Journal of the House - 108th Day - Monday, April 28, 2008

A quorum was present.

Beard and Scalze were excused.

Anderson, B., was excused until 1:25 p.m. Moe was excused until 2:55 p.m. Hornstein was excused until 5:45 p.m.

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

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PETITIONS AND COMMUNICATIONS

The following communications were received:

STATE OF MINNESOTA

OFFICE OF THE GOVERNOR

SAINT PAUL 55155

April 25, 2008

The Honorable Margaret Anderson Kelliher

Speaker of the House of Representatives

The State of Minnesota

Dear Speaker Kelliher:

I have vetoed and am returning H. F. No. 3220, Chapter No. 237, a bill granting political subdivisions general authority to make unlimited monetary or in-kind grants to nonprofit organizations.

Political subdivisions derive their powers from the state. Existing law already allows political subdivisions to make grants to nonprofit organizations pursuant to specific appropriations or statutory authority. Local governments also have broad authority to enter contracts or other agreements with nonprofit and other entities to facilitate services to individuals on behalf of the local government.

At a time when many political subdivisions are raising property taxes and requesting additional local government aid, granting political subdivisions authority to use taxpayer money to make unlimited charitable contributions or initiate new grant programs is simply not warranted.

I believe strongly in supporting charitable organizations. However, instead of granting local elected officials the power to make charitable contributions and grants to nonprofits using taxpayer money, political subdivisions should be focusing on ways to lower property taxes. With lower property taxes and more money in their pockets, Minnesota taxpayers can decide for themselves which religious, charitable, or other nonprofit organizations they would like to support.

Sincerely,

Tim Pawlenty

Governor

STATE OF MINNESOTA

OFFICE OF THE GOVERNOR

SAINT PAUL 55155

April 25, 2008

The Honorable Margaret Anderson Kelliher

Speaker of the House of Representatives

The State of Minnesota

Dear Speaker Kelliher:

I have vetoed and am returning H. F. No. 1351, Chapter No. 239, the 2007 Omnibus Transportation Policy Bill.

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This bill includes many positive provisions I support, including provisions related to the transportation of forest and agricultural products and commercial transportation needs and requirements. However, the bill includes problematic language relating to the implementation of more secure driver's licenses under the federal REAL I.D. Act. For this reason, I am vetoing the bill.

If Minnesota driver's licenses are not compliant with federal REAL I.D. requirements after December 31, 2009, Minnesotans will be prohibited from using their driver's licenses as identification for air travel or for entering federal buildings.

REAL I.D. requires inclusion of minimum security features in state driver's licenses. It was a product of the recommendations of the 9/11 Commission. REAL I.D. was passed by Congress on a bipartisan basis and signed into law by the President. Implementing REAL I.D. will significantly enhance homeland security, reduce identity fraud, and help reduce illegal immigration.

On behalf of the nation's governors, I have been deeply involved in advocating for the federal government to protect states' rights, pay their fair share of this federal mandate, and ensure the privacy rights of our citizens as REAL I.D. moves forward. The federal government's response is not complete or finalized. Until it is, we should be careful not to unduly restrict our ability to at least begin preparations for implementing REAL I.D. or to undertake state initiatives to improve our Minnesota driver's licenses.

I share concerns about the need for government to pay for this program and to protect privacy, but the provisions in this bill are flawed.

My suggestions for improving the REAL I.D. provisions in this bill were not incorporated in the bill. These matters should have been resolved before the bill was presented to me. A clear description of the items or activities we expect the federal government to fund should be included in the bill. Many of the costs of REAL I.D. will overlap with security features Minnesota will pursue for its driver's licenses independently of REAL I.D. It is unrealistic to expect the federal government to pay for implementing those state features. I also requested that language regarding the federal obligation be specific as to the time period involved. These requests were also ignored or rejected.

The bill also prohibits REAL I.D. compliance efforts, unless Congress appropriates and designates funding for Minnesota's costs. Federal funding for REAL I.D., like many other federal programs, may be provided on a reimbursement basis. It is likely that Congress will appropriate funds to a federal agency for disbursement and will not specifically designate federal dollars for Minnesota.

My concerns could have been easily addressed in the bill, but my suggestions were rejected. The positions of interest groups such as the ACLU, the lack of clarity as to what constitutes state costs, and the requirement that Congress designate funds for Minnesota will likely cause protracted and unnecessary litigation for the state and impair homeland security in the process.

I strongly support the compromise privacy protections included in the bill. I am issuing my veto with the hope that the Legislature will re-pass a non-controversial transportation policy bill, without the objectionable language regarding REAL I.D.

Sincerely,

Tim Pawlenty

Governor

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REPORTS OF STANDING COMMITTEES AND DIVISIONS

Carlson from the Committee on Finance to which was referred:

H. F. No. 1724, A bill for an act relating to occupations and professions; providing for registration of naturopathic doctors; amending Minnesota Statutes 2006, sections 116J.70, subdivision 2a; 145.61, subdivision 2; 146.23, subdivision 7; 148B.60, subdivision 3; 214.23, subdivision 1; 604A.01, subdivision 2; 604A.015; proposing coding for new law as Minnesota Statutes, chapter 147E.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. [147E.01] DEFINITIONS.

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

Subd. 2. Advisory council. "Advisory council" means the Registered Naturopathic Doctor Advisory Council established under section 147E.35.

Subd. 3. Approved naturopathic medical program. "Approved naturopathic medical program" means a naturopathic medical education program in the United States or Canada and meets the requirements for accreditation by the Council on Naturopathic Medical Education (CNME) or an equivalent federally recognized accrediting body for the naturopathic medical profession recognized by the board. This program must offer graduate-level full-time didactic and supervised clinical training leading to the degree of Doctor of Naturopathy or Doctor of Naturopathic Medicine. The program must be an institution, or part of an institution, of higher education that at the time the student completes the program is:

(1) either accredited or is a candidate for accreditation by a regional institution accrediting agency recognized by the United States Secretary of Education; or

(2) a degree granting college or university that prior to the existence of CNME offered a full-time structured curriculum in basic sciences and supervised patient care comprising a doctoral naturopathic medical education that is at least 132 weeks in duration, must be completed in at least 35 months, and is reputable and in good standing in the judgment of the board.

Subd. 4. Board. "Board" means the Board of Medical Practice or its designee.

Subd. 5. Contact hour. "Contact hour" means an instructional session of 50 consecutive minutes, excluding coffee breaks, registration, meals without a speaker, and social activities.

Subd. 6. Homeopathic preparations. "Homeopathic preparations" means medicines prepared according to the Homeopathic Pharmacopoeia of the United States.

Subd. 7. Registered naturopathic doctor. "Registered naturopathic doctor" means a person authorized and registered to practice naturopathic medicine under this chapter.

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Subd. 8. Minor office procedures. "Minor office procedures" means the use of operative, electrical, or other methods for the repair and care incidental to superficial lacerations and abrasions, superficial lesions, and the removal of foreign bodies located in the superficial tissues and the use of antiseptics and local topical anesthetics in connection with such methods.

Subd. 9. Naturopathic licensing examination. "Naturopathic licensing examination" means the Naturopathic Physicians Licensing Examination or its successor administered by the North American Board of Naturopathic Examiners or its successor as recognized by the board.

Subd. 10. Naturopathic medicine. "Naturopathic medicine" means a system of primary health care for the prevention, assessment, and treatment of human health conditions, injuries, and diseases that uses:

(1) services and treatments as described in section 147E.05; and

(2) natural health procedures and treatments in section 146A.01, subdivision 4.

Subd. 11. Naturopathic physical medicine. "Naturopathic physical medicine" includes, but is not limited to, the therapeutic use of the physical agents of air, water, heat, cold, sound, light, and electromagnetic nonionizing radiation and the physical modalities of electrotherapy, diathermy, ultraviolet light, hydrotherapy, massage, stretching, colon hydrotherapy, frequency specific microcurrent, electrical muscle stimulation, transcutaneous electrical nerve stimulation, and therapeutic exercise.

Sec. 2. [147E.05] SCOPE OF PRACTICE.

Subdivision 1. Practice parameters. (a) The practice of naturopathic medicine includes, but is not limited to, the following services:

(1) ordering, administering, prescribing, or dispensing for preventive and therapeutic purposes: food, extracts of food, nutraceuticals, vitamins, minerals, amino acids, enzymes, botanicals and their extracts, botanical medicines, herbal remedies, homeopathic medicines, all dietary supplements and nonprescription drugs as defined by the federal Food, Drug, and Cosmetic Act, glandulars, protomorphogens, lifestyle counseling, hypnotherapy, biofeedback, dietary therapy, electrotherapy, galvanic therapy, naturopathic physical medicine, oxygen, therapeutic devices, barrier devices for contraception, and minor office procedures, including obtaining specimens to assess and treat disease;

(2) performing or ordering physical and orificial examinations and physiological function tests;

(3) ordering clinical laboratory tests and examinations;

(4) referring a patient for diagnostic imaging studies including x-ray, CT scan, MRI, ultrasound, mammogram, bone densitometry, and referring the studies to an appropriately licensed health care professional to conduct the study and interpret the results;

(5) prescribing nonprescription medications and therapeutic devices or ordering noninvasive diagnostic procedures commonly used by physicians in general practice; and

(6) prescribing or performing naturopathic physical medicine.

(b) A registered naturopathic doctor may admit patients to a hospital if the naturopathic doctor meets the hospital's governing body requirements regarding credentialing and privileging process.

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Subd. 2. Prohibitions on practice. (a) The practice of naturopathic medicine does not include:

(1) administering therapeutic ionizing radiation or radioactive substances;

(2) administering general or spinal anesthesia;

(3) prescribing, dispensing, or administering legend drugs or controlled substances including chemotherapeutic substances; or

(4) performing or inducing abortions.

(b) A naturopathic doctor registered under this chapter shall not perform surgical procedures using a laser device or perform surgical procedures beyond superficial tissue.

(c) A naturopathic doctor shall not practice or claim to practice as a medical doctor, surgeon, osteopath, dentist, podiatrist, optometrist, psychologist, advanced practice professional nurse, physician assistant, chiropractor, physical therapist, acupuncturist, dietician, nutritionist, or any other health care professional, unless the naturopathic physician also holds the appropriate license or registration for the health care practice profession.

Sec. 3. [147E.06] PROFESSIONAL CONDUCT.

Subdivision 1. Informed consent. (a) The registered naturopathic doctor shall obtain a signed informed consent from the patient prior to initiating treatment and after advising the patient of the naturopathic doctor's qualifications including education and registration information; and outlining of the scope of practice of registered naturopathic doctors in Minnesota. This information must be supplied to the patient in writing before or at the time of the initial visit. The registrant shall present treatment facts and options accurately to the patient or to the individual responsible for the patient's care and make treatment recommendations according to standards of good naturopathic medical practice.

(b) Upon request, the registered naturopathic doctor must provide a copy of the informed consent form to the board.

Subd. 2. Patient records. (a) A registered naturopathic doctor shall maintain a record for seven years for each patient treated, including:

(1) a copy of the informed consent;

(2) evidence of a patient interview concerning the patient's medical history and current physical condition;

(3) evidence of an examination and assessment;

(4) record of the treatment provided to the patient; and

(5) evidence of evaluation and instructions given to the patient, including acknowledgment by the patient in writing that, if deemed necessary by the registered naturopathic doctor, the patient has been advised to consult with another health care provider.

(b) A registered naturopathic doctor shall maintain the records of minor patients for seven years or until the minor's 19th birthday, whichever is longer.

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Subd. 3. Data practices. Data maintained on a naturopathic patient by a registered naturopathic doctor is subject to sections 144.291 to 144.298.

Subd. 4. State and municipal public health regulations. A registered naturopathic doctor shall comply with all applicable state and municipal requirements regarding public health.

Sec. 4. [147E.10] PROTECTED TITLES.

Subdivision 1. Designation. (a) No individual may use the title "registered naturopathic doctor," "naturopathic doctor," "doctor of naturopathic medicine," or use, in connection with the individual's name, the letters "N.D.," "R.N.D.," or "N.M.D.," or any other titles, words, letters, abbreviations, or insignia indicating or implying that the individual is eligible for registration by the state as a registered naturopath or a registered naturopathic doctor unless the individual has been registered as a registered naturopathic doctor according to this chapter.

(b) After July 1, 2008, individuals who are registered under this chapter and who represent themselves as practicing naturopathic medicine by use of a term in paragraph (a) shall conspicuously display the registration in the place of practice.

Subd. 2. Other health care practitioners. Nothing in this chapter may be construed to prohibit or to restrict:

(1) the practice of a profession by individuals who are licensed, certified, or registered under other laws of this state and are performing services within their authorized scope of practice;

(2) the provision of the complementary and alternative healing methods and treatments, including naturopathy, as described in chapter 146A;

(3) the practice of naturopathic medicine by an individual licensed, registered, or certified in another state and employed by the government of the United States while the individual is engaged in the performance of duties prescribed by the laws and regulations of the United States;

(4) the practice by a naturopathic doctor duly licensed, registered, or certified in another state, territory, or the District of Columbia when incidentally called into this state for consultation with a Minnesota licensed physician or Minnesota registered naturopathic doctor; or

(5) individuals not registered by this chapter from the use of individual modalities which comprise the practice of naturopathic medicine.

Subd. 3. Penalty. A person violating subdivision 2 is guilty of a gross misdemeanor.

Sec. 5. [147E.15] REGISTRATION REQUIREMENTS.

Subdivision 1. General requirements for registration. To be eligible for registration, an applicant must:

(1) submit a completed application on forms provided by the board along with all fees required under section 147E.40 that includes:

(i) the applicant's name, Social Security number, home address and telephone number, and business address and telephone number;

(ii) the name and location of the naturopathic medical program the applicant completed;

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(iii) a list of degrees received from other educational institutions;

(iv) a description of the applicant's professional training;

(v) a list of registrations, certifications, and licenses held in other jurisdictions;

(vi) a description of any other jurisdiction's refusal to credential the applicant;

(vii) a description of all professional disciplinary actions initiated against the applicant in any jurisdiction; and

(viii) any history of drug or alcohol abuse, and any misdemeanor or felony conviction;

(2) submit a copy of a diploma from an approved naturopathic medical education program;

(3) have successfully passed the Naturopathic Physicians Licensing Examination, a competency-based national naturopathic licensing examination administered by the North American Board of Naturopathic Examiners or successor agency as recognized by the board; passing scores are determined by the Naturopathic Physicians Licensing Examination;

(4) submit additional information as requested by the board, including providing any additional information necessary to ensure that the applicant is able to practice with reasonable skill and safety to the public;

(5) sign a statement that the information in the application is true and correct to the best of the applicant's knowledge and belief; and

(6) sign a waiver authorizing the board to obtain access to the applicant's records in this or any other state in which the applicant has completed an approved naturopathic medical program or engaged in the practice of naturopathic medicine.

Subd. 2. Registration by endorsement; reciprocity. (a) To be eligible for registration by endorsement or reciprocity, the applicant must hold a current naturopathic license, registration, or certification in another state, Canadian province, the District of Columbia, or territory of the United States, whose standards for licensure, registration, or certification are at least equivalent to those of Minnesota, and must:

(1) submit the application materials and fees as required by subdivision 1, clauses (1), (2), and (4) to (6);

(2) have successfully passed either:

(i) the Naturopathic Physicians Licensing Examination; or

(ii) if prior to 1986, the state or provincial naturopathic board licensing examination required by that regulating state or province;

(3) provide a verified copy from the appropriate government body of a current license, registration, or certification for the practice of naturopathic medicine in another jurisdiction that has initial licensing, registration, or certification requirements equivalent to or higher than the requirements in subdivision 1; and

(4) provide letters of verification from the appropriate government body in each jurisdiction in which the applicant holds a license, registration, or certification. Each letter must state the applicant's name, date of birth, license, registration, or certification number, date of issuance, a statement regarding disciplinary actions, if any, taken against the applicant, and the terms under which the license, registration, or certification was issued.

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(b) An applicant applying for license, registration, or certification by endorsement must be licensed, registered, or certified in another state or Canadian province prior to January 1, 2005, and have completed a 60-hour course and examination in pharmacotherapeutics.

Subd. 3. Temporary registration. The board may issue a temporary registration to practice as a registered naturopathic doctor to an applicant who is licensed, registered, or certified in another state or Canadian province and is eligible for registration under this section, if the application for registration is complete, all applicable requirements in this section have been met, and a nonrefundable fee has been paid. The temporary registration remains valid only until the meeting of the board at which time a decision is made on the registered naturopathic doctor's application for registration.

Subd. 4. Registration expiration. Registrations issued under this chapter expire annually.

Subd. 5. Renewal. (a) To be eligible for registration renewal a registrant must:

(1) annually, or as determined by the board, complete a renewal application on a form provided by the board;

(2) submit the renewal fee;

(3) provide evidence of a total of 25 hours of continuing education approved by the board as described in section 147E.25; and

(4) submit any additional information requested by the board to clarify information presented in the renewal application. The information must be submitted within 30 days after the board's request, or the renewal request is nullified.

Subd. 6. Change of address. A registrant who changes addresses must inform the board within 30 days, in writing, of the change of address. All notices or other correspondence mailed to or served on a registrant by the board are considered as having been received by the registrant.

Subd. 7. Registration renewal notice. At least 45 days before the registration renewal date, the board shall send out a renewal notice to the last known address of the registrant on file. The notice must include a renewal application and a notice of fees required for renewal or instructions for online renewal. It must also inform the registrant that registration will expire without further action by the board if an application for registration renewal is not received before the deadline for renewal. The registrant's failure to receive this notice does not relieve the registrant of the obligation to meet the deadline and other requirements for registration renewal. Failure to receive this notice is not grounds for challenging expiration of registration status.

Subd. 8. Renewal deadline. The renewal application and fee must be postmarked on or before December 31 of the year of renewal. If the postmark is illegible, the application is considered timely if received by the third working day after the deadline.

Subd. 9. Inactive status and return to active status. (a) A registrant may be placed in inactive status upon application to the board by the registrant and upon payment of an inactive status fee.

(b) Registrants seeking restoration to active from inactive status must pay the current renewal fees and all unpaid back inactive fees. They must meet the criteria for renewal specified in subdivision 5, including continuing education hours.

(c) Registrants whose inactive status period has been five years or longer must additionally have a period of no less than eight weeks of advisory council-approved supervision by another registered naturopathic doctor.

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Subd. 10. Registration following lapse of registration status for two years or less. For any individual whose registration status has lapsed for two years or less, to regain registration status, the individual must:

(1) apply for registration renewal according to subdivision 5;

(2) document compliance with the continuing education requirements of section 147E.25 since the registrant's initial registration or last renewal; and

(3) submit the fees required under section 147E.40 for the period not registered, including the fee for late renewal.

Subd. 11. Cancellation due to nonrenewal. The board shall not renew, reissue, reinstate, or restore a registration that has lapsed and has not been renewed within two annual registration renewal cycles starting January 2009. A registrant whose registration is canceled for nonrenewal must obtain a new registration by applying for registration and fulfilling all requirements then in existence for initial registration as a registered naturopathic doctor.

Subd. 12. Cancellation of registration in good standing. (a) A registrant holding an active registration as a registered naturopathic doctor in the state may, upon approval of the board, be granted registration cancellation if the board is not investigating the person as a result of a complaint or information received or if the board has not begun disciplinary proceedings against the registrant. Such action by the board must be reported as a cancellation of registration in good standing.

