1.1    .................... moves to amend H.F. No. 2268 as follows:
1.2Delete everything after the enacting clause and insert:

1.3    "Section 1. Minnesota Statutes 2006, section 118A.03, subdivision 3, is amended to
1.4read:
1.5    Subd. 3. Amount. The total amount of the collateral computed at its market value
1.6shall be at least ten percent more than the amount on deposit plus accrued interest at
1.7the close of the financial institution's banking day, except that where the collateral is
1.8irrevocable standby letters of credit issued by Federal Home Loan Banks, the amount of
1.9collateral shall be at least equal to the amount on deposit plus accrued interest at the close
1.10of the financial institution's banking day. The financial institution may furnish both a
1.11surety bond and collateral aggregating the required amount.

1.12    Sec. 2. Minnesota Statutes 2006, section 123B.61, is amended to read:
1.13123B.61 PURCHASE OF CERTAIN EQUIPMENT.
1.14    The board of a district may issue general obligation certificates of indebtedness
1.15or capital notes subject to the district debt limits to: (a) purchase vehicles, computers,
1.16telephone systems, cable equipment, photocopy and office equipment, technological
1.17equipment for instruction, and other capital equipment having an expected useful life at
1.18least as long as the terms of the certificates or notes; (b) purchase computer hardware and
1.19software, without regard to its expected useful life, whether bundled with machinery or
1.20equipment or unbundled, together with application development services and training
1.21related to the use of the computer; and (c) prepay special assessments. The certificates or
1.22notes must be payable in not more than five ten years and must be issued on the terms
1.23and in the manner determined by the board, except that certificates or notes issued to
1.24prepay special assessments must be payable in not more than 20 years. The certificates
1.25or notes may be issued by resolution and without the requirement for an election. The
1.26certificates or notes are general obligation bonds for purposes of section 126C.55. A tax
2.1levy must be made for the payment of the principal and interest on the certificates or
2.2notes, in accordance with section 475.61, as in the case of bonds. The sum of the tax
2.3levies under this section and section 123B.62 for each year must not exceed the lesser
2.4of the amount of the district's total operating capital revenue or the sum of the district's
2.5levy in the general and community service funds excluding the adjustments under this
2.6section for the year preceding the year the initial debt service levies are certified. The
2.7district's general fund levy for each year must be reduced by the sum of (1) the amount
2.8of the tax levies for debt service certified for each year for payment of the principal and
2.9interest on the certificates or notes issued under this section as required by section 475.61,
2.10(2) the amount of the tax levies for debt service certified for each year for payment of the
2.11principal and interest on bonds issued under section 123B.62, and (3) any excess amount
2.12in the debt redemption fund used to retire bonds, certificates, or notes issued under this
2.13section or section 123B.62 after April 1, 1997, other than amounts used to pay capitalized
2.14interest. If the district's general fund levy is less than the amount of the reduction, the
2.15balance shall be deducted first from the district's community service fund levy, and next
2.16from the district's general fund or community service fund levies for the following year. A
2.17district using an excess amount in the debt redemption fund to retire the certificates or
2.18notes shall report the amount used for this purpose to the commissioner by July 15 of the
2.19following fiscal year. A district having an outstanding capital loan under section 126C.69
2.20or an outstanding debt service loan under section 126C.68 must not use an excess amount
2.21in the debt redemption fund to retire the certificates or notes.

2.22    Sec. 3. Minnesota Statutes 2006, section 204B.46, is amended to read:
2.23204B.46 MAIL ELECTIONS; QUESTIONS.
2.24    A county, municipality, or school district submitting questions to the voters at a
2.25special election may apply to the county auditor for approval of an election by mail with
2.26no polling place other than the office of the auditor or clerk. No more than two questions
2.27may be submitted at a mail election and no offices may be voted on at a mail election.
2.28Notice of the election and the special mail procedure must be given at least six weeks prior
2.29to the election. No earlier than 20 or later than 14 days prior to the election, the auditor
2.30or clerk shall mail ballots by nonforwardable mail to all voters registered in the county,
2.31municipality, or school district. Eligible voters not registered at the time the ballots are
2.32mailed may apply for ballots pursuant to chapter 203B.

2.33    Sec. 4. Minnesota Statutes 2006, section 331A.05, subdivision 2, is amended to read:
2.34    Subd. 2. Time of notice. Unless otherwise specified by a particular statute law, or
2.35by order of a court, publication of a public notice shall be as follows:
2.36    (a) the notice shall be published once;
3.1    (b) if the notice is intended to inform the public about a future event, the last
3.2publication shall occur not more than 14 30 days and not less than seven days before
3.3the event;
3.4    (c) if the notice is intended to inform the public about a past action or event, the last
3.5publication shall occur not more than 45 days after occurrence of the action or event.

3.6    Sec. 5. Minnesota Statutes 2006, section 365A.02, is amended to read:
3.7365A.02 DEFINITION DEFINITIONS.
3.8    Subdivision 1. Subordinate service district. "Subordinate service district" means a
3.9defined area within the town in which one or more governmental services or additions to
3.10townwide special services are provided by the town specially for the area and financed
3.11from revenues from the area. The boundaries of a single subordinate service district
3.12may not embrace an entire town.
3.13    Subd. 2. Special services. "Special services" means one or more governmental
3.14services or additions to townwide services provided by the town specially for the area
3.15and financed from revenues from the area.

3.16    Sec. 6. Minnesota Statutes 2006, section 365A.04, is amended to read:
3.17365A.04 CREATION BY PETITION.
3.18    Subdivision 1. Petition. A petition signed by at least 50 percent of the property
3.19owners in the part of the town proposed for the subordinate service district may be
3.20submitted to the town board requesting the establishment of a subordinate service district
3.21to provide a service that the town is otherwise authorized by law to provide. The petition
3.22must include the territorial boundaries of the proposed district and specify the kinds of
3.23services to be provided within the district.
3.24    Subd. 1a. Creation by town. The town may establish a subordinate service district
3.25in a portion of the town by adoption of a resolution, subject to the requirements of
3.26subdivision 2.
3.27    Subd. 2. Public hearing. Upon receipt of the petition, and the verification of the
3.28signatures by the town clerk or prior to adoption of the resolution specified in subdivision
3.291a, the town board shall, within 30 days following verification or prior to adoption of the
3.30resolution specified in subdivision 1a, hold a public hearing on the question of whether or
3.31not the requested district shall be established. The notice of public hearing must specify
3.32the special services to be provided within the subordinate service district and must specify
3.33the territorial boundaries of the requested district. The notice of public hearing must be
3.34published once in a newspaper of general circulation in the town at least 14 days prior
3.35to the date of the public hearing.
4.1    Subd. 3. Approval; disapproval. Within 30 days after the public hearing, the
4.2town board by resolution shall approve or disapprove the establishment of the requested
4.3district. An approving resolution must specify the special services to be provided within
4.4the subordinate service district and must specify the territorial boundaries of the district.
4.5A resolution approving the establishment of the district may contain amendments or
4.6modifications of the district's boundaries or functions as set forth in the petition or the
4.7resolution specified in subdivision 1a.

4.8    Sec. 7. Minnesota Statutes 2006, section 365A.08, is amended to read:
4.9365A.08 FINANCING.
4.10    Subdivision 1. Budget. (a) Upon adoption of the next annual budget following
4.11the creation of a subordinate service district the town board shall include in the budget
4.12appropriate provisions for the operation of the district including either a property tax
4.13levied only on property of the users of the service within the boundaries of the district
4.14or a levy of a service charge against the users of the service within the district, or a
4.15combination of a property tax and a service charge on the users of the service.
4.16    (b) A tax or service charge or a combination of them may be imposed to finance a
4.17function or service in the district that the town ordinarily provides throughout the town
4.18only to the extent that there is an increase in the level of the function or service provided
4.19in the service district over that provided throughout the town. In that case, in addition
4.20to the townwide tax levy, an amount necessary to pay for the increase in the level of the
4.21function or service may be imposed in the district.
4.22    Subd. 2. Bonds. At any time after the requirements of section 356A.06 have been
4.23met and the subordinate service district created, the town board may issue obligations in an
4.24amount it deems necessary to defray in whole or in part the expense incurred and estimated
4.25to be incurred in making capital improvements necessary to operate the subordinate service
4.26district and provide the special services in the district, including every item of cost from
4.27inception to completion and all fees and expenses incurred in connection with the capital
4.28improvements or the financing. The obligations are payable primarily out of the proceeds
4.29of the taxes and service charges imposed under subdivision 1, net revenues as described
4.30in section 444.075, and special assessments under chapter 429. The town board may by
4.31resolution pledge the full faith credit and taxing power of the town to ensure payment of
4.32the principal and interest on the obligations if the proceeds of the taxes and service charges
4.33are insufficient to pay the principal and interest. Obligations must be issued in accordance
4.34with chapter 475, except that the amount of the obligations is not included in determining
4.35the net indebtedness of the town under the provisions of any law limiting indebtedness.
5.1    Subd. 3. Covenants to secure obligations. In resolutions authorizing the issuance
5.2of general or special obligations and pledging taxes and service charges imposed under
5.3subdivision 1, net revenues, or special assessments to their payment, the town board
5.4may make covenants for the protection of holders of the obligations and taxpayers of the
5.5town as it deems necessary, including a covenant that the town will impose and collect
5.6charges of the nature authorized by this chapter at the time and in the amounts required to
5.7produce, together with any taxes or special assessments designated as a primary source
5.8of payment of the obligations, funds adequate to pay all principal and interest when due
5.9on the obligations, and to create and maintain reserves securing the payments as may be
5.10provided in the resolutions.

5.11    Sec. 8. Minnesota Statutes 2006, section 365A.095, is amended to read:
5.12365A.095 PETITION FOR REMOVAL OF DISTRICT; PROCEDURE.
5.13    Subdivision 1. Petition. A petition signed by at least 75 percent of the property
5.14owners in the territory of the subordinate service district requesting the removal of the
5.15district may be presented to the town board. Within 30 days after the town board receives
5.16the petition, the town clerk shall determine the validity of the signatures on the petition. If
5.17the requisite number of signatures are certified as valid, the town board must hold a public
5.18hearing on the petitioned matter. Within 30 days after the end of the hearing, the town
5.19board must decide whether to discontinue the subordinate service district, continue as it is,
5.20or take some other action with respect to it.
5.21    Subd. 2. Bonds. If obligations have been issued for the benefit of the subordinate
5.22service district, the rates, charges, and tax levies, if any, continue until the obligations and
5.23any obligations issued to refund them have been paid in full.

5.24    Sec. 9. Minnesota Statutes 2006, section 373.01, subdivision 3, is amended to read:
5.25    Subd. 3. Capital notes. (a) A county board may, by resolution and without
5.26referendum, issue capital notes subject to the county debt limit to purchase capital
5.27equipment useful for county purposes that has an expected useful life at least equal to the
5.28term of the notes. The notes shall be payable in not more than ten years and shall be
5.29issued on terms and in a manner the board determines. A tax levy shall be made for
5.30payment of the principal and interest on the notes, in accordance with section 475.61,
5.31as in the case of bonds.
5.32    (b) For purposes of this subdivision, "capital equipment" means:
5.33    (1) public safety, ambulance, road construction or maintenance, and medical
5.34equipment; and
6.1    (2) computer hardware and software, whether bundled with machinery or equipment
6.2or unbundled. The authority to issue capital notes for software expires on July 1, 2007.

6.3    Sec. 10. Minnesota Statutes 2006, section 375B.09, is amended to read:
6.4375B.09 FINANCING.
6.5    Subdivision 1. Budget. (a) Upon adoption of the next annual budget following the
6.6creation of a subordinate service district the county board shall include in the budget
6.7appropriate provisions for the operation of the district including, as appropriate, either a
6.8property tax levied only on property within the boundaries of the district or a levy of a
6.9service charge against the users of the service within the district, or any combination of a
6.10property tax and a service charge.
6.11    (b) A tax or service charge or a combination thereof shall not be imposed to finance a
6.12function or service in the subordinate service district which the county generally provides
6.13throughout the county unless an increase in the level of the service is to be supplied in the
6.14subordinate service district in which case, in addition to the countywide tax levy, only an
6.15amount necessary to pay for the increased level of service may be imposed.
6.16    Subd. 2. Bonds. At any time after the requirements of section 375B.07 have been
6.17met and the subordinate service district created, the county board may issue obligations
6.18in an amount it deems necessary to defray in whole or in part the expense incurred
6.19and estimated to be incurred in making capital improvements necessary to operate the
6.20subordinate service district and provide the special services in the district, including every
6.21item of cost from inception to completion and all fees and expenses incurred in connection
6.22with the capital improvements or the financing. The obligations shall be payable primarily
6.23out of the proceeds of the taxes and service charges imposed pursuant to subdivision 1, net
6.24revenues as described in section 444.075, and special assessments under chapter 429. The
6.25county board may by resolution pledge the full faith credit and taxing power of the county
6.26to ensure payment of the principal and interest on the obligations if the proceeds of the
6.27taxes and service charges are insufficient to pay the principal and interest. Obligations
6.28must be issued in accordance with chapter 475, except that the amount of the obligations
6.29is not included in determining the net indebtedness of the county under the provisions of
6.30any law limiting indebtedness.
6.31    Subd. 3. Covenants to secure obligations. In resolutions authorizing the issuance
6.32of general or special obligations and pledging taxes and service charges imposed under
6.33subdivision 1, net revenues, or special assessments to their payment, the county board
6.34may make covenants for the protection of holders of the obligations and taxpayers of the
6.35county as it deems necessary, including a covenant that the county will impose and collect
7.1charges of the nature authorized by this chapter at the time and in the amounts required to
7.2produce, together with any taxes or special assessments designated as a primary source
7.3of payment of the obligations, funds adequate to pay all principal and interest when due
7.4on the obligations and to create and maintain reserves securing the payments as may be
7.5provided in the resolutions.
7.6    Subd. 4. Continuance in the event of withdrawal. If obligations have been issued
7.7for the benefit of the subordinate service district, and the district is withdrawn or removed
7.8pursuant to either section 375B.10 or 375B.11, the rates, charges, and tax levies, if any, in
7.9the withdrawn or removed district must continue until the obligations and any obligations
7.10issued to refund them have been paid in full.

7.11    Sec. 11. Minnesota Statutes 2006, section 383B.77, subdivision 1, is amended to read:
7.12    Subdivision 1. Creation. The Hennepin County Housing and Redevelopment
7.13Authority is created in the county of Hennepin. It shall have all of the powers and duties
7.14of a housing and redevelopment authority under sections 469.001 to 469.047. For the
7.15purposes of applying the municipal housing and redevelopment act to Hennepin County,
7.16the county has all of the powers and duties of a city, the county board has all the powers
7.17and duties of a governing body, the chair of the county board has all of the powers and
7.18duties of a mayor, and, notwithstanding section 469.008, the area of operation includes the
7.19area within the territorial boundaries of the county.
7.20EFFECTIVE DATE.Because the population of Hennepin County is more than
7.211,000,000, under Minnesota Statutes, section 645.023, this section is effective without
7.22local approval.

7.23    Sec. 12. Minnesota Statutes 2006, section 383B.77, subdivision 2, is amended to read:
7.24    Subd. 2. Limitation. This section does not limit or restrict any existing housing
7.25and redevelopment authority or prevent a municipality from creating an authority. For
7.26purposes of this subdivision, "housing and redevelopment authority" includes any
7.27municipal department, agency, or authority of the city of Minneapolis which exercises the
7.28powers of a housing and redevelopment authority pursuant to section 469.003 or other
7.29law. The county authority shall notify a municipal authority by January 31 of each year
7.30as to the activities the county authority plans to participate in within the municipality.
7.31The municipal authority shall notify the county authority within 45 days of the date of
7.32the notice from the county authority, if the municipal authority does not consent to the
7.33activities of the county authority. The county authority shall not exercise its powers in a
7.34municipality where a housing and redevelopment authority was created under Minnesota
7.35Statutes 1969, chapter 462, before June 8, 1971, except as provided in this subdivision. If a
8.1city housing and redevelopment authority requests the county housing and redevelopment
8.2authority to exercise any power or perform any function of the municipal authority, the
8.3county authority may do so.
8.4EFFECTIVE DATE.Because the population of Hennepin County is more than
8.51,000,000, under Minnesota Statutes, section 645.023, this section is effective without
8.6local approval.

8.7    Sec. 13. Minnesota Statutes 2006, section 383B.117, subdivision 2, is amended to read:
8.8    Subd. 2. Equipment acquisition; capital notes. The board may, by resolution and
8.9without public referendum, issue capital notes within existing debt limits for the purpose
8.10of purchasing ambulance and other medical equipment, road construction or maintenance
8.11equipment, public safety equipment and other capital equipment having an expected
8.12useful life at least equal to the term of the notes issued. The notes shall be payable in
8.13not more than five ten years and shall be issued on terms and in a manner as the board
8.14determines. The total principal amount of the notes issued for any fiscal year shall not
8.15exceed one percent of the total annual budget for that year and shall be issued solely for
8.16the purchases authorized in this subdivision. A tax levy shall be made for the payment
8.17of the principal and interest on such notes as in the case of bonds. For purposes of this
8.18subdivision, "equipment" includes computer hardware and software, whether bundled with
8.19machinery or equipment or unbundled. For purposes of this subdivision, the term "medical
8.20equipment" includes computer hardware and software and other intellectual property for
8.21use in medical diagnosis, medical procedures, research, record keeping, billing, and other
8.22hospital applications, together with application development services and training related
8.23to the use of the computer hardware and software and other intellectual property, all
8.24without regard to their useful life. For purposes of determining the amount of capital notes
8.25which the county may issue in any year, the budget of the county and Hennepin Healthcare
8.26System, Inc. shall be combined and the notes issuable under this subdivision shall be in
8.27addition to obligations issuable under section 373.01, subdivision 3.

8.28    Sec. 14. Minnesota Statutes 2006, section 410.32, is amended to read:
8.29410.32 CITIES MAY ISSUE CAPITAL NOTES FOR CAPITAL EQUIPMENT.
8.30    (a) Notwithstanding any contrary provision of other law or charter, a home rule
8.31charter city may, by resolution and without public referendum, issue capital notes subject
8.32to the city debt limit to purchase capital equipment.
8.33    (b) For purposes of this section, "capital equipment" means:
8.34    (1) public safety equipment, ambulance and other medical equipment, road
8.35construction and maintenance equipment, and other capital equipment; and
9.1    (2) computer hardware and software, whether bundled with machinery or equipment
9.2or unbundled.
9.3    (c) The equipment or software must have an expected useful life at least as long as the
9.4term of the notes. The authority to issue capital notes for software expires on July 1, 2007.
9.5    (d) The notes shall be payable in not more than ten years and be issued on terms and
9.6in the manner the city determines. The total principal amount of the capital notes issued
9.7in a fiscal year shall not exceed 0.03 percent of the market value of taxable property
9.8in the city for that year.
9.9    (e) A tax levy shall be made for the payment of the principal and interest on the
9.10notes, in accordance with section 475.61, as in the case of bonds.
9.11    (f) Notes issued under this section shall require an affirmative vote of two-thirds of
9.12the governing body of the city.
9.13    (g) Notwithstanding a contrary provision of other law or charter, a home rule charter
9.14city may also issue capital notes subject to its debt limit in the manner and subject to the
9.15limitations applicable to statutory cities pursuant to section 412.301.

9.16    Sec. 15. Minnesota Statutes 2006, section 412.301, is amended to read:
9.17412.301 FINANCING PURCHASE OF CERTAIN EQUIPMENT.
9.18    (a) The council may issue certificates of indebtedness or capital notes subject to the
9.19city debt limits to purchase capital equipment.
9.20    (b) For purposes of this section, "capital equipment" means:
9.21    (1) public safety equipment, ambulance and other medical equipment, road
9.22construction and maintenance equipment, and other capital equipment; and
9.23    (2) computer hardware and software, whether bundled with machinery or equipment
9.24or unbundled.
9.25    (c) The equipment or software must have an expected useful life at least as long as
9.26the terms of the certificates or notes. The authority to issue capital notes for software
9.27expires on July 1, 2007.
9.28    (d) Such certificates or notes shall be payable in not more than ten years and shall be
9.29issued on such terms and in such manner as the council may determine.
9.30    (e) If the amount of the certificates or notes to be issued to finance any such purchase
9.31exceeds 0.25 percent of the market value of taxable property in the city, they shall not
9.32be issued for at least ten days after publication in the official newspaper of a council
9.33resolution determining to issue them; and if before the end of that time, a petition asking
9.34for an election on the proposition signed by voters equal to ten percent of the number of
9.35voters at the last regular municipal election is filed with the clerk, such certificates or notes
10.1shall not be issued until the proposition of their issuance has been approved by a majority
10.2of the votes cast on the question at a regular or special election.
10.3    (f) A tax levy shall be made for the payment of the principal and interest on such
10.4certificates or notes, in accordance with section 475.61, as in the case of bonds.

10.5    Sec. 16. Minnesota Statutes 2006, section 428A.02, subdivision 1, is amended to read:
10.6    Subdivision 1. Ordinance. The governing body of a city may adopt an ordinance
10.7establishing a special service district. Only property that is classified under section 273.13
10.8and used for residential, commercial, industrial, or public utility purposes, or is vacant
10.9land zoned or designated on a land use plan for commercial or industrial use and located
10.10in the special service district, may be subject to the charges imposed by the city on the
10.11special service district. Other types of property may be included within the boundaries of
10.12the special service district but are not subject to the levies or charges imposed by the city
10.13on the special service district. If 50 percent or more of the market value of a parcel of
10.14property is classified under section 273.13 as residential, commercial, industrial, or vacant
10.15land zoned or designated on a land use plan for commercial or industrial use, or public
10.16utility for the current assessment year, then the entire market value of the property is
10.17subject to a service charge based on net tax capacity for purposes of sections 428A.01
10.18to 428A.10. The ordinance shall describe with particularity the area within the city to
10.19be included in the district and the special services to be furnished in the district. The
10.20ordinance may not be adopted until after a public hearing has been held on the question.
10.21Notice of the hearing shall include the time and place of hearing, a map showing the
10.22boundaries of the proposed district, and a statement that all persons owning property in the
10.23proposed district that would be subject to a service charge will be given opportunity to be
10.24heard at the hearing. Within 30 days after adoption of the ordinance under this subdivision,
10.25the governing body shall send a copy of the ordinance to the commissioner of revenue.

10.26    Sec. 17. Minnesota Statutes 2006, section 453A.02, subdivision 3, is amended to read:
10.27    Subd. 3. City. "City" means a city organized and existing under the laws of
10.28Minnesota or a city charter adopted pursuant thereto, and authorized by such laws or
10.29charter to engage in the local distribution and sale of gas, provided that any city so
10.30engaged on January 1, 1979 is authorized to continue such distribution and sale, and every
10.31city now or hereafter so authorized may exercise, either individually or as a member of a
10.32municipal gas agency, all of the powers granted in sections 453A.01 to 453A.12.
10.33    City also includes a city organized and existing under the laws of another state or
10.34a city charter adopted pursuant thereto which participates in a municipal gas agency
10.35with Minnesota cities.

11.1    Sec. 18. [471.6175] TRUST FOR POSTEMPLOYMENT BENEFITS.
11.2    Subdivision 1. Authorization; establishment. A political subdivision or other
11.3public entity that creates or has created an actuarial liability to pay postemployment
11.4benefits to employees or officers after their termination of service may establish a trust to
11.5pay those benefits. For purposes of this section, the term "postemployment benefits" means
11.6benefits giving rise to a liability under Statement No. 45 of the Governmental Accounting
11.7Standards Board and the term "trust" means a trust, a trust account, or a custodial account
11.8or contract authorized under section 401(f) of the Internal Revenue Code.
11.9    Subd. 2. Purpose of trust. The trust established under this section may only be
11.10used to pay postemployment benefits and may be either revocable or irrevocable.
11.11    Subd. 3. Trust administrator. The trust administrator of a trust established under
11.12this section shall be either:
11.13    (1) the Public Employees Retirement Association;
11.14    (2) a bank or banking association incorporated under the laws of the United States or
11.15of any state and authorized by the laws under which it is organized to exercise corporate
11.16trust powers; or
11.17    (3) an insurance company or agency qualified to do business in Minnesota which has
11.18at least five years' experience in investment products and services for group retirement
11.19benefits and which has a specialized department dedicated to services for retirement
11.20investment products.
11.21    A political subdivision or public entity may, in its discretion and in compliance
11.22with any applicable trust document, change trust administrators and transfer trust assets
11.23accordingly.
11.24    Subd. 4. Account maintenance. (a) A political subdivision or other public entity
11.25may establish a trust account to be held under the supervision of the trust administrator for
11.26the purposes of this section. A trust administrator shall establish a separate account for
11.27each participating political subdivision or public entity. The trust administrator may charge
11.28participating political subdivisions and public entities fees for reasonable administrative
11.29costs. The amount of any fees charged by the Public Employees Retirement Association is
11.30appropriated to the association from the account. A trust administrator may establish other
11.31reasonable terms and conditions for creation and maintenance of these accounts.
11.32    (b) The trust administrator must report to the political subdivision or other public
11.33entity on the investment returns of invested trust assets and on all investment fees or costs
11.34incurred by the trust. The annual rates of return, along with investment and administrative
12.1fees and costs for the trust, must be disclosed in the political subdivision's or public entity's
12.2annual financial audit in a manner prescribed by the state auditor.
12.3    (c) Effective for fiscal years beginning after December 31, 2008, the trust
12.4administrator must report electronically to the state auditor the portfolio and performance
12.5information specified in section 356.219, subdivision 3, in the manner prescribed by
12.6the state auditor.
12.7    Subd. 5. Investment. (a) The assets of a trust or trust account shall be invested and
12.8held as stipulated in paragraphs (b) to (e).
12.9    (b) The Public Employees Retirement Association must certify all money in the trust
12.10accounts for which it is trust administrator to the State Board of Investment for investment
12.11under section 11A.14, subject to the policies and procedures established by the State
12.12Board of Investment. Investment earnings must be credited to the trust account of the
12.13individual political subdivision or public entity.
12.14    (c) A trust administrator, other than the Public Employees Retirement Association,
12.15must ensure that all money in the trust accounts for which it is trust administrator is
12.16invested by a registered investment adviser, a bank investment trust department or an
12.17insurance company or agency retirement investment department. Investment earnings
12.18must be credited to the trust account of the individual political subdivision or public entity.
12.19    (d) For trust assets invested by the State Board of Investment, the investment
12.20restrictions shall be the same as those generally applicable to the State Board of
12.21Investment. For trust assets invested by a trust administrator other than the Public
12.22Employees Retirement Association, the assets may only be invested in investments
12.23authorized under chapter 118A or section 356A.06, subdivision 7, in the manner specified
12.24in the applicable trust document.
12.25    (e) A political subdivision or public entity may provide investment direction to a
12.26trust administrator in compliance with any applicable trust document.
12.27    Subd. 6. Limit on deposit. A political subdivision or public entity may not
12.28deposit money in a trust or trust account created pursuant to this section if the total
12.29amount invested by that political subdivision or public entity would exceed the political
12.30subdivision's or public entity's actuarially determined liabilities for postemployment
12.31benefits due to officers and employees, as determined under the applicable standards of the
12.32Governmental Accounting Standards Board.
12.33    Subd. 7. Withdrawal of funds and termination of account. (a) For a revocable
12.34account, a political subdivision or public entity may withdraw some or all of its money
12.35or terminate the trust account. Money and accrued investment earnings withdrawn
13.1from a revocable account must be deposited in a fund separate and distinct from any
13.2other funds of the political subdivision or public entity. This money, with accrued
13.3investment earnings, must be used to pay legally enforceable postemployment benefits
13.4to former officers and employees, unless (i) there has been a change in state or federal
13.5law affecting that political subdivision's or public entity's liabilities for postemployment
13.6benefits, or (ii) there has been a change in the demographic composition of that political
13.7subdivision's or public entity's employees eligible for postemployment benefits, or (iii)
13.8there has been a change in the provisions or terms of the postemployment benefits in that
13.9political subdivision or public entity including, but not limited to, the portion of the costs
13.10eligible employees must pay to receive the benefits, or (iv) other factors exist that have
13.11a material effect on that political subdivision's or public entity's actuarially determined
13.12liabilities for postemployment benefits, in which event any amount in excess of 100
13.13percent of that political subdivision's or public entity's actuarially determined liabilities for
13.14postemployment benefits, as determined under standards of the Government Accounting
13.15Standards Board, may be withdrawn and used for any purpose.
13.16    (b) For an irrevocable account, a political subdivision or public entity may withdraw
13.17money only:
13.18    (1) as needed to pay postemployment benefits owed to former officers and employees
13.19of the political subdivision or public entity; or
13.20    (2) when all postemployment benefit liability owed to former officers or employees
13.21of the political subdivision or public entity has been satisfied or otherwise defeased.
13.22    (c) A political subdivision or public entity requesting withdrawal of money from
13.23an account created under this section must do so at a time and in the manner required by
13.24the executive director of the Public Employees Retirement Association or specified in an
13.25applicable trust document. The political subdivision or public entity that created the trust
13.26must ensure that withdrawals comply with the requirements of this section.
13.27    (d) The legislature may not divert funds in these trusts or trust accounts for use
13.28for another purpose.
13.29    Subd. 8. Status of irrevocable trust. (a) All money in an irrevocable trust or
13.30trust account created in this section is held in trust for the exclusive benefit of former
13.31officers and employees of the participating political subdivision or public entity, and are
13.32not subject to claims by creditors of the state, the participating political subdivision or
13.33public entity, the current or former officers and employees of the political subdivision
13.34or public entity, or the trust administrator.
13.35    (b) An irrevocable trust fund or trust account created in this section shall be deemed
13.36an arrangement equivalent to a trust for all legal purposes.
14.1EFFECTIVE DATE.This section is effective the day following final enactment,
14.2and is applicable immediately to all political subdivisions or public entities subject to
14.3Statement No. 45 of the Governmental Accounting Standards Board in 2007, to those
14.4political subdivisions or public entities whose trusts or trust accounts are validated
14.5by section 22, and to those political subdivisions or public entities that have begun
14.6consideration of measures to implement Statement No. 45 in 2007. This section is
14.7applicable on July 1, 2008, for all other political subdivisions or public entities.

14.8    Sec. 19. Minnesota Statutes 2006, section 473.39, is amended by adding a subdivision
14.9to read:
14.10    Subd. 1m. OBLIGATIONS. After July 1, 2007, in addition to other authority in
14.11this section, the council may issue certificates of indebtedness, bonds, or other obligations
14.12under this section in an amount not exceeding $33,600,000 for capital expenditures as
14.13prescribed in the council's regional transit master plan and transit capital improvement
14.14program and for related costs, including the costs of issuance and sale of the obligations.
14.15APPLICATION AND EFFECTIVE DATE.This section applies in the counties of
14.16Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington, and is effective the
14.17day following final enactment.

14.18    Sec. 20. Minnesota Statutes 2006, section 473.39, is amended by adding a subdivision
14.19to read:
14.20    Subd. 5. Anticipation of grants. In addition to other authority granted in this
14.21section, the council may exercise the authority granted to an issuing political subdivision
14.22by section 475.522.

14.23    Sec. 21. Minnesota Statutes 2006, section 475.52, subdivision 6, is amended to read:
14.24    Subd. 6. Certain purposes. Any municipality may issue bonds for paying
14.25judgments against it; for refunding outstanding bonds; for funding floating indebtedness;
14.26for funding actuarial liabilities to pay postemployment benefits to employees or officers
14.27after their termination of service; or for funding all or part of the municipality's current
14.28and future unfunded liability for a pension or retirement fund or plan referred to in
14.29section 356.20, subdivision 2, as those liabilities are most recently computed pursuant
14.30to sections 356.215 and 356.216. The board of trustees or directors of a pension fund or
14.31relief association referred to in section 69.77 or chapter 422A must consent and must
14.32be a party to any contract made under this section with respect to the fund held by it
14.33for the benefit of and in trust for its members. For purposes of this section, the term
14.34"postemployment benefits" means benefits giving rise to a liability under Statement No.
14.3545 of the Governmental Accounting Standards Board.

15.1    Sec. 22. [475.522] GRANT ANTICIPATION FINANCING OF
15.2TRANSPORTATION OR TRANSIT PROJECTS.
15.3    Subdivision 1. Definitions. For purposes of this section, the term "political
15.4subdivision" means a county or a statutory or home rule charter city, and the term
15.5"issuing political subdivision" means a political subdivision that issues obligations under
15.6subdivision 2.
15.7    Subd. 2. Authorization. An issuing political subdivision may enter into agreements
15.8with any other political subdivision of the state, within or without its jurisdiction, and any
15.9state agency, with respect to federal grants for transportation or transit projects to be
15.10received directly or indirectly by or on behalf of the political subdivision or agency,
15.11under an executed grant agreement with the relevant federal agency. The agreements
15.12may provide that the political subdivision or agency will pledge to the issuing political
15.13subdivision all or a specified portion of the federal grants received by or on behalf of the
15.14political subdivision or agency for a specified period of years, or until all obligations issued
15.15by the issuing political subdivision under subdivision 3 with respect to those federal grants
15.16have been paid or legally defeased. If the issuing political subdivision issues obligations
15.17under subdivision 3, the agreements must provide the method by which the proceeds of
15.18the obligations will be used to pay or reimburse the costs of the transportation or transit
15.19projects relating to the federal grants described in the executed federal grant agreement.
15.20    Subd. 3. Issuance of obligations. In anticipation of any federal grants for
15.21transportation or transit projects to be received directly or indirectly by any political
15.22subdivision or agency as specified in subdivision 1, or by an issuing political subdivision
15.23with respect to any transportation or transit projects within its jurisdiction, an issuing
15.24political subdivision may issue its obligations payable from the collections of those
15.25federal grants. The obligations may be issued in the principal amount the issuing political
15.26subdivision determines provided that the estimated collections of the federal grants under
15.27the relevant executed federal grant agreement in each year in which the obligations will
15.28be outstanding must be at least equal to:
15.29    (1) if the obligations are to be issued as revenue obligations, 150 percent of the
15.30maximum annual debt service on the obligations; or
15.31    (2) if the obligations are to be issued as general obligations, 110 percent of the
15.32maximum annual debt service on the obligations.
15.33    Except as otherwise provided in this section, the issuing political subdivision shall
15.34provide for the issuance, sale, and security of the obligations as provided in chapter 475,
15.35and has the same powers and duties as a municipality issuing bonds under that law, except
15.36that no election is required and the net debt limitations in chapter 475 do not apply to the
16.1obligations. The issuing political subdivision may determine to issue the obligations as
16.2revenue obligations, payable solely from the collections of the federal grants anticipated,
16.3or may pledge its full faith and credit to the payment of the obligations.
16.4    Subd. 4. Use of proceeds. The proceeds of the obligations must be used:
16.5    (1) to pay or reimburse the costs of the transportation or transit projects relating to
16.6the federal grants being anticipated;
16.7    (2) to pay the costs of issuance of the obligations, including credit enhancement;
16.8    (3) to pay interest on the obligations for a period not exceeding three years from
16.9their date of issue; and
16.10    (4) if the full faith and credit of the issuing political subdivision is not pledged to the
16.11payment of the obligations, to fund a debt service reserve fund for the obligations.

16.12    Sec. 23. Minnesota Statutes 2006, section 475.58, subdivision 1, is amended to read:
16.13    Subdivision 1. Approval by electors; exceptions. Obligations authorized by law or
16.14charter may be issued by any municipality upon obtaining the approval of a majority of
16.15the electors voting on the question of issuing the obligations, but an election shall not be
16.16required to authorize obligations issued:
16.17    (1) to pay any unpaid judgment against the municipality;
16.18    (2) for refunding obligations;
16.19    (3) for an improvement or improvement program, which obligation is payable wholly
16.20or partly from the proceeds of special assessments levied upon property specially benefited
16.21by the improvement or by an improvement within the improvement program, or from tax
16.22increments, as defined in section 469.174, subdivision 25, including obligations which are
16.23the general obligations of the municipality, if the municipality is entitled to reimbursement
16.24in whole or in part from the proceeds of such special assessments or tax increments and
16.25not less than 20 percent of the cost of the improvement or the improvement program is to
16.26be assessed against benefited property or is to be paid from the proceeds of federal grant
16.27funds or a combination thereof, or is estimated to be received from tax increments;
16.28    (4) payable wholly from the income of revenue producing conveniences;
16.29    (5) under the provisions of a home rule charter which permits the issuance of
16.30obligations of the municipality without election;
16.31    (6) under the provisions of a law which permits the issuance of obligations of a
16.32municipality without an election;
16.33    (7) to fund pension or retirement fund or postemployment benefit liabilities pursuant
16.34to section 475.52, subdivision 6;
16.35    (8) under a capital improvement plan under section 373.40; and
17.1    (9) under sections 469.1813 to 469.1815 (property tax abatement authority bonds), if
17.2the proceeds of the bonds are not used for a purpose prohibited under section 469.176,
17.3subdivision 4g , paragraph (b).

17.4    Sec. 24. Minnesota Statutes 2006, section 475.58, subdivision 3b, is amended to read:
17.5    Subd. 3b. Street reconstruction. (a) A municipality may, without regard to
17.6the election requirement under subdivision 1, issue and sell obligations for street
17.7reconstruction, if the following conditions are met:
17.8    (1) the streets are reconstructed under a street reconstruction plan that describes the
17.9streets to be reconstructed street reconstruction to be financed, the estimated costs, and
17.10any planned reconstruction of other streets in the municipality over the next five years,
17.11and the plan and issuance of the obligations has been approved by a vote of all of the
17.12members of the governing body present at the meeting following a public hearing for
17.13which notice has been published in the official newspaper at least ten days but not more
17.14than 28 days prior to the hearing; and
17.15    (2) if a petition requesting a vote on the issuance is signed by voters equal to
17.16five percent of the votes cast in the last municipal general election and is filed with the
17.17municipal clerk within 30 days of the public hearing, the municipality may issue the bonds
17.18only after obtaining the approval of a majority of the voters voting on the question of
17.19the issuance of the obligations.
17.20    (b) Obligations issued under this subdivision are subject to the debt limit of the
17.21municipality and are not excluded from net debt under section 475.51, subdivision 4.
17.22    (c) For purposes of this subdivision, street reconstruction includes utility
17.23replacement and relocation and other activities incidental to the street reconstruction, turn
17.24lanes and other improvements having a substantial public safety function, realignments,
17.25other modifications to intersect with state and county roads, and the local share of state
17.26and county road projects.
17.27    (d) Except in the case of turn lanes, safety improvements, realignments, intersection
17.28modifications, and the local share of state and county road projects, street reconstruction
17.29does not include the portion of project cost allocable to widening a street or adding curbs
17.30and gutters where none previously existed.

17.31    Sec. 25. VALIDATION.
17.32    Any trust or trust account or other custodial account or contract authorized under
17.33section 401(f) of the Internal Revenue Code, created prior to June 6, 2006, to pay
17.34postemployment benefits to employees or officers after termination of service, is hereby
17.35validated, may continue in full force and effect, and shall have continuing authority
17.36to accept new funds; however, this section does not validate or correct defects in any
18.1previously created trust document. Any funds held by a validated trust or account under
18.2this section may be invested as provided in section 1, subdivision 5. A validated trust or
18.3account shall have until January 1, 2008, to bring its trust documents and procedures
18.4into compliance with section 1.
18.5EFFECTIVE DATE.This section is effective the day following final enactment.

18.6    Sec. 26. TOWN OF CRANE LAKE, CERTIFICATES OF INDEBTEDNESS.
18.7    Notwithstanding Minnesota Statutes, section 366.095, or any other law to the
18.8contrary, the town board of the town of Crane Lake in St. Louis County may issue one
18.9or more certificates of indebtedness in a total amount not to exceed $225,000, which
18.10are not subject to the debt limits of the town. The proceeds of the certificates must be
18.11used to acquire property and pay other costs related to a land exchange with the United
18.12States Forest Service. The certificates shall be payable in not more than 30 years and be
18.13issued on the terms and in the manner as the board may determine. Minnesota Statutes,
18.14sections 475.54, subdivision 1, and 475.56, paragraph (c), do not apply to the certificates
18.15issued under this section. A tax levy shall be made to pay the principal and interest on the
18.16certificates as in the case of bonds.
18.17EFFECTIVE DATE.This section is effective the day after the governing body of
18.18the town of Crane Lake and its chief clerical officer timely complete their compliance with
18.19Minnesota Statutes, section 645.021, subdivisions 2 and 3.

18.20    Sec. 27. CITY OF WINSTED; BONDING AUTHORITY.
18.21    (a) The city of Winsted may issue general obligation bonds under Minnesota
18.22Statutes, chapter 475, to finance the acquisition and betterment of a facility consisting of
18.23a city hall, community center, and police station; park improvements, including trails
18.24and an amphitheater; related public improvements; and substantial landscaping for the
18.25improvements.
18.26    (b) The bonds may be issued as general obligations of the city without an election to
18.27approve the bonds under Minnesota Statutes, section 475.58.
18.28    (c) The bonds are not included in computing any debt limitation applicable to the
18.29city, including, but not limited to, the net debt limits under Minnesota Statutes, section
18.30475.53, and the levy of taxes under Minnesota Statutes, section 475.61, to pay principal of
18.31and interest on the bonds is not subject to any levy limitation.
18.32    (d) The aggregate principal amount of bonds used to pay costs of the acquisition and
18.33betterment of the facility consisting of a city hall, community center, and police station;
18.34park improvements, including trails and an amphitheater; related public improvements;
19.1and substantial landscaping for the improvements may not exceed $4,900,000, plus an
19.2amount equal to the costs related to issuance of the bonds and capitalized interest.
19.3EFFECTIVE DATE.This section is effective upon compliance by the governing
19.4body of the city Winsted with Minnesota Statutes, section 645.021, subdivision 3."
19.5Amend the title accordingly