4) full accessibility for the elderly and persons with disabilities.

(b) The council shall consult with the Transportation Accessibility Advisory Committee.

Subd. 3. Maintenance. A transit authority shall ensure transit shelters are maintained in good working order and are accessible to all users of the transit system. This requirement includes but is not limited to:

(1) keeping transit shelters reasonably clean and free from graffiti; and

(2) removing snow and ice in a manner that provides accessibility for the elderly and persons with disabilities to be able to enter and exit transit shelters, and board and exit trains at each stop.

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

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Sec. 19. WATERCRAFT DECONTAMINATION SITES; REST AREAS.

Where feasible with existing resources, the commissioners of natural resources and transportation shall cooperate in an effort to use rest areas as sites for watercraft decontamination and other activities to prevent the spread of aquatic invasive species.

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

Sec. 20. WOMAN VETERAN LICENSE PLATES; DESIGN.

The commissioner of veterans affairs, in consultation with the commissioner of public safety, a representative of the Minnesota Women Veterans Initiative Working Group, and any interested Minnesota veterans service organization, shall design the "WOMAN VETERAN" special plates established in Minnesota Statutes, section 168.123, subdivision 2, subject to the approval of the commissioner of public safety.

Sec. 21. HIGHWAY 14 TURNBACK.

Notwithstanding Minnesota Statutes, sections 161.081, subdivision 3, and 161.16, or any other law to the contrary, the commissioner of transportation may:

(1) by temporary order, take over the road described as "Old Highway 14" in the settlement agreement and release executed January 7, 2014, between the state and Waseca and Steele Counties;

(2) expend $35,000,000 or the amount necessary to complete the work required under the settlement agreement; and

(3) upon completion of the work described in the settlement agreement, release "Old Highway 14" back to Steele and Waseca Counties.

Upon completion of the work described in the settlement agreement between the state and Waseca and Steele Counties, the counties shall accept responsibility for the road described in the agreement as "Old Highway 14."

Sec. 22. COMMUNITY DESTINATION SIGN PILOT PROGRAM.

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

(b) "City" means the city of Two Harbors.

(c) "General retail services" means a business that sells goods or services at retail and directly to an end-use consumer. General retail services includes but is not limited to:

(1) personal services;

(2) repair services;

(3) hardware stores;

(4) lumber or building supply stores; and

(5) automotive parts sellers.

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Subd. 2. Pilot program established. (a) In consultation with the city of Two Harbors, the commissioner of transportation shall establish a community destination sign pilot program for wayfinding within the city to destinations or attractions of interest to the traveling public.

(b) For purposes of Minnesota Statutes, chapter 173, signs under the pilot program are official signs.

Subd. 3. Signage, design. (a) The pilot program must include as eligible attractions and destinations:

(1) minor traffic generators; and

(2) general retail services, specified by business name, that are identified in a community wayfinding program established by the city.

(b) The commissioner of transportation, in coordination with the city, may establish sign design specifications for signs under the pilot program. Design specifications must allow for placement of:

(1) a city name and city logo or symbol; and

(2) up to five attractions or destinations on a community destination sign assembly.

Subd. 4. Program costs. The city shall pay costs of design, construction, erection, and maintenance of the signs and sign assemblies under the pilot program. The commissioner shall not impose fees for the pilot program.

Subd. 5. Expiration. The pilot program under this section expires January 1, 2022.

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

AGRICULTURE, ENVIRONMENT, AND NATURAL RESOURCES

ARTICLE 15

AGRICULTURE, ENVIRONMENT, AND NATURAL RESOURCES

APPROPRIATIONS

Section 1. SUMMARY OF APPROPRIATIONS.

The amounts shown in this section summarize direct appropriations, by fund, made in this article.

						2015
General						$15,999,000
Natural Resources						900,000
Game and Fish						3,000
Environment and Natural Resources Trust						490,000

Total						$17,392,000

Sec. 2. APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are added to the appropriations in Laws 2013, chapter 114, or appropriated to the agencies and for the purposes specified in this article. The appropriations are from the general fund, or another named fund, and are available for the fiscal year indicated for each purpose. The figure "2015" used in this article means that the addition to the appropriations listed under them are available for the fiscal year ending June 30, 2015.

Sec. 3. AGRICULTURE.

Subdivision 1. Total Appropriation

$1,910,000

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

Subd. 2. Department of Agriculture

1,600,000

$1,500,000 in 2015 is for a grant to Second Harvest Heartland on behalf of the six Feeding America food banks that serve Minnesota to compensate agricultural producers and processors for costs incurred to harvest and package for transfer surplus fruits, vegetables, or other agricultural commodities that would otherwise go unharvested or be discarded. Surplus commodities must be distributed statewide to food shelves and other charitable organizations that are eligible to receive food from the food banks. Surplus food acquired under this appropriation must be from Minnesota producers and processors. Second Harvest Heartland must report when required by, and in the form prescribed by, the commissioner. Second Harvest Heartland may use up to 11 percent of the grant for administrative expenses. This appropriation is added to the base.

$100,000 in 2015 is to compensate experts evaluating pollinator death or illness as authorized in Minnesota Statutes, section 18B.04. $65,000 is added to the base.

The commissioner shall examine how other states are implementing the industrial hemp research authority provided in Public Law 113-79 and to gauge the interest of Minnesota higher education institutions. No later than January 15, 2015, the commissioner must report the information and items for legislative consideration to the legislative committees with jurisdiction over agriculture policy and finance.

Subd. 3. Board of Animal Health

310,000

$310,000 in 2015 is to administer the dog and cat breeder licensing and inspection program. The base in fiscal year 2016 is $426,000 and the base in fiscal year 2017 is $435,000.

Sec. 4. POLLUTION CONTROL AGENCY

Subdivision 1. Total Appropriation

$7,349,000

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

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Subd. 2. Water

1,000

$1,000 in 2015 is to compile information on the presence of plastic microbeads in the state's waters and their potential impacts on aquatic ecosystems and human health, in consultation with the University of Minnesota. No later than December 15, 2014, the commissioner must present the information to the legislative committees with jurisdiction over environment and natural resources policy and finance and make recommendations. This is a onetime appropriation.

Subd. 3. Environmental Assistance and Cross-Media

7,348,000

$7,000,000 in 2015 is for the purposes of Minnesota Statutes, section 115A.557, subdivision 2. This appropriation is added to the base.

$348,000 in 2015 is for costs incurred implementing Minnesota Statutes, sections 116.9401 to 116.9425. This is a onetime appropriation. Of this amount, $13,000 is transferred to the commissioner of health. The base for this program from the environmental fund is $744,000 in fiscal year 2016 and $495,000 in fiscal year 2017.

Sec. 5. NATURAL RESOURCES

Subdivision 1. Total Appropriation

$2,107,000

Appropriations by Fund

General		1,654,000
Game and Fish		3,000
Natural Resources		450,000

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

Subd. 2. Ecological and Water Resources

50,000

$50,000 in 2015 is for a study of the effects of the Lake Emily dam in Crow Wing County on water clarity and water levels in Lake Emily, Lake Mary, and the Little Pine River. This is a onetime appropriation.

Subd. 3. Parks and Trails Management

2,045,000

$1,595,000 in 2015 is for the improvement, maintenance, and conditions of facilities and infrastructure in state parks for safety and general use. This is a onetime appropriation.

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$450,000 in 2015 is from the natural resources fund for state trail, park, and recreation area operations. This appropriation is from the revenue deposited in the natural resources fund under Minnesota Statutes, section 297A.94, paragraph (e), clause (2). This is a onetime appropriation.

Subd. 4. Fish and Wildlife Management

12,000

$3,000 in 2015 is from the game and fish fund for a report on aquatic plant management permitting policies for the management of narrow-leaved and hybrid cattail in a range of basin types across the state. The report shall be submitted to the chairs and ranking minority members of the house of representatives and senate committees with jurisdiction over environment and natural resources by December 15, 2014, and include recommendations for any necessary changes in statutes, rules, or permitting procedures. This is a onetime appropriation.

$9,000 in 2015 is for the commissioner, in consultation with interested parties, agencies, and other states, to develop a detailed restoration plan to recover the historical native population of bobwhite quail in Minnesota for its ecological and recreational benefits to the citizens of the state. The commissioner shall conduct public meetings in developing the plan. No later than January 15, 2015, the commissioner must report on the plan's progress to the legislative committees with jurisdiction over environment and natural resources policy and finance. This is a onetime appropriation.

Sec. 6. METROPOLITAN COUNCIL

$450,000

$450,000 in 2015 is from the natural resources fund for metropolitan area regional parks and trails maintenance and operations. This appropriation is from the revenue deposited in the natural resources fund under Minnesota Statutes, section 297A.94, paragraph (e), clause (3). This is a onetime appropriation.

Sec. 7. UNIVERSITY OF MINNESOTA

$5,554,000

Appropriations by Fund

General		5,064,000
Environment and Natural Resources Trust		490,000

$5,064,000 in 2015 is from the general fund for the Invasive Terrestrial Plants and Pests Center requested under this act, including a director, graduate students, and necessary supplies. This is a onetime appropriation and is available until June 30, 2025.

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$490,000 in 2015 is from the environment and natural resources trust fund for the Invasive Terrestrial Plants and Pests Center requested under this act, including a director, graduate students, and necessary supplies. This is a onetime appropriation and is available until June 30, 2025.

$970,000 from the environment and natural resources trust fund appropriated in Laws 2011, First Special Session chapter 2, article 3, section 2, subdivision 9, paragraph (d), Reinvest in Minnesota Wetlands Reserve Acquisition and Restoration Program Partnership, is transferred to the Board of Regents of the University of Minnesota for the Invasive Terrestrial Plants and Pests Center requested under this act, including a director, graduate students, and necessary supplies and is available until June 30, 2025.

Sec. 8. Laws 2013, chapter 114, article 3, section 4, subdivision 3, is amended to read:

Subd. 3. Ecological and Water Resources

27,182,000

~~31,582,000~~ 31,604,000

Appropriations by Fund

General	12,117,000	~~16,817,000~~ 16,839,000
Natural Resources	11,002,000	10,702,000
Game and Fish	4,063,000	4,063,000

$3,542,000 the first year and $3,242,000 the second year are from the invasive species account in the natural resources fund and $2,906,000 the first year and $3,206,000 the second year are from the general fund for management, public awareness, assessment and monitoring research, and water access inspection to prevent the spread of invasive species; management of invasive plants in public waters; and management of terrestrial invasive species on state-administered lands.

$5,000,000 the first year and $5,000,000 the second year are from the water management account in the natural resources fund for only the purposes specified in Minnesota Statutes, section 103G.27, subdivision 2.

$103,000 the first year and ~~$103,000~~ $125,000 the second year are for a grant to the Mississippi Headwaters Board for up to 50 percent of the cost of implementing the comprehensive plan for the upper Mississippi within areas under the board's jurisdiction. The base for this grant is $103,000. By January 15, 2015, the board shall submit a report detailing the results achieved with the fiscal year 2014 appropriation and the anticipated results that will be achieved with the fiscal year 2015 appropriation to the commissioner and the chairs and ranking minority members of the senate and house of representatives committees and divisions with jurisdiction over environment and natural resources policy and finance.

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$10,000 the first year and $10,000 the second year are for payment to the Leech Lake Band of Chippewa Indians to implement the band's portion of the comprehensive plan for the upper Mississippi.

$264,000 the first year and $264,000 the second year are for grants for up to 50 percent of the cost of implementation of the Red River mediation agreement. The commissioner shall submit a report to the chairs of the legislative committees having primary jurisdiction over environment and natural resources policy and finance on the accomplishments achieved with the grants by January 15, 2015.

$1,643,000 the first year and $1,643,000 the second year are from the heritage enhancement account in the game and fish fund for only the purposes specified in Minnesota Statutes, section 297A.94, paragraph (e), clause (1).

$1,223,000 the first year and $1,223,000 the second year are from the nongame wildlife management account in the natural resources fund for the purpose of nongame wildlife management. Notwithstanding Minnesota Statutes, section 290.431, $100,000 the first year and $100,000 the second year may be used for nongame wildlife information, education, and promotion.

$1,600,000 the first year and $6,000,000 the second year are from the general fund for the following activities:

(1) increased financial reimbursement and technical support to soil and water conservation districts or other local units of government for groundwater level monitoring;

(2) additional surface water monitoring and analysis, including installation of monitoring gauges;

(3) additional groundwater analysis to assist with water appropriation permitting decisions;

(4) additional permit application review incorporating surface water and groundwater technical analysis;

(5) enhancement of precipitation data and analysis to improve the use of irrigation;

(6) enhanced information technology, including electronic permitting and integrated data systems; and

(7) increased compliance and monitoring.

Of this amount, $600,000 the first year is for silica sand rulemaking and is available until spent.

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The commissioner, in cooperation with the commissioner of agriculture, shall enforce compliance with aquatic plant management requirements regulating the control of aquatic plants with pesticides and removal of aquatic plants by mechanical means under Minnesota Statutes, section 103G.615.

ARTICLE 16

AGRICULTURE, ENVIRONMENT, AND NATURAL RESOURCES

FISCAL IMPLEMENTATION PROVISIONS

Section 1. Minnesota Statutes 2012, section 13.643, subdivision 6, is amended to read:

Subd. 6. Animal premises data. (a) The following data collected and maintained by the Board of Animal Health related to registration and identification of premises and animals under chapter 35, are classified as private or nonpublic:

(1) the names and addresses;

(2) the location of the premises where animals are kept; and

(3) the identification number of the premises or the animal.

(b) Except as provided in section 347.58, subdivision 5, data collected and maintained by the Board of Animal Health under sections 347.57 to 347.64 are classified as private or nonpublic.

~~(b)~~ (c) The Board of Animal Health may disclose data collected under paragraph (a) or (b) to any person, agency, or to the public if the board determines that the access will aid in the law enforcement process or the protection of public or animal health or safety.

Sec. 2. Minnesota Statutes 2012, section 13.7411, subdivision 8, is amended to read:

Subd. 8. Pollution Control Agency. (a) Hazardous waste generators. Information provided by hazardous waste generators under section 473.151 and for which confidentiality is claimed is governed by section 116.075, subdivision 2.

(b) Tests. Trade secret information made available by applicants for certain projects of the Pollution Control Agency is classified under section 116.54.

(c) Priority chemicals. Information submitted to the Pollution Control Agency related to priority chemicals in children's products is classified under section 116.9403.

Sec. 3. Minnesota Statutes 2012, section 18B.01, is amended by adding a subdivision to read:

Subd. 1c. Apiary. "Apiary" means a place where a collection of one or more hives or colonies of bees or the nuclei of bees are kept.

Sec. 4. Minnesota Statutes 2012, section 18B.01, is amended by adding a subdivision to read:

Subd. 2a. Bee. "Bee" means any stage of the common honeybee, Apis mellifera (L).

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Sec. 5. Minnesota Statutes 2012, section 18B.01, is amended by adding a subdivision to read:

Subd. 2b. Bee owner. "Bee owner" means a person who owns an apiary.

Sec. 6. Minnesota Statutes 2012, section 18B.01, is amended by adding a subdivision to read:

Subd. 4c. Colony. "Colony" means the aggregate of worker bees, drones, the queen, and developing young bees living together as a family unit in a hive or other dwelling.

Sec. 7. Minnesota Statutes 2012, section 18B.01, is amended by adding a subdivision to read:

Subd. 11a. Hive. "Hive" means a frame hive, box hive, box, barrel, log gum, skep, or any other receptacle or container, natural or artificial, or any part of one, which is used as domicile for bees.

Sec. 8. Minnesota Statutes 2012, section 18B.01, is amended by adding a subdivision to read:

Subd. 20a. Pollinator. "Pollinator" means an insect that pollinates flowers.

Sec. 9. Minnesota Statutes 2012, section 18B.03, is amended by adding a subdivision to read:

Subd. 4. Pollinator enforcement. The commissioner may take enforcement action under chapter 18D for a violation of this chapter, or any rule adopted under this chapter, that results in harm to pollinators, including but not limited to applying a pesticide in a manner inconsistent with the pesticide product's label or labeling and resulting in pollinator death or willfully applying pesticide in a manner inconsistent with the pesticide product's label or labeling. The commissioner must deposit any penalty collected under this subdivision in the pesticide regulatory account in section 18B.05.

Sec. 10. Minnesota Statutes 2012, section 18B.04, is amended to read:

18B.04 PESTICIDE IMPACT ON ENVIRONMENT.

(a) The commissioner shall:

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

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

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

(b) The commissioner may assemble a group of experts under section 16C.10, subdivision 2, to consult in the investigation of pollinator deaths or illnesses. The group of experts may include representatives from local, state, and federal agencies; academia; the state pollinator bank; or other professionals as deemed necessary by the commissioner.

Sec. 11. [18B.055] COMPENSATION FOR BEES KILLED BY PESTICIDE; APPROPRIATION.

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

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

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

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

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

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

Subd. 3. Claim form. The bee owner must file a claim on forms provided by the commissioner and available on the Department of Agriculture's Web site.

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

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

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

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

Subd. 6. Deduction from payment. In order to be eligible for compensation under this section, a bee owner must document that at the time of the loss the bee owner had insurance sufficient to cover up to 50 percent of the total value of the owner's colony. The commissioner must reduce payments made under this section by any compensation received by the bee owner as proceeds from an insurance policy or from another source.

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

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Sec. 12. [19.70] DEFINITIONS.

Subdivision 1. Scope. For the purposes of this chapter the terms defined in this section have the meanings given.

Subd. 2. Abandoned apiary. "Abandoned apiary" means any apiary not regularly attended in accordance with good beekeeping practices and which constitutes a disease or parasite hazard to the beekeeping industry.

Subd. 3. Africanized honeybees. "Africanized honeybees" means Africanized honeybees using United States Department of Agriculture standards.

Subd. 4. Bee diseases. "Bee diseases" means infectious, contagious, or harmful diseases including but not limited to: American or European foulbrood, sacbrood, chalkbrood, Nosema, bee paralysis, or abnormal condition of egg, larval, pupal, or adult stages of bees.

Subd. 5. Bee equipment. "Bee equipment" means hives, supers, frames, veils, gloves, and any apparatus, tool, machine, vehicle, or other device used in the handling, moving, or manipulating of bees, honey, wax, or hives, including containers of honey or wax which may be used in an apiary or in transporting bees and their products and apiary supplies.

Subd. 6. Beekeeper. "Beekeeper" means a person who keeps bees.

Subd. 7. Beekeeping. "Beekeeping" means the moving, raising, and producing of bees, beeswax, honey, related products, and pollination.

Subd. 8. Commissioner. "Commissioner" means the commissioner of agriculture or the commissioner's authorized agents.

Subd. 9. Department. "Department" means the Department of Agriculture.

Subd. 10. Exotic parasite. "Exotic parasite" means any parasite harmful to bees including but not limited to: Varroa jacobsoni, Tropilaelaps clareae, or Acarapis woodi.

Subd. 11. Queen apiary. "Queen apiary" means any apiary or premises in which queen bees are reared or kept for sale or gift.

Sec. 13. Minnesota Statutes 2012, section 84.788, subdivision 2, is amended to read:

Subd. 2. Exemptions. Registration is not required for off-highway motorcycles:

(1) owned and used by the United States, an Indian tribal government, the state, another state, or a political subdivision;

(2) registered in another state or country that have not been within this state for more than 30 consecutive days; or

(3) registered under chapter 168, when operated on forest roads to gain access to a state forest campground;

(4) used exclusively in organized track racing events;

(5) operated on state or grant-in-aid trails by a nonresident possessing a nonresident off-highway motorcycle state trail pass; or

(6) operated by a person participating in an event for which the commissioner has issued a special use permit.

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Sec. 14. [84.7945] NONRESIDENT OFF-HIGHWAY MOTORCYCLE STATE TRAIL PASS.

Subdivision 1. Pass required; fee. (a) A tribal member exempt from registration under section 84.788, subdivision 2, clause (2), or a nonresident, may not operate an off-highway motorcycle on a state or grant-in-aid off-highway motorcycle trail unless the operator carries a valid nonresident off-highway motorcycle state trail pass in immediate possession. The pass must be available for inspection by a peace officer, a conservation officer, or an employee designated under section 84.0835.

(b) The commissioner of natural resources shall issue a pass upon application and payment of a $20 fee. The pass is valid from January 1 through December 31. Fees collected under this section, except for the issuing fee for licensing agents, shall be deposited in the state treasury and credited to the off-highway motorcycle account in the natural resources fund and, except for the electronic licensing system commission established by the commissioner under section 84.027, subdivision 15, must be used for grants-in-aid to counties and municipalities for off-highway motorcycle organizations to construct and maintain off-highway motorcycle trails and use areas.

(1) an off-highway motorcycle that is owned and used by the United States, another state, or a political subdivision thereof that is exempt from registration under section 84.788, subdivision 2;

(2) a person operating an off-highway motorcycle only on the portion of a trail that is owned by the person or the person's spouse, child, or parent; or

(3) a nonresident operating an off-highway motorcycle that is registered according to section 84.788.

Subd. 2. License agents. The commissioner may appoint agents to issue and sell nonresident off-highway motorcycle state trail passes. The commissioner may revoke the appointment of an agent at any time. The commissioner may adopt additional rules as provided in section 97A.485, subdivision 11. An agent shall observe all rules adopted by the commissioner for accounting and handling of passes pursuant to section 97A.485, subdivision 11. An agent shall promptly deposit and remit all money received from the sale of the passes, exclusive of the issuing fee, to the commissioner.

Subd. 3. Issuance of passes. The commissioner and agents shall issue and sell nonresident off-highway motorcycle state trail passes. The commissioner shall also make the passes available through the electronic licensing system established under section 84.027, subdivision 15.

Subd. 4. Agent's fee. In addition to the fee for a pass, an issuing fee of $1 per pass shall be charged. The issuing fee may be retained by the seller of the pass. Issuing fees for passes issued by the commissioner shall be deposited in the off-highway motorcycle account in the natural resources fund and retained for the operation of the electronic licensing system.

Subd. 5. Duplicate passes. The commissioner and agents shall issue a duplicate pass to persons whose pass is lost or destroyed using the process established under section 97A.405, subdivision 3, and rules adopted thereunder. The fee for a duplicate nonresident off-highway motorcycle state trail pass is $2, with an issuing fee of 50 cents.

Sec. 15. Minnesota Statutes 2012, section 85.053, subdivision 2, is amended to read:

Subd. 2. Requirement. Except as provided in section 85.054, a motor vehicle may not enter a state park, state recreation area, or state wayside over 50 acres in area, without a state park permit issued under this section or a state parks and trails plate issued under section 168.1295. Except for vehicles permitted under subdivisions 7, paragraph (a), clause (2), and 8, the state park permit must be affixed to the lower right corner windshield of the motor vehicle and must be completely affixed by its own adhesive to the windshield, or the commissioner may, by written order, provide an alternative means to display and validate state park permits.

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Sec. 16. [85.056] STATE PARKS AND TRAILS DONATION ACCOUNT.

Subdivision 1. Establishment. The state parks and trails donation account is established as a separate account in the natural resources fund. The account shall be administered by the commissioner of natural resources as provided in this section.

Subd. 2. Funding sources. The state parks and trails donation account shall consist of contributions made under section 168.1295 and other contributions. The contributions may be made in cash, property, land, or interests in land.