(b) A registrant who receives board approval for registration cancellation is not entitled to a refund of any registration fees paid for the registration year in which cancellation of the registration occurred.

(c) To obtain registration after cancellation, a registrant must obtain a new registration by applying for registration and fulfilling the requirements then in existence for obtaining initial registration as a registered naturopathic doctor.

Subd. 13. Emeritus status of registration. A registrant may change the status of the registration to "emeritus" by filing the appropriate forms and paying the onetime fee of $50 to the board. This status allows the registrant to retain the title of registered naturopathic doctor but restricts the registrant from actively seeing patients.

Sec. 6. [147E.20] BOARD ACTION ON APPLICATIONS FOR REGISTRATION.

(a) The board shall act on each application for registration according to paragraphs (b) to (d).

(b) The board shall determine if the applicant meets the requirements for registration under section 147E.15. The board or advisory council may investigate information provided by an applicant to determine whether the information is accurate and complete.

(c) The board shall notify each applicant in writing of action taken on the application, the grounds for denying registration if registration is denied, and the applicant's right to review under paragraph (d).

(d) Applicants denied registration may make a written request to the board, within 30 days of the board's notice, to appear before the advisory council or the board and for the advisory council to review the board's decision to deny the applicant's registration. After reviewing the denial, the advisory council shall make a recommendation to the board as to whether the denial shall be affirmed. Each applicant is allowed only one request for review each yearly registration period.

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Sec. 7. [147E.25] CONTINUING EDUCATION REQUIREMENT.

Subdivision 1. Number of required contact hours. (a) A registrant applying for registration renewal must complete a minimum of 25 contact hours of board-approved continuing education in the year preceding registration renewal, with the exception of the registrant's first incomplete year, and attest to completion of continuing education requirements by reporting to the board.

(b) Of the 25 contact hours of continuing education requirement in paragraph (a), at least five hours of continuing education must be in pharmacotherapeutics.

Subd. 2. Approved programs. The board shall approve continuing education programs that have been approved for continuing education credit by the American Association of Naturopathic Physicians or any of its constituent state associations, the American Chiropractic Association or any of its constituent state associations, the American Osteopathic Association Bureau of Professional Education, the American Pharmacists Association or any of its constituent state associations, or an organization approved by the Accreditation Council for Continuing Medical Education.

Subd. 3. Approval of continuing education programs. The board shall also approve continuing education programs that do not meet the requirements of subdivision 2 but meet the following criteria:

(1) the program content directly relates to the practice of naturopathic medicine;

(2) each member of the program faculty is knowledgeable in the subject matter as demonstrated by a degree from an accredited education program, verifiable experience in the field of naturopathic medicine, special training in the subject matter, or experience teaching in the subject area;

(3) the program lasts at least 50 minutes per contact hour;

(4) there are specific, measurable, written objectives, consistent with the program, describing the expected outcomes for the participants; and

(5) the program sponsor has a mechanism to verify participation and maintains attendance records for three years.

Subd. 4. Accumulation of contact hours. A registrant may not apply contact hours acquired in one one-year reporting period to a future continuing education reporting period.

Subd. 5. Verification of continuing education credits. The board shall periodically select a random sample of registrants and require those registrants to supply the board with evidence of having completed the continuing education to which they attested. Documentation may come directly from the registrants from state or national organizations that maintain continuing education records.

Subd. 6. Continuing education topics. Continuing education program topics may include, but are not limited to, naturopathic medical theory and techniques including diagnostic techniques, nutrition, botanical medicine, homeopathic medicine, physical medicine, lifestyle modification counseling, anatomy, physiology, biochemistry, pharmacology, pharmacognosy, microbiology, medical ethics, psychology, history of medicine, and medical terminology or coding.

Subd. 7. Restriction on continuing education topics. (a) A registrant may apply no more than five hours of practice management to a one-year reporting period.

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(b) A registrant may apply no more than 15 hours to any single subject area.

Subd. 8. Continuing education exemptions. The board may exempt any person holding a registration under this chapter from the requirements of subdivision 1 upon application showing evidence satisfactory to the board of inability to comply with the requirements because of physical or mental condition or because of other unusual or extenuating circumstances. However, no person may be exempted from the requirements of subdivision 1 more than once in any five-year period.

Sec. 8. [147E.30] DISCIPLINE; REPORTING.

For purposes of this chapter, registered naturopathic doctors and applicants are subject to sections 147.091 to 147.162.

Sec. 9. [147E.35] REGISTERED NATUROPATHIC DOCTOR ADVISORY COUNCIL.

Subdivision 1. Membership. The board shall appoint a seven-member Registered Naturopathic Doctor Advisory Council appointed by the governor consisting of one public member as defined in section 214.02, five registered naturopathic doctors who are residents of the state, and one licensed physician or osteopath with expertise in natural medicine.

Subd. 2. Organization. The advisory council shall be organized and administered under section 15.059. The council shall not expire.

Subd. 3. Duties. The advisory council shall:

(1) advise the board regarding standards for registered naturopathic doctors;

(2) provide for distribution of information regarding registered naturopathic doctors standards;

(3) advise the board on enforcement of sections 147.091 to 147.162;

(4) review applications and recommend granting or denying registration or registration renewal;

(5) advise the board on issues related to receiving and investigating complaints, conducting hearings, and imposing disciplinary action in relation to complaints against registered naturopathic doctors;

(6) advise the board regarding approval of continuing education programs using the criteria in section 147E.25, subdivision 3; and

(7) perform other duties authorized for advisory councils by chapter 214, as directed by the board.

Sec. 10. [147E.40] FEES.

Subdivision 1. Fees. Fees are as follows:

(1) registration application fee, $200;

(2) renewal fee, $150;

(3) late fee, $75;

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(4) inactive status fee, $50; and

(5) temporary permit fee, $25.

Subd. 2. Proration of fees. The board may prorate the initial annual registration fee. All registrants are required to pay the full fee upon registration renewal.

Subd. 3. Penalty fee for late renewals. An application for registration renewal submitted after the deadline must be accompanied by a late fee in addition to the required fees.

Subd. 4. Nonrefundable fees. All of the fees in subdivision 1 are nonrefundable.

Sec. 11. APPROPRIATIONS.

$13,000 in fiscal year 2009, $17,000 in fiscal year 2010, and $19,000 in fiscal year 2011 are appropriated from the state government special revenue fund to the Board of Medical Practice for the registration of naturopathic doctors under Minnesota Statutes, chapter 147E.

Sec. 12. EFFECTIVE DATE.

Sections 1 to 11 are effective July 1, 2008."

Delete the title and insert:

"A bill for an act relating to occupations and professions; providing for registration of naturopathic doctors; appropriating money; proposing coding for new law as Minnesota Statutes, chapter 147E."

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

The report was adopted.

Lenczewski from the Committee on Taxes to which was referred:

H. F. No. 3032, A bill for an act relating to state lands; modifying Minnesota critical habitat private sector matching account; modifying outdoor recreation system; adding to and deleting from state parks, recreation areas, and forests; modifying authority to convey private easements on tax-forfeited land; providing for public and private sales, conveyances, and exchanges of certain state land; authorizing 30-year leases of tax-forfeited and other state lands for wind energy projects; amending Minnesota Statutes 2006, sections 84.943, subdivision 5; 86A.04; 86A.08, subdivision 1; 282.04, subdivision 4a; Laws 2006, chapter 236, article 1, section 43.

Reported the same back with the following amendments:

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Page 1, after line 25, insert:

"Sec. 2. [84B.062] ENFORCEMENT OF FEDERAL LAWS.

A state employee shall not enforce federal laws pertaining to the use of all-terrain vehicles, snowmobiles, or aircraft in the navigable waters within Voyageurs National Park under the state's jurisdiction as described in section 84B.061."

Page 3, after line 9, insert:

"Sec. 5. Minnesota Statutes 2006, section 90.151, subdivision 1, is amended to read:

Subdivision 1. Issuance; expiration. (a) Following receipt of the down payment for state timber required under section 90.14 or 90.191, the commissioner shall issue a numbered permit to the purchaser, in a form approved by the attorney general, by the terms of which the purchaser shall be authorized to enter upon the land, and to cut and remove the timber therein described as designated for cutting in the report of the state appraiser, according to the provisions of this chapter. The permit shall be correctly dated and executed by the commissioner and signed by the purchaser. If a permit is not signed by the purchaser within 60 days from the date of purchase, the permit cancels and the down payment for timber required under section 90.14 forfeits to the state. The commissioner may grant an additional period for the purchaser to sign the permit, not to exceed five business days, provided the purchaser pays a $125 penalty fee.

(b) The permit shall expire no later than five years after the date of sale as the commissioner shall specify or as specified under section 90.191, and the timber shall be cut within the time specified therein. All cut timber, equipment, and buildings not removed from the land within 90 days after expiration of the permit shall become the property of the state.

(c) The commissioner may grant an additional period of time not to exceed 120 days for the removal of cut timber, equipment, and buildings upon receipt of such request by the permit holder for good and sufficient reasons. The commissioner may grant a second period of time not to exceed 120 days for the removal of cut timber, equipment, and buildings upon receipt of a request by the permit holder for hardship reasons only.

EFFECTIVE DATE. This section is effective the day following final enactment and applies retroactively to permits dated January 1, 2008, and thereafter."

Page 37, line 24, delete "53" and insert "55"

Renumber the sections in sequence

Amend the title as follows:

Page 1, line 3, after the first semicolon, insert "modifying certain enforcement authority; modifying timber permit provisions;"

Correct the title numbers accordingly

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

The report was adopted.

Journal of the House - 108th Day - Monday, April 28, 2008 - Top of Page 10715

Carlson from the Committee on Finance to which was referred:

H. F. No. 3345, A bill for an act relating to economic development; allowing Explore Minnesota Tourism to provide a grant to the Minnesota Film and TV Board; appropriating money.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. Minnesota Statutes 2006, section 116U.26, is amended to read:

116U.26 FILM JOBS PRODUCTION PROGRAM.

(a) The film production jobs program is created. The program shall be operated by the Minnesota Film and TV Board with administrative oversight and control by the director of Explore Minnesota Tourism. The program shall make payment to producers of feature films, national television programs, documentaries, music videos, and commercials that directly create new film jobs in Minnesota. To be eligible for a payment, a producer must submit documentation to the Minnesota Film and TV Board of expenditures for production costs incurred in Minnesota that are directly attributable to the production in Minnesota of a film product.

The Minnesota Film and TV Board shall make recommendations to the director of Explore Minnesota Tourism about program payment, but the director has the authority to make the final determination on payments. The director's determination must be based on proper documentation of eligible production costs submitted for payments. No more than five percent of the funds appropriated for the program in any year may be expended for administration.

(b) For the purposes of this section:

(1) "production costs" means the cost of the following:

(i) a story and scenario to be used for a film;

(ii) salaries of talent, management, and labor, including payments to personal services corporations for the services of a performing artist;

(iii) set construction and operations, wardrobe, accessories, and related services;

(iv) photography, sound synchronization, lighting, and related services;

(v) editing and related services;

(vi) rental of facilities and equipment; or

(vii) other direct costs of producing the film in accordance with generally accepted entertainment industry practice; and

(2) "film" means a movie, television show, documentary, music video, or television commercial, whether on film or video. Film does not include news, current events, public programming, or a program that includes weather or market reports; a talk show; a production with respect to a questionnaire or contest; a sports event or sports activity; a gala presentation or awards show; a finished production that solicits funds; or a production for which the production company is required under United States Code, title 18, section 2257, to maintain records with respect to a performer portrayed in a single-media or multimedia program.

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(c) Notwithstanding any other law to the contrary, the Minnesota Film and TV Board may make reimbursements of up to 20 percent of film production costs for films that incur production costs in excess of $5,000,000 in Minnesota within a 12-month period.

EFFECTIVE DATE. This section is effective for films that begin filming on or after the day following final enactment.

Sec. 2. MINNESOTA FILM AND TV BOARD GRANT.

$500,000 is appropriated from the special marketing account established pursuant to Laws 2005, First Special Session chapter 1, article 3, section 6, to the director of Explore Minnesota Tourism for a onetime grant to the Minnesota Film and TV Board for the filming of a movie in Minnesota in 2008 and 2009. The grant is in addition to any payments made for the same purpose from the film production jobs program under Minnesota Statutes, section 116U.26. This appropriation is available until expended.

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

Delete the title and insert:

"A bill for an act relating to economic development; allowing Explore Minnesota Tourism to provide a grant to the Minnesota Film and TV Board; allowing film production costs reimbursements; appropriating money; amending Minnesota Statutes 2006, section 116U.26."

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

The report was adopted.

Carlson from the Committee on Finance to which was referred:

H. F. No. 3494, A bill for an act relating to employment; providing up to three hours of paid leave in any 12-month period for state employees to donate blood; authorizing employers to provide leave to employees to donate blood; proposing coding for new law in Minnesota Statutes, chapters 43A; 181.

Reported the same back with the following amendments:

Page 1, delete section 1 and insert:

"Section 1. [43A.187] BLOOD DONATION LEAVE.

A state employee must be granted leave from work with 100 percent of pay to donate blood at a location away from the place of work. The total amount of leave used under this section may not exceed three hours in a 12-month period, and must be determined by the employee. A state employee seeking leave from work under this section must provide 14 days notice to the appointing authority. This leave must not affect the employee's vacation leave, pension, compensatory time, personal vacation days, sick leave, earned overtime accumulation, or cause a loss of seniority. For the purposes of this section, "state employee" does not include an employee of the Minnesota State Colleges and Universities."

With the recommendation that when so amended the bill pass.

The report was adopted.

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Carlson from the Committee on Finance to which was referred:

H. F. No. 3539, A bill for an act relating to health; providing an exception to hospital construction moratorium; amending Minnesota Statutes 2006, section 144.551, subdivision 1.

Reported the same back with the following amendments:

Page 5, delete lines 4 to 9 and insert:

"(24) a project for construction of a specialty psychiatric hospital in the city of Woodbury for up to 66 beds, exclusively for patients who are under 21 years of age on the date of admission, provided the hospital shall be subject to the Federal Emergency Medical Treatment and Active Labor Act and Centers for Medicaid and Medicare certification including, but not limited to:

(i) accepting emergency transfers and admissions 24 hours a day, 365 days a year;

(ii) having physicians on site or on call and able to respond on site 24 hours a day;

(iii) providing emergency medical treatment regardless of ability to pay; and

(iv) establishing a transfer agreement with a general hospital for services not available at the facility."

With the recommendation that when so amended the bill pass.

The report was adopted.

Lenczewski from the Committee on Taxes to which was referred:

H. F. No. 3547, A bill for an act relating to natural resources; modifying aquatic farm and invasive species provisions; authorizing certain fees; modifying horse pass requirements; modifying report requirements for game and fish fund; providing for wildlife disease management; modifying disposition of pheasant habitat improvement account; modifying wild turkey management account; modifying hunting and fishing licensing and taking provisions; requiring reports; providing for rulemaking; appropriating money; amending Minnesota Statutes 2006, sections 17.4981; 84.027, subdivision 15; 84D.10, subdivision 2; 84D.13, subdivision 4; 85.46, subdivision 1; 97A.015, by adding a subdivision; 97A.045, subdivision 11; 97A.055, subdivision 4b; 97A.075, subdivisions 4, 5; 97A.311, subdivision 5; 97A.431, subdivision 2; 97A.433, subdivision 2; 97A.434, subdivision 2; 97A.435, subdivision 4; 97A.451, subdivision 4, by adding a subdivision; 97A.475, subdivision 5; 97A.485, subdivision 6; 97A.535, subdivision 1; 97B.015, subdivision 5; 97B.041; 97B.106, subdivision 1; 97B.211, subdivision 1; 97B.301, subdivision 6, by adding a subdivision; 97B.405; 97B.431; 97B.621, subdivision 3; 97B.711, subdivision 1; 97B.721; 97C.001, subdivision 3; 97C.005, subdivision 3; 97C.205; 97C.315, subdivision 1; 97C.355, subdivisions 4, 7, 7a; 97C.371, subdivision 4, by adding a subdivision; 97C.395, subdivision 1; 97C.865, subdivision 2; Minnesota Statutes 2007 Supplement, sections 17.4984, subdivision 1; 97A.055, subdivision 4; 97A.405, subdivision 2; 97A.441, subdivision 7; 97A.451, subdivision 3; 97A.475, subdivisions 2, 3, 7, 11, 12, 16; 97B.031, subdivision 1; 97B.035, subdivision 1a; 97B.036; 97B.328; 97C.355, subdivisions 2, 8; proposing coding for new law in Minnesota Statutes, chapter 97C; repealing Minnesota Statutes 2006, section 97A.411, subdivision 2; Minnesota Rules, parts 6232.0200, subpart 4; 6232.0300, subpart 4; 6234.0100, subpart 4.

Reported the same back with the recommendation that the bill pass and be re-referred to the Committee on Ways and Means.

The report was adopted.

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Carlson from the Committee on Finance to which was referred:

H. F. No. 3873, A bill for an act relating to human services; prohibiting the release of the names of certain potential enrollees to health plans for marketing purposes; amending Minnesota Statutes 2006, section 256B.69, subdivision 28.

Reported the same back with the recommendation that the bill pass.

The report was adopted.

Carlson from the Committee on Finance to which was referred:

H. F. No. 3969, A bill for an act relating to state government; authorizing the secretary of state to transfer funds.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. Laws 2007, chapter 148, article 1, section 7, is amended to read:

Sec. 7. SECRETARY OF STATE $9,019,000 $6,497,000

Appropriations by Fund

2008 2009

General 6,175,000 6,497,000

Special Revenue 2,844,000

(a) $310,000 of this appropriation must be transferred to the Help America Vote Act account and is designated as a portion of the match required by section 253(b)(5) of the Help America Vote Act.

(b) $2,844,000 the first year is appropriated from the Help America Vote Act account for the purposes and uses authorized by federal law. This appropriation is available until June 30, 2009.

(c) Notwithstanding Laws 2005, chapter 162, section 34, subdivision 7, any balance remaining in the Help America Vote Act account after previous appropriations and the appropriations in this section is appropriated to the secretary of state for the purposes of the account. This appropriation is available until June 30, 2011.

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(d) The amount necessary to meet federal requirements for interest payments and the additional match for the Help America Vote Act account is transferred from the general fund appropriation to the Help America Vote Act account.

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

Correct the title numbers accordingly

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

The report was adopted.

Carlson from the Committee on Finance to which was referred:

H. F. No. 4014, A bill for an act relating to Steele County; authorizing transfer of nursing home and assisted living facility and related assets to nonprofit corporation and acquisition of membership interest in nonprofit corporation.

Reported the same back with the following amendments:

Delete everything after the enacting clause and insert:

"Section 1. Minnesota Statutes 2006, section 144A.071, subdivision 4c, is amended to read:

Subd. 4c. Exceptions for replacement beds after June 30, 2003. (a) The commissioner of health, in coordination with the commissioner of human services, may approve the renovation, replacement, upgrading, or relocation of a nursing home or boarding care home, under the following conditions:

(1) to license and certify an 80-bed city-owned facility in Nicollet County to be constructed on the site of a new city-owned hospital to replace an existing 85-bed facility attached to a hospital that is also being replaced. The threshold allowed for this project under section 144A.073 shall be the maximum amount available to pay the additional medical assistance costs of the new facility;

(2) to license and certify 29 beds to be added to an existing 69-bed facility in St. Louis County, provided that the 29 beds must be transferred from active or layaway status at an existing facility in St. Louis County that had 235 beds on April 1, 2003.

The licensed capacity at the 235-bed facility must be reduced to 206 beds, but the payment rate at that facility shall not be adjusted as a result of this transfer. The operating payment rate of the facility adding beds after completion of this project shall be the same as it was on the day prior to the day the beds are licensed and certified. This project shall not proceed unless it is approved and financed under the provisions of section 144A.073;

(3) to license and certify a new 60-bed facility in Austin, provided that: (i) 45 of the new beds are transferred from a 45-bed facility in Austin under common ownership that is closed and 15 of the new beds are transferred from a 182-bed facility in Albert Lea under common ownership; (ii) the commissioner of human services is authorized by the 2004 legislature to negotiate budget-neutral planned nursing facility closures; and (iii) money is available from planned closures of facilities under common ownership to make implementation of this clause budget-neutral to the

Journal of the House - 108th Day - Monday, April 28, 2008 - Top of Page 10720

state. The bed capacity of the Albert Lea facility shall be reduced to 167 beds following the transfer. Of the 60 beds at the new facility, 20 beds shall be used for a special care unit for persons with Alzheimer's disease or related dementias; ~~and~~

(4) to license and certify up to 80 beds transferred from an existing state-owned nursing facility in Cass County to a new facility located on the grounds of the Ah-Gwah-Ching campus. The operating cost payment rates for the new facility shall be determined based on the interim and settle-up payment provisions of Minnesota Rules, part 9549.0057, and the reimbursement provisions of section 256B.431. The property payment rate for the first three years of operation shall be $35 per day. For subsequent years, the property payment rate of $35 per day shall be adjusted for inflation as provided in section 256B.434, subdivision 4, paragraph (c), as long as the facility has a contract under section 256B.434; and

(5) to initiate a pilot program to license and certify up to 80 beds transferred from an existing county-owned nursing facility in Steele County relocated to the site of a new acute care facility as part of the county's Communities for a Lifetime comprehensive plan to create innovative responses to the aging of its population. Upon relocation to the new site, the nursing facility shall delicense 28 beds. The property payment rate for the first three years of operation of the new facility shall be increased by an amount as calculated according to items (i) to (v):

(i) compute the estimated decrease in medical assistance residents served by the nursing facility by multiplying the decrease in licensed beds by the historical percentage of medical assistance resident days;

(ii) compute the annual savings to the medical assistance program from the delicensure of 28 beds by multiplying the anticipated decrease in medical assistance residents, determined in item (i), by the existing facility's weighted average payment rate multiplied by 365;

(iii) compute the anticipated annual costs for community-based services by multiplying the anticipated decrease in medical assistance residents served by the nursing facility, determined in item (i), by the average monthly elderly waiver service costs for individuals in Steele County multiplied by 12;

(iv) subtract the amount in item (iii) from the amount in item (ii);

(v) divide the amount in item (iv) by an amount equal to the relocated nursing facility's occupancy factor under section 256B.431, subdivision 3f, paragraph (c), multiplied by the historical percentage of medical assistance resident days.

For subsequent years, the adjusted property payment rate shall be adjusted for inflation as provided in section 256B.434, subdivision 4, paragraph (c), as long as the facility has a contract under section 256B.434.

(b) Projects approved under this subdivision shall be treated in a manner equivalent to projects approved under subdivision 4a.

Sec. 2. STEELE COUNTY ASSET TRANSFER; STATUS OF TRANSFEREE.

Subdivision 1. Asset transfer authorized. Steele County may lease, sell, or otherwise transfer to a nonprofit corporation all of the real and personal property, tangible and intangible, including contract rights, receivables, and enterprise funds, owned or used by the county for nursing home, assisted living, and related purposes and may acquire a membership interest in the nonprofit corporation. Any lease must provide for rent payable by the corporation at least sufficient to pay the principal and interest on the outstanding bonds of the county issued to finance any of the facilities. The lease may grant the corporation an option or require the corporation to purchase the facilities upon payment or redemption of the outstanding bonds. Any lease, sale, or other transfer must be on terms and conditions approved by the county board, without advertisement or public solicitation of bids.

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Subd. 2. Status of transferee. The articles of incorporation or bylaws of the transferee corporation may provide that the county board has the right to appoint and remove one or more members of the governing board of the corporation and that specified actions be subject to the approval of the members. The corporation shall be a nonprofit corporation organized under Minnesota Statutes, chapter 317A, and entitled to exercise all of the powers of a nonprofit corporation under that chapter. If the county board does not have the right to appoint a majority of the governing board of the nonprofit corporation, neither Minnesota Statutes, section 465.717, nor other laws applicable to public corporations shall apply to the nonprofit corporation.

Subd. 3. Open meeting law; data practices. A nonprofit corporation created under this section is subject to the Minnesota Open Meeting Law and Minnesota Government Data Practices Act.

EFFECTIVE DATE; LOCAL APPROVAL. This section is effective the day after the governing body of Steele County and its chief clerical officer timely complete compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3."

Delete the title and insert:

"A bill for an act relating to Steele County; authorizing transfer of nursing home and assisted living facility and related assets to nonprofit corporation and acquisition of membership interest in nonprofit corporation; providing an exception to the moratorium on new nursing home beds for beds transferred to a new site within the county; amending Minnesota Statutes 2006, section 144A.071, subdivision 4c."

With the recommendation that when so amended the bill pass.

The report was adopted.

Lenczewski from the Committee on Taxes to which was referred:

H. F. No. 4100, A bill for an act relating to transportation; establishing driver and vehicle services technology account; imposing technology surcharge; adjusting certain fees; amending Minnesota Statutes 2006, sections 168.013, by adding a subdivision; 168A.29, as amended; 299A.705, by adding a subdivision; Minnesota Statutes 2007 Supplement, section 171.06, subdivision 2.

Reported the same back with the recommendation that the bill pass and be re-referred to the Committee on Ways and Means.

The report was adopted.

SECOND READING OF HOUSE BILLS

H. F. Nos. 3494, 3539, 3873 and 4014 were read for the second time.

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INTRODUCTION AND FIRST READING OF HOUSE BILLS

The following House Files were introduced:

Hornstein; Hausman; Anzelc; Laine; Murphy, E.; Slocum; Mariani; Johnson; Wagenius; Greiling; Kahn; Clark; Loeffler; Bly; Hansen; Davnie; Swails; Tschumper and Paymar introduced:

H. F. No. 4213, A bill for an act relating to nuclear waste; prohibiting issuance of a certificate of need to expand nuclear waste storage at Prairie Island; amending Minnesota Statutes 2006, section 216B.243, by adding a subdivision.

The bill was read for the first time and referred to the Energy Finance and Policy Division.

Loeffler, Hosch and Murphy, E., introduced:

H. F. No. 4214, A bill for an act relating to human services; increasing the medical assistance asset limit for elderly individuals who own and occupy a homestead; amending Minnesota Statutes 2006, section 256B.056, subdivision 3.

The bill was read for the first time and referred to the Committee on Health and Human Services.

Peppin; Otremba; Fritz; Garofalo; Drazkowski; Anderson, B.; Wardlow; Gunther; Emmer; Buesgens; Dettmer and Dean introduced:

H. F. No. 4215, A bill for an act relating to abortions; regulating retention and composition of medical records; proposing coding for new law in Minnesota Statutes, chapter 145.

The bill was read for the first time and referred to the Committee on Health and Human Services.

Bigham and Hilstrom introduced:

H. F. No. 4216, A bill for an act relating to public safety; requiring that uniform traffic ticket contain notice of the criminal and traffic surcharge; amending Minnesota Statutes 2006, section 169.99, by adding a subdivision.

The bill was read for the first time and referred to the Committee on Public Safety and Civil Justice.

Mariani, Norton, Lieder, Haws, Swails, Wollschlager, Tillberry, Bigham and Knuth introduced:

H. F. No. 4217, A bill for an act relating to education finance; modifying the school finance system; creating a new education funding framework; amending Minnesota Statutes 2006, sections 123B.53, subdivision 5; 123B.57, subdivision 4; 123B.59, subdivision 1; 123B.591, subdivisions 2, 3; 124D.59, subdivision 2; 124D.65, subdivision 5; 125A.79, subdivision 7; 126C.01, by adding subdivisions; 126C.05, subdivisions 3, 5, 6, 8, 16, 17; 126C.10, subdivisions 1, 2a, 3, 4, 6, 13, 18, by adding subdivisions; 126C.13, subdivision 5; 126C.17, subdivision 1; 126C.20; 126C.40, subdivision 1; Minnesota Statutes 2007 Supplement, sections 125A.76, subdivision 5; 126C.05, subdivision 1; 126C.10, subdivision 2; 126C.13, subdivision 4; proposing coding for new law in Minnesota Statutes,

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chapters 123B; 126C; repealing Minnesota Statutes 2006, sections 126C.10, subdivisions 13a, 13b, 25, 26, 27, 28, 29, 30, 31, 31a, 31b, 32, 33, 35, 36; 126C.12; 127A.50; Minnesota Statutes 2007 Supplement, sections 123B.54; 125A.76, subdivision 4; 125A.79, subdivision 6; 126C.10, subdivisions 2b, 24, 34; 126C.126.

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

MESSAGES FROM THE SENATE

The following message was received from the Senate:

Madam Speaker:

I hereby announce the passage by the Senate of the following House File, herewith returned, as amended by the Senate, in which amendments the concurrence of the House is respectfully requested:

H. F. No. 3172, A bill for an act relating to elections; changing certain ballot delivery, election judge, mail election, special election and special primary, school district election, and postelection review procedures; authorizing continued use of certain applications; amending Minnesota Statutes 2006, sections 203B.06, subdivision 3; 203B.11, subdivision 4; 204B.21; 204B.46; 204D.19, subdivision 2; 204D.23, subdivision 2; 204D.27, by adding a subdivision; 205.075, by adding a subdivision; 205A.03, subdivision 1; 205A.06, subdivision 1a; 205A.10, subdivision 2; 205A.12, by adding a subdivision; 206.89, subdivision 5.

Colleen J. Pacheco, Second Assistant Secretary of the Senate

Pelowski moved that the House refuse to concur in the Senate amendments to H. F. No. 3172, that the Speaker appoint a Conference Committee of 3 members of the House, and that the House requests that a like committee be appointed by the Senate to confer on the disagreeing votes of the two houses. The motion prevailed.

The following Conference Committee Report was received:

CONFERENCE COMMITTEE REPORT ON H. F. NO. 3477

A bill for an act relating to manufactured housing; providing for regulation of lending practices and default; providing notices and remedies; amending Minnesota Statutes 2006, sections 327.64, subdivision 2; 327.65; 327.66; 327B.01, by adding subdivisions; 327B.08, by adding a subdivision; 327B.09, by adding a subdivision; 327B.12; proposing coding for new law in Minnesota Statutes, chapters 327; 327B.

April 23, 2008

The Honorable Margaret Anderson Kelliher

Speaker of the House of Representatives

The Honorable James P. Metzen

President of the Senate

We, the undersigned conferees for H. F. No. 3477 report that we have agreed upon the items in dispute and recommend as follows:

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That the Senate recede from its amendment and that H. F. No. 3477 be further amended as follows:

Delete everything after the enacting clause and insert:

"Section 1. Minnesota Statutes 2006, section 327.64, subdivision 2, is amended to read:

Subd. 2. Notice; service. (a) A secured party may commence repossession of a manufactured home by personally serving upon, or by sending by certified or registered United States mail and concurrently sending a copy of the notice by first class mail to, the occupant of the ~~mobile~~ manufactured home a notice and, if the occupant is not the debtor, by sending a registered or certified letter to the last known address of the debtor under the security agreement, both setting forth the circumstances constituting the default under the security agreement and stating that the secured party will at the expiration of a 30-day period following receipt of the notice seek a court order removing the occupant from the manufactured home and repossessing the manufactured home, unless the debtor or the occupant acting on behalf of the debtor cures the default prior to that time and in the manner provided by section 327.66. If notice is mailed to a debtor in accordance with this subdivision, the secured party by affidavit shall set forth the circumstances causing the secured party to believe that the debtor could be reached at the address to which the notice was mailed. The affidavit shall state that the secured party has no ~~reason to believe~~ reliable information causing the secured party to conclude that the debtor might receive mailed notice at another address.

(b) The notice must state: "Your loan is currently in default. Contact us immediately at [insert phone number] to discuss possible options for preventing repossession. We encourage you to seek assistance from the foreclosure prevention counseling program in your area. Nearby community agencies will answer your questions, offer free advice, and help you create a plan. You can contact the Minnesota Home Ownership Center at (866) 462-6646 or www.hocmn.org to get the phone number and location of the nearest foreclosure prevention organization. Call today. Waiting limits your options. IF YOU DO NOT BECOME CURRENT ON YOUR LOAN WITHIN 30 DAYS, WE WILL SEEK A COURT ORDER REPOSSESSING THE HOME, AND BY COURT ORDER YOU WILL HAVE TO VACATE THE HOME."

(c) If the debtor does not sign for the registered or certified letter containing the notice within seven calendar days of the first attempted delivery, the secured party may proceed with all permissible actions provided in statute as though the debtor's signature has been secured.

Sec. 2. Minnesota Statutes 2006, section 327.65, is amended to read:

327.65 COURT ORDER.

Except in cases of voluntary repossession, upon expiration of the 30-day period specified in the notices required by section 327.64, a secured party must apply to the district court in the county in which the manufactured home is located for an order pursuant to chapter 565 directing the seizure and delivery of the manufactured home. The application shall be accompanied by a copy of the security agreement entitling the secured party to repossession of the manufactured home, a copy of the notices required under sections 327.64 and 327.665, and ~~by the~~ an affidavit ~~required by section 327.64 if notice is mailed to the debtor~~ of service stating that the notices required under sections 327.64 and 327.665 were properly served upon the occupant, and if the occupant of the home is not the debtor, the debtor. The notices required by ~~section~~ sections 327.64 and 327.665 shall not be considered as satisfying any of the notice requirements under chapter 565.

Sec. 3. [327.651] VOLUNTARY REPOSSESSION.

The secured party and the debtor and occupant, if the debtor is not the occupant, may agree in writing on a voluntary surrender of the title and possession of the manufactured home to the secured party prior to or after the end of the 30-day period specified under section 327.64. The secured party may file the agreement and any other documents necessary to transfer the title in the manner required under chapter 336. When this provision is exercised, notice under section 327.64, subdivision 3 is not applicable.

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Sec. 4. Minnesota Statutes 2006, section 327.66, is amended to read:

327.66 CURE OF DEFAULT.

A debtor, or an occupant of a manufactured home acting on behalf of a debtor, may within the 30 day period specified in the notices required by section 327.64, cure a default by tendering full payment of the sums then in arrears under the terms of the security agreement, or by otherwise remedying the default, and by paying the reasonable costs, not to exceed the sum of ~~$15~~ $100, incurred by the secured party to enforce the security agreement. Cure of a default in accordance with the provisions of this section shall suspend the secured party's right to seek repossession of the manufactured home under the provisions of sections 327.61 to 327.67.

Sec. 5. [327.665] REINSTATEMENT.

Subdivision 1. Right to reinstate. (a) If the debtor does not cure the default within the 30-day period specified in section 327.66, the secured party must send a registered or certified letter and concurrently send a copy of the notice by first class mail to the occupant of the home and, if the debtor is different than the occupant, to the debtor, stating that the debtor has 30 days to reinstate the loan by paying the defaulted amount plus additional allowable fees incurred by the secured party in order to regain possession of the home.

(b) If the debtor does not sign for the registered or certified letter containing the notice within seven calendar days of the first attempted delivery, the secured party may proceed with all permissible actions provided in statute as though the debtor's signature had been secured.

Subd. 2. Required notice; contents of notice. (a) The notice shall contain, at a minimum, the following information:

(1) the name of the secured party, the debtor, each current assignee of the loan, if any, and the original or maximum principal amount secured by the loan;

(2) the date of the loan;

(3) the amount in arrears on the loan as of the date of the notice;

(4) a description of the manufactured home upon which the loan is secured, conforming substantially to that contained in the loan documents;

(5) the amount of allowable fees incurred by the secured party in order to regain possession of the home prior to the court order.

(b) The notice must also state: "Your manufactured home is currently being repossessed. Contact us immediately at [insert phone number] to discuss possible options for reinstating your loan. We encourage you to seek counseling with the foreclosure prevention counselor in your area. Nearby community agencies will answer your questions, offer free advice, and help you create a plan. You can contact the Minnesota Home Ownership Center at 866-462-6646 or www.hocmn.org to get the phone number and location of the nearest counseling organization. Call today. Waiting limits your options. If you do not become current on your loan within 30 days, including any additional fees, you will no longer be entitled to reinstate your loan. We are seeking a court order repossessing the home, and by court order you will have to vacate the home."

Subd. 3. Action to repossess; termination of action. At any time after the expiration of the 30-day period required under section 327.64, the creditor may proceed with a court action under section 327.65, so long as the right to reinstate has not been exercised. The exercise of the right to reinstatement in accordance with the provisions

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of this section shall suspend the secured party's right to seek repossession of the manufactured home under the provisions of sections 327.61 to 327.67 and shall immediately terminate any court action filed pursuant to sections 327.61 to 327.67 or section 565.

Subd. 4. Allowable costs. For the purposes of this section, allowable costs that can be recovered include insurance; delinquent taxes, if any, upon the premises; interest to date of payment; cost of services of process or notices; filing fees; attorney fees, not to exceed $150 or one-half of the attorney fees authorized by section 582.01, whichever is greater; together with other lawful disbursements necessarily incurred in connection with the proceedings by the party repossessing.

Sec. 6. Minnesota Statutes 2006, section 327B.01, is amended by adding a subdivision to read:

Subd. 2a. Borrower. "Borrower" means a person or persons applying for or obtaining a manufactured home loan.

Sec. 7. Minnesota Statutes 2006, section 327B.01, is amended by adding a subdivision to read:

Subd. 4b. Churning. "Churning" means knowingly or intentionally making, providing, or arranging for a manufactured home loan when the new manufactured home loan does not provide a reasonable, tangible net benefit to the borrower considering all of the circumstances, including the terms of both the new and refinanced loans, the cost of the new loan, and the borrower's circumstances.

Sec. 8. Minnesota Statutes 2006, section 327B.01, is amended by adding a subdivision to read:

Subd. 13a. Manufactured home lender. "Manufactured home lender" means a person who makes a manufactured home loan to a borrower, including a person who provides table funding. A manufactured home lender includes an affiliate, subsidiary, or any person acting as an agent of the lender. This definition does not apply to a manufactured home loan originated by a federal or state chartered bank, savings bank, credit union, or a licensed sales finance company as defined under section 53C.01, subdivision 12.

Sec. 9. Minnesota Statutes 2006, section 327B.01, is amended by adding a subdivision to read:

Subd. 13b. Manufactured home loan. "Manufactured home loan" means a loan made to a person or persons for the purchase, refinancing, improvement, or repair of a manufactured home.

Sec. 10. Minnesota Statutes 2006, section 327B.01, is amended by adding a subdivision to read:

Subd. 14b. Negative amortization. "Negative amortization" occurs when the borrower's compliance with any repayment option offered pursuant to the terms of the manufactured home loan is insufficient to satisfy the interest accruing on the loan, resulting in an increase in the loan balance. Negative amortization does not occur when a manufactured home loan is originated, subsidized, or guaranteed by or through a state, tribal, or local government, or nonprofit organization, and bears one or more of the following nonstandard payment terms that substantially benefit the borrower:

(1) payments vary with income;

(2) payments of principal and interest are deferred until the maturity date of the loan or the sale of the residence;

(3) principal or interest is forgivable under specified conditions; or

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(4) where no interest or an annual interest rate of two percent or less is charged in connection with the loan, and excludes existing loan modifications and payment extensions mutually agreed upon by the secured party and debtor.

Sec. 11. Minnesota Statutes 2006, section 327B.08, is amended by adding a subdivision to read:

Subd. 6. Duty of agency. (a) A person acting as a broker shall be considered to have created an agency relationship with the borrower in all cases and shall comply with the following duties:

(1) brokers shall reasonably act:

(i) in the borrower's best interest;

(ii) in the utmost good faith toward borrowers; and

(iii) so as not to compromise a borrower's right or interest in favor of another's right or interest, including a right or interest of the broker. A broker shall not accept, give, or charge any undisclosed compensation or realize any undisclosed remuneration, either through direct or indirect means, that inures to the benefit of the broker on an expenditure made for the borrower;

(2) brokers shall carry out all lawful instructions given by borrowers;

(3) brokers shall disclose to borrowers all material facts of which the broker has knowledge which might reasonably affect the borrower's rights, interests, or ability to receive the borrower's intended benefit from the manufactured home loan, but not facts which are reasonably susceptible to the knowledge of the borrower;

(4) brokers shall use reasonable care in performing duties; and

(5) brokers shall account to a borrower for all the borrower's money and property received as an agent.

(b) The duty of agency does not attach to a broker who is:

(1) a dealer or retailer;

(2) a limited dealer or retailer;

(3) licensed as a sales finance company as defined under section 53C.01, subdivision 12;

(4) employed by:

(i) a manufactured home lender;

(ii) a dealer or retailer;

(iii) a limited dealer or retailer; or

(iv) a licensed sales finance company as defined under section 53C.01, subdivision 12;

(5) a person who has an exclusive contract to act as a broker for:

(i) a manufactured home lender;

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(ii) a dealer or retailer;

(iii) a limited dealer or retailer; or

(iv) a licensed sales finance company as defined under section 53C.01, subdivision 12.

(c) Nothing in this section prohibits a broker who is bound by the duty of agency from contracting for or collecting a reasonable fee for services rendered and which had been disclosed to the borrower in advance of the provision of such services.

(d) Nothing in this section requires a broker who is bound by the duty of agency to obtain a loan containing terms or conditions not available to the broker in the broker's usual course of business, or to obtain a loan for the borrower from a manufactured home loan lender with whom the broker does not have a business relationship.

Sec. 12. Minnesota Statutes 2006, section 327B.09, is amended by adding a subdivision to read:

Subd. 6. Standards of conduct. (a) No manufactured home lender shall:

(1) charge a fee for a product or service where the product or service is not actually provided, or misrepresent the amount charged by or paid to a third-party for a product or service;

(2) make or cause to be made, directly or indirectly, any false, deceptive, or misleading statement or representation in connection with a manufactured home loan transaction, including, without limitation, a false, deceptive, or misleading statement or representation regarding the borrower's ability to qualify for any manufactured home loan product;

(3) issue any document indicating conditional qualification or conditional approval for a manufactured home loan, unless the document also clearly indicates that final qualification or approval is not guaranteed, and may be subject to additional review;

(4) make or assist in making any manufactured home loan without verifying the reasonable ability of the borrower to repay the loan, taking into consideration taxes and insurance in connection with the manufactured home;

(5) make, provide, or arrange for a manufactured home loan for a higher interest rate or on less favorable terms than the rate or terms for which the borrower qualifies based on criteria typically used by that lender to evaluate rate and term offerings;

(6) make, provide, or arrange for a manufactured home loan all or a portion of the proceeds of which are used to fully or partially pay off a "special loan" unless the borrower has obtained a written certification from an authorized independent loan counselor that the borrower has received counseling on the advisability of the loan transaction. For the purposes of this section, "special loan" means a loan for the purchase, refinance, improvement, or repair of the manufactured home originated, subsidized, or guaranteed by or through a state, tribal, or local government, or nonprofit organization, that bears one or more of the following nonstandard payment terms, which substantially benefit the borrower:

(i) payments vary with income;

(ii) payments of principal or interest are not required or can be deferred under specified conditions;

(iii) principal or interest is forgivable under specified conditions; or

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(iv) where no interest or an annual interest rate of two percent or less is charged in connection with the loan. For the purposes of this section, "authorized independent loan counselor" means a nonprofit, third-party individual or organization providing homebuyer education programs, foreclosure prevention services, loan counseling, or credit counseling certified by the United States Department of Housing and Urban Development, the Minnesota Home Ownership Center, the Minnesota Mortgage Foreclosure Prevention Association, AARP, or NeighborWorks America.

(7) engage in churning; or

(8) make, provide, or arrange for a manufactured home loan if the borrower's compliance with any repayment option offered under the terms of the loan will result in negative amortization during any six-month period. This excludes existing loan extensions and modifications.

(b) This subdivision does not apply to a state or federally chartered bank, savings bank, or credit union, an institution chartered by Congress under the Farm Credit Act, or to a person making, providing, or arranging a manufactured home loan originated or purchased by a state agency or a tribal or local unit of government.

Sec. 13. [327B.095] INTEREST, POINTS, FINANCE CHARGES, FEES, AND OTHER CHARGES.

Subdivision 1. Financed interest, points, finance charges, fees, and other charges. (a) A manufactured home lender making or modifying a manufactured home loan to a borrower located in this state must not include in the principal amount of any loan, all or any portion of any lender fee in an aggregate amount exceeding:

(1) five percent of the loan amount for loans over $60,000;

(2) six percent of the loan amount for loans less than $60,000, but greater than or equal to $40,000; or

(3) eight percent of the loan amount for loans of less than $40,000.

(b) "Lender fee" means interest, origination points, finance charges, fees, and other charges payable in connection with the manufactured home loan:

(1) by the borrower to any manufactured home lender or broker or to any assignee of any manufactured home lender or broker; or

(2) by the lender to a broker.

(c) Lender fee does not include discount points, provided there is a concomitant benefit to the borrower, recording fees, taxes, passthroughs, or other amounts that are paid by any person to any government entity, filing office, or other third party that is not a manufactured home lender or broker or to any assignee of any manufactured home lender or broker. Lender fee also does not include any amount that is set aside to pay taxes or insurance on any property securing the manufactured home loan.

(d) "Loan amount" means:

(1) for a line of credit, the maximum principal amount of the line of credit; and

(2) for any other manufactured home loan, the principal amount of the loan, excluding all interest, points, finance charges, fees, and other charges.

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(e) A manufactured home lender or broker shall not charge, receive, or collect any excess financed interest, points, finance charges, fees, or other charges described in this subdivision, or any interest, points, finance charges, fees, or other charges with respect to this excess.

Subd. 2. Prepayment penalties. No manufactured home loan may contain a provision requiring or permitting the imposition of a penalty, fee, premium, or other charge in the event the manufactured home loan is prepaid in whole or in part unless the penalty, fee, premium, or other charge constitutes consideration for an equal or greater benefit to the borrower.

Subd. 3. Exemption. This section does not apply to a manufactured home loan originated by a federal or state chartered bank, savings bank, credit union, or a licensed sales finance company as defined under section 53C.01, subdivision 12.

Sec. 14. Minnesota Statutes 2006, section 327B.12, is amended to read:

327B.12 ADDITIONAL REMEDIES AND ENFORCEMENT.

Subdivision 1. Private remedies. (a) Any person injured or threatened with injury by a dealer or manufacturer's violation of sections 327B.01 to 327B.12 may bring a private action in any court of competent jurisdiction.

(b) A borrower injured by a violation of the standards, duties, prohibitions, or requirements of sections 327B.08, subdivision 6; 325B.09, subdivision 6; or 325B.095, shall have a private right of action and the court shall award actual, incidental, and consequential damages.

Subd. 2. Fraud remedies. In addition to the remedies provided in sections 327B.01 to 327B.12, any violation of section 327B.08 or 327B.09 is a violation of section 325F.69, subdivision 1 and the provisions of section 8.31 shall apply. A private right of action by the borrower under this chapter is in the public interest."

Delete the title and insert:

"A bill for an act relating to manufactured housing; providing for regulation of lending practices and default; providing notices and remedies; amending Minnesota Statutes 2006, sections 327.64, subdivision 2; 327.65; 327.66; 327B.01, by adding subdivisions; 327B.08, by adding a subdivision; 327B.09, by adding a subdivision; 327B.12; proposing coding for new law in Minnesota Statutes, chapters 327; 327B."

We request the adoption of this report and repassage of the bill.

House Conferees: Paul Gardner, Jim Davnie and John Berns.

Senate Conferees: John Marty, Michael J. Jungbauer and Linda Scheid.

Gardner moved that the report of the Conference Committee on H. F. No. 3477 be adopted and that the bill be repassed as amended by the Conference Committee. The motion prevailed.

H. F. No. 3477, A bill for an act relating to manufactured housing; providing for regulation of lending practices and default; providing notices and remedies; amending Minnesota Statutes 2006, sections 327.64, subdivision 2; 327.65; 327.66; 327B.01, by adding subdivisions; 327B.08, by adding a subdivision; 327B.09, by adding a subdivision; 327B.12; proposing coding for new law in Minnesota Statutes, chapters 327; 327B.

The bill was read for the third time, as amended by Conference, and placed upon its repassage.

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The question was taken on the repassage of the bill and the roll was called. There were 126 yeas and 3 nays as follows:

Those who voted in the affirmative were:

The bill was passed, as amended, and its title agreed to.

S. F. No. 3001 was reported to the House.

Mariani moved to amend S. F. No. 3001, the fourth engrossment, as follows:

Delete everything after the enacting clause and insert the following language of H. F. No. 3316, the second engrossment:

"ARTICLE 1

GENERAL EDUCATION

Section 1. Minnesota Statutes 2006, section 123B.14, subdivision 7, is amended to read:

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Subd. 7. Clerk records. The clerk shall keep a record of all meetings of the district and the board in books provided by the district for that purpose. The clerk shall, within three days after an election, notify all persons elected of their election. By ~~August~~ September 15 of each year the clerk shall file with the board a report of the revenues, expenditures and balances in each fund for the preceding fiscal year. The report together with vouchers and supporting documents shall subsequently be examined by a public accountant or the state auditor, either of whom shall be paid by the district, as provided in section 123B.77, subdivision 3. The board shall by resolution approve the report or require a further or amended report. By ~~August~~ September 15 of each year, the clerk shall make and transmit to the commissioner certified reports, showing:

~~(1) The condition and value of school property;~~

~~(2)~~ (1) The revenues and expenditures in detail, and such other financial information required by law, rule, or as may be called for by the commissioner;

~~(3)~~ (2) The length of school term and the enrollment and attendance by grades; and

~~(4)~~ (3) Such other items of information as may be called for by the commissioner.

The clerk shall enter in the clerk's record book copies of all reports and of the teachers' term reports, as they appear in the registers, and of the proceedings of any meeting as furnished by the clerk pro tem, and keep an itemized account of all the expenses of the district. The clerk shall furnish to the auditor of the proper county, by ~~October 10~~ September 30 of each year, an attested copy of the clerk's record, showing the amount of ~~money~~ proposed property taxes voted by the district or the board for school purposes; draw and sign all orders upon the treasurer for the payment of money for bills allowed by the board for salaries of officers and for teachers' wages and all claims, to be countersigned by the chair. Such orders must state the consideration, payee, and the fund and the clerk shall take a receipt therefor. Teachers' wages shall have preference in the order in which they become due, and no money applicable for teachers' wages shall be used for any other purpose, nor shall teachers' wages be paid from any fund except that raised or apportioned for that purpose.

Sec. 2. Minnesota Statutes 2006, section 123B.77, subdivision 3, is amended to read:

Subd. 3. Statement for comparison and correction. (a) By November 30 of the calendar year of the submission of the unaudited financial data, the district must provide to the commissioner audited financial data for the preceding fiscal year. The audit must be conducted in compliance with generally accepted governmental auditing standards, the federal Single Audit Act, and the Minnesota legal compliance guide issued by the Office of the State Auditor. An audited financial statement prepared in a form which will allow comparison with and correction of material differences in the unaudited financial data shall be submitted to the commissioner and the state auditor by December 31. The audited financial statement must also provide a statement of assurance pertaining to uniform financial accounting and reporting standards compliance and a copy of the management letter submitted to the district by the school district's auditor.

(b) By ~~January~~ February 15 of the calendar year following the submission of the unaudited financial data, the commissioner shall convert the audited financial data required by this subdivision into the consolidated financial statement format required under subdivision 1a and publish the information on the department's Web site.

Sec. 3. Minnesota Statutes 2006, section 123B.81, subdivision 3, is amended to read:

Subd. 3. Debt verification. The commissioner shall establish a uniform auditing or other verification procedure for districts to determine whether a statutory operating debt exists in any Minnesota school district as of June 30, 1977. This procedure must identify all interfund transfers made during fiscal year 1977 from a fund included in computing statutory operating debt to a fund not included in computing statutory operating debt. The standards for

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this uniform auditing or verification procedure must be promulgated by the state board pursuant to chapter 14. If a district applies to the commissioner for a statutory operating debt verification ~~or if the unaudited financial statement for the school year ending June 30, 1977 reveals that a statutory operating debt might exist~~, the commissioner shall require a verification of the amount of the statutory operating debt which actually does exist.

Sec. 4. Minnesota Statutes 2007 Supplement, section 123B.81, subdivision 4, is amended to read:

Subd. 4. Debt elimination. If an audit or other verification procedure conducted pursuant to subdivision 3 determines that a statutory operating debt exists, a district must follow the procedures set forth in ~~this~~ section 123B.83 to eliminate this statutory operating debt.

Sec. 5. Minnesota Statutes 2006, section 123B.81, subdivision 5, is amended to read:

Subd. 5. Certification of debt. The commissioner shall certify the amount of statutory operating debt for each district. ~~Prior to June 30, 1979, the commissioner may, on the basis of corrected figures, adjust the total amount of statutory operating debt certified for any district.~~

Sec. 6. Minnesota Statutes 2006, section 123B.83, subdivision 3, is amended to read:

Subd. 3. Failure to limit expenditures. If a district does not limit its expenditures in accordance with this section, the commissioner may so notify the appropriate committees of the legislature by no later than ~~January 1~~ February 15 of the year following the end of that fiscal year.

Sec. 7. Minnesota Statutes 2007 Supplement, section 126C.10, subdivision 34, is amended to read:

Subd. 34. Basic alternative teacher compensation aid. (a) For fiscal years 2007 ~~and later~~, 2008, and 2009, the basic alternative teacher compensation aid for a school district with a plan approved under section 122A.414, subdivision 2b, equals 65 73.1 percent of the alternative teacher compensation revenue under section 122A.415, subdivision 1. The basic alternative teacher compensation aid for an intermediate school district or charter school with a plan approved under section 122A.414, subdivisions 2a and 2b, if the recipient is a charter school, equals $260 times the number of pupils enrolled in the school on October 1 of the previous fiscal year, or on October 1 of the current fiscal year for a charter school in the first year of operation, times the ratio of the sum of the alternative teacher compensation aid and alternative teacher compensation levy for all participating school districts to the maximum alternative teacher compensation revenue for those districts under section 122A.415, subdivision 1.

(b) For fiscal years 2010 and later, the basic alternative teacher compensation aid for a school district with a plan approved under section 122A.414, subdivision 2b, equals 65 percent of the alternative teacher compensation revenue under section 122A.415, subdivision 1. The basic alternative teacher compensation aid for an intermediate school district or charter school with a plan approved under section 122A.414, subdivisions 2a and 2b, if the recipient is a charter school, equals $260 times the number of pupils enrolled in the school on October 1 of the previous fiscal year, or on October 1 of the current fiscal year for a charter school in the first year of operation, times the ratio of the sum of the alternative teacher compensation aid and alternative teacher compensation levy for all participating school districts to the maximum alternative teacher compensation revenue for those districts under section 122A.415, subdivision 1.

~~(b)~~ (c) Notwithstanding paragraphs (a) and (b) and section 122A.415, subdivision 1, the state total basic alternative teacher compensation aid entitlement must not exceed $75,636,000 for fiscal year 2007 and later. The commissioner must limit the amount of alternative teacher compensation aid approved under section 122A.415 so as not to exceed these limits.

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

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Sec. 8. Minnesota Statutes 2006, section 126C.40, subdivision 6, is amended to read:

Subd. 6. Lease purchase; installment buys. (a) Upon application to, and approval by, the commissioner in accordance with the procedures and limits in subdivision 1, paragraphs (a) and (b), a district, as defined in this subdivision, may:

(1) purchase real or personal property under an installment contract or may lease real or personal property with an option to purchase under a lease purchase agreement, by which installment contract or lease purchase agreement title is kept by the seller or vendor or assigned to a third party as security for the purchase price, including interest, if any; and

(2) annually levy the amounts necessary to pay the district's obligations under the installment contract or lease purchase agreement.

(b) The obligation created by the installment contract or the lease purchase agreement must not be included in the calculation of net debt for purposes of section 475.53, and does not constitute debt under other law. An election is not required in connection with the execution of the installment contract or the lease purchase agreement.

(c) The proceeds of the levy authorized by this subdivision must not be used to acquire a facility to be primarily used for athletic or school administration purposes.

(d) For the purposes of this subdivision, "district" means:

(1) a racially isolated school district or a school district with a racially identifiable school required to have a ~~comprehensive~~ desegregation or integration plan ~~for the elimination of segregation~~ under Minnesota Rules, parts 3535.0100 to 3535.0180, which is eligible for revenue under section 124D.86, subdivision 3, clause (1), (2), or (3), and whose plan has been determined by the commissioner to be in compliance with Department of Education rules relating to equality of educational opportunity and school desegregation and, for a district eligible for revenue under section 124D.86, subdivision 3, clause (4) or (5), where the acquisition of property under this subdivision is determined by the commissioner to contribute to the implementation of the desegregation plan; or

(2) a school district that participates in a joint program for interdistrict desegregation with a district defined in clause (1) if the facility acquired under this subdivision is to be primarily used for the joint program and the commissioner determines that the joint programs are being undertaken to implement the districts' desegregation plan.

(e) Notwithstanding subdivision 1, the prohibition against a levy by a district to lease or rent a district-owned building to itself does not apply to levies otherwise authorized by this subdivision.

(f) For the purposes of this subdivision, any references in subdivision 1 to building or land shall include personal property.

Sec. 9. Minnesota Statutes 2007 Supplement, 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

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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;

(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.13, if the district received general education aid according to section 126C.13, subdivision 4, paragraph (b), clause (1), of that section in the second preceding year;~~

~~(F)~~ (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;

~~(G)~~ (F) section 126C.10, subdivision 29, if the district received equity aid according to section 126C.10, subdivision 30, in the second preceding year;

~~(H)~~ (G) section 126C.10, subdivision 32, if the district received transition aid according to section 126C.10, subdivision 33, in the second preceding year;

~~(I)~~ (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;

~~(J)~~ (I) 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;

~~(K)~~ (J) 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

~~(L)~~ (K) 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.

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Sec. 10. Minnesota Statutes 2007 Supplement, 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:

(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: