1.1 	A bill for an act
1.2 	relating to natural resources; creating the Minnesota
1.3 	Conservation Heritage Foundation; eliminating the
1.4 	Legislative Commission on Minnesota Resources;
1.5 	providing for disposition of certain revenues;
1.6 	appropriating money; amending Minnesota Statutes 2004,
1.7 	sections 116P.02, by adding a subdivision; 116P.03;
1.8 	116P.04, subdivision 5; 116P.07; 116P.08, subdivisions
1.9 	3, 5, 6, 7, by adding a subdivision; 116P.09; 116P.10;
1.10 	116P.11; 116P.12, subdivision 2; 116P.14, subdivision
1.11 	2; 116P.15, subdivision 2; 168.1296, subdivision 5;
1.12 	297A.94; proposing coding for new law in Minnesota
1.13 	Statutes, chapter 116P; repealing Minnesota Statutes
1.14 	2004, sections 116P.02, subdivision 2 and 5; 116P.05;
1.15 	116P.06; 116P.08, subdivisions 1, 4.
1.16 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.17 	Section 1. Minnesota Statutes 2004, section 116P.02, is
1.18 	amended by adding a subdivision to read:
1.19 		Subd. 4a.Foundation. "Foundation" means the Minnesota
1.20 	Conservation Heritage Foundation created under section 116P.061.

1.21 	Sec. 2. Minnesota Statutes 2004, section 116P.03, is
1.22 	amended to read:
1.23 	116P.03 TRUST FUND NOT TO SUPPLANT EXISTING FUNDING.
1.24 	~~(a)~~ The trust fund may not be used as a substitute for
1.25 	traditional sources of funding environmental and natural
1.26 	resources activities, but the trust fund shall supplement the
1.27 	traditional sources, including those sources used to support the
1.28 	criteria in section 116P.08, subdivision ~~1~~ 1a.  The trust fund
1.29 	must be used primarily to support activities whose benefits
1.30 	become available only over an extended period of time.
2.1 	~~(b) The commission must determine the amount of the state~~
2.2 	~~budget spent from traditional sources to fund environmental and~~
2.3 	~~natural resources activities before and after the trust fund is~~
2.4 	~~established and include a comparison of the amount in the report~~
2.5 	~~under section 116P.09, subdivision 7.~~

2.6 	Sec. 3. Minnesota Statutes 2004, section 116P.04,
2.7 	subdivision 5, is amended to read:
2.8 		Subd. 5.Audits required.  The legislative auditor shall
2.9 	audit trust fund expenditures to ensure that the money is spent
2.10 	for the purposes provided in ~~the commission's budget plan~~ the
2.11 	Minnesota Constitution, article XI, section 14, and the
2.12 	foundation's strategic plan developed under section 116P.08. In
2.13 	addition, the legislative auditor shall audit the books and
2.14 	records of the foundation on an annual basis under sections
2.15 	3.971 and 3.972, subject to the resources of the legislative
2.16 	auditor, to ensure that the expenditures and operations of the
2.17 	foundation are consistent with the requirements of this
2.18 	chapter.  The legislative auditor may recoup the expenses for
2.19 	audits under this subdivision from amounts available to the
2.20 	foundation under section 116P.061, subdivision 6.

2.21 	Sec. 4. [116P.061] MINNESOTA CONSERVATION HERITAGE
2.22 	FOUNDATION.
2.23 		Subdivision 1.Membership. (a) The Minnesota
2.24 	Conservation Heritage Foundation is created pursuant to section
2.25 	15.012, paragraph (a), and is governed by a board of 11
2.26 	members.  The term of members is six years and until their
2.27 	successors have been appointed.  Each board member shall be
2.28 	appointed by the governor with the advice and consent of the
2.29 	senate.  Not more than six board members shall belong to the
2.30 	same political party.  The governor shall select at least one
2.31 	member from each congressional district.
2.32 	(b) To be eligible for appointment to the foundation board,
2.33 	a prospective board member must:  (1) demonstrate expertise and
2.34 	experience in the science, policy, or practice of the
2.35 	protection, conservation, preservation, and enhancement of the
2.36 	state's air, water, land, fish, wildlife, and other natural
3.1 	resources; and (2) not be a paid employee of an organization
3.2 	whose primary mission is the protection, conservation,
3.3 	preservation, and enhancement of natural resources.  Prior
3.4 	service on multimember boards with grant-making responsibilities
3.5 	or prior experience in the management of a business enterprise
3.6 	is also recommended.
3.7 	(c) Except as provided in this section, the terms,
3.8 	compensation, and removal of members and filling of vacancies on
3.9 	the foundation board shall be as provided in section 15.0575.  A
3.10 	member may be removed from the foundation board upon a
3.11 	supermajority of eight votes in favor of the removal of that
3.12 	member.
3.13 		Subd. 2.Chair; vice chair. The governor shall select a
3.14 	board member to serve as chair for a term concurrent with that
3.15 	of the governor.  If a vacancy occurs in the position of chair,
3.16 	the governor shall select a new chair to complete the unexpired
3.17 	term.  The chair shall be the principal executive officer of the
3.18 	foundation and shall preside at meetings of the board.  The
3.19 	chair shall organize the work of the foundation and may make
3.20 	assignments to board members, appoint committees, and give
3.21 	direction to the foundation staff.  The members of the board
3.22 	shall select a vice chair.
3.23 		Subd. 3.Quorum. Except when otherwise specified, a
3.24 	majority of the foundation shall constitute a quorum and the act
3.25 	or decision of a majority of members present, if at least a
3.26 	quorum is present, shall be the act or decision of the
3.27 	foundation.  If a vacancy exists on the foundation, a majority
3.28 	of the remaining members constitutes a quorum.  A supermajority
3.29 	of eight members in favor is required for:  (1) hiring or
3.30 	removing an executive director for the foundation, if any; or
3.31 	(2) using funds for debt service on bonds.
3.32 		Subd. 4.Duties. The foundation board shall adopt a
3.33 	strategic plan as provided in section 116P.08 and shall make
3.34 	expenditures as provided in that section.  The board may adopt
3.35 	operating and grant-making procedures by order of the board to
3.36 	fulfill its duties under this chapter.  If the board finds that
4.1 	it must adopt rules for its operations, the board may use the
4.2 	process for rulemaking provided under section 14.389.
4.3 		Subd. 5.Appropriation. Beginning July 1, 2007, and on
4.4 	July 1 of each year thereafter, the amount of the environment
4.5 	and natural resources trust fund that may be appropriated under
4.6 	the terms of article XI, section 14, of the Minnesota
4.7 	Constitution is appropriated to the foundation for expenditures
4.8 	made according to section 116P.08, subdivision 1a, paragraph
4.9 	(a), and is available until expended.
4.10 		Subd. 6.Appropriation; conservation heritage account. A
4.11 	conservation heritage account is created in the natural
4.12 	resources fund.  Money in the account is annually appropriated
4.13 	to the foundation for the purposes of section 116B.08,
4.14 	subdivision 1a, paragraph (b), and is available until expended.
4.15 		Subd. 7.Gifts. The foundation may accept and use grants
4.16 	of money or property from the United States or other grantors
4.17 	for any purpose pertaining to the activities of the foundation.
4.18 	Any money or property so received is appropriated and dedicated
4.19 	for the purposes for which it is granted and shall be expended
4.20 	or used solely for such purposes according to federal laws and
4.21 	regulations pertaining thereto, subject to applicable state laws
4.22 	and rules as to manner of expenditure or use.  The foundation
4.23 	may make subgrants of any money received to other agencies,
4.24 	units of local government, private individuals, private
4.25 	organizations, and private nonprofit corporations.  Appropriate
4.26 	funds and accounts shall be maintained by the commissioner of
4.27 	finance to comply with this section.  Lands and interests in
4.28 	lands received may be sold or exchanged according to chapter 94.

4.29 	Sec. 5. Minnesota Statutes 2004, section 116P.07, is
4.30 	amended to read:
4.31 	116P.07 INFORMATION GATHERING.
4.32 	The ~~commission~~ foundation board may convene public forums
4.33 	or employ other methods to gather information for establishing
4.34 	priorities for funding.

4.35 	Sec. 6. Minnesota Statutes 2004, section 116P.08, is
4.36 	amended by adding a subdivision to read:
5.1 		Subd. 1a.Expenditures. (a) The amount appropriated to
5.2 	the Minnesota Conservation Heritage Foundation from the
5.3 	environment and natural resources trust fund under section
5.4 	116P.061, subdivision 5, may be spent only for the public
5.5 	purpose of protection, conservation, preservation, and
5.6 	enhancement of the state's air, water, land, fish, wildlife, and
5.7 	other natural resources.  Expenditures by the foundation under
5.8 	this paragraph must be consistent with article XI, section 14,
5.9 	of the Minnesota Constitution and the strategic plan adopted
5.10 	under subdivision 3 and must demonstrate a direct benefit to the
5.11 	state's natural resources.  Expenditures for the purposes
5.12 	described in section 84.95, subdivision 2, shall be a priority
5.13 	for the foundation under this paragraph.  Nothing in this
5.14 	paragraph precludes the granting of funds for a project with a
5.15 	recreational purpose if the project is consistent with article
5.16 	XI, section 14, of the Minnesota Constitution.
5.17 	(b) Money appropriated to the foundation under section
5.18 	116P.061, subdivision 6, or from a source other than the trust
5.19 	fund may be used for the administrative costs of the foundation
5.20 	or for any other purpose consistent with the statutory
5.21 	provisions governing the source of the funds and the
5.22 	foundation's mission and strategic plan.

5.23 	Sec. 7. Minnesota Statutes 2004, section 116P.08,
5.24 	subdivision 3, is amended to read:
5.25 		Subd. 3.Strategic plan required.  (a) The ~~commission~~ 
5.26 	foundation shall adopt a strategic plan for making expenditures
5.27 	~~from the trust fund~~, including identifying the priority areas
5.28 	for funding for the next ~~six~~ ten years.  The strategic plan must
5.29 	be updated every two years. ~~The plan is advisory only~~ The
5.30 	foundation shall make funding allocation decisions and make
5.31 	expenditures on an annual basis according to the strategic plan.
5.32 	(b) The ~~commission~~ foundation shall submit the plan~~, as a~~
5.33 	~~recommendation,~~to the ~~house of representatives Ways and Means~~
5.34 	~~and senate Finance Committees~~ chairs of the house and senate
5.35 	committees with jurisdiction over environment and natural
5.36 	resources policy and finance by January ~~1~~ 15 of each
6.1 	odd-numbered year according to section 116P.09, subdivision 7.
6.2 	~~(b) The commission may accept or modify the draft of the~~
6.3 	~~strategic plan submitted to it by the advisory committee before~~
6.4 	~~voting on the plan's adoption.~~

6.5 	Sec. 8. Minnesota Statutes 2004, section 116P.08,
6.6 	subdivision 5, is amended to read:
6.7 		Subd. 5.Public meetings.  All ~~advisory committee and~~
6.8 	~~commission~~ foundation meetings must be open to the public. ~~The~~
6.9 	~~commission shall attempt to meet at least once in each of the~~
6.10 	~~state's congressional districts during each biennium.~~

6.11 	Sec. 9. Minnesota Statutes 2004, section 116P.08,
6.12 	subdivision 6, is amended to read:
6.13 		Subd. 6.Peer review.  (a) Research proposals must
6.14 	include a stated purpose, timeline, potential outcomes, and an
6.15 	explanation of the need for the research.  All research
6.16 	proposals ~~must~~ should be ~~reviewed by a peer review panel~~ 
6.17 	peer-reviewed before receiving an appropriation. Peer reviews
6.18 	shall be considered by the foundation board in evaluating a
6.19 	research project proposal.  The board may establish a peer
6.20 	review panel under subdivision 7 to assist its work.
6.21 	(b) ~~In conducting research proposal reviews, the peer~~
6.22 	~~review panel~~ A peer review report on a proposed research
6.23 	project, prepared for a research proposal review,shall:
6.24 	(1) comment on the methodology proposed and whether it can
6.25 	be expected to yield appropriate and useful information and
6.26 	data; and 
6.27 	(2) comment on the need for the research and about similar
6.28 	existing information available, if any~~; and~~ 
6.29 	~~(3) report to the commission and advisory committee on~~
6.30 	~~clauses (1) and (2).~~
6.31 	~~(c) The peer review panel also must review completed~~
6.32 	~~research proposals that have received an appropriation and~~
6.33 	~~comment and report upon whether the project reached the intended~~
6.34 	~~goals~~.

6.35 	Sec. 10. Minnesota Statutes 2004, section 116P.08,
6.36 	subdivision 7, is amended to read:
7.1 		Subd. 7.Peer review panel;membership; duties. ~~(a)~~ If
7.2 	established by the foundation:
7.3 	(1) the peer review panel must consist of at least five
7.4 	members who are knowledgeable in general research methods in the
7.5 	areas of environment and natural resources.  Not more than two
7.6 	members of the panel may be employees of state agencies in
7.7 	Minnesota~~.~~;
7.8 	~~(b)~~ (2) the ~~commission~~ foundation shall select a chair
7.9 	every two years who shall be responsible for convening meetings
7.10 	of the panel as often as is necessary to fulfill its duties as
7.11 	prescribed in this section.  Compensation of panel members is
7.12 	governed by section 15.059, subdivision 3; and 
7.13 	(3) the peer review panel must review completed research
7.14 	proposals that have received an appropriation and comment and
7.15 	report upon whether the project reached the intended goals.

7.16 	Sec. 11. Minnesota Statutes 2004, section 116P.09, is
7.17 	amended to read:
7.18 	116P.09 ADMINISTRATION.
7.19 		Subdivision 1.Administrative authority. The
7.20 	~~commission~~ foundation may appoint legal and other personnel and
7.21 	consultants necessary to carry out functions and duties of the
7.22 	~~commission~~ foundation.  Permanent employees shall be in the
7.23 	unclassified service.  In addition, the ~~commission~~ foundation 
7.24 	may request staff assistance and data from any other agency of
7.25 	state government as needed for the execution of the
7.26 	responsibilities of the ~~commission and advisory~~
7.27 	~~committee~~ foundation and an agency must promptly furnish it.
7.28 		Subd. 2.Liaison officers. The ~~commission~~ foundation 
7.29 	shall request each department or agency head of all state
7.30 	agencies with a direct interest and responsibility in any phase
7.31 	of environment and natural resources to appoint, and the latter
7.32 	shall appoint for the agency, a liaison officer who shall work
7.33 	closely with the ~~commission~~ foundation and its staff.
7.34 		Subd. 3.Appraisal and evaluation. The ~~commission~~ 
7.35 	foundation shall obtain and appraise information available
7.36 	through private organizations and groups, utilizing to the
8.1 	fullest extent possible studies, data, and reports previously
8.2 	prepared or currently in progress by public agencies, private
8.3 	organizations, groups, and others, concerning future trends in
8.4 	the protection, conservation, preservation, and enhancement of
8.5 	the state's air, water, land, forests, fish, wildlife, native
8.6 	vegetation, and other natural resources.  Any data compiled by
8.7 	the ~~commission~~ foundation shall be made available to any
8.8 	standing or interim committee of the legislature upon the
8.9 	request of the chair of the respective committee.
8.10 		Subd. 4.Personnel. Persons who are employed by a state
8.11 	agency to work on a project and are paid by an appropriation
8.12 	from the trust fund are in the unclassified civil service, and
8.13 	their continued employment is contingent upon the availability
8.14 	of money from the appropriation.  When the appropriation has
8.15 	been spent, their positions must be canceled and the approved
8.16 	complement of the agency reduced accordingly.  Part-time
8.17 	employment of persons for a project is authorized. ~~The use of~~
8.18 	~~classified employees is authorized when approved as part of the~~
8.19 	~~work program required by section 116P.05, subdivision 2,~~
8.20 	~~paragraph (c).~~
8.21 		Subd. 5.Administrative expense. ~~The prorated expenses~~
8.22 	~~related to commission administration of the trust fund may not~~
8.23 	~~exceed an amount equal to four percent of the amount available~~
8.24 	~~for appropriation of the trust fund for the biennium~~ The
8.25 	foundation's administrative expenses may not exceed $500,000
8.26 	annually.
8.27 		Subd. 6.Conflict of interest. (a) A ~~commission~~ 
8.28 	foundation board member, ~~advisory committee member,~~a peer
8.29 	review panelist, or an employee of the ~~commission~~ foundation may
8.30 	not participate in or vote on a decision of the ~~commission,~~
8.31 	~~advisory committee,~~foundation or a peer review panel relating
8.32 	to an organization in which the member, panelist, or employee
8.33 	has either a direct or indirect personal financial interest.
8.34 	While serving on the ~~legislative commission, advisory committee,~~
8.35 	foundation board or peer review panel~~,~~or ~~being~~ while an
8.36 	employee of the ~~commission~~ foundation, a person shall avoid any
9.1 	potential conflict of interest. A conflict of interest exists
9.2 	if the person:
9.3 	(1) would receive a direct or indirect personal financial
9.4 	benefit from an entity proposing a project for funding by the
9.5 	foundation or from a proposal under review for funding by the
9.6 	foundation;
9.7 	(2) serves as an employee, consultant, or governing board
9.8 	member of an entity proposing a project for funding by the
9.9 	foundation; or 
9.10 	(3) has a family relationship with a project proposer or a
9.11 	staff or board member of an entity proposing a project for
9.12 	funding by the foundation.
9.13 	(b) The foundation must develop procedures to identify a
9.14 	conflict of interest during the initial proposal review
9.15 	process.  If a conflict is found to exist, the person must
9.16 	notify the foundation in writing and may not advocate for or
9.17 	against the proposal or vote on the proposal.
9.18 		Subd. 7.Report required. The ~~commission~~ foundation 
9.19 	shall, by January 15 of each odd-numbered year, submit a report
9.20 	to the governor~~, the chairs of the house appropriations and~~
9.21 	~~senate finance committees,~~and the chairs of the house and
9.22 	senate committees ~~on~~ with jurisdiction over environment and
9.23 	natural resources policy and finance.  Copies of the report must
9.24 	be available to the public.  The report must include a summary
9.25 	of the foundation's conservation achievements during the
9.26 	reporting period and:
9.27 	(1) a copy of the current strategic plan;
9.28 	(2) a description of each project receiving money from the
9.29 	trust fund during the preceding biennium and how the project
9.30 	relates to the constitutional dedication of the trust fund and
9.31 	to the foundation's current strategic plan;
9.32 	(3) a summary of any research project completed in the
9.33 	preceding biennium;
9.34 	(4) recommendations to implement successful projects and
9.35 	programs into a state agency's standard operations;
9.36 	(5) to the extent known by the ~~commission~~ foundation,
10.1 	descriptions of the projects anticipated to be supported by the
10.2 	trust fund during the next biennium;
10.3 	(6) the source and amount of all revenues collected and
10.4 	distributed by the ~~commission~~ foundation, including all
10.5 	administrative and other expenses;
10.6 	(7) a description of the assets and liabilities of the
10.7 	trust fund;
10.8 	(8) any findings or recommendations that are deemed proper
10.9 	to assist the legislature in formulating legislation;
10.10 	(9) a list of all gifts and donations with a value over
10.11 	$1,000;
10.12 	(10) a comparison of the amounts spent by the state for
10.13 	environment and natural resources activities through the most
10.14 	recent fiscal year; and
10.15 	(11) a copy of the most recent compliance audit.

10.16 	Sec. 12. Minnesota Statutes 2004, section 116P.10, is
10.17 	amended to read:
10.18 	116P.10 ROYALTIES, COPYRIGHTS, PATENTS.
10.19 	~~This section applies to projects supported by the trust~~
10.20 	~~fund and the oil overcharge money referred to in section 4.071,~~
10.21 	~~subdivision 2, each of which is referred to in this section as a~~
10.22 	~~"fund."~~ The trust fund owns and shall take title to the
10.23 	percentage of a royalty, copyright, or patent resulting from a
10.24 	project supported by the trust fund equal to the percentage of
10.25 	the project's total funding provided by the trust fund.  Cash
10.26 	receipts resulting from a royalty, copyright, or patent, or the
10.27 	sale of the trust fund's rights to a royalty, copyright, or
10.28 	patent, must be credited immediately to the principal of
10.29 	the trust fund.  Receipts from Minnesota future resources fund
10.30 	projects must be credited to the trust fund.  Before the
10.31 	foundation decides to fund a project ~~is included in the budget~~
10.32 	~~plan~~, the ~~commission~~ foundation may vote to relinquish the
10.33 	ownership or rights to a royalty, copyright, or patent resulting
10.34 	from a project supported by the trust fund to the project's
10.35 	proposer when the amount of the original grant or loan, plus
10.36 	interest, has been repaid to the trust fund.

11.1 	Sec. 13. Minnesota Statutes 2004, section 116P.11, is
11.2 	amended to read:
11.3 	116P.11 AVAILABILITY OF FUNDS FOR DISBURSEMENT.
11.4 	(a) The amount biennially available from the trust fund for
11.5 	the ~~budget plan developed by the commission~~ foundation under
11.6 	section 116P.061, subdivision 5,is as defined in the Minnesota
11.7 	Constitution, article XI, section 14.
11.8 	(b) Any appropriated funds not encumbered in the biennium
11.9 	in which they are appropriated cancel and must be credited to
11.10 	the principal of the trust fund.

11.11 	Sec. 14. Minnesota Statutes 2004, section 116P.12,
11.12 	subdivision 2, is amended to read:
11.13 		Subd. 2.Application and administration.  (a) The
11.14 	~~commission~~ foundation must adopt a procedure for the issuance of
11.15 	the water system improvement loans by the Public Facilities
11.16 	Authority.
11.17 	(b) The ~~commission~~ foundation also must ensure that the
11.18 	loans are administered according to its fiduciary standards and
11.19 	requirements.

11.20 	Sec. 15. Minnesota Statutes 2004, section 116P.14,
11.21 	subdivision 2, is amended to read:
11.22 		Subd. 2.State land and water conservation account;
11.23 	creation.  A state land and water conservation account is
11.24 	created in the natural resources fund. ~~All of the~~ Money made
11.25 	available to the state from funds granted under subdivision 1
11.26 	shall be allocated as follows:  (1) beginning July 1, 2007,
11.27 	$1,500,000 annually shall be deposited in the conservation
11.28 	heritage account established under section 116P.061; and (2) the
11.29 	balance shall be deposited in the state land and water
11.30 	conservation account.

11.31 	Sec. 16. Minnesota Statutes 2004, section 116P.15,
11.32 	subdivision 2, is amended to read:
11.33 		Subd. 2.Restrictions; modification procedure.  (a) An
11.34 	interest in real property acquired with an appropriation from
11.35 	the trust fund or the Minnesota future resources fund must be
11.36 	used in perpetuity or for the specific term of an easement
12.1 	interest for the purpose for which the appropriation was made.
12.2 	(b) A recipient of funding who acquires an interest in real
12.3 	property subject to this section may not alter the intended use
12.4 	of the interest in real property or convey any interest in the
12.5 	real property acquired with the appropriation without the prior
12.6 	review and approval of the ~~commission~~ foundation.
12.7 	The ~~commission~~ foundation shall establish procedures to review
12.8 	requests from recipients to alter the use of or convey an
12.9 	interest in real property.  These procedures shall allow for the
12.10 	replacement of the interest in real property with another
12.11 	interest in real property meeting the following criteria:
12.12 	(1) the interest is at least equal in fair market value, as
12.13 	certified by the commissioner of natural resources, to the
12.14 	interest being replaced; and
12.15 	(2) the interest is in a reasonably equivalent location,
12.16 	and has a reasonably equivalent usefulness compared to the
12.17 	interest being replaced.
12.18 	(c) A recipient of funding who acquires an interest in real
12.19 	property under paragraph (a) must separately record a notice of
12.20 	funding restrictions in the appropriate local government office
12.21 	where the conveyance of the interest in real property is filed.
12.22 	The notice of funding agreement must contain:
12.23 	(1) a legal description of the interest in real property
12.24 	covered by the funding agreement;
12.25 	(2) a reference to the underlying funding agreement;
12.26 	(3) a reference to this section; and
12.27 	(4) the following statement:
12.28 	"This interest in real property shall be administered in
12.29 	accordance with the terms, conditions, and purposes of the grant
12.30 	agreement or work program controlling the acquisition of the
12.31 	property.  The interest in real property, or any portion of the
12.32 	interest in real property, shall not be sold, transferred,
12.33 	pledged, or otherwise disposed of or further encumbered without
12.34 	obtaining the prior written approval of the ~~Legislative~~
12.35 	~~Commission on Minnesota Resources~~ Minnesota Conservation
12.36 	Heritage Foundation or its successor.  If the holder of the
13.1 	interest in real property fails to comply with the terms and
13.2 	conditions of the grant agreement or work program, ownership of
13.3 	the interest in real property shall transfer to this state."

13.4 	Sec. 17. Minnesota Statutes 2004, section 168.1296,
13.5 	subdivision 5, is amended to read:
13.6 		Subd. 5.Contribution and fees credited.  Contributions
13.7 	under subdivision 1, paragraph (a), clause (5), must be paid to
13.8 	the registrar and credited:  (1) beginning July 1, 2007,
13.9 	$3,000,000 annually to the conservation heritage account
13.10 	established under section 116P.061, subdivision 6; and (2) the
13.11 	balance to the Minnesota critical habitat private sector
13.12 	matching account established in section 84.943.  The fees
13.13 	collected under this section must be deposited in the highway
13.14 	user tax distribution fund.

13.15 	Sec. 18. Minnesota Statutes 2004, section 297A.94, is
13.16 	amended to read:
13.17 	297A.94 DEPOSIT OF REVENUES.
13.18 	(a) Except as provided in this section, the commissioner
13.19 	shall deposit the revenues, including interest and penalties,
13.20 	derived from the taxes imposed by this chapter in the state
13.21 	treasury and credit them to the general fund.
13.22 	(b) The commissioner shall deposit taxes in the Minnesota
13.23 	agricultural and economic account in the special revenue fund if:
13.24 	(1) the taxes are derived from sales and use of property
13.25 	and services purchased for the construction and operation of an
13.26 	agricultural resource project; and
13.27 	(2) the purchase was made on or after the date on which a
13.28 	conditional commitment was made for a loan guaranty for the
13.29 	project under section 41A.04, subdivision 3.
13.30 	The commissioner of finance shall certify to the commissioner
13.31 	the date on which the project received the conditional
13.32 	commitment.  The amount deposited in the loan guaranty account
13.33 	must be reduced by any refunds and by the costs incurred by the
13.34 	Department of Revenue to administer and enforce the assessment
13.35 	and collection of the taxes.
13.36 	(c) The commissioner shall deposit the revenues, including
14.1 	interest and penalties, derived from the taxes imposed on sales
14.2 	and purchases included in section 297A.61, subdivision 3,
14.3 	paragraph (g), clauses (1) and (4), in the state treasury, and
14.4 	credit them as follows:
14.5 	(1) first to the general obligation special tax bond debt
14.6 	service account in each fiscal year the amount required by
14.7 	section 16A.661, subdivision 3, paragraph (b); and
14.8 	(2) after the requirements of clause (1) have been met, the
14.9 	balance to the general fund.
14.10 	(d) The commissioner shall deposit the revenues, including
14.11 	interest and penalties, collected under section 297A.64,
14.12 	subdivision 5, in the state treasury and credit them to the
14.13 	general fund.  By July 15 of each year the commissioner shall
14.14 	transfer to the highway user tax distribution fund an amount
14.15 	equal to the excess fees collected under section 297A.64,
14.16 	subdivision 5, for the previous calendar year.
14.17 	(e) For fiscal year 2001, 97 percent; for fiscal years 2002
14.18 	and 2003, 87 percent; and for fiscal year 2004 and thereafter,
14.19 	72.43 percent of the revenues, including interest and penalties,
14.20 	transmitted to the commissioner under section 297A.65, must be
14.21 	deposited by the commissioner in the state treasury as follows:
14.22 	(1) 50 percent of the receipts shall be divided as follows:
14.23 	(i) beginning July 1, 2007, $1,000,000 annually must be
14.24 	deposited in the conservation heritage account under section
14.25 	116P.061, subdivision 6; and (ii) the balance must be deposited
14.26 	in the heritage enhancement account in the game and fish fund,
14.27 	and may be spent only on activities that improve, enhance, or
14.28 	protect fish and wildlife resources, including conservation,
14.29 	restoration, and enhancement of land, water, and other natural
14.30 	resources of the state;
14.31 	(2) 22.5 percent of the receipts must be deposited in the
14.32 	natural resources fund, and may be spent only for state parks
14.33 	and trails;
14.34 	(3) 22.5 percent of the receipts must be deposited in the
14.35 	natural resources fund, and may be spent only on metropolitan
14.36 	park and trail grants;
15.1 	(4) three percent of the receipts shall be divided as
15.2 	follows:  (i) beginning July 1, 2007, $500,000 annually must be
15.3 	deposited in the conservation heritage account under section
15.4 	116P.061, subdivision 6; and (ii) the balance must be deposited
15.5 	in the natural resources fund, and may be spent only on local
15.6 	trail grants; and
15.7 	(5) two percent of the receipts must be deposited in the
15.8 	natural resources fund, and may be spent only for the Minnesota
15.9 	Zoological Garden, the Como Park Zoo and Conservatory, and the
15.10 	Duluth Zoo.
15.11 	(f) The revenue dedicated under paragraph (e) may not be
15.12 	used as a substitute for traditional sources of funding for the
15.13 	purposes specified, but the dedicated revenue shall supplement
15.14 	traditional sources of funding for those purposes.  Land
15.15 	acquired with money deposited in the game and fish fund under
15.16 	paragraph (e) must be open to public hunting and fishing during
15.17 	the open season, except that in aquatic management areas or on
15.18 	lands where angling easements have been acquired, fishing may be
15.19 	prohibited during certain times of the year and hunting may be
15.20 	prohibited.  At least 87 percent of the money deposited in the
15.21 	game and fish fund for improvement, enhancement, or protection
15.22 	of fish and wildlife resources under paragraph (e) must be
15.23 	allocated for field operations.

15.24 	Sec. 19. TRANSITION.
 15.25 	(a) The staff of the Legislative Commission on Minnesota
15.26 	Resources shall provide administrative and technical assistance
15.27 	to the Minnesota Conservation Heritage Foundation until June 30,
15.28 	2007.
15.29 	(b) Administrative expenses saved through the elimination
15.30 	of the Citizens Advisory Committee shall be used for the
15.31 	administrative expenses of the Minnesota Conservation Heritage
15.32 	Foundation.

15.33 	Sec. 20. INITIAL APPOINTMENTS.
 15.34 	To ensure that the members of the Minnesota Conservation
15.35 	Heritage Foundation have staggered terms as required by
15.36 	Minnesota Statutes, section 116P.061, subdivision 1, the
16.1 	governor shall make the initial appointments to the Minnesota
16.2 	Conservation Heritage Foundation according to the following
16.3 	schedule of terms:
16.4 	(1) the chair to serve a full six-year term;
16.5 	(2) three members to serve five-year terms;
16.6 	(3) three members to serve four-year terms;
16.7 	(4) two members to serve three-year terms; and 
16.8 	(5) two members to serve two-year terms.

16.9 	Sec. 21. REPEALER.
 16.10 	(a) Minnesota Statutes 2004, sections 116P.02, subdivisions
16.11 	2 and 5; 116P.06; and 116P.08, subdivisions 1 and 4, are
16.12 	repealed.
16.13 	(b) Minnesota Statutes 2004, section 116P.05, is repealed
16.14 	effective June 30, 2007.

16.15 	Sec. 22. EFFECTIVE DATE.
 16.16 	Sections 1 to 21 are effective the day following final
16.17 	enactment.