Subd. 3. Uses. Money in the account is appropriated to the commissioner of natural resources to operate and maintain the state parks and trails system.

Sec. 17. Minnesota Statutes 2012, section 85.34, subdivision 7, is amended to read:

Subd. 7. Disposition of proceeds. (a) All revenue derived from the lease of the Fort Snelling upper bluff, with the exception of payment for costs of the water line as described in subdivision 6, shall be deposited in the natural resources fund and credited to a state park account. Interest earned on the money in the account accrues to the account.

(b) Revenue and expenses from the upper bluff shall be tracked separately within the account. Money in the account derived from the leasing or operation of the property described in subdivision 1 ~~may be~~ is appropriated annually to the commissioner for the payment of expenses attributable to the leasing, development, and operation of the property described in subdivision 1, including, but not limited to, the maintenance, repair, and rehabilitation of historic buildings and landscapes.

Sec. 18. Minnesota Statutes 2012, section 85A.02, subdivision 2, is amended to read:

Subd. 2. Zoological Garden. The board shall acquire, construct, equip, operate and maintain the Minnesota Zoological Garden at a site in Dakota County legally described in Laws 1975, chapter 382, section 12. The Zoological Garden shall consist of adequate facilities and structures for the collection, habitation, preservation, care, exhibition, examination or study of wild and domestic animals, including, but not limited to mammals, birds, fish, amphibians, reptiles, crustaceans and mollusks. The board may provide such lands, buildings and equipment as it deems necessary for parking, transportation, entertainment, education or instruction of the public in connection with such Zoological Garden. The Zoological Garden is the official pollinator bank for the state of Minnesota. For purposes of this subdivision, "pollinator bank" means a program to avert the extinction of pollinator species by cultivating insurance breeding populations.

Sec. 19. [87A.10] TRAP SHOOTING SPORTS FACILITY GRANTS.

The commissioner of natural resources shall administer a program to provide cost-share grants to local recreational trap shooting clubs for up to 50 percent of the costs of developing or rehabilitating trap shooting sports facilities for public use. A facility rehabilitated or developed with a grant under this section must be open to the general public at reasonable times and for a reasonable fee on a walk-in basis. The commissioner shall give preference to projects that will provide the most opportunities for youth.

Sec. 20. Minnesota Statutes 2012, section 103G.271, subdivision 6, is amended to read:

Subd. 6. Water use permit processing fee. (a) Except as described in paragraphs (b) to ~~(f)~~ (g), a water use permit processing fee must be prescribed by the commissioner in accordance with the schedule of fees in this subdivision for each water use permit in force at any time during the year. Fees collected under this paragraph are credited to the water management account in the natural resources fund. The schedule is as follows, with the stated fee in each clause applied to the total amount appropriated:

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(1) $140 for amounts not exceeding 50,000,000 gallons per year;

(2) $3.50 per 1,000,000 gallons for amounts greater than 50,000,000 gallons but less than 100,000,000 gallons per year;

(3) $4 per 1,000,000 gallons for amounts greater than 100,000,000 gallons but less than 150,000,000 gallons per year;

(4) $4.50 per 1,000,000 gallons for amounts greater than 150,000,000 gallons but less than 200,000,000 gallons per year;

(5) $5 per 1,000,000 gallons for amounts greater than 200,000,000 gallons but less than 250,000,000 gallons per year;

(6) $5.50 per 1,000,000 gallons for amounts greater than 250,000,000 gallons but less than 300,000,000 gallons per year;

(7) $6 per 1,000,000 gallons for amounts greater than 300,000,000 gallons but less than 350,000,000 gallons per year;

(8) $6.50 per 1,000,000 gallons for amounts greater than 350,000,000 gallons but less than 400,000,000 gallons per year;

(9) $7 per 1,000,000 gallons for amounts greater than 400,000,000 gallons but less than 450,000,000 gallons per year;

(10) $7.50 per 1,000,000 gallons for amounts greater than 450,000,000 gallons but less than 500,000,000 gallons per year; and

(11) $8 per 1,000,000 gallons for amounts greater than 500,000,000 gallons per year.

(b) For once-through cooling systems, a water use processing fee must be prescribed by the commissioner in accordance with the following schedule of fees for each water use permit in force at any time during the year:

(1) for nonprofit corporations and school districts, $200 per 1,000,000 gallons; and

(2) for all other users, $420 per 1,000,000 gallons.

(c) The fee is payable based on the amount of water appropriated during the year and, except as provided in paragraph (f), the minimum fee is $100.

(d) For water use processing fees other than once-through cooling systems:

(1) the fee for a city of the first class may not exceed $250,000 per year;

(2) the fee for other entities for any permitted use may not exceed:

(i) $60,000 per year for an entity holding three or fewer permits;

(ii) $90,000 per year for an entity holding four or five permits; or

(iii) $300,000 per year for an entity holding more than five permits;

(3) the fee for agricultural irrigation may not exceed $750 per year;

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(4) the fee for a municipality that furnishes electric service and cogenerates steam for home heating may not exceed $10,000 for its permit for water use related to the cogeneration of electricity and steam; and

(5) no fee is required for a project involving the appropriation of surface water to prevent flood damage or to remove flood waters during a period of flooding, as determined by the commissioner.

(e) Failure to pay the fee is sufficient cause for revoking a permit. A penalty of two percent per month calculated from the original due date must be imposed on the unpaid balance of fees remaining 30 days after the sending of a second notice of fees due. A fee may not be imposed on an agency, as defined in section 16B.01, subdivision 2, or federal governmental agency holding a water appropriation permit.

(f) The minimum water use processing fee for a permit issued for irrigation of agricultural land is $20 for years in which:

(1) there is no appropriation of water under the permit; or

(2) the permit is suspended for more than seven consecutive days between May 1 and October 1.

(g) The commissioner shall waive the water use permit fee for installations and projects that use storm water runoff or for a public entity that is diverting water to treat a water quality issue and returning that water to its source without using the water for any other purpose, unless the commissioner determines that any of the proposed uses adversely affect surface water or groundwater.

~~(g)~~ (h) A surcharge of $30 per million gallons in addition to the fee prescribed in paragraph (a) shall be applied to the volume of water used in each of the months of June, July, and August that exceeds the volume of water used in January for municipal water use, irrigation of golf courses, and landscape irrigation. The surcharge for municipalities with more than one permit shall be determined based on the total appropriations from all permits that supply a common distribution system.

Sec. 21. Minnesota Statutes 2012, section 115A.151, is amended to read:

115A.151 RECYCLABLE MATERIAL CONTAINER REQUIREMENTS; PUBLIC ENTITIES, SPORTS FACILITIES, AND COMMERCIAL BUILDINGS.

(a) A public entity, the owner of a sports facility, and the owner of a commercial building shall:

(1) ensure that facilities under its control, from which mixed municipal solid waste is collected, have containers for at least three recyclable materials, such as, but not limited to, paper, glass, plastic, and metal; and

(2) transfer all recyclable materials collected to a recycler.

(b) For the purposes of this section:

(1) "public entity" means the state, an office, agency, or institution of the state, the Metropolitan Council, a metropolitan agency, the Metropolitan Mosquito Control Commission, the legislature, the courts, a county, a statutory or home rule charter city, a town, a school district, a special taxing district, or any entity that receives an appropriation from the state for a capital improvement project after August 1, 2002;

(2) "metropolitan agency" and "Metropolitan Council," have the meanings given them in section 473.121; ~~and~~

(3) "Metropolitan Mosquito Control Commission" means the commission created in section 473.702;

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(4) "commercial building" means a building that contains a business classified in sectors 42 to 81 under the North American Industrial Classification System and that contracts for two cubic yards or more per week of solid waste collection; and

(5) "sports facility" means a professional or collegiate sports facility at which competitions take place before a public audience.

EFFECTIVE DATE. This section is effective January 1, 2015.

Sec. 22. Minnesota Statutes 2012, section 115A.55, subdivision 4, is amended to read:

Subd. 4. Statewide source reduction goal. (a) It is a goal of the state ~~that there be a minimum ten percent per capita reduction in the amount of mixed~~ and counties to reduce the generation of municipal solid waste ~~generated in the state by December 31, 2000, based on a reasonable estimate of the amount of mixed municipal solid waste that was generated in calendar year 1993~~.

(b) As part of the ~~1997~~ report required under section 115A.411, the commissioner shall submit to the senate and house of representatives committees having jurisdiction over environment and natural resources and environment and natural resources finance a proposed strategy for meeting the goal in paragraph (a). The strategy must include a discussion of the different reduction potentials to be found in various sectors and may include recommended interim goals. The commissioner shall report progress on meeting the goal in paragraph (a), as well as recommendations and revisions to the proposed strategy, as part of the ~~1999~~ report required under section 115A.411.

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

Sec. 23. Minnesota Statutes 2012, section 115A.551, subdivision 1, is amended to read:

Subdivision 1. Definition. (a) For the purposes of this section, "recycling" means, in addition to the meaning given in section 115A.03, subdivision 25b, yard waste and source-separated compostable materials composting, and recycling that occurs through mechanical or hand separation of materials that are then delivered ~~for reuse in their original form or~~ for use in manufacturing processes that do not cause the destruction of recyclable materials in a manner that precludes further use.

(b) For the purposes of this section, "total solid waste generation" means the total by weight of:

(1) materials separated for recycling;

(2) materials separated for yard waste and source-separated compostable materials composting;

(3) mixed municipal solid waste plus ~~yard waste,~~ motor and vehicle fluids and filters, tires, lead acid batteries, and major appliances; and

(4) residential and commercial waste materials that would be mixed municipal solid waste but for the fact that they are not collected as such.

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

Sec. 24. Minnesota Statutes 2012, section 115A.551, subdivision 2a, is amended to read:

Subd. 2a. ~~Supplementary~~ County recycling goals. (a) By December 31, ~~1996~~ 2030, each county will have as a goal to recycle the following amounts:

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(1) for a county outside of the metropolitan area, 35 percent by weight of total solid waste generation; and

(2) for a metropolitan county, 50 75 percent by weight of total solid waste generation.

(b) Each county will develop and implement or require political subdivisions within the county to develop and implement programs, practices, or methods designed to meet its recycling goal. Nothing in this section or in any other law may be construed to prohibit a county from establishing a higher recycling goal.

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

Sec. 25. Minnesota Statutes 2012, section 115A.557, subdivision 2, is amended to read:

Subd. 2. Purposes for which money may be spent. (a) A county receiving money distributed by the commissioner under this section may use the money only for the development and implementation of programs to:

(1) reduce the amount of solid waste generated;

(2) recycle the maximum amount of solid waste technically feasible;

(3) create and support markets for recycled products;

(4) remove problem materials from the solid waste stream and develop proper disposal options for them;

(5) inform and educate all sectors of the public about proper solid waste management procedures;

(6) provide technical assistance to public and private entities to ensure proper solid waste management;

(7) provide educational, technical, and financial assistance for litter prevention; ~~and~~

(8) process mixed municipal solid waste generated in the county at a resource recovery facility located in Minnesota; and

(9) compost source-separated compostable materials, including the provision of receptacles for residential composting.

(b) Beginning in fiscal year 2015 and continuing thereafter, of any money distributed by the commissioner under this section to a metropolitan county, as defined in section 473.121, subdivision 4, that exceeds the amount the county was eligible to receive under this section in fiscal year 2014: (1) at least 50 percent must be expended on activities in paragraph (a), clause (9); and (2) the remainder must be expended on activities in paragraph (a), clauses (1) to (7) and (9) that advance the county toward achieving its recycling goal under section 115A.551.

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

Sec. 26. Minnesota Statutes 2012, section 115A.557, subdivision 3, is amended to read:

Subd. 3. Eligibility to receive money. (a) To be eligible to receive money distributed by the commissioner under this section, a county shall within one year of October 4, 1989:

(1) create a separate account in its general fund to credit the money; and

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(2) set up accounting procedures to ensure that money in the separate account is spent only for the purposes in subdivision 2.

(b) In each following year, each county shall also:

(1) have in place an approved solid waste management plan or master plan including a recycling implementation strategy under section 115A.551, subdivision 7, and a household hazardous waste management plan under section 115A.96, subdivision 6, by the dates specified in those provisions;

(2) submit a report by April 1 of each year to the commissioner, which may be submitted electronically and must be posted on the agency's Web site, detailing for the previous calendar year:

(i) how the money was spent including, but not limited to, specific recycling and composting activities undertaken to increase the county's proportion of solid waste recycled in order to achieve its recycling goal established in section 115A.551; specific information on the number of employees performing SCORE planning, oversight, and administration; the percentage of those employees' total work time allocated to SCORE planning, oversight, and administration; the specific duties and responsibilities of those employees; and the amount of staff salary for these SCORE duties and responsibilities of the employees; and

(ii) the resulting gains achieved in solid waste management practices; and

(3) provide evidence to the commissioner that local revenue equal to 25 percent of the money sought for distribution under this section will be spent for the purposes in subdivision 2.

(c) The commissioner shall withhold all or part of the funds to be distributed to a county under this section if the county fails to comply with this subdivision and subdivision 2.

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

Sec. 27. Minnesota Statutes 2012, section 116.9401, is amended to read:

116.9401 DEFINITIONS.

(a) For the purposes of sections 116.9401 to ~~116.9407~~ 116.9425, the following terms have the meanings given them.

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

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

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

(e) "Chemical of high concern" means a chemical identified on the basis of credible scientific evidence by a state, federal, or international agency as being known or suspected with a high degree of probability to:

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

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

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(3) disrupt the endocrine or hormone system;

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

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

(6) be very persistent and very bioaccumulative.

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

(g) "Children's product" means a consumer product intended for use by children, such as baby products, toys, car seats, personal care products, and clothing.

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

(i) "Contaminant" means a trace amount of a chemical that is incidental to manufacturing and serves no intended function in the product component. Contaminant includes, but is not limited to, unintended by-products of chemical reactions that occur during the manufacture of the product component, trace impurities in feedstock, incompletely reacted chemical mixtures, and degradation products.

(j) "Department" means the Department of Health.

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

~~(k)~~ (l) "Green chemistry" means an approach to designing and manufacturing products that minimizes the use and generation of toxic substances.

(m) "Intentionally added chemical" means a chemical in a product that serves an intended function in the product component.

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

(o) "Mouthable" means a product that can be placed into and kept in a child's mouth to be sucked or chewed, including any product or product part smaller than five centimeters in one dimension. A product that can only be licked is not mouthable.

(p) "Practical quantification limit" means the lowest concentration of a chemical that can be reliably measured within specified limits of precision, accuracy, representativeness, completeness, and comparability under routine laboratory operating conditions and the value of which:

(1) is based on scientifically defensible, standard analytical methods;

(2) may vary depending on the matrix and analytical method used; and

(3) will be determined by the commissioner, taking into consideration practical quantification limits established by federal or state agencies.

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~~(m)~~ (q) "Priority chemical" means a chemical identified by the Department of Health as a chemical of high concern that meets the criteria in section 116.9403.

(r) "Product category" means the brick level of the GS1 Global Product Classification (GPC) standard, which identifies products that serve a common purpose, are of a similar form and material, and share the same set of category attributes.

(s) "Product code" means the numeric representation of the item level of the GS1 electronic product code (EPC), the international article number (EAN), or the universal product code (UPC), whichever is used by a manufacturer to identify a unique company-specific or brand-specific product.

(t) "Product component" means a uniquely identifiable material or coating including, but not limited to, an ink or dye that is intended to be included as a part of a finished children's product.

~~(n)~~ (u) "Safer alternative" means:

(1) an alternative whose potential to harm human health or the environment is less than that of the use of a priority chemical that it could replace.;

(2) an alternative chemical that is not a priority chemical identified by the department under section 116.9403; or

(3) an alternative chemical that is not identified on the basis of credible scientific evidence by a state, federal, or international agency as being known or suspected with a high degree of probability to:

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

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

(iii) disrupt the endocrine or hormone system; or

(iv) damage the nervous system, immune system, or organs, or cause other systemic toxicity.

(v) "Toy" means a product designed or intended by the manufacturer to be used by a child at play.

(w) "Trade association" means a membership organization of persons engaging in a similar or related line of commerce, organized to promote and improve business conditions in that line of commerce and not to engage in a regular business of a kind ordinarily carried on for profit.

Sec. 28. Minnesota Statutes 2012, section 116.9402, is amended to read:

116.9402 IDENTIFICATION OF CHEMICALS OF HIGH CONCERN.

(a) By July 1, 2010, the department shall, after consultation with the agency, generate a list of chemicals of high concern.

(b) The department must periodically review and revise the list of chemicals of high concern at least every three years. The department may add chemicals to the list if the chemical meets one or more of the criteria in section 116.9401, paragraph (e). Any changes to the list of chemicals of high concern must be published on the department's Web site and in the State Register when a change is made.

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(c) The department shall consider chemicals listed as a suspected carcinogen, reproductive or developmental toxicant, or as being persistent, bioaccumulative, and toxic, or very persistent and very bioaccumulative by a state, federal, or international agency. These agencies may include, but are not limited to, the California Environmental Protection Agency, the Washington Department of Ecology, the United States Department of Health, the United States Environmental Protection Agency, the United Nation's World Health Organization, and European Parliament Annex XIV concerning the Registration, Evaluation, Authorisation, and Restriction of Chemicals.

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

Sec. 29. Minnesota Statutes 2012, section 116.9403, is amended to read:

116.9403 IDENTIFICATION OF PRIORITY CHEMICALS.

Subdivision 1. Designation; publication. (a) The department, after consultation with the agency, may designate a chemical of high concern as a priority chemical if the department finds that the chemical:

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

(2) meets any of the following criteria:

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

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

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

(b) By February 1, 2011, the department shall publish a list of priority chemicals in the State Register and on the department's Internet Web site and shall update the published list whenever a new priority chemical is designated. Any proposed changes to the list of priority chemicals must be published on the department's Web site and in the State Register and will be subject to a minimum 60-day public comment period. In the 60 days following the date of publication in the State Register, the public may submit comments to the department on the proposed changes to the priority chemical list. A final list of changes to the list of priority chemicals must be published on the department's Web site following the end of the comment period and the department's review and consideration of all comments received during this period before finalizing changes to the list.

Subd. 2. Public data. Notwithstanding section 13.37, subdivision 2, the presence and concentration and total amount of a priority chemical in a specific children's product reported to the agency under section 116.9409, clauses (1) to (6), are classified as public data.

Subd. 3. Not misappropriation of trade secret. Notwithstanding section 325C.01, subdivision 3, publication of the presence and concentration and total amount of a priority chemical in a specific children's product under this section is not misappropriation of a trade secret.

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Sec. 30. Minnesota Statutes 2012, section 116.9405, is amended to read:

116.9405 ~~APPLICABILITY~~ EXEMPTIONS.

The requirements of sections ~~116.9401~~ 116.9408 to ~~116.9407~~ 116.9425 do not apply to:

(1) chemicals in ~~used~~ previously owned children's products;

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

(3) priority chemicals used in agricultural production;

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

(5) priority chemicals generated solely as combustion by-products or that are present ~~in combustible fuels;~~ in combustible petroleum fuels or in biofuel, as defined in section 239.051, subdivision 5a;

(6) retailers, except if a retailer is also the producer, manufacturer, importer, or domestic distributor of a children's product containing a priority chemical or the retailer's brand name is affixed to a children's product containing a priority chemical;

(7) over-the-counter drugs, pharmaceutical products, dietary supplements, or biologics;

(8) a medical device as defined in the federal Food, Drug, and Cosmetic Act, United States Code, title 21, section 321(h);

(9) ~~food and food or beverage packaging, except a container containing baby food or infant formula;~~

~~(10)~~ consumer electronics products and electronic components, including but not limited to personal computers; audio and video equipment; calculators; digital displays; wireless phones; cameras; game consoles; printers; and handheld electronic and electrical devices used to access interactive software or their associated peripherals; or products that comply with the provisions of directive 2002/95/EC of the European Union, adopted by the European Parliament and Council of the European Union now or hereafter in effect; or

(10) interactive software, such as computer games, and their storage media, such as compact discs;

(11) outdoor sport equipment, including snowmobiles as defined in section 84.81, subdivision 3; all-terrain vehicles as defined in section 84.92, subdivision 8; personal watercraft as defined in section 86B.005, subdivision 14a; watercraft as defined in section 86B.005, subdivision 18; and off-highway motorcycles, as defined in section 84.787, subdivision 7, and all attachments and repair parts for all of this equipment.;

(12) batteries; or

(13) a children's product, manufactured or distributed by an individual manufacturer or distributor, if fewer than 3,000 units of the children's product are manufactured or distributed annually in the United States by that manufacturer.

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Sec. 31. Minnesota Statutes 2012, section 116.9406, is amended to read:

116.9406 DONATIONS TO THE STATE.

The commissioner may accept donations, grants, and other funds to carry out the purposes of sections 116.9401 to ~~116.9407~~ 116.9425. All donations, grants, and other funds must be accepted without preconditions regarding the outcomes of the regulatory oversight processes set forth in sections 116.9401 to ~~116.9407~~ 116.9425.

Sec. 32. [116.9408] CHILDREN'S PRODUCTS; INITIAL NOTIFICATION ON PRIORITY CHEMICALS.

(a) A manufacturer or distributor of a children's product offered for sale in this state that contains a priority chemical must, unless the children's product is not subject to regulation under section 116.9405, provide the information required under this section to the agency:

(1) within one year of the effective date of this act, if both the designation of the priority chemical under section 116.9403 and the offering for sale in this state of the children's product containing the priority chemical occurred prior to the effective date of this act;

(2) within one year of the priority chemical being designated under section 116.9403, if the children's product is initially offered for sale in this state before the designation and the designation is made after the effective date of this act; or

(3) within one year of the initial offering of the children's product for sale in this state, if the initial offering occurs after the priority chemical is designated under section 116.9403 and the designation is made after the effective date of this act.

(b) An initial notification is required for each children's product that is known or believed likely to include a priority chemical in any amount and must include the following information submitted to the agency on a form developed by the commissioner:

(1) the name of the priority chemical and its Chemical Abstracts Service Registry number;

(2) in which of the following tiers the children's product containing a priority chemical belongs:

(i) Tier 1: a mouthable children's product intended to be used by children three years of age or younger or a children's product intended to be placed in a child's mouth or directly applied to a child's skin;

(ii) Tier 2: a children's product intended to be in direct contact with a child's skin for one hour or longer, including but not limited to clothing, jewelry, bedding, or a car seat;

(iii) Tier 3: a children's product intended to be in direct contact with a child's skin for less than one hour; or

(iv) Tier 4: a children's product in which a priority chemical is contained only in an internal component that, under normal use, is unlikely to come into direct contact with a child's skin or mouth;

(3) a description of the product component in which the priority chemical is present; and

(4) the name and address of the reporting manufacturer or distributor and the name, address, and telephone number of the contact person for the reporting manufacturer or distributor.

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Sec. 33. [116.9409] CHILDREN'S PRODUCTS; FULL PRODUCT REPORTING INFORMATION ON PRIORITY CHEMICALS; TIMING.

A manufacturer or distributor of a children's product offered for sale in this state that contains a priority chemical must, unless the children's product is not subject to regulation under section 116.9405, provide the full product information required under section 116.9410 to the agency. The maximum length of time between the filing of the information required under section 116.9408, paragraph (a), and the filing of full product information required under section 116.9410 varies according to the manufacturer's or distributor's annual aggregate gross sales, both within and outside the state, as reported in the manufacturer's or distributor's most recently filed federal tax return, as follows:

(1) for a manufacturer or distributor with gross sales exceeding $1,000,000,000, one year or, for a priority chemical designated under section 116.9403 before January 1, 2014, by two years after the effective date of this section;

(2) for a manufacturer or distributor with gross sales exceeding $250,000,000 but less than or equal to $1,000,000,000, 1-1/2 years or, for a priority chemical designated under section 116.9403 before January 1, 2014, by 2-1/2 years after the effective date of this section;

(3) for a manufacturer or distributor with gross sales exceeding $100,000,000 but less than or equal to $250,000,000, two years or, for a priority chemical designated under section 116.9403 before January 1, 2014, by three years after the effective date of this section;

(4) for a manufacturer or distributor with gross sales exceeding $5,000,000 but less than or equal to $100,000,000, three years or, for a priority chemical designated under section 116.9403 before January 1, 2014, by four years after the effective date of this section;

(5) for a manufacturer or distributor with gross sales exceeding $100,000 but less than or equal to $5,000,000, four years or, for a priority chemical designated under section 116.9403 before January 1, 2014, by five years after the effective date of this section; and

(6) for a manufacturer or distributor with gross sales less than or equal to $100,000, five years or, for a priority chemical designated under section 116.9403 before January 1, 2014, by six years after the effective date of this section.

Sec. 34. [116.9410] CHILDREN'S PRODUCTS; FULL PRODUCT REPORTING INFORMATION ON PRIORITY CHEMICALS.

(a) A manufacturer or distributor of a children's product offered for sale in the state that contains one or more priority chemicals must, except as provided in paragraph (e) or if the children's product is not subject to regulation under section 116.9405, provide the following full product information to the agency on a form developed by the commissioner:

(1) the name of each priority chemical and its Chemical Abstracts Service Registry number;

(2) in which of the following tiers the children's product containing a priority chemical belongs:

(ii) Tier 2: a children's product intended to be in direct contact with a child's skin for one hour or longer, including but not limited to clothing, jewelry, bedding, or a car seat;

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(iii) Tier 3: a children's product intended to be in direct contact with a child's skin for less than one hour; or

(iv) Tier 4: a children's product in which a priority chemical is contained only in an internal component that, under normal use, is unlikely to come into direct contact with a child's skin or mouth;

(3) the product components, materials, or coatings that contain one or more priority chemicals;

(4) the concentration and total amount of each priority chemical contained in a children's product, a description of how the concentration was determined, and an evaluation of the accuracy of the determination. Concentrations at or above the practical quantification limit must be reported, but may be reported in the following ranges:

(i) greater than or equal to the practical quantification limit but less than 100 ppm;

(ii) greater than or equal to 100 ppm but less than 500 ppm;

(iii) greater than or equal to 500 ppm but less than 1,000 ppm;

(iv) greater than or equal to 1,000 ppm but less than 5,000 ppm;

(v) greater than or equal to 5,000 ppm but less than 10,000 ppm; and

(vi) greater than or equal to 10,000 ppm.

For the purposes of this section, "ppm" means parts per million;

(5) the product category or categories for the children's product;

(6) a description of the function of the priority chemical in the product, including whether it is present as a contaminant;

(7) the name and address of the manufacturer, distributor, or trade association filing the report and the name, address, and telephone number of the contact person for the reporting manufacturer, distributor, or trade association;

(8) evidence describing the extent to which a child is likely to be exposed to the priority chemical through normal use of the children's product;

(9) the number of units of the children's product sold or distributed in Minnesota or nationally;

(10) any other information the manufacturer or distributor deems relevant; and

(11) any other information requested by the commissioner.

(b) Reporting shall include all intentionally added chemicals at or above the applicable practical quantification limit, and contaminants present in a product component at a concentration above 100 ppm.

(c) Reporting parties are not required to include any specific formula information or the specific name and address of the facility that is responsible for introduction of a priority chemical into a children's product or product component.

(d) If the information required in paragraph (a) is not submitted in a timely fashion or is incomplete or otherwise unacceptable as determined by the agency, the agency may contract with an independent third party of the agency's choice to provide the information and may assess a fee on the manufacturer or distributor to pay the costs as specified under section 116.9419.

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(e) The agency shall determine on a case-by-case basis if reporting the information in paragraph (a), clauses (3) to (9), is required by a manufacturer or distributor whose children's product belongs in Tier 4 under paragraph (a), clause (2).

(f) If a manufacturer claims that any of the information provided to the agency under this section is trade secret information under section 13.37, subdivision 1, the agency shall make a determination regarding the claim. Information determined to be public data shall be posted on the agency's Web site. This paragraph does not apply to the presence and concentration and total amount of a priority chemical in a specific children's product, which is governed under section 116.9403, subdivisions 2 and 3.

(g) A trade association may file the information required under this section on behalf of a manufacturer or distributor, provided that the trade association includes in the filing a list of the manufacturers or distributors on whose behalf the trade association is reporting and all the information otherwise required of an individual manufacturer or distributor.

Sec. 35. [116.9411] CHILDREN'S PRODUCTS; FULL PRODUCT REPORTING INFORMATION ON PRIORITY CHEMICALS; SECOND AND SUBSEQUENT REPORTS.

(a) Following the initial submission of the information required under section 116.9410, a manufacturer or distributor of a children's product offered for sale in the state that continues to contain a priority chemical must submit the information required under section 116.9410 to the agency every two years.

(b) If a reporting party determines that there has been no change in the information required to be filed under section 116.9410 since the most recent filing, the reporting party may submit a written statement indicating that the previously filed data is still valid, in lieu of a new duplicate complete report, and must submit the required fees.

(c) If a manufacturer or distributor is required to file more than one report under section 116.9410 on the same priority chemical in the same children's product code, each subsequent report must include the following information in addition to the information required under section 116.9410:

(1) the product code of the children's product; and

(2) a description of the manufacturer's attempts to remove the priority chemical from the children's product and any evaluation made of the use of safer alternatives to substitute for the priority chemical contained in the children's product, including the Chemical Abstracts Service Registry numbers of safer alternatives considered. If the manufacturer claims that any information provided to the agency under this clause is trade secret information under section 13.37, subdivision 1, the agency shall make a determination regarding the claim.

Sec. 36. [116.9412] CHILDREN'S PRODUCTS; REMOVING A PRIORITY CHEMICAL; REPORTING REQUIREMENT.

A manufacturer or distributor who removes a priority chemical from a children's product for which an initial notification has been filed under section 116.9408 or for which full product information has been filed under section 116.9410 must notify the agency of the removal at the earliest date possible. If the priority chemical removed is replaced by a safer alternative, the manufacturer or distributor must provide, on a form developed by the commissioner, the information in section 116.9410, paragraph (a), clauses (1) to (7), and the name of the safer alternative and its Chemical Abstracts Service Registry number, or, if not replaced by a chemical alternative, a description of the techniques or design changes implemented. The safer alternative or nonchemical techniques or design changes are trade secrets.

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Sec. 37. [116.9419] FEES.

(a) The agency shall, if applicable, assess and collect the following fees from manufacturers and distributors of children's products offered for sale in this state:

(1) a fee of $1,000 for each full product report required under section 116.9410. If a children's product contains more than one priority chemical, each priority chemical is subject to this fee;

(2) a fee equal to the costs billed by the independent contractor plus the agency's actual incurred costs to bid and administer the contract for each contract issued under section 116.9410, paragraph (d); and

(3) a fee equal to twice the fee in clause (1) for the second full product report required under section 116.9410 on the same priority chemical in the same children's product. The fee for each subsequent full product report required under that section is correspondingly increased by an amount equal to the fee in clause (1).

(b) No fee is required for filing an initial notification under section 116.9408.

(c) The commissioner shall deposit all fees collected under this section in the environmental fund. All fees collected under this section are exempt from section 16A.1285.

Sec. 38. [116.9420] STATE AGENCY DUTIES.

(a) The agency shall publish all data that is required to be filed under sections 116.9410 and 116.9411 and that is not trade secret data on the agency's Web site and through other means determined by the commissioner.

(b) If a priority chemical continues to be used in a specific children's product after its manufacturer files a report required under section 116.9411, the commissioner may recommend options to further reduce or eliminate the use of the priority chemical in the report required under section 116.9425.

(c) The commissioner, in consultation with the commissioners of commerce and health, may use fee revenue in excess of program implementation costs to offer grants awarded competitively to manufacturers or other researchers to develop safer alternatives to priority chemicals in children's products, to establish alternatives as safer alternatives, or to accelerate the commercialization of safer alternatives.

(d) The commissioners of health and commerce shall develop and implement an education effort regarding priority chemicals in children's products. Education and outreach activities include, but are not limited to, consumer product safety advice; notification of recalls; identification of target audiences for product alerts and methods of notification; outreach and feedback at county and state fairs; publicity of reporting requirements of priority chemicals in children's products; and education of retailers about reporting requirements.

Sec. 39. [116.9423] ENFORCEMENT.

The agency shall enforce sections 116.9401 to 116.9424 and rules adopted thereunder in the manner provided by section 115.071, subdivisions 1, 3, 4, 5, and 6. Section 115.071, subdivision 2, does not apply to violations of sections 116.9401 to 116.9424 and rules adopted thereunder.

Sec. 40. [116.9424] RULES.

The commissioner or the commissioner of commerce may adopt rules as necessary to implement, administer, and enforce sections 116.9401 to 116.9425.

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Sec. 41. [116.9425] REPORT.

By November 15, 2015, and every three years thereafter, the commissioners of the Pollution Control Agency, health, and commerce shall report to the legislative committees with jurisdiction over environment and natural resources, commerce, and public health on the implementation of sections 116.9401 to 116.9424.

Sec. 42. [168.1295] STATE PARKS AND TRAILS PLATES.

Subdivision 1. General requirements and procedures. (a) The commissioner shall issue state parks and trails plates to an applicant who:

(1) is a registered owner of a passenger automobile, recreational vehicle, one ton pickup truck, or motorcycle;

(2) pays a fee of $10 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 a minimum of $50 annually to the state parks and trails donation account established in section 85.056; and

(6) complies with this chapter and rules governing registration of motor vehicles and licensing of drivers.

(b) The state parks and trails plate application must indicate that the contribution specified under paragraph (a), clause (5), is a minimum contribution to receive the plate and that the applicant may make an additional contribution to the account.

Subd. 2. Design. After consultation with interested groups, the commissioners of natural resources and public safety shall jointly select a suitable symbol for use by the commissioner of public safety to design the state parks and trails plates.

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 automobile registered to the person to whom the plates were issued.

Subd. 5. Contribution and fees credited. Contributions under subdivision 1, paragraph (a), clause (5), must be paid to the commissioner and credited to the state parks and trails donation account established in section 85.056. The other fees collected under this section must be deposited in the vehicle services operating account of the special revenue fund under section 299A.705.

Subd. 6. Record. The commissioner shall maintain a record of the number of plates issued under this section.

Subd. 7. Exemption. Special plates issued under this section are not subject to section 168.1293, subdivision 2.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to applications submitted on or after January 1, 2016, or the date the new driver and vehicle services information technology system is implemented, whichever comes later.

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Sec. 43. [347.57] DEFINITIONS.

Subdivision 1. Terms. The definitions in this section apply to sections 347.57 to 347.64.

Subd. 2. Animal. "Animal" means a dog or a cat.

Subd. 3. Board. "Board" means the Board of Animal Health.

Subd. 4. Cat. "Cat" means a mammal that is wholly or in part of the species Felis domesticus. An adult cat is a cat 28 weeks of age or older. A kitten is a cat under 28 weeks of age.

Subd. 5. Commercial breeder. "Commercial breeder" means a person who possesses or has an ownership interest in animals and is engaged in the business of breeding animals for sale or for exchange in return for consideration, and who possesses ten or more adult intact animals and whose animals produce more than five total litters of puppies or kittens per year.

Subd. 6. Confinement area. "Confinement area" means a structure used or designed for use to restrict an animal to a limited amount of space, such as a room, pen, cage, kennel, compartment, crate, or hutch.

Subd. 7. Dog. "Dog" means a mammal that is wholly or in part of the species Canis familiaris. An adult dog is a dog 28 weeks of age or older. A puppy is a dog under 28 weeks of age.

Subd. 8. Facility. "Facility" means the place used by a commercial breeder for breeding animals, and includes all buildings, property, confinement areas, and vehicles.

Subd. 9. Local animal control authority. "Local animal control authority" means an agency of the state, county, municipality, or other political subdivision of the state that is responsible for animal control operations in its jurisdiction.

Subd. 10. Person. "Person" means a natural person, firm, partnership, corporation, or association, however organized.

Subd. 11. Possess. "Possess" means to have custody of or have control over.

Subd. 12. Veterinarian. "Veterinarian" means a veterinarian in good standing and licensed in the state of Minnesota.

Sec. 44. [347.58] LICENSING AND INSPECTIONS.

Subdivision 1. Licensing. (a) The board may grant an operating license to a commercial breeder and must enforce sections 347.58 to 347.64.

(b) Beginning July 1, 2015, a commercial breeder must obtain an annual license for each facility it owns or operates. More than one building on the same premises is considered one facility. The initial prelicense inspection fee and the annual license fee is $10 per adult intact animal, but each fee must not exceed $250.

(c) The board must perform an announced initial prelicense inspection within 60 days from the date of receiving a license application. A commercial breeder is not in violation of this section if the commercial breeder has filed a completed license application with the board and the board has not performed the initial prelicense inspection. The board must inspect a commercial breeder's facility before an initial license is issued. The initial prelicense inspection fee must be included with the license application. Upon completion of the inspection, the inspector must provide the commercial breeder an inspection certificate signed by the inspector in a format approved by the board.

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(d) The license application must indicate if a commercial breeder operates under more than one name from a single location or has an ownership interest in any other facility. License holders must keep separate records for each business name.

(e) The application must include a statement that includes the following information:

(1) whether any license held by an applicant under this section or under any other federal, state, county, or local law, ordinance, or other regulation relating to breeding cats or dogs was ever suspended, revoked, or denied; and

(2) whether the applicant was ever convicted of animal cruelty.

(f) An application from a partnership, corporation, or limited liability company must include the name and address of all partners, directors, officers, or members and must include a notation of any partners, directors, officers, members, or others authorized to represent the partnership, corporation, or limited liability company.

(g) A nonresident applicant must consent to adjudication of any violation under the laws of the state of Minnesota and in Minnesota courts.

(h) A license issued under this section is not transferable.

(i) A license holder must apply for license renewal annually by submitting a renewal application on a form approved by the board. The license renewal application must be postmarked or submitted electronically in a method approved by the board by July 1 of each year. The board may assess a late renewal penalty of up to 50 percent of the license fee. If a license is not renewed by August 1, the board may require the commercial breeder to reapply for an initial license.

(j) A commercial breeder must submit to the board an annual report by July 1 on a form prepared by the board. The form must include the current number of cats and dogs at the facility on the date of the report, the number of animals during the preceding year that were sold, traded, bartered, leased, brokered, given away, euthanized, or deceased from other causes, and any other information required by the board.

(k) If a commercial breeder is required to be licensed by the United States Department of Agriculture, United States Department of Agriculture inspection reports and records relating to animal care plans and veterinary care must be made available during an inspection, upon request.

(l) A commercial breeder must prominently display the commercial breeder's license at each facility.

(m) A commercial breeder's state license number or a symbol approved by the board must be included in all of the commercial breeder's advertisements or promotions that pertain to animals being sold or traded including, but not limited to, all newspapers, Internet, radio, or flyers.

(n) A commercial breeder must notify the board by certified mail or electronically in a method approved by the board within ten days of any change in address, name, management, or substantial control and ownership of the business or operation.

(o) The board must refuse to issue an initial license when a commercial breeder:

(1) is in violation of section 343.21; 343.24; 343.27; 343.28; 343.31; 343.37; 346.37; 346.38; 346.39; 346.44; or 346.155;

(2) has failed to meet any of the requirements of this section and section 347.59;

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(3) is in violation of a local ordinance regarding breeders;

(4) has been convicted, other than a petty misdemeanor conviction, of cruelty to animals under Minnesota law or a substantially similar animal cruelty law of another jurisdiction;

(5) has had a substantially similar license denied, revoked, or suspended by another federal or state authority within the last five years; or

(6) has falsified any material information requested by the board.

(p) A person who has been an officer, agent, direct family member, or employee of a commercial breeder whose license was revoked or suspended and who was responsible for or participated in the violation that was a basis for the revocation or suspension may not be licensed while the revocation or suspension is in effect.

Subd. 2. Inspections. (a) The board must inspect each licensed facility at least annually. The inspection must be with the commercial breeder or an agent of the commercial breeder present. The inspector must submit an inspection report to the board within ten days of each inspection on a form prepared by the board. The inspection report form must list separately each law, rule, regulation, and ordinance the facility is not in compliance with and what correction is required for compliance. The inspection report form must document the animal inventory on the date of the inspection.

(b) If, after the prelicense inspection, the commercial breeder has two consecutive years of inspections with no violations, the board must inspect the commercial breeder at least every two years. If the commercial breeder has any violations during an inspection or if the board has cause, the board must inspect the commercial breeder at least annually.

(c) If a license to operate is suspended, revoked, or denied, the board must be granted access to the facility during normal business hours to verify that it is not operating.

Subd. 3. Record requirements. (a) The commercial breeder must keep records on each animal at the facility that includes:

(1) the name, address, and United States Department of Agriculture license number, if applicable, from whom an animal was received; the date the commercial breeder received the animal; the date of the animal's birth; the breed, sex, color, and identifying marks of the animal; any identifying tag, tattoo, microchip, or collar number; worming treatments, vaccinations, and name of the person who administered the vaccination; medication received by the animal while in the possession of the commercial breeder; and any disease conditions diagnosed by a veterinarian; and

(2) the name and address of the person or entity to whom an animal was transferred.

(b) The commercial breeder must maintain a copy of the records required to be kept under this subdivision for two years.

Subd. 4. Veterinary protocol. (a) A commercial breeder must establish and maintain a written protocol for disease control and prevention, euthanasia, and veterinary care of animals at each facility. The initial protocol must be developed under the direction and supervision of the board. A commercial breeder must maintain a written protocol that is updated at least every 12 months and that is signed and dated by the board or by a veterinarian along with the commercial breeder. The written protocol must be available to the board upon request or at the time of inspection.

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(b) An animal sold or otherwise distributed by a commercial breeder must be accompanied by a veterinary health certificate completed by a veterinarian. The certificate must be completed within 30 days prior to the sale or distribution and must indicate that the animal is current with vaccinations and has no signs of infectious or contagious diseases. The certificate accompanying an adult dog that was not spayed or neutered must indicate that the dog has no signs of infectious or contagious diseases and was tested for canine brucellosis with a test approved by the board and found to be negative.

Subd. 5. Posting of information. The board must maintain and post in a timely manner on its Web site a list of commercial breeders licensed and in good standing under this section.

Sec. 45. [347.59] STANDARDS OF CARE.

(a) A commercial breeder must comply with chapters 343 and 346.

(b) A commercial breeder must ensure that animals that are part of the commercial breeder's breeding business operations are cared for as follows:

(1) cats must not be housed in outdoor confinement areas;

(2) animals exercised in groups must be compatible and show no signs of contagious or infectious disease;

(3) females in estrus must not be housed in the same confinement area with unneutered males, except for breeding purposes;

(4) animals must be provided daily enrichment and must be provided positive physical contact with human beings and compatible animals at least twice daily unless a veterinarian determines such activities would adversely affect the health or well-being of the animal;

(5) animals must not be sold, traded, or given away before the age of eight weeks unless a veterinarian determines it would be in the best interests of the health or well-being of the animal;

(6) the commercial breeder must provide identification and tracking for each animal, which is not transferable to another animal; and

(7) the commercial breeder must provide adequate staff to maintain the facility and observe each animal daily to monitor each animal's health and well-being, and to properly care for the animals.

(c) A commercial breeder must not knowingly hire staff or independent contractors who have been convicted of cruelty to animals under the law of any jurisdiction.

(d) A commercial breeder must comply with any additional standards the board considers necessary to protect the public health and welfare of animals covered under sections 347.57 to 347.61. The standards must be established by rule.

(e) A United States Department of Agriculture (USDA) licensed breeder or dealer who is in compliance with the minimum USDA regulations governing the license holder as they relate to animal confinement areas as of the effective date of this section does not have to comply with the minimum confinement area measurements under section 346.39, subdivision 4, for existing confinement areas in each facility the breeder or dealer owns. If a USDA-licensed breeder or dealer builds a new confinement area after the effective date of this section, those minimum standards must meet or exceed the minimum specifications as they relate to confinement area size under section 346.39, subdivision 4.

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Sec. 46. [347.60] INVESTIGATIONS.

(a) The board must initiate an investigation upon receiving a formal complaint alleging violations of section 347.58 or 347.59.

(b) When a local animal control authority, a peace officer, or a humane agent appointed under section 343.01 is made aware of an alleged violation under this chapter or chapter 343 or 346, committed by a commercial breeder, the local animal control authority, peace officer, or humane agent appointed under section 343.01 must report the alleged violation in a timely manner to the board.

Sec. 47. [347.61] CIVIL ENFORCEMENT.

Subdivision 1. Correction orders. (a) The board may issue a correction order requiring a commercial breeder to correct a violation of state statutes, rules, and regulations governing breeding facilities. The correction order must state the deficiencies that constitute the violation; the specific statute, rule, or regulation violated; and when the violation must be corrected.

(b) A commercial breeder may ask the board to reconsider any portion of the correction order that the commercial breeder believes is in error. The request for reconsideration must be made in writing by certified mail or electronically in a method approved by the board within seven days after receipt of the correction order. The request for reconsideration does not stay the correction order. The board must respond to the request for reconsideration within 15 days after receiving a request. The board's disposition of a request for reconsideration is final. The board may extend the time for complying with a correction order after receiving a request for reconsideration if necessary.

(c) The board must reinspect the facility within 15 days after the time for correcting the violation has passed to determine whether the violation has been corrected. If the violation has been corrected, the board must notify the commercial breeder in writing that the commercial breeder is in compliance with the correction order. The board may charge a reinspection fee to determine if a previous violation has been corrected.

Subd. 2. Administrative penalty orders. After the inspection required under subdivision 1, paragraph (c), the board may issue an order requiring violations to be corrected and administratively assessing monetary penalties for violations. The administrative penalty order must include a citation of the statute, rule, or regulation violated; a description of the violation; and the amount of the penalty for each violation. A single correction order may assess a maximum administrative penalty of $5,000.

Subd. 3. Injunctive relief. In addition to any other remedy provided by law, the board may bring an action for injunctive relief in the district court in Ramsey County or in the county in which a violation of the statutes, rules, or regulations governing the breeding of cats and dogs occurred to enjoin the violation.

Subd. 4. Cease and desist. The board must issue an order to cease a practice if its continuation would result in an immediate risk to animal welfare or public health. An order issued under this subdivision is effective for a maximum of 72 hours. The board or its designated agent must seek an injunction or take other administrative action authorized by law to restrain a practice beyond 72 hours. The issuance of a cease-and-desist order does not preclude other enforcement action by the board.

Subd. 5. Refusal to reissue license; license suspension or revocation. (a) The board may suspend, revoke, or refuse to renew a license as follows:

(1) for failure to comply with a correction order;

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(2) for failure to pay an administrative penalty;

(3) for failure to meet the requirements of section 347.58 or 347.59; or

(4) for falsifying information requested by the board.

A license suspension, revocation, or nonrenewal may be appealed through the Office of Administrative Hearings. A notice of intent to appeal must be filed in writing with the board within 20 days after receipt of the notice of suspension, revocation, or nonrenewal.

(b) The board must revoke a license if a commercial breeder has been convicted of cruelty to animals under Minnesota law or a substantially similar animal cruelty law of another jurisdiction, or for the denial, revocation, or suspension of a similar license by another federal or state authority. A license revocation under this subdivision may be appealed through the Office of Administrative Hearings. A notice of intent to appeal must be filed in writing with the board within 20 days after receipt of the notice of revocation.

(c) A commercial breeder whose license is revoked may not reapply for licensure for two years after the date of revocation. The license is permanently revoked if the basis for the revocation was a gross misdemeanor or felony conviction for animal cruelty.

(d) A commercial breeder whose license is suspended or revoked two times is permanently barred from licensure.

Subd. 6. Administrative hearing rights. (a) Except as provided in paragraph (b), if the board proposes to refuse to renew, suspend, or revoke a license, the board must first notify the commercial breeder in writing of the proposed action and provide an opportunity to request a hearing under the contested case provisions of chapter 14. If the commercial breeder does not request a hearing within 20 days after receipt of the notice of the proposed action, the board may proceed with the action without a hearing.

(b) The contested case provisions of chapter 14 do not apply when the board denies a license based on an applicant's failure to meet the minimum qualifications for licensure.

(c) A commercial breeder may appeal the amount of an administrative penalty order through the Office of Administrative Hearings pursuant to the procedures set forth in chapter 14. A commercial breeder wishing to file an appeal must notify the board in writing within 20 days after receipt of the administrative penalty order.

Subd. 7. Other jurisdictions. The board may accept as prima facie evidence of grounds for an enforcement action under this section any enforcement or disciplinary action from another jurisdiction, if the underlying violation would be grounds for a violation under the provisions of this section.

Subd. 8. Appeals. A final order by the board may be appealed to the Minnesota Court of Appeals.

Sec. 48. [347.615] BIOSECURITY; ENTRY INTO FACILITIES.

No law enforcement officer, agent of the board, or other official may enter a commercial breeder facility unless the person follows either the biosecurity procedure issued by the board or a reasonable biosecurity procedure maintained and prominently posted by the commercial breeder at each entry to a facility, whichever is more stringent. This section does not apply in emergency or exigent circumstances.

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Sec. 49. [347.62] PENALTIES.

(a) A violation of section 347.58 or 347.59 that results in cruelty or torture to an animal, as those terms are defined in section 343.20, subdivision 3, is subject to the penalties in section 343.21, subdivisions 9 and 10, relating to pet or companion animals.

(b) It is a misdemeanor to falsify information in a license application, annual report, or record.

(d) It is a misdemeanor for a commercial breeder to operate without a license.

Sec. 50. [347.63] DOG AND CAT BREEDERS LICENSING ACCOUNT; APPROPRIATION.

A dog and cat breeders licensing account is created in the special revenue fund. All fees and penalties collected by the board under sections 347.58 to 347.62 must be deposited in the state treasury and credited to the dog and cat breeders licensing account in the special revenue fund. Money in the account, including interest on the account, is annually appropriated to the board to administer those sections.

Sec. 51. [347.64] APPLICABILITY.

Sections 347.57 to 347.63 do not apply to:

(1) any species other than dogs and cats as they are defined in section 347.57; and

(2) veterinary clinics or veterinary hospitals.

Sec. 52. Laws 2008, chapter 363, article 5, section 4, subdivision 7, as amended by Laws 2009, chapter 37, article 1, section 61, is amended to read:

Subd. 7. Fish and Wildlife Management

123,000

119,000

Appropriations by Fund

General	-0-	(427,000)
Game and Fish	123,000	546,000

$329,000 in 2009 is a reduction for fish and wildlife management.

$46,000 in 2009 is a reduction in the appropriation for the Minnesota Shooting Sports Education Center.

$52,000 in 2009 is a reduction for licensing.

$123,000 in 2008 and $246,000 in 2009 are from the game and fish fund to implement fish virus surveillance, prepare infrastructure to handle possible outbreaks, and implement control procedures for highest risk waters and fish production operations. This is a onetime appropriation.

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Notwithstanding Minnesota Statutes, section 297A.94, paragraph (e), $300,000 in 2009 is from the second year appropriation in Laws 2007, chapter 57, article 1, section 4, subdivision 7, from the heritage enhancement account in the game and fish fund ~~to study, predesign, and design a shooting sports facility in the seven-county metropolitan area~~ for shooting sports facilities. Of this amount, $100,000 is for a grant to the Itasca County Gun Club for shooting sports facility improvements; and the remaining balance is for trap shooting facility grants under Minnesota Statutes, section 87A.10. This is available onetime only and is available until expended.

$300,000 in 2009 is appropriated from the game and fish fund for only activities that improve, enhance, or protect fish and wildlife resources. This is a onetime appropriation.

Sec. 53. Laws 2012, chapter 249, section 11, is amended to read:

Sec. 11. COSTS OF SCHOOL TRUST LANDS DIRECTOR AND LEGISLATIVE PERMANENT SCHOOL FUND COMMISSION.

(a) The costs of the school trust lands director, including the costs of hiring staff, and the Legislative Permanent School Fund Commission for fiscal years 2014 ~~and~~, 2015, and 2016 shall be from the state forest ~~development~~ suspense account under Minnesota Statutes, section 16A.125, and from the minerals management account under Minnesota Statutes, section 93.2236~~, as appropriated by the legislature~~.

(b) The school trust lands director and the Legislative Permanent School Fund Commission shall submit to the ~~2014~~ 2015 legislature a proposal to fund the operational costs of the Legislative Permanent School Fund Commission and school trust lands director and staff with a cost certification method using revenues generated by the permanent school fund lands.

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

Sec. 54. RECOGNITION; COMMERCIAL BREEDER EXCELLENCE.

The Board of Animal Health, in consultation with representatives of the licensed commercial breeder industry, must develop a program to recognize persons who demonstrate commercial breeder excellence and exceed the standards and practices required of commercial breeders under this act.

Sec. 55. REGISTRATION; INITIAL PRELICENSE INSPECTIONS.

Subdivision 1. Commercial breeder registration. Beginning July 1, 2014, until June 30, 2015, a commercial breeder must register each facility it owns or operates by paying a registration fee not to exceed $250 per facility to the Board of Animal Health.

Subd. 2. Initial prelicense inspections. Beginning July 1, 2014, the board may begin the initial prelicense inspections under Minnesota Statutes, section 347.58.

Subd. 3. Deposits of fees. Fees collected under this section must be deposited in the dog and cat breeders licensing account in the special revenue fund.

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Sec. 56. BEE VALUATION PROTOCOL REQUIRED.

No later than January 1, 2015, the commissioner of agriculture must report to the house of representatives and senate committees with jurisdiction over agriculture finance the protocol that the commissioner developed, in consultation with experts, for determining the fair market value of bees, hives, colonies, apiaries, and queen apiaries for purposes of compensation under Minnesota Statutes, section 18B.055.

Sec. 57. INVASIVE TERRESTRIAL PLANTS AND PESTS CENTER.

Subdivision 1. Establishment. The Board of Regents of the University of Minnesota is requested to establish an Invasive Terrestrial Plants and Pests Center to prevent and minimize the threats posed by terrestrial invasive plants, other weeds, pathogens, and pests in order to protect the state's prairies, forests, wetlands, and agricultural resources. With the approval of the board, the College of Food, Agricultural and Natural Resource Science, in coordination with the College of Biological Sciences, shall administer the center utilizing the following departments:

(1) Entomology;

(2) Plant Pathology;

(3) Forest Resources;

(4) Horticultural Science;

(5) Fisheries Wildlife and Conservation Biology;

(6) Agronomy and Plant Genetics;

(7) Plant Biology; and

(8) Ecology, Evolution, and Behavior.

The college may also utilize the following research and outreach centers in achieving the purposes of this section: Cloquet Forestry Center; North Central Research and Outreach Center; Northwest Research and Outreach Center; Southern Research and Outreach Center; Southwest Research and Outreach Center; West Central Research and Outreach Center; Rosemount Research and Outreach Center; Horticultural Research Center; and Sand Plain Research Center.

Subd. 2. Purpose. The purpose of the Invasive Terrestrial Plants and Pests Center is to research and develop effective measures to prevent and minimize the threats posed by terrestrial invasive plants, pathogens, and pests, including agricultural weeds and pests, in order to protect the state's native prairies, forests, wetlands, and agricultural resources, by:

(1) creating a prioritized list of pest and plant species that threaten the state's prairies, forests, wetlands, and agricultural resources and making the list publicly accessible; and

(2) conducting research focused on the species included on the prioritized list developed under this subdivision that includes:

(i) development of new control methods, including biocontrols;

(ii) development of integrated pest management tools that minimize nontarget impacts;

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(iii) research projects focused on establishment prevention, early detection, and rapid response;

(iv) an analysis of any consequences related to the management of prioritized species to the state's water, pollinators, and native prairies and other native species; and

(v) reports on the results that are made publicly accessible.

Subd. 3. Report. By January 15, each year as a condition of the appropriation provided under this act, the Board of Regents of the University of Minnesota shall submit a report to the chairs and ranking minority members of the house of representatives and senate committees and divisions with jurisdiction over the environment and natural resources and agriculture on: (1) the activities and outcomes of the center; and (2) any recommendations for additional funding for education, implementation, or other activities.

Sec. 58. REPEALER.

Minnesota Statutes 2012, section 115A.551, subdivision 2, is repealed.

EDUCATION

ARTICLE 17

GENERAL EDUCATION

Section 1. Minnesota Statutes 2012, section 123A.05, subdivision 2, is amended to read:

Subd. 2. Reserve revenue. Each district that is a member of an area learning center or alternative learning program must reserve revenue in an amount equal to the sum of (1) at least 90 and no more than 100 percent of the district average general education revenue per adjusted pupil unit minus an amount equal to the product of the formula allowance according to section 126C.10, subdivision 2, times ~~.0485~~ .0466, calculated without basic skills revenue and transportation sparsity revenue, times the number of pupil units attending an area learning center or alternative learning program under this section, plus (2) the amount of basic skills revenue generated by pupils attending the area learning center or alternative learning program. The amount of reserved revenue under this subdivision may only be spent on program costs associated with the area learning center or alternative learning program.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 2. Minnesota Statutes 2013 Supplement, section 123B.75, subdivision 5, is amended to read:

Subd. 5. Levy recognition. For fiscal year ~~2011~~ 2014 and later years, in June of each year, the school district must recognize as revenue, in the fund for which the levy was made, the lesser of:

(1) the sum of May, June, and July school district tax settlement revenue received in that calendar year, plus general education aid according to section 126C.13, subdivision 4, received in July and August of that calendar year; or

(2) the sum of:

(i) ~~the greater of 48.6 percent of the referendum levy certified according to section 126C.17 in the prior calendar year, or~~ 31 percent of the referendum levy certified according to section 126C.17 in calendar year 2000; plus

(ii) the entire amount of the levy certified in the prior calendar year according to section 124D.4531~~, 124D.86, subdivision 4, for school districts receiving revenue under sections 124D.86, subdivision 3, clauses (1), (2), and (3)~~; 124D.862, for Special School District No. 1, Minneapolis, Independent School District No. 625, St. Paul, and Independent School District No. 709, Duluth; 126C.41, subdivisions 1, 2, paragraph (a), and 3, paragraphs (b), (c), and (d); 126C.43, subdivision 2; and 126C.48, subdivision 6~~; plus~~

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(iii) 48.6 percent of the amount of the levy certified in the prior calendar year for the school district's general and community service funds, plus or minus auditor's adjustments, that remains after subtracting the referendum levy certified according to section 126C.17 and the amount recognized according to item (ii).

Sec. 3. Minnesota Statutes 2012, section 124D.09, subdivision 9, is amended to read:

Subd. 9. Enrollment priority. A postsecondary institution shall give priority to its postsecondary students when enrolling 10th, 11th, and 12th grade pupils in its courses. A postsecondary institution may provide information about its programs to a secondary school or to a pupil or parent and it may advertise or otherwise recruit or solicit a secondary pupil to enroll in its programs on educational and programmatic grounds only. An institution must not enroll secondary pupils, for postsecondary enrollment options purposes, in remedial, developmental, or other courses that are not college level except when a student eligible to participate in the graduation incentives program under section 124D.68 enrolls full time in a middle or early college program specifically designed to allow the student to earn dual high school and college credit. In this case, the student shall receive developmental college credit and not college credit for completing remedial or developmental courses. Once a pupil has been enrolled in a postsecondary course under this section, the pupil shall not be displaced by another student.

EFFECTIVE DATE. This section is effective July 1, 2014.

Sec. 4. Minnesota Statutes 2012, section 124D.09, subdivision 13, is amended to read:

Subd. 13. Financial arrangements. For a pupil enrolled in a course under this section, the department must make payments according to this subdivision for courses that were taken for secondary credit.

The department must not make payments to a school district or postsecondary institution for a course taken for postsecondary credit only. The department must not make payments to a postsecondary institution for a course from which a student officially withdraws during the first 14 days of the quarter or semester or who has been absent from the postsecondary institution for the first 15 consecutive school days of the quarter or semester and is not receiving instruction in the home or hospital.

A postsecondary institution shall receive the following:

(1) for an institution granting quarter credit, the reimbursement per credit hour shall be an amount equal to 88 percent of the product of the formula allowance minus ~~$415~~ $425, multiplied by ~~1.3~~ 1.2, and divided by 45; or

(2) for an institution granting semester credit, the reimbursement per credit hour shall be an amount equal to 88 percent of the product of the general revenue formula allowance minus ~~$415~~ $425, multiplied by ~~1.3~~ 1.2, and divided by 30.

The department must pay to each postsecondary institution 100 percent of the amount in clause (1) or (2) within 30 days of receiving initial enrollment information each quarter or semester. If changes in enrollment occur during a quarter or semester, the change shall be reported by the postsecondary institution at the time the enrollment information for the succeeding quarter or semester is submitted. At any time the department notifies a postsecondary institution that an overpayment has been made, the institution shall promptly remit the amount due.

EFFECTIVE DATE. This section is effective for fiscal year 2015 and later.

Sec. 5. Minnesota Statutes 2013 Supplement, section 124D.11, subdivision 1, is amended to read:

Subdivision 1. General education revenue. General education revenue must be paid to a charter school as though it were a district. The general education revenue for each adjusted pupil unit is the state average general education revenue per pupil unit, plus the referendum equalization aid allowance in the pupil's district of residence,

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minus an amount equal to the product of the formula allowance according to section 126C.10, subdivision 2, times .0466, calculated without declining enrollment revenue, local optional revenue, basic skills revenue, extended time revenue, pension adjustment revenue, transition revenue, and transportation sparsity revenue, plus declining enrollment revenue, basic skills revenue, extended time revenue, pension adjustment revenue, and transition revenue as though the school were a school district. The general education revenue for each extended time pupil unit equals $4,794.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 6. Minnesota Statutes 2012, section 124D.59, subdivision 2, is amended to read:

Subd. 2. English learner. (a) "English learner" means a pupil in kindergarten through grade 12 who meets the following requirements:

(1) the pupil, as declared by a parent or guardian first learned a language other than English, comes from a home where the language usually spoken is other than English, or usually speaks a language other than English; and

(2) the pupil is determined by a valid assessment measuring the pupil's English language proficiency and by developmentally appropriate measures, which might include observations, teacher judgment, parent recommendations, or developmentally appropriate assessment instruments, to lack the necessary English skills to participate fully in academic classes taught in English.

(b) ~~Notwithstanding paragraph (a),~~ A pupil enrolled in a Minnesota public school in ~~grades~~ any grade 4 through 12 who ~~was enrolled in a Minnesota public school on the dates during~~ in the previous school year ~~when a commissioner provided~~ took a commissioner-provided assessment ~~that measures~~ measuring the pupil's emerging academic English ~~was administered~~, shall ~~not~~ be counted as an English learner in calculating English learner pupil units under section 126C.05, subdivision 17, and shall ~~not~~ generate state English learner aid under section 124D.65, subdivision 5, ~~unless~~ if the pupil scored below the state cutoff score or is otherwise counted as a nonproficient participant on an the assessment measuring the pupil's emerging academic English ~~provided by the commissioner during the previous school year~~, or, in the judgment of the pupil's classroom teachers, consistent with section 124D.61, clause (1), the pupil is unable to demonstrate academic language proficiency in English, including oral academic language, sufficient to successfully and fully participate in the general core curriculum in the regular classroom.

(c) Notwithstanding paragraphs (a) and (b), a pupil in kindergarten through grade 12 shall not be counted as an English learner in calculating English learner pupil units under section 126C.05, subdivision 17, and shall not generate state English learner aid under section 124D.65, subdivision 5, if:

(1) the pupil is not enrolled during the current fiscal year in an educational program for English learners ~~in accordance with~~ under sections 124D.58 to 124D.64; or

(2) the pupil has generated ~~five~~ six or more years of average daily membership in Minnesota public schools since July 1, 1996.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 7. Minnesota Statutes 2013 Supplement, section 124D.65, subdivision 5, is amended to read:

Subd. 5. School district EL revenue. ~~(a)~~ A district's English learner programs revenue equals the product of (1) ~~$704~~ $726 times (2) the greater of 20 or the adjusted average daily membership of eligible English learners enrolled in the district during the current fiscal year.

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(b) A pupil ceases to generate state English learner aid in the school year following the school year in which the pupil attains the state cutoff score on a commissioner-provided assessment that measures the pupil's emerging academic English.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 8. [124D.695] APPROVED RECOVERY PROGRAM FUNDING.

Subdivision 1. Approved recovery program. "Approved recovery program" means a course of instruction offered by a recovery school that provides academic services, assistance with recovery, and continuing care to students recovering from substance abuse or dependency. A recovery program may be offered in a transitional academic setting designed to meet graduation requirements. A recovery program must be approved by the commissioner of education. The commissioner may specify the manner and form of the application for the approval of a recovery school or recovery program.

Subd. 2. Eligibility. An approved recovery program is eligible for an annual recovery program grant of up to $125,000 to pay for a portion of the costs of recovery program support staff under this section. "Recovery program support staff" means licensed alcohol and chemical dependency counselors, licensed school counselors, licensed school psychologists, licensed school nurses, and licensed school social workers.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 9. Minnesota Statutes 2013 Supplement, section 126C.05, subdivision 15, is amended to read:

Subd. 15. Learning year pupil units. (a) When a pupil is enrolled in a learning year program under section 124D.128, an area learning center or an alternative learning program approved by the commissioner under sections 123A.05 and 123A.06, or a contract alternative program under section 124D.68, subdivision 3, paragraph (d), or subdivision 4, for more than 1,020 hours in a school year for a secondary student, more than 935 hours in a school year for an elementary student, more than 850 hours in a school year for a kindergarten student without a disability in an all-day kindergarten program, or more than 425 hours in a school year for a half-day kindergarten student without a disability, that pupil may be counted as more than one pupil in average daily membership for purposes of section 126C.10, subdivision 2a. The amount in excess of one pupil must be determined by the ratio of the number of hours of instruction provided to that pupil in excess of: (i) the greater of 1,020 hours or the number of hours required for a full-time secondary pupil in the district to 1,020 for a secondary pupil; (ii) the greater of 935 hours or the number of hours required for a full-time elementary pupil in the district to 935 for an elementary pupil in grades 1 through 6; and (iii) the greater of ~~425~~ 850 hours or the number of hours required for a full-time kindergarten student without a disability in the district to ~~425~~ 850 for a kindergarten student without a disability; and (iv) the greater of 425 hours or the number of hours required for a half-time kindergarten student without a disability in the district to 425 for a half-day kindergarten student without a disability. Hours that occur after the close of the instructional year in June shall be attributable to the following fiscal year. A student in kindergarten or grades 1 through 12 must not be counted as more than 1.2 pupils in average daily membership under this subdivision.

(b)(i) To receive general education revenue for a pupil in an area learning center or alternative learning program that has an independent study component, a district must meet the requirements in this paragraph. The district must develop, for the pupil, a continual learning plan consistent with section 124D.128, subdivision 3. Each school district that has an area learning center or alternative learning program must reserve revenue in an amount equal to at least 90 and not more than 100 percent of the district average general education revenue per pupil unit, minus an amount equal to the product of the formula allowance according to section 126C.10, subdivision 2, times .0466, calculated without basic skills and transportation sparsity revenue, times the number of pupil units generated by students attending an area learning center or alternative learning program. The amount of reserved revenue available under this subdivision may only be spent for program costs associated with the area learning center or alternative learning program. Basic skills revenue generated according to section 126C.10, subdivision 4, by pupils attending the eligible program must be allocated to the program.

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(ii) General education revenue for a pupil in a state-approved alternative program without an independent study component must be prorated for a pupil participating for less than a full year, or its equivalent. The district must develop a continual learning plan for the pupil, consistent with section 124D.128, subdivision 3. Each school district that has an area learning center or alternative learning program must reserve revenue in an amount equal to at least 90 and not more than 100 percent of the district average general education revenue per pupil unit, minus an amount equal to the product of the formula allowance according to section 126C.10, subdivision 2, times .0466, calculated without basic skills and transportation sparsity revenue, times the number of pupil units generated by students attending an area learning center or alternative learning program. The amount of reserved revenue available under this subdivision may only be spent for program costs associated with the area learning center or alternative learning program. Basic skills revenue generated according to section 126C.10, subdivision 4, by pupils attending the eligible program must be allocated to the program.

(iii) General education revenue for a pupil in a state-approved alternative program that has an independent study component must be paid for each hour of teacher contact time and each hour of independent study time completed toward a credit or graduation standards necessary for graduation. Average daily membership for a pupil shall equal the number of hours of teacher contact time and independent study time divided by 1,020.

(iv) For a state-approved alternative program having an independent study component, the commissioner shall require a description of the courses in the program, the kinds of independent study involved, the expected learning outcomes of the courses, and the means of measuring student performance against the expected outcomes.

Sec. 10. Minnesota Statutes 2013 Supplement, section 126C.10, subdivision 2, is amended to read:

Subd. 2. Basic revenue. For fiscal year 2014, the basic revenue for each district equals the formula allowance times the adjusted marginal cost pupil units for the school year. For fiscal year 2015 and later, the basic revenue for each district equals the formula allowance times the adjusted pupil units for the school year. The formula allowance for fiscal year 2013 is $5,224. The formula allowance for fiscal year 2014 is $5,302. The formula allowance for fiscal year 2015 and later is ~~$5,806~~ $5,864.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 11. Minnesota Statutes 2013 Supplement, section 126C.10, subdivision 2a, is amended to read:

Subd. 2a. Extended time revenue. (a) A school district's extended time revenue for fiscal year 2014 is equal to the product of $4,601 and the sum of the adjusted marginal cost pupil units of the district for each pupil in average daily membership in excess of 1.0 and less than 1.2 according to section 126C.05, subdivision 8. A school district's extended time revenue for fiscal year 2015 and later is equal to the product of $5,017 and the sum of the adjusted pupil units of the district for each pupil in average daily membership in excess of 1.0 and less than 1.2 according to section 126C.05, subdivision 8.

