1.1                          A bill for an act 
  1.2             relating to education; implementing the 
  1.3             recommendations of the task force on transitional 
  1.4             issues affecting state board of education powers and 
  1.5             duties; amending Minnesota Statutes 1998, sections 
  1.6             120B.30, subdivision 1; 122A.19, subdivision 4; 
  1.7             122A.20, subdivisions 1 and 2; 122A.21; 123B.83, 
  1.8             subdivision 4; 124D.19, subdivision 11; 124D.86, 
  1.9             subdivisions 1 and 3; 124D.89, subdivision 1; 124D.94, 
  1.10            subdivision 3; 125A.09, subdivision 11; 127A.05, 
  1.11            subdivision 1; 127A.41, subdivision 5; 127A.42, 
  1.12            subdivisions 5 and 6; 127A.60, subdivision 1; 127A.66, 
  1.13            subdivision 2; proposing coding for new law in 
  1.14            Minnesota Statutes, chapter 127A; repealing Minnesota 
  1.15            Statutes 1998, sections 127A.42, subdivision 8; 
  1.16            127A.60, subdivisions 2, 3, and 4; 127A.61; 127A.62, 
  1.17            subdivision 2; 127A.64; and 127A.66, subdivision 1. 
  1.18  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.19     Section 1.  [STATE BOARD OF EDUCATION CHANGED TO 
  1.20  COMMISSIONER OF CHILDREN, FAMILIES, AND LEARNING; OTHER 
  1.21  CHANGES.] 
  1.22     The provisions of Laws 1998, chapter 398, article 5, 
  1.23  section 55, and related sections apply except as provided under 
  1.24  this act. 
  1.25     Sec. 2.  Minnesota Statutes 1998, section 120B.30, 
  1.26  subdivision 1, is amended to read: 
  1.27     Subdivision 1.  [STATEWIDE TESTING.] (a) The commissioner, 
  1.28  with advice from experts with appropriate technical 
  1.29  qualifications and experience and stakeholders, shall include in 
  1.30  the comprehensive assessment system, for each grade level to be 
  1.31  tested, a single statewide norm-referenced or 
  2.1   criterion-referenced test, or a combination of a norm-referenced 
  2.2   and a criterion-referenced test, which shall be highly 
  2.3   correlated with the state's graduation standards and 
  2.4   administered annually to all students in the third, fifth, and 
  2.5   eighth grades.  The commissioner shall establish one or more 
  2.6   months during which schools shall administer the tests to 
  2.7   students each school year.  Only Minnesota basic skills tests in 
  2.8   reading, mathematics, and writing shall fulfill students' 
  2.9   testing requirements for a passing state notation.  
  2.10     (b) In addition, at the secondary level, districts shall 
  2.11  assess student performance in all required learning areas and 
  2.12  selected required standards within each area of the profile of 
  2.13  learning.  The testing instruments and testing process shall be 
  2.14  determined by the commissioner.  The results shall be aggregated 
  2.15  at the site and district level.  The testing shall be 
  2.16  administered beginning in the 1999-2000 school year and 
  2.17  thereafter. 
  2.18     (c) The comprehensive assessment system shall include an 
  2.19  evaluation of school site and school district performance levels 
  2.20  during the 1997-1998 school year and thereafter using an 
  2.21  established performance baseline developed from students' test 
  2.22  scores under this section that records, at a minimum, students' 
  2.23  unweighted mean test scores in each tested subject, a second 
  2.24  performance baseline that reports, at a minimum, the same 
  2.25  unweighted mean test scores of only those students enrolled in 
  2.26  the school by January 1 of the previous school year, and a third 
  2.27  performance baseline that reports the same unweighted test 
  2.28  scores of all students except those students receiving limited 
  2.29  English proficiency instruction.  The evaluation also shall 
  2.30  record separately, in proximity to the performance baselines, 
  2.31  the percentages of students who are eligible to receive a free 
  2.32  or reduced price school meal, demonstrate limited English 
  2.33  proficiency, or are eligible to receive special education 
  2.34  services. 
  2.35     (d) In addition to the testing and reporting requirements 
  2.36  under paragraphs (a), (b), and (c), the commissioner~~, in~~ 
  3.1   ~~consultation with the state board of education,~~ shall include 
  3.2   the following components in the statewide educational 
  3.3   accountability and public reporting system: 
  3.4      (1) uniform statewide testing of all third, fifth, eighth, 
  3.5   and post-eighth grade students with exemptions, only with parent 
  3.6   or guardian approval, from the testing requirement only for 
  3.7   those very few students for whom the student's individual 
  3.8   education plan team under sections 125A.05 and 125A.06, 
  3.9   determines that the student is incapable of taking a statewide 
  3.10  test, or a limited English proficiency student under section 
  3.11  124D.59, subdivision 2, if the student has been in the United 
  3.12  States for fewer than 12 months and for whom special language 
  3.13  barriers exist, such as the student's native language does not 
  3.14  have a written form or the district does not have access to 
  3.15  appropriate interpreter services for the student's native 
  3.16  language; 
  3.17     (2) educational indicators that can be aggregated and 
  3.18  compared across school districts and across time on a statewide 
  3.19  basis; 
  3.20     (3) students' scores on the American College Test; 
  3.21     (4) participation in the National Assessment of Educational 
  3.22  Progress so that the state can benchmark its performance against 
  3.23  the nation and other states, and, where possible, against other 
  3.24  countries, and contribute to the national effort to monitor 
  3.25  achievement; and 
  3.26     (5) basic skills and advanced competencies connecting 
  3.27  teaching and learning to high academic standards, assessment, 
  3.28  and transitions to citizenship and employment. 
  3.29     (e) Districts must report exemptions under paragraph (d), 
  3.30  clause (1), to the commissioner consistent with a format 
  3.31  provided by the commissioner. 
  3.32     Sec. 3.  Minnesota Statutes 1998, section 122A.19, 
  3.33  subdivision 4, is amended to read: 
  3.34     Subd. 4.  [TEACHER PREPARATION PROGRAMS.] For the purpose 
  3.35  of licensing bilingual and English as a second language 
  3.36  teachers, the board may approve programs at colleges or 
  4.1   universities designed for their training ~~subject to the approval~~ 
  4.2   ~~of the state board of education~~. 
  4.3      Sec. 4.  Minnesota Statutes 1998, section 122A.20, 
  4.4   subdivision 1, is amended to read: 
  4.5      Subdivision 1.  [GROUNDS FOR REVOCATION, SUSPENSION, OR 
  4.6   DENIAL.] The board of teaching ~~or the state board of education,~~ 
  4.7   ~~whichever has jurisdiction over a teacher's licensure,~~ may, on 
  4.8   the written complaint of the school board employing a teacher, a 
  4.9   teacher organization, or any other interested person, refuse to 
  4.10  issue, refuse to renew, suspend, or revoke a teacher's license 
  4.11  to teach for any of the following causes: 
  4.12     (1) Immoral character or conduct; 
  4.13     (2) Failure, without justifiable cause, to teach for the 
  4.14  term of the teacher's contract; 
  4.15     (3) Gross inefficiency or willful neglect of duty; or 
  4.16     (4) Failure to meet licensure requirements; or 
  4.17     (5) Fraud or misrepresentation in obtaining a license. 
  4.18     The written complaint must specify the nature and character 
  4.19  of the charges.  For purposes of this subdivision, the board of 
  4.20  teaching is delegated the authority to suspend or revoke 
  4.21  coaching licenses ~~under the jurisdiction of the state board of~~ 
  4.22  ~~education~~.  
  4.23     Sec. 5.  Minnesota Statutes 1998, section 122A.20, 
  4.24  subdivision 2, is amended to read: 
  4.25     Subd. 2.  [MANDATORY REPORTING.] A school board must report 
  4.26  to the board of teaching~~, the state board of education,~~ or the 
  4.27  board of trustees of the Minnesota state colleges and 
  4.28  universities, whichever has jurisdiction over the teacher's 
  4.29  license, when its teacher is discharged or resigns from 
  4.30  employment after a charge is filed with the school board under 
  4.31  section 122A.41, subdivisions 6, clauses (1), (2), and (3), and 
  4.32  7, or after charges are filed that are ground for discharge 
  4.33  under section 122A.40, subdivision 13, clauses (a), (b), (c), 
  4.34  (d), and (e), or when a teacher is suspended or resigns while an 
  4.35  investigation is pending under section 122A.40, subdivision 13, 
  4.36  clauses (a), (b), (c), (d), and (e); 122A.41, subdivisions 6, 
  5.1   clauses (1), (2), and (3), and 7; or 626.556.  The report must 
  5.2   be made to the appropriate licensing board within ten days after 
  5.3   the discharge, suspension, or resignation has occurred.  The 
  5.4   licensing board to which the report is made must investigate the 
  5.5   report for violation of subdivision 1 and the reporting board 
  5.6   must cooperate in the investigation.  Notwithstanding any 
  5.7   provision in chapter 13 or any law to the contrary, upon written 
  5.8   request from the licensing board having jurisdiction over the 
  5.9   teacher's license, a board or school superintendent shall 
  5.10  provide the licensing board with information about the teacher 
  5.11  from the district's files, any termination or disciplinary 
  5.12  proceeding, any settlement or compromise, or any investigative 
  5.13  file.  Upon written request from the appropriate licensing 
  5.14  board, a board or school superintendent may, at the discretion 
  5.15  of the board or school superintendent, solicit the written 
  5.16  consent of a student and the student's parent to provide the 
  5.17  licensing board with information that may aid the licensing 
  5.18  board in its investigation and license proceedings.  The 
  5.19  licensing board's request need not identify a student or parent 
  5.20  by name.  The consent of the student and the student's parent 
  5.21  must meet the requirements of chapter 13 and Code of Federal 
  5.22  Regulations, title 34, section 99.30.  The licensing board may 
  5.23  provide a consent form to the district.  Any data transmitted to 
  5.24  any board under this section is private data under section 
  5.25  13.02, subdivision 12, notwithstanding any other classification 
  5.26  of the data when it was in the possession of any other agency. 
  5.27     The licensing board to which a report is made must transmit 
  5.28  to the attorney general's office any record or data it receives 
  5.29  under this subdivision for the sole purpose of having the 
  5.30  attorney general's office assist that board in its 
  5.31  investigation.  When the attorney general's office has informed 
  5.32  an employee of the appropriate licensing board in writing that 
  5.33  grounds exist to suspend or revoke a teacher's license to teach, 
  5.34  that licensing board must consider suspending or revoking or 
  5.35  decline to suspend or revoke the teacher's license within 45 
  5.36  days of receiving a stipulation executed by the teacher under 
  6.1   investigation or a recommendation from an administrative law 
  6.2   judge that disciplinary action be taken.  
  6.3      Sec. 6.  Minnesota Statutes 1998, section 122A.21, is 
  6.4   amended to read: 
  6.5      122A.21 [TEACHERS' AND ADMINISTRATORS' LICENSES; FEES.] 
  6.6      Each application for the issuance, renewal, or extension of 
  6.7   a license to teach and each application for the issuance, 
  6.8   renewal, or extension of a license as supervisory personnel must 
  6.9   be accompanied by a processing fee in an amount set by the board 
  6.10  of teaching by rule.  ~~Each application for the issuance,~~ 
  6.11  ~~renewal, or extension of a license as supervisory personnel must~~ 
  6.12  ~~be accompanied by a processing fee in an amount set by the state~~ 
  6.13  ~~board of education by rule.~~  The processing fee for a teacher's 
  6.14  license and for the licenses of supervisory personnel must be 
  6.15  paid to the executive secretary of the board of teaching.  ~~The~~ 
  6.16  ~~processing fee for the licenses of supervisory personnel must be~~ 
  6.17  ~~paid to the commissioner.~~  The executive secretary of the board 
  6.18  of teaching ~~and the commissioner~~ shall deposit the fees with the 
  6.19  state treasurer, as provided by law, and report each month to 
  6.20  the commissioner of finance the amount of fees collected.  The 
  6.21  fees as set by the ~~boards~~ board are nonrefundable for applicants 
  6.22  not qualifying for a license.  However, a fee must be refunded 
  6.23  by the state treasurer in any case in which the applicant 
  6.24  already holds a valid unexpired license.  The ~~boards~~ board may 
  6.25  waive or reduce fees for applicants who apply at the same time 
  6.26  for more than one license~~, even if the licenses are under the~~ 
  6.27  ~~jurisdiction of different boards~~.  
  6.28     Sec. 7.  Minnesota Statutes 1998, section 123B.83, 
  6.29  subdivision 4, is amended to read: 
  6.30     Subd. 4.  [SPECIAL OPERATING PLAN.] (1) If the net negative 
  6.31  unappropriated operating fund balance as defined in section 
  6.32  126C.01, subdivision 11, calculated in accordance with the 
  6.33  uniform financial accounting and reporting standards for 
  6.34  Minnesota school districts, as of June 30 each year, is more 
  6.35  than 2-1/2 percent of the year's expenditure amount, the 
  6.36  district must, prior to January 31 of the next fiscal year, 
  7.1   submit a special operating plan to reduce the district's deficit 
  7.2   expenditures to the commissioner for approval.  The commissioner 
  7.3   may also require the district to provide evidence that the 
  7.4   district meets and will continue to meet all ~~of the curriculum~~ 
  7.5   high school graduation requirements ~~of the state board~~. 
  7.6      Notwithstanding any other law to the contrary, a district 
  7.7   submitting a special operating plan to the commissioner under 
  7.8   this clause which is disapproved by the commissioner must not 
  7.9   receive any aid pursuant to chapters 120B, 122A, 123A, 123B, 
  7.10  124D, 125A, 126C, and 127A until a special operating plan of the 
  7.11  district is so approved. 
  7.12     (2) A district must receive aids pending the approval of 
  7.13  its special operating plan under clause (1).  A district which 
  7.14  complies with its approved operating plan must receive aids as 
  7.15  long as the district continues to comply with the approved 
  7.16  operating plan. 
  7.17     Sec. 8.  Minnesota Statutes 1998, section 124D.19, 
  7.18  subdivision 11, is amended to read: 
  7.19     Subd. 11.  [EXTENDED DAY PROGRAMS.] (a) A school board may 
  7.20  offer, as part of a community education program, an extended day 
  7.21  program for children from kindergarten through grade 6 for the 
  7.22  purpose of expanding students' learning opportunities.  A 
  7.23  program must include the following: 
  7.24     (1) adult supervised programs while school is not in 
  7.25  session; 
  7.26     (2) parental involvement in program design and direction; 
  7.27     (3) partnerships with the kindergarten through grade 12 
  7.28  system, and other public, private, or nonprofit entities; and 
  7.29     (4) opportunities for trained secondary school pupils to 
  7.30  work with younger children in a supervised setting as part of a 
  7.31  community service program. 
  7.32     (b) The district may charge a sliding fee based upon family 
  7.33  income for extended day programs.  The district may receive 
  7.34  money from other public or private sources for the extended day 
  7.35  program.  The board of the district must develop standards for 
  7.36  school age child care programs.  Districts must adopt standards 
  8.1   within one year after the district first offers services under a 
  8.2   program authorized by this subdivision.  The ~~state board of~~ 
  8.3   ~~education~~ commissioner may not adopt rules for extended day 
  8.4   programs. 
  8.5      (c) The district shall maintain a separate account within 
  8.6   the community services fund for all funds related to the 
  8.7   extended day program. 
  8.8      Sec. 9.  Minnesota Statutes 1998, section 124D.86, 
  8.9   subdivision 1, is amended to read: 
  8.10     Subdivision 1.  [USE OF THE REVENUE.] Integration revenue 
  8.11  under this section must be used for programs established under a 
  8.12  desegregation plan ~~mandated by the state board~~ or under court 
  8.13  order, to increase learning opportunities and reduce the 
  8.14  learning gap between learners living in high concentrations of 
  8.15  poverty and their peers. 
  8.16     Sec. 10.  Minnesota Statutes 1998, section 124D.86, 
  8.17  subdivision 3, is amended to read: 
  8.18     Subd. 3.  [INTEGRATION REVENUE.] For fiscal year 1999 and 
  8.19  later fiscal years, integration revenue equals the following 
  8.20  amounts: 
  8.21     (1) for independent school district No. 709, Duluth, $193 
  8.22  times the resident pupil units for the school year; 
  8.23     (2) for independent school district No. 625, St. Paul, $427 
  8.24  times the resident pupil units for the school year; 
  8.25     (3) for special school district No. 1, Minneapolis, $523 
  8.26  times the resident pupil units for the school year; and 
  8.27     (4) for a district not listed in clause (1), (2), or (3) 
  8.28  that is required to implement a plan according to the 
  8.29  requirements of Minnesota Rules, ~~parts 3535.0200 to 3535.2200,~~ 
  8.30  the lesser of the actual cost of implementing the plan during 
  8.31  the fiscal year or $93 times the resident pupil units for the 
  8.32  school year. 
  8.33     Sec. 11.  Minnesota Statutes 1998, section 124D.89, 
  8.34  subdivision 1, is amended to read: 
  8.35     Subdivision 1.  [CULTURAL EXCHANGE PROGRAM GOALS.] (a) A 
  8.36  cultural exchange grant program is established to develop and 
  9.1   create opportunities for children and staff of different ethnic, 
  9.2   racial, and other cultural backgrounds to experience educational 
  9.3   and social exchange.  Student and staff exchanges under this 
  9.4   section may only take place between a district with a 
  9.5   desegregation plan ~~approved by the state board of education~~ and 
  9.6   a district without a desegregation plan.  Participating school 
  9.7   districts shall offer summer programs for credit with the goals 
  9.8   set forth in paragraphs (b) to (e). 
  9.9      (b) The program must develop curriculum reflective of 
  9.10  particular ethnic, racial, and other cultural aspects of various 
  9.11  demographic groups in the state. 
  9.12     (c) The program must develop immersion programs that are 
  9.13  coordinated with the programs offered in paragraph (b). 
  9.14     (d) The program must create opportunities for students from 
  9.15  across the state to enroll in summer programs in districts other 
  9.16  than the one of residence, or in other schools within their 
  9.17  district of residence. 
  9.18     (e) The program must create opportunities for staff 
  9.19  exchanges on a cultural basis. 
  9.20     Sec. 12.  Minnesota Statutes 1998, section 124D.94, 
  9.21  subdivision 3, is amended to read: 
  9.22     Subd. 3.  [BOARD OF DIRECTORS.] The board of directors of 
  9.23  the foundation shall consist of the commissioner of children, 
  9.24  families, and learning~~, a member of the state board of education~~ 
  9.25  ~~selected by the state board who shall serve as chair~~ and 20 
  9.26  members to be appointed by the governor.  Of the 20 members 
  9.27  appointed by the governor, eight shall represent a variety of 
  9.28  education groups and 12 shall represent a variety of business 
  9.29  groups.  The members of the board of directors shall select one 
  9.30  member to serve as chair.  The commissioner of children, 
  9.31  families, and learning shall serve as secretary for the board of 
  9.32  directors and provide administrative support to the foundation.  
  9.33  An executive committee of the foundation board composed of the 
  9.34  board officers and chairs of board committees, may only advise 
  9.35  and make recommendations to the foundation board. 
  9.36     Sec. 13.  Minnesota Statutes 1998, section 125A.09, 
 10.1   subdivision 11, is amended to read: 
 10.2      Subd. 11.  [HEARING REVIEW OFFICER'S QUALIFICATIONS.] The 
 10.3   commissioner must select an individual who has the 
 10.4   qualifications enumerated in this subdivision to serve as the 
 10.5   hearing review officer: 
 10.6      (1) the individual must be knowledgeable and impartial; 
 10.7      (2) the individual must not have a personal interest in or 
 10.8   specific involvement with the student who is a party to the 
 10.9   hearing; 
 10.10     (3) the individual must not have been employed as an 
 10.11  administrator by the district that is a party to the hearing; 
 10.12     (4) the individual must not have been involved in the 
 10.13  selection of the administrators of the district that is a party 
 10.14  to the hearing; 
 10.15     (5) the individual must not have a personal, economic, or 
 10.16  professional interest in the outcome of the hearing other than 
 10.17  the proper administration of the federal and state laws, rules, 
 10.18  and policies; 
 10.19     (6) the individual must not have substantial involvement in 
 10.20  the development of a state or local policy or procedures that 
 10.21  are challenged in the appeal; 
 10.22     (7) the individual is not a current employee or board 
 10.23  member of a Minnesota public school district, education 
 10.24  district, intermediate unit or regional education agency~~,~~ or the 
 10.25  department~~, and the state board of education~~; and 
 10.26     (8) the individual is not a current employee or board 
 10.27  member of a disability advocacy organization or group.  
 10.28     Sec. 14.  Minnesota Statutes 1998, section 127A.05, 
 10.29  subdivision 1, is amended to read: 
 10.30     Subdivision 1.  [APPOINTMENT AND DUTIES.] The department 
 10.31  shall be under the administrative control of the commissioner of 
 10.32  children, families, and learning which office is 
 10.33  established.  ~~The commissioner shall be the secretary of the~~ 
 10.34  ~~state board.~~  The governor shall appoint the commissioner under 
 10.35  the provisions of section 15.06.  
 10.36     The commissioner shall be a person who possesses 
 11.1   educational attainment and breadth of experience in the 
 11.2   administration of public education and of the finances 
 11.3   pertaining thereto commensurate with the spirit and intent of 
 11.4   this code.  Notwithstanding any other law to the contrary, the 
 11.5   commissioner may appoint two deputy commissioners who shall 
 11.6   serve in the unclassified service.  The commissioner shall also 
 11.7   appoint other employees as may be necessary for the organization 
 11.8   of the department.  The commissioner shall perform such duties 
 11.9   as the law and ~~the~~ rules ~~of the state board~~ may provide and be 
 11.10  held responsible for the efficient administration and discipline 
 11.11  of the department.  The commissioner ~~shall make recommendations~~ 
 11.12  ~~to the board and be~~ is charged with the execution of powers and 
 11.13  duties ~~which the state board may prescribe, from time to time,~~ 
 11.14  to promote public education in the state~~,~~ and to safeguard the 
 11.15  finances pertaining thereto~~, and to enable the state board to~~ 
 11.16  ~~carry out its duties~~.  
 11.17     Sec. 15.  [127A.055] [EDUCATION ADVISORY COUNCIL.] 
 11.18     An education advisory council to the commissioner is 
 11.19  established to advise the commissioner and the legislature on 
 11.20  matters affecting state education policy and related short- and 
 11.21  long-term education planning, including at least the issues of 
 11.22  charter schools, educational diversity, state high school 
 11.23  graduation standards, special education, and other education 
 11.24  issues of special concern to the commissioner.  The advisory 
 11.25  council members shall be composed of representatives of 
 11.26  organizations of interested stakeholders and of public members.  
 11.27  The commissioner shall determine which organizations shall be 
 11.28  advisory council members and each organization that is an 
 11.29  advisory council member shall select its own representative to 
 11.30  attend council meetings.  Section 15.0597 applies to the 
 11.31  appointment of public members to the council.  No council member 
 11.32  may participate in deliberations where a direct financial 
 11.33  conflict of interest may arise.  Council members annually shall 
 11.34  choose one member to serve as a council chair.  No council 
 11.35  member shall serve as council chair for more than three 
 11.36  consecutive school years.  Council meetings are subject to the 
 12.1   state's open meeting law under section 471.705 and must use 
 12.2   available technology to make council meetings accessible to the 
 12.3   public throughout the state.  Membership terms, compensation, 
 12.4   removal of members and filling of vacancies on the council are 
 12.5   governed by section 15.059.  The council expires June 30, 2003. 
 12.6      Sec. 16.  Minnesota Statutes 1998, section 127A.41, 
 12.7   subdivision 5, is amended to read: 
 12.8      Subd. 5.  [DISTRICT APPEAL OF AID REDUCTION; INSPECTION OF 
 12.9   DISTRICT SCHOOLS AND ACCOUNTS AND RECORDS.] A board may appeal 
 12.10  to the Minnesota court of appeals a reduction of aid under this 
 12.11  section ~~may be appealed to the state board of education and its~~ 
 12.12  ~~decision shall be final~~.  Public schools shall at all times be 
 12.13  open to the inspection of the commissioner.  The accounts and 
 12.14  records of any district must be open to inspection by the state 
 12.15  auditor, ~~the state board,~~ or the commissioner for the purpose of 
 12.16  audits conducted under this section.  Each district shall keep 
 12.17  for a minimum of three years at least the following:  (1) 
 12.18  identification of the annual session days held, together with a 
 12.19  record of the length of each session day, (2) a record of each 
 12.20  pupil's daily attendance, with entrance and withdrawal dates, 
 12.21  and (3) identification of the pupils transported who are 
 12.22  reported for transportation aid.  
 12.23     Sec. 17.  Minnesota Statutes 1998, section 127A.42, 
 12.24  subdivision 5, is amended to read: 
 12.25     Subd. 5.  [DISPUTE VIOLATIONS; HEARING.] The board to which 
 12.26  such notice is given may, by a majority vote of the whole board, 
 12.27  decide to dispute that the specified violation exists or that 
 12.28  the time allowed is reasonable or the correction specified is 
 12.29  correct, or that the commissioner may reduce aids.  The board 
 12.30  must give the commissioner written notice of the decision.  If 
 12.31  the commissioner, after further investigation as the 
 12.32  commissioner deems necessary, adheres to the previous notice, 
 12.33  the board shall be entitled to ~~a hearing by the state board~~ 
 12.34  appeal the matter to the Minnesota court of appeals.  ~~The state~~ 
 12.35  ~~board must set a hearing time and place and the board of the~~ 
 12.36  ~~district must be given notice by mail.  The state board must~~ 
 13.1   ~~adopt rules governing the proceedings for hearings.  The~~ 
 13.2   ~~hearings must be designed to give a full and fair hearing and~~ 
 13.3   ~~permit interested parties an opportunity to produce evidence~~ 
 13.4   ~~relating to the issues involved.  The rules may provide that any~~ 
 13.5   ~~question of fact to be determined at the hearing may be referred~~ 
 13.6   ~~to one or more members of the board or to an employee of the~~ 
 13.7   ~~state board acting as a referee to hear evidence and report the~~ 
 13.8   ~~testimony taken to the state board.  The state board, or a~~ 
 13.9   ~~person designated to receive evidence at a hearing, shall have~~ 
 13.10  ~~the same right to issue subpoenas and administer oaths and~~ 
 13.11  ~~parties to the hearing shall have the same right to subpoenas~~ 
 13.12  ~~issued as are allowed for proceedings before the industrial~~ 
 13.13  ~~commission.  A stenographic record must be made of all testimony~~ 
 13.14  ~~given and other proceedings during the hearing.  If practicable,~~ 
 13.15  ~~rules governing admission of evidence in courts shall apply to~~ 
 13.16  ~~the hearing.  The decision of the state board must be in writing~~ 
 13.17  ~~and the controlling facts upon which the decision is made must~~ 
 13.18  ~~be stated in sufficient detail to apprise the parties and the~~ 
 13.19  ~~reviewing court of the basis and reason for the decision.  The~~ 
 13.20  ~~decision must be confined to whether any of the specified~~ 
 13.21  ~~violations existed at the date of the commissioner's first~~ 
 13.22  ~~notice, whether the violations were corrected within the time~~ 
 13.23  ~~permitted, and whether the violations require reduction of the~~ 
 13.24  ~~state aids under this section.~~  
 13.25     Sec. 18.  Minnesota Statutes 1998, section 127A.42, 
 13.26  subdivision 6, is amended to read: 
 13.27     Subd. 6.  [VIOLATION; AID REDUCTION.] The commissioner 
 13.28  shall not reduce state aids payable to the district if the 
 13.29  violation specified is corrected within the time permitted, or 
 13.30  if the commissioner on being notified of the district board's 
 13.31  decision to dispute decides the violation does not exist, or if 
 13.32  ~~the state board decides~~ the Minnesota court of appeals decides 
 13.33  no violation exists after hearing no violation specified in the 
 13.34  commissioner's notice existed at the time of the notice, or that 
 13.35  the violations were corrected within the time permitted.  
 13.36  Otherwise state aids payable to the district for the year in 
 14.1   which the violation occurred shall be reduced as follows:  The 
 14.2   total amount of state aids to which the district may be entitled 
 14.3   shall be reduced in the proportion that the period during which 
 14.4   a specified violation continued, computed from the last day of 
 14.5   the time permitted for correction, bears to the total number of 
 14.6   days school is held in the district during the year in which a 
 14.7   violation exists, multiplied by 60 percent of the basic revenue, 
 14.8   as defined in section 126C.10, subdivision 2, of the district 
 14.9   for that year. 
 14.10     Sec. 19.  Minnesota Statutes 1998, section 127A.60, 
 14.11  subdivision 1, is amended to read: 
 14.12     Subdivision 1.  [DEPARTMENT.] A state department of 
 14.13  children, families, and learning is hereby created ~~which shall~~ 
 14.14  ~~be maintained under the direction of a state board of education~~ 
 14.15  ~~composed of nine representative citizens of the state, at least~~ 
 14.16  ~~one of whom shall reside in each congressional district in the~~ 
 14.17  ~~state~~. 
 14.18     ~~Of the nine representative citizens of the state who are~~ 
 14.19  ~~appointed to the state board of education not less than three~~ 
 14.20  ~~members thereof shall previously thereto have served as an~~ 
 14.21  ~~elected member of a board of education of a school district~~ 
 14.22  ~~however organized.~~ 
 14.23     ~~The members of the state board shall be appointed by the~~ 
 14.24  ~~governor, with the advice and consent of the senate.  One member~~ 
 14.25  ~~shall be chosen annually as president, but no member shall serve~~ 
 14.26  ~~as president more than three consecutive years.  The state board~~ 
 14.27  ~~shall hold its annual meeting in August.  It shall hold meetings~~ 
 14.28  ~~on dates and at places as it designates.  No member shall hold~~ 
 14.29  ~~any public office, or represent or be employed by any board of~~ 
 14.30  ~~education or school district, public or private, and shall not~~ 
 14.31  ~~voluntarily have any personal financial interest in any contract~~ 
 14.32  ~~with a board of education or school district, or be engaged in~~ 
 14.33  ~~any capacity where a conflict of interest may arise.~~ 
 14.34     Sec. 20.  Minnesota Statutes 1998, section 127A.66, 
 14.35  subdivision 2, is amended to read: 
 14.36     Subd. 2.  [ADMINISTRATIVE RULES.] (a) The ~~state board~~ 
 15.1   commissioner may adopt new rules and amend them or amend any ~~of~~ 
 15.2   ~~its~~ existing rules only under specific authority and consistent 
 15.3   with the requirements of chapter 14.  The ~~state board~~ 
 15.4   commissioner may repeal any of ~~its~~ the commissioner's existing 
 15.5   rules.  Notwithstanding the provisions of section 14.05, 
 15.6   subdivision 4, the ~~state board~~ commissioner may grant a variance 
 15.7   to ~~its~~ the commissioner's rules upon application by a school 
 15.8   district for purposes of implementing experimental programs in 
 15.9   learning or school management.  This subdivision shall not 
 15.10  prohibit the ~~state board~~ commissioner from making technical 
 15.11  changes or corrections to ~~its~~ the commissioner's rules. 
 15.12     (b) The commissioner annually must report by February 1 to 
 15.13  the education and governmental operations committees of the 
 15.14  legislature on the status of proposed rules and recommend 
 15.15  proposals for adopting new rules and amending or repealing 
 15.16  existing rules. 
 15.17     Sec. 21.  [SUCCESSOR TRUSTEE.] 
 15.18     The commissioner is a successor trustee for all funds 
 15.19  bequeathed to the state board of education and held in trust by 
 15.20  the board for a particular use or purpose.  The commissioner 
 15.21  shall administer the trust funds for the same purpose for which 
 15.22  the funds were received and held. 
 15.23     Sec. 22.  [REPEALER.] 
 15.24     Minnesota Statutes 1998, sections 127A.42, subdivision 8; 
 15.25  127A.60, subdivisions 2, 3, and 4; 127A.61; 127A.62, subdivision 
 15.26  2; 127A.64; and 127A.66, subdivision 1, are repealed. 
 15.27     Sec. 23.  [EFFECTIVE DATE.] 
 15.28     Sections 1 to 22 are effective December 31, 1999.