(b) A school district's extended time revenue may be used for extended day programs, extended week programs, summer school, and other programming authorized under the learning year program.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to revenue for fiscal year 2014 and later.

Sec. 12. Minnesota Statutes 2013 Supplement, section 126C.10, subdivision 24, is amended to read:

Subd. 24. Equity revenue. (a) A school district qualifies for equity revenue if:

(1) the school district's adjusted pupil unit amount of basic revenue, transition revenue, and referendum revenue is less than the value of the school district at or immediately above the 95th percentile of school districts in its equity region for those revenue categories; and

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(2) the school district's administrative offices are not located in a city of the first class on July 1, 1999.

(b) Equity revenue for a qualifying district that receives referendum revenue under section 126C.17, subdivision 4, equals the product of (1) the district's adjusted pupil units for that year; times (2) the sum of (i) $14, plus (ii) $80, times the school district's equity index computed under subdivision 27.

(c) Equity revenue for a qualifying district that does not receive referendum revenue under section 126C.17, subdivision 4, equals the product of the district's adjusted pupil units for that year times $14.

(d) A school district's equity revenue is increased by the greater of zero or an amount equal to the district's ~~resident~~ adjusted pupil units times the difference between ten percent of the statewide average amount of referendum revenue per ~~resident~~ adjusted pupil unit for that year and the district's referendum revenue per ~~resident~~ adjusted pupil unit. A school district's revenue under this paragraph must not exceed $100,000 for that year.

(e) A school district's equity revenue for a school district located in the metro equity region or a school district with its administrative offices located in any Minnesota county in the Minneapolis-St. Paul-Bloomington Metropolitan Statistical Area delineated in 2009 by the United States Census Bureau equals the amount computed in paragraphs (b), (c), and (d) multiplied by 1.25.

(f) A school district's additional equity revenue equals $50 times its adjusted pupil units.

EFFECTIVE DATE. The changes in paragraph (d) are effective for revenue for fiscal year 2015 and later. The changes in paragraph (e) are effective for revenue for fiscal years 2017 and later.

Sec. 13. Minnesota Statutes 2012, section 126C.10, subdivision 25, is amended to read:

Subd. 25. Regional equity gap. The regional equity gap equals the difference between the value of the school district at or immediately above the fifth percentile of adjusted general revenue per adjusted ~~marginal cost~~ pupil unit and the value of the school district at or immediately above the 95th percentile of adjusted general revenue per adjusted ~~marginal cost~~ pupil unit.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 14. Minnesota Statutes 2012, section 126C.10, subdivision 26, is amended to read:

Subd. 26. District equity gap. A district's equity gap equals the greater of zero or the difference between the district's adjusted general revenue and the value of the school district at or immediately above the regional 95th percentile of adjusted general revenue per adjusted ~~marginal cost~~ pupil unit.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 15. Minnesota Statutes 2013 Supplement, section 126C.10, subdivision 31, is amended to read:

Subd. 31. Transition revenue. (a) A district's transition allowance equals the sum of the transition revenue the district would have received for fiscal year 2015 under Minnesota Statutes 2012, section 126C.10, subdivisions 31, 31a, and 31c, and the greater of zero or the difference between:

(1) the sum of:

(i) the general education revenue the district would have received for fiscal year 2015 according to Minnesota Statutes 2012, section 126C.10;

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(ii) the integration revenue the district received for fiscal year 2013 under Minnesota Statutes 2012, section 124D.86;

(iii) the pension adjustment the district would have received for fiscal year 2015 under Minnesota Statutes 2012, section 127A.50;

(iv) the special education aid the district would have received for fiscal year 2015 under Minnesota Statutes 2012, section 125A.76; and

(v) the special education excess cost aid the district would have received for fiscal year 2015 under Minnesota Statutes 2012, section 125A.79; and

(2) the sum of the district's:

(i) general education revenue for fiscal year 2015 excluding transition revenue under this section;

(ii) achievement and integration revenue for fiscal year 2015 under section 124D.862; ~~and~~

(iii) special education aid for fiscal year 2015 under section 125A.76; and

(iv) alternative teacher compensation revenue for fiscal year 2015 under section 122A.415,

divided by the number of adjusted pupil units for fiscal year 2015.

(b) A district's transition revenue for fiscal year 2015 and later equals the product of the district's transition allowance times the district's adjusted pupil units.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 16. Minnesota Statutes 2013 Supplement, section 126C.17, subdivision 6, is amended to read:

Subd. 6. Referendum equalization levy. (a) ~~For fiscal year 2003 and later,~~ A district's referendum equalization levy equals the sum of the first tier referendum equalization levy, the second tier referendum equalization levy, and the third tier referendum equalization levy.

(b) A district's first tier referendum equalization levy equals the district's first tier referendum equalization revenue times the lesser of one or the ratio of the district's referendum market value per resident pupil unit to $880,000.

(c) A district's second tier referendum equalization levy equals the district's second tier referendum equalization revenue times the lesser of one or the ratio of the district's referendum market value per resident pupil unit to $510,000.

(d) A district's third tier referendum equalization levy equals the district's third tier referendum equalization revenue times the lesser of one or the ratio of the district's referendum market value per resident pupil unit to $290,000.

Sec. 17. Minnesota Statutes 2013 Supplement, section 126C.17, subdivision 7b, is amended to read:

Subd. 7b. Referendum aid guarantee. (a) Notwithstanding subdivision 7, the sum of a district's referendum equalization aid and location equity aid under section 126C.10, subdivision 2e, for fiscal year 2015 must not be less than the sum of the referendum equalization aid the district would have received for fiscal year 2015 under Minnesota Statutes 2012, section 126C.17, subdivision 7, and the adjustment the district would have received under Minnesota Statutes 2012, section 127A.47, subdivision 7, paragraphs (a), (b), and (c).

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(b) Notwithstanding subdivision 7, the sum of referendum equalization aid and location equity aid under section 126C.10, subdivision 2e, for fiscal year 2016 and later, for a district qualifying for additional aid under paragraph (a) for fiscal year 2015, must not be less than the product of (1) the district's referendum equalization aid for fiscal year 2015, times (2) the lesser of one or the ratio of the district's referendum revenue for that school year to the district's referendum revenue for fiscal year 2015, times (3) the lesser of one or the ratio of the district's referendum market value used for fiscal year 2015 referendum equalization calculations to the district's referendum market value used for that year's referendum equalization calculations.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 18. Minnesota Statutes 2013 Supplement, section 126C.17, subdivision 9, is amended to read:

Subd. 9. Referendum revenue. (a) The revenue authorized by section 126C.10, subdivision 1, may be increased in the amount approved by the voters of the district at a referendum called for the purpose. The referendum may be called by the board. The referendum must be conducted one or two calendar years before the increased levy authority, if approved, first becomes payable. Only one election to approve an increase may be held in a calendar year. Unless the referendum is conducted by mail under subdivision 11, paragraph (a), the referendum must be held on the first Tuesday after the first Monday in November. The ballot must state the maximum amount of the increased revenue per adjusted pupil unit. The ballot may state a schedule, determined by the board, of increased revenue per adjusted pupil unit that differs from year to year over the number of years for which the increased revenue is authorized or may state that the amount shall increase annually by the rate of inflation. For this purpose, the rate of inflation shall be the annual inflationary increase calculated under subdivision 2, paragraph (b). The ballot may state that existing referendum levy authority is expiring. In this case, the ballot may also compare the proposed levy authority to the existing expiring levy authority, and express the proposed increase as the amount, if any, over the expiring referendum levy authority. The ballot must designate the specific number of years, not to exceed ten, for which the referendum authorization applies. The ballot, including a ballot on the question to revoke or reduce the increased revenue amount under paragraph (c), must abbreviate the term "per adjusted pupil unit" as "per pupil." The notice required under section 275.60 may be modified to read, in cases of renewing existing levies at the same amount per pupil as in the previous year:

"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU ARE VOTING TO EXTEND AN EXISTING PROPERTY TAX REFERENDUM THAT IS SCHEDULED TO EXPIRE."

The ballot may contain a textual portion with the information required in this subdivision and a question stating substantially the following:

"Shall the increase in the revenue proposed by (petition to) the board of ........., School District No. .., be approved?"

If approved, an amount equal to the approved revenue per adjusted pupil unit times the adjusted pupil units for the school year beginning in the year after the levy is certified shall be authorized for certification for the number of years approved, if applicable, or until revoked or reduced by the voters of the district at a subsequent referendum.

(b) The board must prepare and deliver by first class mail at least 15 days but no more than 30 days before the day of the referendum to each taxpayer a notice of the referendum and the proposed revenue increase. The board need not mail more than one notice to any taxpayer. For the purpose of giving mailed notice under this subdivision, owners must be those shown to be owners on the records of the county auditor or, in any county where tax statements are mailed by the county treasurer, on the records of the county treasurer. Every property owner whose name does not appear on the records of the county auditor or the county treasurer is deemed to have waived this mailed notice unless the owner has requested in writing that the county auditor or county treasurer, as the case may be, include the name on the records for this purpose. The notice must project the anticipated amount of tax increase in annual dollars for typical residential homesteads, agricultural homesteads, apartments, and commercial-industrial property within the school district.

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The notice for a referendum may state that an existing referendum levy is expiring and project the anticipated amount of increase over the existing referendum levy in the first year, if any, in annual dollars for typical residential homesteads, agricultural homesteads, apartments, and commercial-industrial property within the district.

The notice must include the following statement: "Passage of this referendum will result in an increase in your property taxes." However, in cases of renewing existing levies, the notice may include the following statement: "Passage of this referendum extends an existing operating referendum at the same amount per pupil as in the previous year."

(c) A referendum on the question of revoking or reducing the increased revenue amount authorized pursuant to paragraph (a) may be called by the board. A referendum to revoke or reduce the revenue amount must state the amount per ~~resident marginal cost~~ adjusted pupil unit by which the authority is to be reduced. Revenue authority approved by the voters of the district pursuant to paragraph (a) must be available to the school district at least once before it is subject to a referendum on its revocation or reduction for subsequent years. Only one revocation or reduction referendum may be held to revoke or reduce referendum revenue for any specific year and for years thereafter.

(d) The approval of 50 percent plus one of those voting on the question is required to pass a referendum authorized by this subdivision.

(e) At least 15 days before the day of the referendum, the district must submit a copy of the notice required under paragraph (b) to the commissioner and to the county auditor of each county in which the district is located. Within 15 days after the results of the referendum have been certified by the board, or in the case of a recount, the certification of the results of the recount by the canvassing board, the district must notify the commissioner of the results of the referendum.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 19. Minnesota Statutes 2013 Supplement, section 126C.17, subdivision 9a, is amended to read:

Subd. 9a. Board-approved referendum allowance. Notwithstanding subdivision 9, a school district may convert up to $300 per adjusted pupil unit of referendum authority from voter approved to board approved by a board vote. A district with less than $300 per adjusted pupil unit of referendum authority after the local optional revenue subtraction under subdivision 1 may authorize new referendum authority up to the difference between $300 per adjusted pupil unit and the district's referendum authority. The board may authorize this levy for up to five years and may subsequently reauthorize that authority in increments of up to five years.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 20. Minnesota Statutes 2013 Supplement, section 126C.44, is amended to read:

126C.44 SAFE SCHOOLS LEVY.

(a) Each district may make a levy on all taxable property located within the district for the purposes specified in this section. The maximum amount which may be levied for all costs under this section shall be equal to $36 multiplied by the district's adjusted pupil units for the school year. The proceeds of the levy must be reserved and used for directly funding the following purposes or for reimbursing the cities and counties who contract with the district for the following purposes:

(1) to pay the costs incurred for the salaries, benefits, and transportation costs of peace officers and sheriffs for liaison in services in the district's schools;

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(2) to pay the costs for a drug abuse prevention program as defined in section 609.101, subdivision 3, paragraph (e), in the elementary schools;

(3) to pay the costs for a gang resistance education training curriculum in the district's schools;

(4) to pay the costs for security in the district's schools and on school property;

(5) to pay the costs for other crime prevention, drug abuse, student and staff safety, voluntary opt-in suicide prevention tools, and violence prevention measures taken by the school district;

(6) to pay costs for licensed school counselors, licensed school nurses, licensed school social workers, licensed school psychologists, and licensed alcohol and chemical dependency counselors to help provide early responses to problems;

(7) to pay for facility security enhancements including laminated glass, public announcement systems, emergency communications devices, and equipment and facility modifications related to violence prevention and facility security;

(8) to pay for costs associated with improving the school climate; or

(9) to pay costs for colocating and collaborating with mental health professionals who are not district employees or contractors.

(b) For expenditures under paragraph (a), clause (1), the district must initially attempt to contract for services to be provided by peace officers or sheriffs with the police department of each city or the sheriff's department of the county within the district containing the school receiving the services. If a local police department or a county sheriff's department does not wish to provide the necessary services, the district may contract for these services with any other police or sheriff's department located entirely or partially within the school district's boundaries.

(c) A school district that is a member of an intermediate school district may include in its authority under this section the costs associated with safe schools activities authorized under paragraph (a) for intermediate school district programs. This authority must not exceed ~~$10~~ $15 times the adjusted ~~marginal cost~~ pupil units of the member districts. This authority is in addition to any other authority authorized under this section. Revenue raised under this paragraph must be transferred to the intermediate school district.

EFFECTIVE DATE. This section is effective for taxes payable in 2015 and later.

Sec. 21. Minnesota Statutes 2012, section 127A.45, subdivision 2, is amended to read:

Subd. 2. Definitions. (a) "Other district receipts" means payments by county treasurers pursuant to section 276.10, apportionments from the school endowment fund pursuant to section 127A.33, apportionments by the county auditor pursuant to section 127A.34, subdivision 2, and payments to school districts by the commissioner of revenue pursuant to chapter 298.

(b) "Cumulative amount guaranteed" means the product of

(1) the cumulative disbursement percentage shown in subdivision 3; times

(2) the sum of

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(i) the current year aid payment percentage of the estimated aid and credit entitlements paid according to subdivision 13; plus

(ii) 100 percent of the entitlements paid according to subdivisions 11 and 12; plus

(iii) the other district receipts.

(c) "Payment date" means the date on which state payments to districts are made by the electronic funds transfer method. If a payment date falls on a Saturday, a Sunday, or a weekday which is a legal holiday, the payment shall be made on the immediately preceding business day. The commissioner may make payments on dates other than those listed in subdivision 3, but only for portions of payments from any preceding payment dates which could not be processed by the electronic funds transfer method due to documented extenuating circumstances.

(d) The current year aid payment percentage equals ~~73 in fiscal year 2010 and 70 in fiscal year 2011, and 60 in fiscal years 2012 and later~~ 90.

Sec. 22. Minnesota Statutes 2012, section 127A.45, subdivision 3, is amended to read:

Subd. 3. Payment dates and percentages. (a) The commissioner shall pay to a district on the dates indicated an amount computed as follows: the cumulative amount guaranteed minus the sum of (1) the district's other district receipts through the current payment, and (2) the aid and credit payments through the immediately preceding payment. For purposes of this computation, the payment dates and the cumulative disbursement percentages are as follows:

	Payment date	Percentage

Payment 1	July 15:	5.5
Payment 2	July 30:	8.0
Payment 3	August 15:	17.5
Payment 4	August 30:	20.0
Payment 5	September 15:	22.5
Payment 6	September 30:	25.0
Payment 7	October 15:	27.0
Payment 8	October 30:	30.0
Payment 9	November 15:	32.5
Payment 10	November 30:	36.5
Payment 11	December 15:	42.0
Payment 12	December 30:	45.0
Payment 13	January 15:	50.0
Payment 14	January 30:	54.0
Payment 15	February 15:	58.0
Payment 16	February 28:	63.0
Payment 17	March 15:	68.0
Payment 18	March 30:	74.0
Payment 19	April 15:	78.0
Payment 20	April 30:	85.0
Payment 21	May 15:	90.0
Payment 22	May 30:	95.0
Payment 23	June 20:	100.0

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(b) In addition to the amounts paid under paragraph (a), the commissioner shall pay to a school district or charter school on the dates indicated an amount computed as follows:

Payment 3	August 15: the final adjustment for the prior fiscal year for the state paid property tax credits established in section 273.1392
Payment 4	August 30: 30 percent of the final adjustment for the prior fiscal year for all aid entitlements except state paid property tax credits
Payment 6	September 30: 40 percent of the final adjustment for the prior fiscal year for all aid entitlements except state paid property tax credits
Payment 8	October 30: 30 percent of the final adjustment for the prior fiscal year for all aid entitlements except state paid property tax credits

(c) Notwithstanding paragraph (b), if the current year aid payment percentage under subdivision 2, paragraph (d), is less than 90, in addition to the amounts paid under paragraph (a), the commissioner shall pay to a charter school on the dates indicated an amount computed as follows:

Payment 1	July 15: 75 percent of the final adjustment for the prior fiscal year for all aid entitlements
Payment 8	October 30: 25 percent of the final adjustment for the prior fiscal year for all aid entitlements

EFFECTIVE DATE. This section is effective July 1, 2015.

Sec. 23. Minnesota Statutes 2013 Supplement, section 127A.47, subdivision 7, is amended to read:

Subd. 7. Alternative attendance programs. (a) The general education aid and special education aid for districts must be adjusted for each pupil attending a nonresident district under sections 123A.05 to 123A.08, 124D.03, 124D.08, and 124D.68. The adjustments must be made according to this subdivision.

(b) For purposes of this subdivision, the "unreimbursed cost of providing special education and services" means the difference between: (1) the actual cost of providing special instruction and services, including special transportation and unreimbursed building lease and debt service costs for facilities used primarily for special education, for a pupil with a disability, as defined in section 125A.02, or a pupil, as defined in section 125A.51, who is enrolled in a program listed in this subdivision, minus (2) if the pupil receives special instruction and services outside the regular classroom for more than 60 percent of the school day, the amount of general education revenue and referendum equalization aid as defined in section 125A.11, subdivision 1, paragraph (c), attributable to that pupil for the portion of time the pupil receives special instruction and services outside of the regular classroom, excluding portions attributable to district and school administration, district support services, operations and maintenance, capital expenditures, and pupil transportation, minus (3) special education aid under section 125A.76 attributable to that pupil, that is received by the district providing special instruction and services. For purposes of this paragraph, general education revenue and referendum equalization aid attributable to a pupil must be calculated using the serving district's average general education revenue and referendum equalization aid per adjusted pupil unit.

(c) For fiscal year 2015 and later, special education aid paid to a resident district must be reduced by an amount equal to 90 percent of the unreimbursed cost of providing special education and services.

(d) Notwithstanding paragraph (c), special education aid paid to a resident district must be reduced by an amount equal to 100 percent of the unreimbursed cost of special education and services provided to students at an intermediate district, cooperative, or charter school where the percent of students eligible for special education services is at least 70 percent of the charter school's total enrollment.

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(e) Special education aid paid to the district or cooperative providing special instruction and services for the pupil, or to the fiscal agent district for a cooperative, must be increased by the amount of the reduction in the aid paid to the resident district under paragraphs (c) and (d). If the resident district's special education aid is insufficient to make the full adjustment, the remaining adjustment shall be made to other state aids due to the district.

(f) An area learning center operated by a service cooperative, intermediate district, education district, or a joint powers cooperative may elect through the action of the constituent boards to charge the resident district tuition for pupils rather than to have the general education revenue paid to a fiscal agent school district. Except as provided in paragraph (e), the district of residence must pay tuition equal to at least 90 and no more than 100 percent of the district average general education revenue per pupil unit minus an amount equal to the product of the formula allowance according to section 126C.10, subdivision 2, times .0466, calculated without compensatory revenue and transportation sparsity revenue, times the number of pupil units for pupils attending the area learning center.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 24. Laws 2012, chapter 263, section 1, is amended to read:

Section 1. INNOVATIVE DELIVERY OF EDUCATION SERVICES AND SHARING OF DISTRICT RESOURCES; PILOT PROJECT.

Subdivision 1. Establishment; requirements for participation. (a) A ~~five-year~~ pilot project ~~for the 2013-2014 through 2017-2018 school years~~ is established to improve student and school outcomes by allowing groups of school districts to work together to provide innovative education programs and activities and share district resources. The pilot project may last until June 30, 2018, or for up to five years, whichever is less, except that innovation partnerships formed during the period of the pilot project may continue past June 30, 2018, with the agreement of the partnership members.

(b) To participate in this pilot project to improve student and school outcomes, a group of two or more school districts must collaborate with school staff and receive formal school board approval to form a partnership. The partnership must develop a plan to provide challenging programmatic options for students, create professional development opportunities for educators, increase student engagement and connection and challenging learning opportunities for students, or demonstrate efficiencies in delivering financial and other services. The plan must establish:

(1) collaborative educational goals and objectives;

(2) strategies and processes to implement those goals and objectives, including a budget process with periodic expenditure reviews;

(3) valid and reliable measures to evaluate progress in realizing the goals and objectives;

(4) an implementation timeline; and

(5) other applicable conditions, regulations, responsibilities, duties, provisions, fee schedules, and legal considerations needed to fully implement the plan.

A partnership may invite additional districts to join the partnership during the pilot project term after notifying the commissioner.

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(c) A partnership of interested districts must apply by February 1~~, 2013,~~ of any year to the education commissioner in the form and manner the commissioner determines, consistent with this section. The application must contain the formal approval adopted by the school board in each district to participate in the plan.

(d) Notwithstanding other law to the contrary, a participating school district under this section continues to: receive revenue and maintain its taxation authority; be organized and governed by an elected school board with general powers under Minnesota Statutes, section 123B.02; and be subject to employment agreements under Minnesota Statutes, chapter 122A, and Minnesota Statutes, section 179A.20; and district employees continue to remain employees of the employing school district.

Subd. 2. Commissioner's role. Interested groups of school districts must submit a completed application to the commissioner by March 1~~, 2013,~~ of any year in the form and manner determined by the commissioner. The education commissioner must convene an advisory panel composed of a teacher appointed by Education Minnesota, a school principal appointed by the Minnesota Association of Secondary School Principals, a school board member appointed by the Minnesota School Boards Association, and a school superintendent appointed by the Minnesota Association of School Administrators to advise the commissioner on applicants' qualifications to participate in this pilot project. The commissioner ~~must select between three and~~ may select up to six qualified applicants under subdivision 1 by April 1~~, 2013,~~ of any year to participate in this pilot project, ensuring an equitable geographical distribution of project participants to the extent practicable. The commissioner must select only those applicants that fully comply with the requirements in subdivision 1. The commissioner must terminate a project participant that fails to effectively implement the goals and objectives contained in its application and according to its stated timeline.

Subd. 3. Pilot project evaluation. Participating school districts must submit pilot project data to the commissioner in the form and manner determined by the commissioner. The education commissioner must analyze participating districts' progress in realizing their educational goals and objectives to work together in providing innovative education programs and activities and sharing resources. The commissioner must include the analysis of best practices in a report to the legislative committees with jurisdiction over kindergarten through grade 12 education finance and policy on the efficacy of this pilot project. The commissioner ~~may~~ shall submit an interim project report ~~at any time~~ by February 1, 2016, and must submit a final report to the legislature by February 1, ~~2018~~ 2019, recommending whether or not to continue or expand the pilot project.

Sec. 25. Laws 2012, chapter 263, section 1, the effective date, is amended to read:

EFFECTIVE DATE. This section is effective the day following final enactment ~~and applies to the 2013-2014 through 2017-2018 school years~~.

Sec. 26. Laws 2013, chapter 116, article 1, section 58, subdivision 2, is amended to read:

Subd. 2. General education aid. For general education aid under Minnesota Statutes, section 126C.13, subdivision 4:

		$ ~~6,051,766,000~~ 6,851,972,000	. . . . .	2014
		$ ~~6,370,640,000~~ 6,495,698,000	. . . . .	2015

The 2014 appropriation includes ~~$781,842,000~~ $780,709,000 for 2013 and ~~$5,269,924,000~~ $6,071,263,000 for 2014.

The 2015 appropriation includes ~~$823,040,000~~ $589,097,000 for 2014 and ~~$5,547,600,000~~ $5,906,601,000 for 2015.

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Sec. 27. APPROPRIATIONS.

Subdivision 1. Department of Education. The sums indicated in this section are appropriated from the general fund to the Department of Education for the fiscal years designated.

Subd. 2. Recovery program grants. For recovery program grants under Minnesota Statutes, section 124D.695:

$500,000

. . . . .

2015

Sec. 28. REVISOR'S INSTRUCTION.

In Minnesota Statutes, the revisor of statutes shall change the term "location equity" to "local optional."

ARTICLE 18

EDUCATION EXCELLENCE

Section 1. Minnesota Statutes 2012, section 122A.40, subdivision 13, is amended to read:

Subd. 13. Immediate discharge. (a) Except as otherwise provided in paragraph (b), a board may discharge a continuing-contract teacher, effective immediately, upon any of the following grounds:

(1) immoral conduct, insubordination, or conviction of a felony;

(2) conduct unbecoming a teacher which requires the immediate removal of the teacher from classroom or other duties;

(3) failure without justifiable cause to teach without first securing the written release of the school board;

(4) gross inefficiency which the teacher has failed to correct after reasonable written notice;

(5) willful neglect of duty; or

(6) continuing physical or mental disability subsequent to a 12 months leave of absence and inability to qualify for reinstatement in accordance with subdivision 12.

For purposes of this paragraph, conduct unbecoming a teacher includes an unfair discriminatory practice described in section 363A.13.

Prior to discharging a teacher under this paragraph, the board must notify the teacher in writing and state its ground for the proposed discharge in reasonable detail. Within ten days after receipt of this notification the teacher may make a written request for a hearing before the board and it shall be granted before final action is taken. The board may suspend a teacher with pay pending the conclusion of the hearing and determination of the issues raised in the hearing after charges have been filed which constitute ground for discharge. If a teacher has been charged with a felony and the underlying conduct that is the subject of the felony charge is a ground for a proposed immediate discharge, the suspension pending the conclusion of the hearing and determination of the issues may be without pay. If a hearing under this paragraph is held, the board must reimburse the teacher for any salary or compensation withheld if the final decision of the board or the arbitrator does not result in a penalty to or suspension, termination, or discharge of the teacher.

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(b) A board must discharge a continuing-contract teacher, effective immediately, upon receipt of notice under section 122A.20, subdivision 1, paragraph (b), that the teacher's license has been revoked due to a conviction for child abuse or sexual abuse.

(c) When a teacher is discharged under paragraph (b) or when the commissioner makes a final determination of child maltreatment involving a teacher under section 626.556, subdivision 11, the school principal or other person having administrative control of the school must include in the teacher's employment record the information contained in the record of the disciplinary action or the final maltreatment determination, consistent with the definition of public data under section 13.41, subdivision 5, and must provide the Board of Teaching and the licensing division at the department with the necessary and relevant information to enable the Board of Teaching and the department's licensing division to fulfill their statutory and administrative duties related to issuing, renewing, suspending, or revoking a teacher's license. Information received by the Board of Teaching or the licensing division at the department under this paragraph is governed by section 13.41 or other applicable law governing data of the receiving entity. In addition to the background check required under section 123B.03, a school board or other school hiring authority must contact the Board of Teaching and the department to determine whether the teacher's license has been suspended or revoked, consistent with the discharge and final maltreatment determinations identified in this paragraph.

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

Sec. 2. Minnesota Statutes 2012, section 122A.41, subdivision 6, is amended to read:

Subd. 6. Grounds for discharge or demotion. (a) Except as otherwise provided in paragraph (b), causes for the discharge or demotion of a teacher either during or after the probationary period must be:

(1) immoral character, conduct unbecoming a teacher, or insubordination;

(2) failure without justifiable cause to teach without first securing the written release of the school board having the care, management, or control of the school in which the teacher is employed;

(3) inefficiency in teaching or in the management of a school, consistent with subdivision 5, paragraph (b);

(4) affliction with active tuberculosis or other communicable disease must be considered as cause for removal or suspension while the teacher is suffering from such disability; or

(5) discontinuance of position or lack of pupils.

For purposes of this paragraph, conduct unbecoming a teacher includes an unfair discriminatory practice described in section 363A.13.

(b) A probationary or continuing-contract teacher must be discharged immediately upon receipt of notice under section 122A.20, subdivision 1, paragraph (b), that the teacher's license has been revoked due to a conviction for child abuse or sexual abuse.

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renewing, suspending, or revoking a teacher's license. Information received by the Board of Teaching or the licensing division at the department under this paragraph is governed by section 13.41 or other applicable law governing data of the receiving entity. In addition to the background check required under section 123B.03, a school board or other school hiring authority must contact the Board of Teaching and the department to determine whether the teacher's license has been suspended or revoked, consistent with the discharge and final maltreatment determinations identified in this paragraph.

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

Sec. 3. Minnesota Statutes 2012, section 122A.415, subdivision 1, is amended to read:

Subdivision 1. Revenue amount. (a) A school district, intermediate school district, school site, or charter school that meets the conditions of section 122A.414 and submits an application approved by the commissioner is eligible for alternative teacher compensation revenue.

(b) For school district and intermediate school district applications, the commissioner must consider only those applications to participate that are submitted jointly by a district and the exclusive representative of the teachers. The application must contain an alternative teacher professional pay system agreement that:

(1) implements an alternative teacher professional pay system consistent with section 122A.414; and

(2) is negotiated and adopted according to the Public Employment Labor Relations Act under chapter 179A, except that notwithstanding section 179A.20, subdivision 3, a district may enter into a contract for a term of two or four years.

Alternative teacher compensation revenue for a qualifying school district or site in which the school board and the exclusive representative of the teachers agree to place teachers in the district or at the site on the alternative teacher professional pay system equals $260 times the number of pupils enrolled at the district or site on October 1 of the previous fiscal year. Alternative teacher compensation revenue for a qualifying intermediate school district must be calculated under ~~section 126C.10, subdivision 34~~ subdivision 4, paragraphs (a) and (b).

(c) For a newly combined or consolidated district, the revenue shall be computed using the sum of pupils enrolled on October 1 of the previous year in the districts entering into the combination or consolidation. The commissioner may adjust the revenue computed for a site using prior year data to reflect changes attributable to school closings, school openings, or grade level reconfigurations between the prior year and the current year.

(d) The revenue is available only to school districts, intermediate school districts, school sites, and charter schools that fully implement an alternative teacher professional pay system by October 1 of the current school year.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 4. Minnesota Statutes 2013 Supplement, section 124D.862, subdivision 1, is amended to read:

Subdivision 1. Initial achievement and integration revenue. (a) An eligible district's initial achievement and integration revenue equals the lesser of 100.3 percent of the district's expenditures under the budget approved by the commissioner under section 124D.861, subdivision 3, paragraph (c), excluding expenditures used to generate incentive revenue under subdivision 2, or the sum of (1) $350 times the district's adjusted pupil units for that year times the ratio of the district's enrollment of protected students for the previous school year to total enrollment for the previous school year and (2) the greater of zero or 66 percent of the difference between the district's integration revenue for fiscal year 2013 and the district's integration revenue for fiscal year 2014 under clause (1).

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(b) In each year, 0.3 percent of each district's initial achievement and integration revenue is transferred to the department for the oversight and accountability activities required under this section and section 124D.861.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to revenue for fiscal year 2014 and later.

Sec. 5. Minnesota Statutes 2013 Supplement, section 124D.862, subdivision 2, is amended to read:

Subd. 2. Incentive revenue. An eligible school district's maximum incentive revenue equals $10 per adjusted pupil unit. ~~In order to receive this revenue, a district must be~~ A district's incentive revenue equals the lesser of the maximum incentive revenue or the district's expenditures for implementing a voluntary plan to reduce racial and economic enrollment disparities through intradistrict and interdistrict activities that have been approved as a part of the district's achievement and integration plan under the budget approved by the commissioner under section 124D.861, subdivision 3, paragraph (c).

EFFECTIVE DATE. This section is effective the day following final enactment and applies to revenue for fiscal year 2014 and later.

Sec. 6. Laws 2013, chapter 116, article 3, section 37, subdivision 11, is amended to read:

Subd. 11. Concurrent enrollment program. For concurrent enrollment programs under Minnesota Statutes, section 124D.091:

		$2,000,000	. . . . .	2014
		$ ~~2,000,000~~ 3,897,000	. . . . .	2015

If the appropriation is insufficient, the commissioner must proportionately reduce the aid payment to each district.

Any balance in the first year does not cancel but is available in the second year. The annual base budget for this program is $2,000,000 for fiscal years 2016 and 2017.

Sec. 7. Laws 2013, chapter 116, article 3, section 37, subdivision 15, is amended to read:

Subd. 15. Early childhood literacy programs. For early childhood literacy programs under Minnesota Statutes, section 119A.50, subdivision 3:

		$4,125,000	. . . . .	2014
		$ ~~4,125,000~~ 4,625,000	. . . . .	2015

Up to $4,125,000 ~~each~~ in the first year and $4,625,000 in the second year is for leveraging federal and private funding to support AmeriCorps members serving in the Minnesota Reading Corps program established by ServeMinnesota, including costs associated with the training and teaching of early literacy skills to children age three to grade 3 and the evaluation of the impact of the program under Minnesota Statutes, sections 124D.38, subdivision 2, and 124D.42, subdivision 6. Up to $500,000 in fiscal year 2015 must be used to support priority and focus schools as defined by the Department of Education and to expand kindergarten programming.

Any balance in the first year does not cancel but is available in the second year.

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Sec. 8. BETTER ALIGNING MINNESOTA'S ALTERNATIVE TEACHER PROFESSIONAL PAY SYSTEM AND TEACHER DEVELOPMENT AND EVALUATION PROGRAM.

To better align Minnesota's alternative teacher professional pay system under Minnesota Statutes, sections 122A.413 to 122A.416, and Minnesota's teacher development and evaluation program under Minnesota Statutes, sections 122A.40, subdivision 8, and 122A.41, subdivision 5, and effect and fund an improved alignment of this system and program, the commissioner of education must consult with stakeholders, including, but not limited to, representatives of the Minnesota Association of School Administrators, the Minnesota Association of Secondary School Principals, the Minnesota Elementary School Principals' Association, Education Minnesota, Schools for Equity in Education, the Minnesota Business Partnership, the Minnesota Chamber of Commerce, the Minnesota School Boards Association, the Department of Education, the College of Education and Human Development at the University of Minnesota, the Minnesota Association of the Colleges for Teacher Education, licensed elementary and secondary school teachers employed in school districts with an alternative teacher professional pay system agreement and licensed elementary and secondary school teachers employed in school districts without an alternative teacher professional pay system agreement, where one or more of these teachers may be a master teacher, peer evaluator, in another teacher leader position, or national board certified teacher, a teacher or school administrator employed in a Minnesota charter school with an alternative teacher professional pay system agreement and a teacher or school administrator employed in a Minnesota charter school without an alternative teacher professional pay system agreement, a parent or guardian of a student currently enrolled in a Minnesota public school, the Association of Metropolitan School Districts, and the Minnesota Rural Education Association. The commissioner also must consult with members of the house of representatives and members of the senate.

The commissioner, by February 1, 2015, must submit to the education policy and finance committees of the legislature written recommendations on better aligning and financing the alternative teacher professional pay system and teacher development and evaluation program.

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

Sec. 9. CAREER AND TECHNICAL EDUCATION PROGRAM INVENTORY.

(a) The commissioner of education must consult with experts knowledgeable about secondary and postsecondary career and technical education programs to determine the content and status of particular career and technical education programs in Minnesota school districts, including cooperating districts under Minnesota Statutes, 123A.33, subdivision 2, integration districts, and postsecondary institutions partnering with school districts or offering courses through PSEO or career and technical programs and the rates of student participation and completion for these various programs, including: agriculture, food, and natural resources; architecture and construction; arts, audiovisual technology, and communications; business management and administration; computer science; family and consumer science; finance; health science; hospitality and tourism; human services; information technology; manufacturing; marketing; science, technology, engineering, and mathematics; and transportation, distribution, and logistics.

(b) To accomplish paragraph (a) and to understand the current role of local school districts and postsecondary institutions in providing career and technical education programs, the commissioner of education, in consultation with experts, also must examine the extent to which secondary and postsecondary education programs offer students a progression of coordinated, nonduplicative courses that adequately prepare students to successfully complete a career and technical education program.

(c) The commissioner of education must submit a report by February 1, 2015, to the education policy and finance committees of the legislature, consistent with this section, and include information about each district's dedicated equipment, resources, and relationships with postsecondary institutions and the local business community.

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

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Sec. 10. APPROPRIATIONS.

Subdivision 1. Department of Education. The sums indicated in this section are appropriated from the general fund to the Department of Education for the fiscal years designated.

Subd. 2. Career and technical program inventory. For the career and technical program inventory program under section 9:

$150,000

. . . . .

2015

This is a onetime appropriation.

Subd. 3. Teacher Professional Pay System and Teacher Evaluation Program alignment. For the alignment and reporting activities under section 8:

$25,000

. . . . .

2015

ARTICLE 19

SPECIAL EDUCATION

Section 1. Minnesota Statutes 2013 Supplement, section 125A.0942, is amended to read:

125A.0942 STANDARDS FOR RESTRICTIVE PROCEDURES.

Subdivision 1. Restrictive procedures plan. (a) Schools that intend to use restrictive procedures shall maintain and make publicly accessible in an electronic format on a school or district Web site or make a paper copy available upon request describing a restrictive procedures plan for children with disabilities that at least:

(1) lists the restrictive procedures the school intends to use;

(2) describes how the school will implement a range of positive behavior strategies and provide links to mental health services;

(3) describes how the school will provide training on de-escalation techniques, consistent with section 122A.09, subdivision 4, paragraph (k);

(4) describes how the school will monitor and review the use of restrictive procedures, including:

(i) conducting post-use debriefings, consistent with subdivision 3, paragraph (a), clause (5); and

(ii) convening an oversight committee to undertake a quarterly review of the use of restrictive procedures based on patterns or problems indicated by similarities in the time of day, day of the week, duration of the use of a procedure, the individuals involved, or other factors associated with the use of restrictive procedures; the number of times a restrictive procedure is used schoolwide and for individual children; the number and types of injuries, if any, resulting from the use of restrictive procedures; whether restrictive procedures are used in nonemergency situations; the need for additional staff training; and proposed actions to minimize the use of restrictive procedures; and

~~(4)~~ (5) includes a written description and documentation of the training staff completed under subdivision 5.

(b) Schools annually must publicly identify oversight committee members who must at least include:

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(1) a mental health professional, school psychologist, or school social worker;

(2) an expert in positive behavior strategies;

(3) a special education administrator; and

(4) a general education administrator.

Subd. 2. Restrictive procedures. (a) Restrictive procedures may be used only by a licensed special education teacher, school social worker, school psychologist, behavior analyst certified by the National Behavior Analyst Certification Board, a person with a master's degree in behavior analysis, other licensed education professional, paraprofessional under section 120B.363, or mental health professional under section 245.4871, subdivision 27, who has completed the training program under subdivision 5.

(b) A school shall make reasonable efforts to notify the parent on the same day a restrictive procedure is used on the child, or if the school is unable to provide same-day notice, notice is sent within two days by written or electronic means or as otherwise indicated by the child's parent under paragraph ~~(d)~~ (f).

(c) The district must hold a meeting of the individualized education program team, conduct or review a functional behavioral analysis, review data, consider developing additional or revised positive behavioral interventions and supports, consider actions to reduce the use of restrictive procedures, and modify the individualized education program or behavior intervention plan as appropriate. The district must hold the meeting: within ten calendar days after district staff use restrictive procedures on two separate school days within 30 calendar days or a pattern of use emerges and the child's individualized education program or behavior intervention plan does not provide for using restrictive procedures in an emergency; or at the request of a parent or the district after restrictive procedures are used. The district must review use of restrictive procedures at a child's annual individualized education program meeting when the child's individualized education program provides for using restrictive procedures in an emergency.

(d) If the individualized education program team under paragraph (c) determines that existing interventions and supports are ineffective in reducing the use of restrictive procedures or the district uses restrictive procedures on a child on ten or more school days during the same school year, the team, as appropriate, either must consult with other professionals working with the child; consult with experts in behavior analysis, mental health, communication, or autism; consult with culturally competent professionals; review existing evaluations, resources, and successful strategies; or consider whether to reevaluate the child.

(e) At the individualized education program meeting under paragraph (c), the team must review any known medical or psychological limitations, including any medical information the parent provides voluntarily, that contraindicate the use of a restrictive procedure, consider whether to prohibit that restrictive procedure, and document any prohibition in the individualized education program or behavior intervention plan.

(f) An individualized education program team may plan for using restrictive procedures and may include these procedures in a child's individualized education program or behavior intervention plan; however, the restrictive procedures may be used only in response to behavior that constitutes an emergency, consistent with this section. The individualized education program or behavior intervention plan shall indicate how the parent wants to be notified when a restrictive procedure is used.

Subd. 3. Physical holding or seclusion. (a) Physical holding or seclusion may be used only in an emergency. A school that uses physical holding or seclusion shall meet the following requirements:

(1) physical holding or seclusion is the least intrusive intervention that effectively responds to the emergency;

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(2) physical holding or seclusion is not used to discipline a noncompliant child;

(3) physical holding or seclusion ends when the threat of harm ends and the staff determines the child can safely return to the classroom or activity;

(4) staff directly observes the child while physical holding or seclusion is being used;

(5) each time physical holding or seclusion is used, the staff person who implements or oversees the physical holding or seclusion documents, as soon as possible after the incident concludes, the following information:

(i) a description of the incident that led to the physical holding or seclusion;

(ii) why a less restrictive measure failed or was determined by staff to be inappropriate or impractical;

(iii) the time the physical holding or seclusion began and the time the child was released; and

(iv) a brief record of the child's behavioral and physical status;

(6) the room used for seclusion must:

(i) be at least six feet by five feet;

(ii) be well lit, well ventilated, adequately heated, and clean;

(iii) have a window that allows staff to directly observe a child in seclusion;

(iv) have tamperproof fixtures, electrical switches located immediately outside the door, and secure ceilings;

(v) have doors that open out and are unlocked, locked with keyless locks that have immediate release mechanisms, or locked with locks that have immediate release mechanisms connected with a fire and emergency system; and

(vi) not contain objects that a child may use to injure the child or others;

(7) before using a room for seclusion, a school must:

(i) receive written notice from local authorities that the room and the locking mechanisms comply with applicable building, fire, and safety codes; and

(ii) register the room with the commissioner, who may view that room; and

(8) until August 1, 2015, a school district may use prone restraints with children age five or older if:

(i) the district has provided to the department a list of staff who have had specific training on the use of prone restraints;

(ii) the district provides information on the type of training that was provided and by whom;

(iii) only staff who received specific training use prone restraints;

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(iv) each incident of the use of prone restraints is reported to the department within five working days on a form provided by the department; and

(v) the district, before using prone restraints, must review any known medical or psychological limitations that contraindicate the use of prone restraints.

The department must collect data on districts' use of prone restraints and publish the data in a readily accessible format on the department's Web site on a quarterly basis.

(b) By ~~March 1, 2014~~ February 1, 2015, and annually thereafter, stakeholders must recommend to the commissioner specific and measurable implementation and outcome goals for reducing the use of restrictive procedures and the commissioner must submit to the legislature a report on districts' progress in reducing the use of restrictive procedures that recommends how to further reduce these procedures and eliminate the use of prone restraints. The statewide plan includes the following components: measurable goals; the resources, training, technical assistance, mental health services, and collaborative efforts needed to significantly reduce districts' use of prone restraints; and recommendations to clarify and improve the law governing districts' use of restrictive procedures. The commissioner must consult with interested stakeholders when preparing the report, including representatives of advocacy organizations, special education directors, teachers, paraprofessionals, intermediate school districts, school boards, day treatment providers, county social services, state human services department staff, mental health professionals, and autism experts. By June 30 each year, districts must report summary data on their use of restrictive procedures to the department, in a form and manner determined by the commissioner. The summary data must include information about the use of restrictive procedures, including use of reasonable force under section 121A.582.

Subd. 4. Prohibitions. The following actions or procedures are prohibited:

(1) engaging in conduct prohibited under section 121A.58;

(2) requiring a child to assume and maintain a specified physical position, activity, or posture that induces physical pain;

(3) totally or partially restricting a child's senses as punishment;

(4) presenting an intense sound, light, or other sensory stimuli using smell, taste, substance, or spray as punishment;

(5) denying or restricting a child's access to equipment and devices such as walkers, wheelchairs, hearing aids, and communication boards that facilitate the child's functioning, except when temporarily removing the equipment or device is needed to prevent injury to the child or others or serious damage to the equipment or device, in which case the equipment or device shall be returned to the child as soon as possible;

(6) interacting with a child in a manner that constitutes sexual abuse, neglect, or physical abuse under section 626.556;

(7) withholding regularly scheduled meals or water;

(8) denying access to bathroom facilities; and

(9) physical holding that restricts or impairs a child's ability to breathe, restricts or impairs a child's ability to communicate distress, places pressure or weight on a child's head, throat, neck, chest, lungs, sternum, diaphragm, back, or abdomen, or results in straddling a child's torso.

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Subd. 5. Training for staff. (a) To meet the requirements of subdivision 1, staff who use restrictive procedures, including paraprofessionals, shall complete training in the following skills and knowledge areas:

(1) positive behavioral interventions;

(2) communicative intent of behaviors;

(3) relationship building;

(4) alternatives to restrictive procedures, including techniques to identify events and environmental factors that may escalate behavior;

(5) de-escalation methods;

(6) standards for using restrictive procedures only in an emergency;

(7) obtaining emergency medical assistance;

(8) the physiological and psychological impact of physical holding and seclusion;

(9) monitoring and responding to a child's physical signs of distress when physical holding is being used;

(10) recognizing the symptoms of and interventions that may cause positional asphyxia when physical holding is used;

(11) district policies and procedures for timely reporting and documenting each incident involving use of a restricted procedure; and

(12) schoolwide programs on positive behavior strategies.

(b) The commissioner, after consulting with the commissioner of human services, must develop and maintain a list of training programs that satisfy the requirements of paragraph (a). The commissioner also must develop and maintain a list of experts to help individualized education program teams reduce the use of restrictive procedures. The district shall maintain records of staff who have been trained and the organization or professional that conducted the training. The district may collaborate with children's community mental health providers to coordinate trainings.

Subd. 6. Behavior supports; reasonable force. (a) School districts are encouraged to establish effective schoolwide systems of positive behavior interventions and supports.

(b) Nothing in this section or section 125A.0941 precludes the use of reasonable force under sections 121A.582; 609.06, subdivision 1; and 609.379. For the 2014-2015 school year and later, districts must collect and submit to the commissioner summary data, consistent with subdivision 3, paragraph (b), on district use of reasonable force that is consistent with the definition of physical holding or seclusion for a child with a disability under this section.

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

Sec. 2. Minnesota Statutes 2013 Supplement, section 125A.11, subdivision 1, is amended to read:

Subdivision 1. Nonresident tuition rate; other costs. (a) For fiscal year 2015 and later, when a school district provides special instruction and services for a pupil with a disability as defined in section 125A.02 outside the district of residence, excluding a pupil for whom an adjustment to special education aid is calculated according to section 127A.47, subdivision 7, paragraphs (b) to (d), special education aid paid to the resident district must be

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reduced by an amount equal to (1) the actual cost of providing special instruction and services to the pupil, including a proportionate amount for special transportation and unreimbursed building lease and debt service costs for facilities used primarily for special education, plus (2) the amount of general education revenue and referendum equalization aid attributable to that pupil, calculated using the resident district's average general education revenue and referendum equalization aid per adjusted pupil unit excluding basic skills revenue, elementary sparsity revenue and secondary sparsity revenue, minus (3) the amount of special education aid for children with a disability under section 125A.76 received on behalf of that child, minus (4) if the pupil receives special instruction and services outside the regular classroom for more than 60 percent of the school day, the amount of general education revenue and referendum equalization aid, excluding portions attributable to district and school administration, district support services, operations and maintenance, capital expenditures, and pupil transportation, attributable to that pupil for the portion of time the pupil receives special instruction and services outside of the regular classroom, calculated using the resident district's average general education revenue and referendum equalization aid per adjusted pupil unit excluding basic skills revenue, elementary sparsity revenue and secondary sparsity revenue and the serving district's basic skills revenue, elementary sparsity revenue and secondary sparsity revenue per adjusted pupil unit. Notwithstanding clauses (1) and (4), for pupils served by a cooperative unit without a fiscal agent school district, the general education revenue and referendum equalization aid attributable to a pupil must be calculated using the resident district's average general education revenue and referendum equalization aid excluding compensatory revenue, elementary sparsity revenue, and secondary sparsity revenue. Special education aid paid to the district or cooperative providing special instruction and services for the pupil must be increased by the amount of the reduction in the aid paid to the resident district. Amounts paid to cooperatives under this subdivision and section 127A.47, subdivision 7, shall be recognized and reported as revenues and expenditures on the resident school district's books of account under sections 123B.75 and 123B.76. If the resident district's special education aid is insufficient to make the full adjustment, the remaining adjustment shall be made to other state aid due to the district.

(b) Notwithstanding paragraph (a) and section 127A.47, subdivision 7, paragraphs (b) to (d), a charter school where more than 30 percent of enrolled students receive special education and related services, a site approved under section 125A.515, an intermediate district, a special education cooperative, or a school district that served as the applicant agency for a group of school districts for federal special education aids for fiscal year 2006 may apply to the commissioner for authority to charge the resident district an additional amount to recover any remaining unreimbursed costs of serving pupils with a disability. The application must include a description of the costs and the calculations used to determine the unreimbursed portion to be charged to the resident district. Amounts approved by the commissioner under this paragraph must be included in the tuition billings or aid adjustments under paragraph (a), or section 127A.47, subdivision 7, paragraphs (b) to (d), as applicable.

(c) For purposes of this subdivision and section 127A.47, subdivision 7, ~~paragraphs (d) and (e)~~ paragraph (b), "general education revenue and referendum equalization aid" means the sum of the general education revenue according to section 126C.10, subdivision 1, excluding the local optional levy according to section 126C.10, subdivision 2e, paragraph (c), plus the referendum equalization aid according to section 126C.17, subdivision 7.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 3. Minnesota Statutes 2013 Supplement, section 125A.76, subdivision 1, is amended to read:

Subdivision 1. Definitions. (a) For the purposes of this section and section 125A.79, the definitions in this subdivision apply.

(b) "Basic revenue" has the meaning given it in section 126C.10, subdivision 2. For the purposes of computing basic revenue pursuant to this section, each child with a disability shall be counted as prescribed in section 126C.05, subdivision 1.

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(c) "Essential personnel" means teachers, cultural liaisons, related services, and support services staff providing services to students. Essential personnel may also include special education paraprofessionals or clericals providing support to teachers and students by preparing paperwork and making arrangements related to special education compliance requirements, including parent meetings and individualized education programs. Essential personnel does not include administrators and supervisors.

(d) "Average daily membership" has the meaning given it in section 126C.05.

(e) "Program growth factor" means 1.046 for fiscal years 2012 ~~though~~ through 2015, 1.0 for fiscal year 2016, 1.046 for fiscal year 2017, and the product of 1.046 and the program growth factor for the previous year for fiscal year 2018 and later.

(f) "Nonfederal special education expenditure" means all direct expenditures that are necessary and essential to meet the district's obligation to provide special instruction and services to children with a disability according to sections 124D.454, 125A.03 to 125A.24, 125A.259 to 125A.48, and 125A.65 as submitted by the district and approved by the department under section 125A.75, subdivision 4, excluding expenditures:

(1) reimbursed with federal funds;

(2) reimbursed with other state aids under this chapter;

(3) for general education costs of serving students with a disability;

(4) for facilities;

(5) for pupil transportation; and

(6) for postemployment benefits.

(g) "Old formula special education expenditures" means expenditures eligible for revenue under Minnesota Statutes 2012, section 125A.76, subdivision 2.

(h) For the Minnesota State Academy for the Deaf and the Minnesota State Academy for the Blind, expenditures under paragraphs (f) and (g) are limited to the salary and fringe benefits of one-to-one instructional and behavior management aides and one-to-one licensed, certified professionals assigned to a child attending the academy, if the aides or professionals are required by the child's individualized education program.

~~(h)~~ (i) "Cross subsidy reduction aid percentage" means 1.0 percent for fiscal year 2014 and 2.27 percent for fiscal year 2015.

~~(i)~~ (j) "Cross subsidy reduction aid limit" means $20 for fiscal year 2014 and $48 for fiscal year 2015.

~~(j)~~ (k) "Special education aid increase limit" means $80 for fiscal year 2016, $100 for fiscal year 2017, and, for fiscal year 2018 and later, the sum of the special education aid increase limit for the previous fiscal year and $40.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 4. Minnesota Statutes 2012, section 125A.76, subdivision 2, is amended to read:

Subd. 2. Special education initial aid. The special education initial aid equals the sum of the following amounts computed using current year data:

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(1) 68 percent of the salary of each essential person employed in the district's program for children with a disability during the fiscal year, whether the person is employed by one or more districts or a Minnesota correctional facility operating on a fee-for-service basis;

(2) for the Minnesota State Academy for the Deaf or the Minnesota State Academy for the Blind, 68 percent of the salary of each ~~one to one~~ one-to-one instructional and behavior management aide and one-to-one licensed, certified professional assigned to a child attending the academy, if the aides or professionals are required by the child's individualized education program;

(3) for special instruction and services provided to any pupil by contracting with public, private, or voluntary agencies other than school districts, in place of special instruction and services provided by the district, 52 percent of the difference between the amount of the contract and the general education revenue, excluding basic skills revenue and alternative teacher compensation revenue, and referendum equalization aid attributable to a pupil, calculated using the resident district's average general education revenue and referendum equalization aid per adjusted pupil unit for the fraction of the school day the pupil receives services under the contract. This includes children who are residents of the state, receive services under this subdivision and subdivision 1, and are placed in a care and treatment facility by court action in a state that does not have a reciprocity agreement with the commissioner under section 125A.155 as provided for in section 125A.79, subdivision 8;

(4) for special instruction and services provided to any pupil by contracting for services with public, private, or voluntary agencies other than school districts, that are supplementary to a full educational program provided by the school district, 52 percent of the amount of the contract for that pupil;

(5) for supplies and equipment purchased or rented for use in the instruction of children with a disability, an amount equal to 47 percent of the sum actually expended by the district, or a Minnesota correctional facility operating on a fee-for-service basis, but not to exceed an average of $47 in any one school year for each child with a disability receiving instruction;

(6) for fiscal years 1997 and later, special education base revenue shall include amounts under clauses (1) to (5) for special education summer programs provided during the base year for that fiscal year;

(7) the cost of providing transportation services for children with disabilities under section 123B.92, subdivision 1, paragraph (b), clause (4); and

(8) the district's transition-disabled program initial aid according to section 124D.454, subdivision 3.

The department shall establish procedures through the uniform financial accounting and reporting system to identify and track all revenues generated from third-party billings as special education revenue at the school district level; include revenue generated from third-party billings as special education revenue in the annual cross-subsidy report; and exclude third-party revenue from calculation of excess cost aid to the districts.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

Sec. 5. Minnesota Statutes 2013 Supplement, section 125A.76, subdivision 2a, is amended to read:

Subd. 2a. Special education initial aid. For fiscal year 2016 and later, a district's special education initial aid equals the sum of:

(1) the ~~lesser~~ least of 62 percent of the district's old formula special education expenditures for the prior fiscal year, excluding pupil transportation expenditures, 50 percent of the district's nonfederal special education expenditures for the prior year, excluding pupil transportation expenditures, or 56 percent of the product of the sum of the following amounts, computed using prior fiscal year data, and the program growth factor:

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(i) the product of the district's average daily membership served and the sum of:

(A) $450; plus

(B) $400 times the ratio of the sum of the number of pupils enrolled on October 1 who are eligible to receive free lunch plus one-half of the pupils enrolled on October 1 who are eligible to receive reduced-price lunch to the total October 1 enrollment; plus

(ii) $10,400 times the December 1 child count for the primary disability areas of autism spectrum disorders, developmental delay, and severely multiply impaired; plus

(iii) $18,000 times the December 1 child count for the primary disability areas of deaf and hard-of-hearing and emotional or behavioral disorders; plus

(iv) $27,000 times the December 1 child count for the primary disability areas of developmentally cognitive mild-moderate, developmentally cognitive severe-profound, physically impaired, visually impaired, and deafblind; plus

(2) the cost of providing transportation services for children with disabilities under section 123B.92, subdivision 1, paragraph (b), clause (4).

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2016 and later.

Sec. 6. Minnesota Statutes 2013 Supplement, section 125A.76, subdivision 2b, is amended to read:

Subd. 2b. Cross subsidy reduction aid. For fiscal years 2014 and 2015, the cross subsidy reduction aid for a school district, not including a charter school, equals the lesser of (a) the product of the cross subsidy reduction aid limit and the district's average daily membership served or (b) the sum of the product of the cross subsidy reduction aid percentage, the district's average daily membership served, and the sum of:

(1) $450; plus

(2) $400 times the ratio of the sum of the number of pupils enrolled on October 1 who are eligible to receive free lunch plus one-half of the pupils enrolled on October 1 who are eligible to receive reduced-price lunch to the total October 1 enrollment; plus

(3) .008 times the district's average daily membership served; plus the product of the cross subsidy aid percentage and the sum of:

(i) $10,100 times the December 1 child count for the primary disability areas of autism spectrum disorders, developmental delay, and severely multiply impaired; plus

(ii) $17,500 times the December 1 child count for the primary disability areas of deaf and hard-of-hearing and emotional or behavioral disorders; plus

(iii) $26,000 times the December 1 child count for the primary disability areas of developmentally cognitive mild-moderate, developmentally cognitive severe-profound, physically impaired, visually impaired, and deafblind.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to revenue for fiscal year 2014 and later.

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Sec. 7. Minnesota Statutes 2013 Supplement, section 125A.76, subdivision 2c, is amended to read:

Subd. 2c. Special education aid. (a) For fiscal year 2014 and fiscal year 2015, a district's special education aid equals the sum of the district's special education ~~initial~~ aid under subdivision 5, the district's cross subsidy reduction aid under subdivision 2b, and the district's excess cost aid under section 125A.79, subdivision 7.

(b) For fiscal year 2016 and later, a district's special education aid equals the sum of the district's special education initial aid under subdivision 2a and the district's excess cost aid under section 125A.79, subdivision 5.

(c) Notwithstanding paragraph (b), for fiscal year 2016, the special education aid for a school district must not exceed the sum of the special education aid the district would have received for fiscal year 2016 under Minnesota Statutes 2012, sections 125A.76 and 125A.79, as adjusted according to Minnesota Statutes 2012, sections 125A.11 and 127A.47, subdivision 7, and the product of the district's average daily membership served and the special education aid increase limit.

(d) Notwithstanding paragraph (b), for fiscal year 2017 and later, the special education aid for a school district must not exceed the sum of: (i) the product of the district's average daily membership served and the special education aid increase limit and (ii) the product of the sum of the special education aid the district would have received for fiscal year 2016 under Minnesota Statutes 2012, sections 125A.76 and 125A.79, as adjusted according to Minnesota Statutes 2012, sections 125A.11 and 127A.47, subdivision 7, the ratio of the district's average daily membership served for the current fiscal year to the district's average daily membership served for fiscal year 2016, and the program growth factor.

(e) Notwithstanding paragraph (b), for fiscal year 2016 and later the special education aid for a school district, not including a charter school, must not be less than the lesser of (1) the district's nonfederal special education expenditures for that fiscal year or (2) the product of the sum of the special education aid the district would have received for fiscal year 2016 under Minnesota Statutes 2012, sections 125A.76 and 125A.79, as adjusted according to Minnesota Statutes 2012, sections 125A.11 and 127A.47, subdivision 7, the ratio of the district's adjusted daily membership for the current fiscal year to the district's average daily membership for fiscal year 2016, and the program growth factor.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to revenue for fiscal year 2014 and later.

Sec. 8. Minnesota Statutes 2013 Supplement, section 125A.79, subdivision 1, is amended to read:

Subdivision 1. Definitions. For the purposes of this section, the definitions in this subdivision apply.

(a) "Unreimbursed old formula special education expenditures" means:

(1) old formula special education expenditures for the prior fiscal year; minus

(2) for fiscal years 2014 and 2015, the sum of the special education aid under section 125A.76, subdivision 5, for the prior fiscal year and the cross subsidy reduction aid under section 125A.76, subdivision 2b, and for fiscal year 2016 and later, the special education initial aid under section 125A.76, subdivision 2a; minus

(3) the amount of general education revenue, excluding local optional revenue, plus local optional aid and referendum equalization aid for the prior fiscal year attributable to pupils receiving special instruction and services outside the regular classroom for more than 60 percent of the school day for the portion of time the pupils receive special instruction and services outside the regular classroom, excluding portions attributable to district and school administration, district support services, operations and maintenance, capital expenditures, and pupil transportation.

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(b) "Unreimbursed nonfederal special education expenditures" means:

(1) nonfederal special education expenditures for the prior fiscal year; minus

(2) special education initial aid under section 125A.76, subdivision 2a; minus

(3) for fiscal year 2016 and later, the amount of general education revenue and referendum equalization aid for the prior fiscal year attributable to pupils receiving special instruction and services outside the regular classroom for more than 60 percent of the school day for the portion of time the pupils receive special instruction and services outside of the regular classroom, excluding portions attributable to district and school administration, district support services, operations and maintenance, capital expenditures, and pupil transportation.

(c) "General revenue" for a school district means the sum of the general education revenue according to section 126C.10, subdivision 1, excluding alternative teacher compensation revenue, ~~minus~~ transportation sparsity revenue ~~minus~~, local optional revenue, and total operating capital revenue. "General revenue" for a charter school means the sum of the general education revenue according to section 124D.11, subdivision 1, and transportation revenue according to section 124D.11, subdivision 2, excluding alternative teacher compensation revenue, ~~minus~~ referendum equalization aid ~~minus~~, transportation sparsity revenue ~~minus~~, and operating capital revenue.

EFFECTIVE DATE. This section is effective the day following final enactment and applies to revenue for fiscal year 2014 and later.

Sec. 9. Minnesota Statutes 2013 Supplement, section 125A.79, subdivision 5, is amended to read:

Subd. 5. ~~Initial~~ Excess cost aid. For fiscal year 2016 and later, a district's ~~initial~~ excess cost aid equals the greater of:

(1) 56 percent of the difference between (i) the district's unreimbursed nonfederal special education expenditures and (ii) 7.0 percent of the district's general revenue;

(2) 62 percent of the difference between (i) the district's unreimbursed old formula special education expenditures and (ii) 2.5 percent of the district's general revenue; or

(3) zero.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2016 and later.

Sec. 10. Minnesota Statutes 2013 Supplement, section 125A.79, subdivision 8, is amended to read:

Subd. 8. Out-of-state tuition. For children who are residents of the state, receive services under section 125A.76, subdivisions 1 and 2, and are placed in a care and treatment facility by court action in a state that does not have a reciprocity agreement with the commissioner under section 125A.155, the resident school district shall ~~submit the balance~~ receive special education out-of-state tuition aid equal to the amount of the tuition bills, minus (1) the general education revenue, excluding basic skills revenue and the local optional levy attributable to the pupil, calculated using the resident district's average general education revenue per adjusted pupil unit, ~~and~~ (2) the referendum equalization aid attributable to the pupil, calculated using the resident district's ~~average general education revenue and~~ referendum equalization aid per adjusted pupil unit ~~minus~~, and (3) the special education ~~contracted services initial revenue~~ aid attributable to the pupil.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2015 and later.

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Sec. 11. Laws 2013, chapter 116, article 5, section 31, subdivision 8, is amended to read:

Subd. 8. Special education paperwork cost savings. (a) For the contract to customize a statewide online reporting system and effect special education paperwork cost savings:

$1,763,000

. . . . .

2014

For a transfer to MNIT. This appropriation is available in fiscal year 2015 ~~if not~~ and must be expended according to this subdivision for online due process reporting.

(b) To ensure a strong focus on outcomes for children with disabilities informs federal and state compliance and accountability requirements and to increase opportunities for special educators and related-services providers to focus on teaching children with disabilities, the commissioner must customize a streamlined, user-friendly statewide online system, with a single model online form, for effectively and efficiently collecting and reporting required special education-related data to individuals with a legitimate educational interest and who are authorized by law to access the data.

(c) The commissioner must consult with qualified experts, including information technology specialists, licensed special education teachers and directors of special education, related-services providers, third-party vendors, a designee of the commissioner of human services, parents of children with disabilities, representatives of advocacy groups representing children with disabilities, and representatives of school districts and special education cooperatives on integrating, field testing, customizing, and sustaining this simple, easily accessible, efficient, and effective online data system for uniform statewide reporting of required due process compliance data. Among other outcomes, the system must:

(1) reduce special education teachers' paperwork burden and thereby increase the teachers' opportunities to focus on teaching children;

(2) to the extent authorized by chapter 13 or other applicable state or federal law governing access to and dissemination of educational records, provide for efficiently and effectively transmitting the records of all transferring children with disabilities, including highly mobile and homeless children with disabilities, among others, and avoid fragmented service delivery;

(3) address language and other barriers and disparities that prevent parents from understanding and communicating information about the needs of their children with disabilities; and

(4) help continuously improve the interface among the online systems serving children with disabilities in order to maintain and reinforce the children's ability to learn.

(d) The commissioner must use the federal Office of Special Education Programs model forms for the (1) individualized education program, (2) notice of procedural safeguards, and (3) prior written notice that are consistent with Part B of IDEA to integrate and customize a state-sponsored universal special education online case management system, consistent with the requirements of state law and this subdivision for customizing a statewide online reporting system. The commissioner must use a request for proposal process to contract for the technology and software needed for customizing the online system in order for the system to be fully functional, consistent with the requirements of this subdivision. This online system must be made available to school districts without charge beginning in the 2015-2016 school year. All actions in which data in the system are entered, updated, accessed, or shared or disseminated outside of the system, must be recorded in a data audit trail. The audit trail must identify the user responsible for the action, and the date and time the action occurred. Data contained in the audit trail maintain the same classification as the underlying data that was affected by the action, and may be accessed by the responsible authority at any time for purposes of auditing the system's user activity and security safeguards. For the

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2015-2016 through 2017-2018 school years, school districts may use this online system or may contract with an outside vendor for compliance reporting. Beginning in the 2018-2019 school year and later, school districts must use this online system for compliance reporting.

(e) Consistent with this subdivision, the commissioner must establish a public Internet Web interface to provide information to educators, parents, and the public about the form and content of required special education reports, to respond to queries from educators, parents, and the public about specific aspects of special education reports and reporting, and to use the information garnered from the interface to streamline and revise special education reporting on the online system under this subdivision. The public Internet Web interface must not provide access to the educational records of any individual child.

(f) The commissioner annually by February 1 must submit to the legislature a report on the status, recent changes, and sustainability of the online system under this subdivision.

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

Sec. 12. RULEMAKING AUTHORITY; SPECIAL EDUCATION TASK FORCE RECOMMENDATIONS.

The commissioner of education must use the expedited rulemaking process under Minnesota Statutes, section 14.389, including subdivision 5, to make the rule changes recommended by the Special Education Case Load and Rule Alignment Task Force in its 2014 report entitled "Recommendations for Special Education Case Load and Rule Alignment" submitted to the legislature on February 15, 2014.

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

Sec. 13. APPROPRIATION.

Subdivision 1. Department of Education. The sums indicated in this section are appropriated from the general fund to the Department of Education for the fiscal years designated.

Subd. 2. Department assistance. For the commissioner of education to assist school districts in meeting the needs of children who have experienced a high use of prone restraints, consistent with Minnesota Statutes 2013 Supplement, section 125A.0942:

$250,000

. . . . .

2015

The commissioners of education and human services, or their designees, must discuss coordinating use of funds and personnel available for this purpose within their respective departments. This is a onetime appropriation.

ARTICLE 20

FACILITIES

Section 1. [123A.482] JOINT POWERS COOPERATIVE FACILITY.

Subdivision 1. Schools may be jointly operated. Two or more school districts may agree to jointly operate a secondary facility. The districts may choose to operate the facility according to a joint powers agreement under section 123A.78 or 471.59.

Subd. 2. Expanded program offerings. A jointly operated secondary program seeking funding under section 123A.485 must demonstrate to the commissioner's satisfaction that the jointly operated program provides enhanced learning opportunities and broader curriculum offerings to the students attending that program. The commissioner must approve or disapprove a cooperative secondary program within 60 days of receipt of an application.

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Subd. 3. Transfer of employees. If an employee is transferred between two employer members of the joint powers agreement under this section, the employee's length of service under section 122A.40, subdivision 5, remains uninterrupted. The employee shall receive credit on the receiving district's salary schedule for the employee's educational attainment and years of continuous service in the sending district, or shall receive a comparable salary, whichever is greater. The employee shall receive credit for accrued sick leave and rights to severance benefits as if the employee had been employed by the receiving district during the employee's years of employment in the sending district.

Subd. 4. Revenue. An approved program that is jointly operated under this section is eligible for aid under section 123A.485 and qualifies for a facilities grant under sections 123A.44 to 123A.446.

Subd. 5. Duty to maintain elementary and secondary schools met. A school district operating a joint facility under this section meets the requirements of section 123A.64.

Subd. 6. Estimated market value limit exclusion. Bonds for a cooperative facility operated under this section issued by a member school district are not subject to the net debt limit under section 475.53, subdivision 4.

Subd. 7. Allocation of levy authority for joint facility. For purposes of determining each member district's school levy, a jointly operated secondary program may allocate program costs to each member district according to the joint powers agreement and each member district may include those costs in its tax levy. The joint powers agreement may choose to allocate costs on any basis adopted as part of the joint powers agreement.

Subd. 8. Effect of consolidation. The joint powers agreement may allow member school districts that choose to consolidate to continue to certify levies separately based on each component district's characteristics.

Subd. 9. Bonds. A joint powers district formed under this section may issue bonds according to section 123A.78 or its member districts may issue bonds individually after complying with this subdivision. The joint powers board must submit the project for review and comment under section 123B.71. The joint powers board must hold a hearing on the proposal. If the bonds are not issued under section 123A.78, each member district of the joint powers district must submit the question of authorizing borrowing of funds for the project to the voters of the district at a special election. The question submitted shall state the total amount of funding needed from that district. The member district may issue the bonds according to chapter 475 and certify the levy required by section 475.61 only if a majority of those voting on the question in that district vote in the affirmative and only after the board has adopted a resolution pledging the full faith and credit of that unit. The resolution must irrevocably commit that unit to pay an agreed-upon share of any debt levy shortages that, together with other funds available, would allow the member school board to pay the principal and interest on the obligations. The clerk of the joint powers board must certify the vote of any bond elections to the commissioner. Bonds issued under this section first qualify for debt service equalization aid in fiscal year 2018.

Subd. 10. Election. A district entering into a joint powers agreement under this section may conduct a referendum seeking approval for a new facility. This election may be held separately or at the same time as a bond election under subdivision 9. If the election is held at the same time, the questions may be asked separately or as a conjunctive question. The question must be approved by a majority of those voting on the question. If asked separately and the question fails, a district may not proceed with the sale of bonds according to subdivision 9.

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

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Sec. 2. Minnesota Statutes 2012, section 123A.485, is amended to read:

123A.485 CONSOLIDATION TRANSITION ~~REVENUE~~ AID.

Subdivision 1. Eligibility and use. A district that operates a cooperative facility under section 123A.482 or that has been reorganized after June 30, 1994, under section 123A.48 is eligible for consolidation transition ~~revenue. Revenue is equal to the sum of~~ aid ~~under subdivision 2 and levy under subdivision 3~~. Consolidation transition ~~revenue~~ aid may only be used according to this section. Revenue must be used for the following purposes and may be distributed among these purposes at the discretion of the district or the governing board of the cooperative facility:

(1) to offer early retirement incentives as provided by section 123A.48, subdivision 23;

(2) to reduce operating debt as defined in section 123B.82;

(3) to enhance learning opportunities for students in the reorganized district; ~~and~~

(4) to repay building debt; or

(5) for other costs incurred in the reorganization.

Revenue received and utilized under clause (3) or ~~(4)~~ (5) may be expended for operating, facilities, and/or equipment.

Subd. 2. Aid. ~~(a)~~ Consolidation transition aid is equal to ~~$200~~ $300 times the number of ~~resident~~ adjusted pupil units in the ~~newly created~~ cooperative facility under section 123A.482 or the consolidated district ~~in the year of consolidation and $100 times the number of resident pupil units in the first year following the year of consolidation~~ under section 123A.48. ~~The number of pupil units used to calculate aid in either year shall not exceed 1,000 for districts consolidating July 1, 1994, and 1,500 for districts consolidating July 1, 1995, and thereafter~~ A district may receive aid under this section for not more than five years except as provided in subdivision 4.

(b) If the total appropriation for consolidation transition aid for any fiscal year, plus any amount transferred under section 127A.41, subdivision 8, is insufficient to pay all districts the full amount of aid earned, the department must first pay the districts in the first year following the year of consolidation the full amount of aid earned and distribute any remaining funds to the newly created districts in the first year of consolidation.

Subd. 3. Levy. If the aid available in subdivision 2 is insufficient to cover the costs of the district under section 123A.48, subdivision 23, the district may levy the difference over a period of time not to exceed three years.

Subd. 4. New districts. If a district enters into a cooperative secondary facilities program or consolidates with another district that has received aid under section 123A.39, subdivision 3, or 123A.485 for a combination or consolidation taking effect within six years of the effective date of the new consolidation or the start of the cooperative secondary facilities program, only the pupil units in the district or districts not previously cooperating or reorganized must be counted for aid purposes under subdivision 2. If two or more districts consolidate and all districts received aid under subdivision 2 for a consolidation taking effect within six years of the effective date of the new consolidation, only one quarter of the pupil units in the newly created district must be used to determine aid under subdivision 2.

EFFECTIVE DATE. This section is effective for state aid for fiscal year 2017 and later.

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Sec. 3. Minnesota Statutes 2012, section 123A.64, is amended to read:

123A.64 DUTY TO MAINTAIN ELEMENTARY AND SECONDARY SCHOOLS.

Each district must maintain classified elementary and secondary schools, grades 1 through 12, unless the district is exempt according to section 123A.61 or 123A.62, has made an agreement with another district or districts as provided in sections 123A.30, 123A.32, or sections 123A.35 to 123A.43, or 123A.17, subdivision 7, or has received a grant under sections 123A.441 to 123A.446, or has formed a cooperative under section 123A.482. A district that has an agreement according to sections 123A.35 to 123A.43 or 123A.32 must operate a school with the number of grades required by those sections. A district that has an agreement according to section 123A.30 or 123A.17, subdivision 7, or has received a grant under sections 123A.441 to 123A.446 must operate a school for the grades not included in the agreement, but not fewer than three grades.

Sec. 4. Minnesota Statutes 2013 Supplement, section 123B.53, subdivision 1, is amended to read:

Subdivision 1. Definitions. (a) For purposes of this section, the eligible debt service revenue of a district is defined as follows:

(1) the amount needed to produce between five and six percent in excess of the amount needed to meet when due the principal and interest payments on the obligations of the district for eligible projects according to subdivision 2, including the amounts necessary for repayment of energy loans according to section 216C.37 or sections 298.292 to 298.298, debt service loans and capital loans, lease purchase payments under section 126C.40, subdivision 2, alternative facilities levies under section 123B.59, subdivision 5, paragraph (a), minus

(2) the amount of debt service excess levy reduction for that school year calculated according to the procedure established by the commissioner.

(b) The obligations in this paragraph are excluded from eligible debt service revenue:

(1) obligations under section 123B.61;

(2) the part of debt service principal and interest paid from the taconite environmental protection fund or Douglas J. Johnson economic protection trust, excluding the portion of taconite payments from the Iron Range school consolidation and cooperatively operated school account under section 298.28, subdivision 7a;

(3) obligations issued under Laws 1991, chapter 265, article 5, section 18, as amended by Laws 1992, chapter 499, article 5, section 24; ~~and~~

(4) obligations under section 123B.62; and

(5) obligations equalized under section 123B.535.

(c) For purposes of this section, if a preexisting school district reorganized under sections 123A.35 to 123A.43, 123A.46, and 123A.48 is solely responsible for retirement of the preexisting district's bonded indebtedness, capital loans or debt service loans, debt service equalization aid must be computed separately for each of the preexisting districts.

(d) For purposes of this section, the adjusted net tax capacity determined according to sections 127A.48 and 273.1325 shall be adjusted to include the tax capacity of property generally exempted from ad valorem taxes under section 272.02, subdivision 64.

EFFECTIVE DATE. This section is effective for fiscal year 2017 and later.

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Sec. 5. Minnesota Statutes 2013 Supplement, section 123B.53, subdivision 5, is amended to read:

Subd. 5. Equalized debt service levy. (a) The equalized debt service levy of a district equals the sum of the first tier equalized debt service levy and the second tier equalized debt service levy.

(b) A district's first tier equalized debt service levy equals the district's first tier debt service equalization revenue times the lesser of one or the ratio of:

(1) the quotient derived by dividing the adjusted net tax capacity of the district for the year before the year the levy is certified by the adjusted pupil units in the district for the school year ending in the year prior to the year the levy is certified; to

(2) ~~$3,550~~ $4,970.

(c) A district's second tier equalized debt service levy equals the district's second tier debt service equalization revenue times the lesser of one or the ratio of:

(2) ~~$7,900~~ $8,000.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2016 and later.

Sec. 6. [123B.535] NATURAL DISASTER DEBT SERVICE EQUALIZATION.

Subdivision 1. Definitions. (a) For purposes of this section, the eligible natural disaster debt service revenue of a district is defined as the amount needed to produce between five and six percent in excess of the amount needed to meet when due the principal and interest payments on the obligations of the district that would otherwise qualify under section 123B.53 under the following conditions:

(1) the district was impacted by a natural disaster event or area occurring January 1, 2005, or later, as declared by the President of the United States of America, which is eligible for Federal Emergency Management Agency payments;

(2) the natural disaster caused $500,000 or more in damages to school district buildings; and

(3) the repair and replacement costs are not covered by insurance payments or Federal Emergency Management Agency payments.

(b) For purposes of this section, the adjusted net tax capacity equalizing factor equals the quotient derived by dividing the total adjusted net tax capacity of all school districts in the state for the year before the year the levy is certified by the total number of adjusted pupil units in the state for the year prior to the year the levy is certified.

(c) For purposes of this section, the adjusted net tax capacity determined according to sections 127A.48 and 273.1325 shall be adjusted to include the tax capacity of property generally exempted from ad valorem taxes under section 272.02, subdivision 64.

Subd. 2. Notification. A district eligible for natural disaster debt service equalization revenue under subdivision 1 must notify the commissioner of the amount of its intended natural disaster debt service revenue calculated under subdivision 1 for all bonds sold prior to the notification by July 1 of the calendar year the levy is certified.

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Subd. 3. Natural disaster debt service equalization revenue. The debt service equalization revenue of a district equals the greater of zero or the eligible debt service revenue, minus the greater of zero or the difference between:

(1) the amount raised by a levy of ten percent times the adjusted net tax capacity of the district; and

(2) the district's eligible debt service revenue under section 123B.53.

Subd. 4. Equalized natural disaster debt service levy. A district's equalized natural disaster debt service levy equals the district's natural disaster debt service equalization revenue times the lesser of one or the ratio of:

(2) 300 percent of the statewide adjusted net tax capacity equalizing factor.

Subd. 5. Natural disaster debt service equalization aid. A district's natural disaster debt service equalization aid equals the difference between the district's natural disaster debt service equalization revenue and the district's equalized natural disaster debt service levy.

Subd. 6. Natural disaster debt service equalization aid payment schedule. Debt service equalization aid must be paid according to section 127A.45, subdivision 10.

EFFECTIVE DATE. This section is effective for taxes payable in 2016 and revenue for fiscal year 2017 and later.

Sec. 7. Minnesota Statutes 2013 Supplement, section 123B.54, is amended to read:

123B.54 DEBT SERVICE APPROPRIATION.

(a) The amount necessary to make debt service equalization aid payments under ~~section~~ sections 123B.53 and 123B.535 is annually appropriated from the general fund to the commissioner of education.

(b) The appropriations in paragraph (a) must be reduced by the amount of any money specifically appropriated for the same purpose in any year from any state fund.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2017 and later.

Sec. 8. Minnesota Statutes 2012, section 123B.71, subdivision 8, is amended to read:

Subd. 8. Review and comment. A school district, a special education cooperative, or a cooperative unit of government, as defined in section 123A.24, subdivision 2, must not initiate an installment contract for purchase or a lease agreement, hold a referendum for bonds, nor solicit bids for new construction, expansion, or remodeling of an educational facility that requires an expenditure in excess of $500,000 per school site if it has a capital loan outstanding, or ~~$1,400,000~~ $2,000,000 per school site if it does not have a capital loan outstanding, prior to review and comment by the commissioner. ~~The commissioner may exempt~~ A facility addition, maintenance project, or remodeling project funded only with general education ~~aid and levy~~ revenue, deferred maintenance revenue, alternative facilities bonding and levy program revenue, lease levy proceeds, capital facilities bond proceeds, or health and safety revenue is exempt from this provision ~~after reviewing a written request from a school district describing the scope of work~~. A capital project under section 123B.63 addressing only technology is exempt from this provision if the district submits a school board resolution stating that funds approved by the voters will be used only as authorized in section 126C.10, subdivision 14. A school board shall not separate portions of a single project into components to avoid the requirements of this subdivision.

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Sec. 9. Minnesota Statutes 2012, section 123B.71, subdivision 9, is amended to read:

Subd. 9. Information required. A school board proposing to construct, expand, or remodel a facility ~~described in~~ that requires a review and comment under subdivision 8 shall submit to the commissioner a proposal containing information including at least the following:

(1) the geographic area and population to be served, preschool through grade 12 student enrollments for the past five years, and student enrollment projections for the next five years;

(2) a list of existing facilities by year constructed, their uses, and an assessment of the extent to which alternate facilities are available within the school district boundaries and in adjacent school districts;

(3) a list of the specific deficiencies of the facility that demonstrate the need for a new or renovated facility to be provided, the process used to determine the deficiencies, a list of those deficiencies that will and will not be addressed by the proposed project, and a list of the specific benefits that the new or renovated facility will provide to the students, teachers, and community users served by the facility;

~~(4) the relationship of the project to any priorities established by the school district, educational cooperatives that provide support services, or other public bodies in the service area;~~

(5) a description of the pedestrian, bicycle, and transit connections between the school and nearby residential areas that make it easier for children, teachers, and parents to get to the school by walking, bicycling, and taking transit;

(6) a specification of how the project maximizes the opportunity for cooperative use of existing park, recreation, and other public facilities and whether and how the project will increase collaboration with other governmental or nonprofit entities;

~~(7)~~ (4) a description of the project, including the specification of site and outdoor space acreage and square footage allocations for classrooms, laboratories, and support spaces; estimated expenditures for the major portions of the project; and the dates the project will begin and be completed;

~~(8)~~ (5) a specification of the source of financing the project, including applicable statutory citations; the scheduled date for a bond issue or school board action; a schedule of payments, including debt service equalization aid; and the effect of a bond issue on local property taxes by the property class and valuation;

(9) an analysis of how the proposed new or remodeled facility will affect school district operational or administrative staffing costs, and how the district's operating budget will cover any increased operational or administrative staffing costs;

~~(10) a description of the consultation with local or state transportation officials on multimodal school site access and safety issues, and the ways that the project will address those issues;~~

~~(11) a description of how indoor air quality issues have been considered and a certification that the architects and engineers designing the facility will have professional liability insurance;~~

(12) as required under section 123B.72, for buildings coming into service after July 1, 2002, a certification that the plans and designs for the extensively renovated or new facility's heating, ventilation, and air conditioning systems will meet or exceed code standards; will provide for the monitoring of outdoor airflow and total airflow of ventilation systems; and will provide an indoor air quality filtration system that meets ASHRAE standard 52.1;

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~~(13) a specification of any desegregation requirements that cannot be met by any other reasonable means;~~

~~(14) a specification of how the facility will utilize environmentally sustainable school facility design concepts;~~

(15) a description of how the architects and engineers have considered the American National Standards Institute Acoustical Performance Criteria, Design Requirements and Guidelines for Schools of the maximum background noise level and reverberation times; and

~~(16) any existing information from the relevant local unit of government about the cumulative costs to provide infrastructure to serve the school, such as utilities, sewer, roads, and sidewalks.~~

(6) documents obligating the school district and contractors to comply with items (i) to (vii) in planning and executing the project:

(i) section 471.346 governing municipal contracts;

(ii) sustainable design;

(iii) school facility commissioning under section 123B.72 certifying the plans and designs for the heating, ventilating, air conditioning, and air filtration for an extensively renovated or new facility meet or exceed current code standards, including the ASHRAE air filtration standard 52.1;

(iv) American National Standards Institute Acoustical Performance Criteria, Design Requirements and Guidelines for Schools on maximum background noise level and reverberation times;

(v) State Fire Code;

(vi) chapter 326B governing building codes; and

(vii) consultation with affected government units about the impact of the project on utilities, roads, sewers, sidewalks, retention ponds, school bus and automobile traffic, access to mass transit, and safe access for pedestrians and cyclists.

Sec. 10. Minnesota Statutes 2013 Supplement, section 126C.10, subdivision 2d, is amended to read:

Subd. 2d. Declining enrollment revenue. (a) A school district's declining enrollment revenue equals the greater of zero or the product of: (1) 28 percent of the formula allowance for that year and (2) the difference between the adjusted pupil units for the preceding year and the adjusted pupil units for the current year.

(b) Notwithstanding paragraph (a), for fiscal years 2015, 2016, and 2017 only, a pupil enrolled at the Crosswinds school shall not generate declining enrollment revenue for the district or charter school in which the pupil was last counted in average daily membership.

Sec. 11. Minnesota Statutes 2013 Supplement, section 126C.48, subdivision 8, is amended to read:

Subd. 8. Taconite payment and other reductions. (1) Reductions in levies pursuant to subdivision 1 must be made prior to the reductions in clause (2).

(2) Notwithstanding any other law to the contrary, districts that have revenue pursuant to sections 298.018; 298.225; 298.24 to 298.28, except an amount distributed under sections 298.26; 298.28, subdivision 4, paragraphs (c), clause (ii), and (d); 298.34 to 298.39; 298.391 to 298.396; 298.405; 477A.15; and any law imposing a tax upon

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severed mineral values must reduce the levies authorized by this chapter and chapters 120B, 122A, 123A, 123B, 124A, 124D, 125A, and 127A by 95 percent of the sum of the previous year's revenue specified under this clause and the amount attributable to the same production year distributed to the cities and townships within the school district under section 298.28, subdivision 2, paragraph (c).

(3) The amount of any voter approved referendum, facilities down payment, and debt levies shall not be reduced by more than 50 percent under this subdivision, except that payments under section 298.28, subdivision 7a, may reduce the debt service levy by more than 50 percent. In administering this paragraph, the commissioner shall first reduce the nonvoter approved levies of a district; then, if any payments, severed mineral value tax revenue or recognized revenue under paragraph (2) remains, the commissioner shall reduce any voter approved referendum levies authorized under section 126C.17; then, if any payments, severed mineral value tax revenue or recognized revenue under paragraph (2) remains, the commissioner shall reduce any voter approved facilities down payment levies authorized under section 123B.63 and then, if any payments, severed mineral value tax revenue or recognized revenue under paragraph (2) remains, the commissioner shall reduce any voter approved debt levies.

(4) Before computing the reduction pursuant to this subdivision of the health and safety levy authorized by sections 123B.57 and 126C.40, subdivision 5, the commissioner shall ascertain from each affected school district the amount it proposes to levy under each section or subdivision. The reduction shall be computed on the basis of the amount so ascertained.

(5) To the extent the levy reduction calculated under paragraph (2) exceeds the limitation in paragraph (3), an amount equal to the excess must be distributed from the school district's distribution under sections 298.225, 298.28, and 477A.15 in the following year to the cities and townships within the school district in the proportion that their taxable net tax capacity within the school district bears to the taxable net tax capacity of the school district for property taxes payable in the year prior to distribution. No city or township shall receive a distribution greater than its levy for taxes payable in the year prior to distribution. The commissioner of revenue shall certify the distributions of cities and towns under this paragraph to the county auditor by September 30 of the year preceding distribution. The county auditor shall reduce the proposed and final levies of cities and towns receiving distributions by the amount of their distribution. Distributions to the cities and towns shall be made at the times provided under section 298.27.

Sec. 12. Minnesota Statutes 2012, section 127A.49, subdivision 2, is amended to read:

Subd. 2. Abatements. Whenever by virtue of chapter 278, sections 270C.86, 375.192, or otherwise, the net tax capacity or referendum market value of any district for any taxable year is changed after the taxes for that year have been spread by the county auditor and the local tax rate as determined by the county auditor based upon the original net tax capacity is applied upon the changed net tax capacities, the county auditor shall, prior to February 1 of each year, certify to the commissioner of education the amount of any resulting net revenue loss that accrued to the district during the preceding year. Each year, the commissioner shall pay an abatement adjustment to the district in an amount calculated according to the provisions of this subdivision. This amount shall be deducted from the amount of the levy authorized by section 126C.46. The amount of the abatement adjustment must be the product of:

(1) the net revenue loss as certified by the county auditor, times

(2) the ratio of:

(i) the sum of the amounts of the district's certified levy in the third preceding year according to the following:

(A) section 123B.57, if the district received health and safety aid according to that section for the second preceding year;

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(B) section 124D.20, if the district received aid for community education programs according to that section for the second preceding year;

(C) section 124D.135, subdivision 3, if the district received early childhood family education aid according to section 124D.135 for the second preceding year;

(D) section 126C.17, subdivision 6, if the district received referendum equalization aid according to that section for the second preceding year;

(E) section 126C.10, subdivision 13a, if the district received operating capital aid according to section 126C.10, subdivision 13b, in the second preceding year;

(F) section 126C.10, subdivision 29, if the district received equity aid according to section 126C.10, subdivision 30, in the second preceding year;

(G) section 126C.10, subdivision 32, if the district received transition aid according to section 126C.10, subdivision 33, in the second preceding year;

(H) section 123B.53, subdivision 5, if the district received debt service equalization aid according to section 123B.53, subdivision 6, in the second preceding year;

(I) section 123B.535, subdivision 4, if the district received natural disaster debt service equalization aid according to section 123B.535, subdivision 5, in the second preceding year;

~~(I)~~ (J) section 124D.22, subdivision 3, if the district received school-age care aid according to section 124D.22, subdivision 4, in the second preceding year;

~~(J)~~ (K) section 123B.591, subdivision 3, if the district received deferred maintenance aid according to section 123B.591, subdivision 4, in the second preceding year; and

~~(K)~~ (L) section 126C.10, subdivision 35, if the district received alternative teacher compensation equalization aid according to section 126C.10, subdivision 36, paragraph (a), in the second preceding year; to

(ii) the total amount of the district's certified levy in the third preceding December, plus or minus auditor's adjustments.

EFFECTIVE DATE. This section is effective for revenue for fiscal year 2017 and later.

Sec. 13. Minnesota Statutes 2012, section 127A.49, subdivision 3, is amended to read:

Subd. 3. Excess tax increment. (a) If a return of excess tax increment is made to a district pursuant to sections 469.176, subdivision 2, and 469.177, subdivision 9, or upon decertification of a tax increment district, the school district's aid and levy limitations must be adjusted for the fiscal year in which the excess tax increment is paid under the provisions of this subdivision.

(b) An amount must be subtracted from the district's aid for the current fiscal year equal to the product of:

(1) the amount of the payment of excess tax increment to the district, times

(2) the ratio of:

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(i) the sum of the amounts of the district's certified levy for the fiscal year in which the excess tax increment is paid according to the following: