1.1 	A bill for an act
1.2 	relating to education; providing for policy and funding for family, adult, and 
1.3 	prekindergarten through grade 12 education including general education, 
1.4 	education excellence, special programs, facilities and technology, libraries, 
1.5 	nutrition, accounting, self-sufficiency and lifelong learning, state agencies, 
1.6 	pupil transportation, school finance system changes, forecast adjustments, 
1.7 	and technical corrections; providing for advisory groups; requiring reports; 
1.8 	appropriating money;amending Minnesota Statutes 2008, sections 6.74; 16A.06, 
1.9 	subdivision 11; 120A.40; 120B.02; 120B.021, subdivision 1; 120B.022, 
1.10 	subdivision 1; 120B.023, subdivision 2; 120B.11, subdivision 5; 120B.13; 
1.11 	120B.132; 120B.30; 120B.31; 120B.35; 120B.36; 121A.15, subdivision 8; 
1.12 	121A.41, subdivisions 7, 10; 121A.43; 122A.07, subdivisions 2, 3; 122A.18, 
1.13 	subdivision 4; 122A.31, subdivision 4; 122A.40, subdivisions 6, 8; 122A.41, 
1.14 	subdivisions 3, 5; 122A.413, subdivision 2; 122A.414, subdivisions 2, 2b; 
1.15 	122A.60, subdivisions 1a, 2; 122A.61, subdivision 1; 123A.05; 123A.06; 
1.16 	123A.08; 123B.02, subdivision 21; 123B.03, subdivisions 1, 1a; 123B.10, 
1.17 	subdivision 1; 123B.14, subdivision 7; 123B.143, subdivision 1; 123B.51, by 
1.18 	adding a subdivision; 123B.53, subdivision 5; 123B.57, subdivision 1; 123B.59, 
1.19 	subdivisions 2, 3, 3a; 123B.70, subdivision 1; 123B.71, subdivisions 8, 9, 
1.20 	12; 123B.75, subdivision 5; 123B.76, subdivision 3; 123B.77, subdivision 3; 
1.21 	123B.79, subdivision 7; 123B.81, subdivisions 3, 4, 5; 123B.83, subdivision 3; 
1.22 	123B.92, subdivisions 1, 5; 124D.095, subdivisions 2, 3, 4, 7, 10; 124D.10; 
1.23 	124D.11, subdivisions 4, 9; 124D.111, subdivision 3; 124D.128, subdivisions 
1.24 	2, 3; 124D.42, subdivision 6, by adding a subdivision; 124D.4531; 124D.59, 
1.25 	subdivision 2; 124D.65, subdivision 5; 124D.68, subdivisions 2, 3, 4, 5; 124D.83, 
1.26 	subdivision 4; 124D.86, subdivisions 1, 1a, 1b; 125A.02; 125A.07; 125A.08; 
1.27 	125A.091; 125A.11, subdivision 1; 125A.15; 125A.28; 125A.51; 125A.56; 
1.28 	125A.57, subdivision 2; 125A.62, subdivision 8; 125A.63, subdivisions 2, 
1.29 	4; 125A.76, subdivisions 1, 5; 125A.79, subdivision 7; 125B.26; 126C.01, 
1.30 	by adding subdivisions; 126C.05, subdivisions 1, 2, 3, 5, 6, 8, 15, 16, 17, 20; 
1.31 	126C.10, subdivisions 1, 2, 2a, 3, 4, 6, 13, 14, 18, 24, 34, by adding subdivisions; 
1.32 	126C.13, subdivisions 4, 5; 126C.15, subdivisions 2, 4; 126C.17, subdivisions 1, 
1.33 	5, 6, 9; 126C.20; 126C.40, subdivisions 1, 6; 126C.41, subdivision 2; 126C.44; 
1.34 	127A.08, by adding a subdivision; 127A.441; 127A.45, subdivisions 2, 3, 13, by 
1.35 	adding a subdivision; 127A.47, subdivisions 5, 7; 127A.51; 134.31, subdivision 
1.36 	4a, by adding a subdivision; 169.011, subdivision 71; 169.443, subdivision 9; 
1.37 	169.4501, subdivision 1; 169.4503, subdivision 20, by adding a subdivision; 
1.38 	169.454, subdivision 13; 169A.03, subdivision 23; 171.01, subdivision 22; 
1.39 	171.02, subdivisions 2, 2a, 2b; 171.05, subdivision 2; 171.17, subdivision 1; 
2.1 	171.22, subdivision 1; 171.321, subdivisions 1, 4, 5; 181A.05, subdivision 1; 
2.2 	275.065, subdivisions 3, 6; 299A.297; 471.975; 475.58, subdivision 1; Laws 
2.3 	2007, chapter 146, article 1, section 24, subdivisions 2, as amended, 6, as 
2.4 	amended, 8, as amended; article 2, section 46, subdivision 6, as amended; article 
2.5 	3, section 24, subdivision 4, as amended; article 4, section 16, subdivisions 2, as 
2.6 	amended, 6, as amended; article 5, section 13, subdivisions 2, as amended, 3, 
2.7 	as amended; article 9, section 17, subdivisions 2, as amended, 13, as amended; 
2.8 	Laws 2008, chapter 363, article 2, section 46, subdivision 1; proposing coding 
2.9 	for new law in Minnesota Statutes, chapters 120B; 123B; 125A; 126C; 127A; 
2.10 	repealing Minnesota Statutes 2008, sections 120B.362; 120B.39; 121A.27; 
2.11 	121A.66; 121A.67, subdivision 1; 122A.628; 122A.75; 123B.54; 123B.57, 
2.12 	subdivisions 3, 4, 5; 123B.591; 124D.091; 125A.03; 125A.05; 125A.18; 
2.13 	125A.76, subdivision 4; 125A.79, subdivision 6; 126C.10, subdivisions 2b, 
2.14 	13a, 13b, 24, 25, 26, 27, 28, 29, 30, 31, 31a, 31b, 32, 33, 34, 35, 36; 126C.12; 
2.15 	126C.126; 127A.50; 275.065, subdivisions 5a, 6b, 6c, 8, 9, 10; Minnesota Rules, 
2.16 	parts 3525.0210, subparts 5, 6, 9, 13, 17, 29, 30, 34, 43, 46, 47; 3525.0400; 
2.17 	3525.1100, subpart 2, item F; 3525.2445; 3525.2900, subpart 5; 3525.4220.
2.18 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.19 	ARTICLE 1
2.20 	GENERAL EDUCATION

2.21 	Section 1. Minnesota Statutes 2008, section 16A.06, subdivision 11, is amended to read:
2.22 		Subd. 11.Permanent school fund reporting. The commissioner shall biannually 
2.23 	report to the Permanent School Fund Advisory Committee and the legislature on the 
2.24 	management of the permanent school trust fund that shows how the commissioner the 
2.25 	amount of the permanent school fund transfer and information about the investment of the 
2.26 	permanent school fund provided by the State Board of Investment. The State Board of 
2.27 	Investment shall provide information about how they maximized the long-term economic 
2.28 	return of the permanent school trust fund.

2.29 	Sec. 2. Minnesota Statutes 2008, section 120A.40, is amended to read:
2.30 	120A.40 SCHOOL CALENDAR.
2.31 	(a) Except for learning programs during summer, flexible learning year programs 
2.32 	authorized under sections 124D.12 to 124D.127, and learning year programs under section 
2.33 	124D.128, a district must not commence an elementary or secondary school year before 
2.34 	Labor Day, except as provided under paragraph (b). Days devoted to teachers' workshops 
2.35 	may be held before Labor Day. Districts that enter into cooperative agreements are 
2.36 	encouraged to adopt similar school calendars.
2.37 	(b) A district may begin the school year on any day before Labor Day:
2.38 	(1) to accommodate a construction or remodeling project of $400,000 or more 
2.39 	affecting a district school facility.;
3.1 	(2) if the district has an agreement under section 123A.30, 123A.32, or 123A.35 
3.2 	with a district that qualifies under clause (1); or
3.3 	A school (3) if the district that agrees to the same schedule with a school district 
3.4 	in an adjoining state also may begin the school year before Labor Day as authorized 
3.5 	under this paragraph.

3.6 	Sec. 3. Minnesota Statutes 2008, section 122A.60, subdivision 1a, is amended to read:
3.7 		Subd. 1a.Effective staff development activities. (a) Staff development activities 
3.8 	must:
3.9 	(1) focus on the school classroom and research-based strategies that improve student 
3.10 	learning;
3.11 	(2) provide opportunities for teachers to practice and improve their instructional 
3.12 	skills over time;
3.13 	(3) provide opportunities for teachers to use student data as part of their daily work 
3.14 	to increase student achievement;
3.15 	(4) enhance teacher content knowledge and instructional skills;
3.16 	(5) align with state and local academic standards;
3.17 	(6) provide opportunities to build professional relationships, foster collaboration 
3.18 	among principals and staff who provide instruction, and provide opportunities for 
3.19 	teacher-to-teacher mentoring; and
3.20 	(7) align with the plan of the district or site for an alternative teacher professional 
3.21 	pay system.
3.22 	Staff development activities may include curriculum development and curriculum training 
3.23 	programs, and activities that provide teachers and other members of site-based teams 
3.24 	training to enhance team performance, and basic first aid, focusing on certification for 
3.25 	CPR and the use of automatic external defibrillators. The school district also may 
3.26 	implement other staff development activities required by law and activities associated with 
3.27 	professional teacher compensation models.
3.28 	(b) Release time provided for teachers to supervise students on field trips and school 
3.29 	activities, or independent tasks not associated with enhancing the teacher's knowledge 
3.30 	and instructional skills, such as preparing report cards, calculating grades, or organizing 
3.31 	classroom materials, may not be counted as staff development time that is financed with 
3.32 	staff development reserved revenue under section 122A.61.

3.33 	Sec. 4. Minnesota Statutes 2008, section 122A.61, subdivision 1, is amended to read:
4.1 		Subdivision 1.Staff development revenue. A district is required to reserve 
4.2 	an amount equal to at least two percent of the basic revenue under section 126C.10, 
4.3 	subdivision 2, for in-service education for programs under section 120B.22, subdivision 
4.4 	2, for staff development plans, including plans for challenging instructional activities 
4.5 	and experiences under section 122A.60, and for curriculum development and programs, 
4.6 	other in-service education, teachers' workshops, teacher conferences, the cost of 
4.7 	substitute teachers staff development purposes, preservice and in-service education for 
4.8 	special education professionals and paraprofessionals, and other related costs for staff 
4.9 	development efforts. A district may annually waive the requirement to reserve their basic 
4.10 	revenue under this section if a majority vote of the licensed teachers in the district and 
4.11 	a majority vote of the school board agree to a resolution to waive the requirement. A 
4.12 	district in statutory operating debt is exempt from reserving basic revenue according to 
4.13 	this section. Districts may expend an additional amount of unreserved revenue for staff 
4.14 	development based on their needs. With the exception of amounts reserved for staff 
4.15 	development from revenues allocated directly to school sites and any amounts spent for 
4.16 	first aid or CPR and automatic external defibrillator training, the board must initially 
4.17 	allocate 50 percent of the remaining reserved revenue to each school site in the district on 
4.18 	a per teacher basis, which must be retained by the school site until used. The board may 
4.19 	retain 25 percent to be used for district wide staff development efforts. The remaining 
4.20 	25 percent of the revenue must be used to make grants to school sites for best practices 
4.21 	methods. A grant may be used for any purpose authorized under section 120B.22, 
4.22 	subdivision 2, 122A.60, or for the costs of curriculum development and programs, other 
4.23 	in-service education, teachers' workshops, teacher conferences, substitute teachers for 
4.24 	staff development purposes, and other staff development efforts, and determined by 
4.25 	the site professional development team. The site professional development team must 
4.26 	demonstrate to the school board the extent to which staff at the site have met the outcomes 
4.27 	of the program. The board may withhold a portion of initial allocation of revenue if the 
4.28 	staff development outcomes are not being met. 

4.29 	Sec. 5. Minnesota Statutes 2008, section 123B.77, subdivision 3, is amended to read:
4.30 		Subd. 3.Statement for comparison and correction. (a) By November 30 of the 
4.31 	calendar year of the submission of the unaudited financial data, the district must provide to 
4.32 	the commissioner audited financial data for the preceding fiscal year. The audit must be 
4.33 	conducted in compliance with generally accepted governmental auditing standards, the 
4.34 	federal Single Audit Act, and the Minnesota legal compliance guide issued by the Office 
4.35 	of the State Auditor. An audited financial statement prepared in a form which will allow 
5.1 	comparison with and correction of material differences in the unaudited financial data 
5.2 	shall be submitted to the commissioner and the state auditor by December 31. The audited 
5.3 	financial statement must also provide a statement of assurance pertaining to uniform 
5.4 	financial accounting and reporting standards compliance and a copy of the management 
5.5 	letter submitted to the district by the school district's auditor.
5.6 	(b) By January February 15 of the calendar year following the submission of the 
5.7 	unaudited financial data, the commissioner shall convert the audited financial data 
5.8 	required by this subdivision into the consolidated financial statement format required 
5.9 	under subdivision 1a and publish the information on the department's Web site.

5.10 	Sec. 6. Minnesota Statutes 2008, section 123B.83, subdivision 3, is amended to read:
5.11 		Subd. 3.Failure to limit expenditures. If a district does not limit its expenditures in 
5.12 	accordance with this section, the commissioner may so notify the appropriate committees 
5.13 	of the legislature by no later than January 1 February 15 of the year following the end 
5.14 	of that fiscal year.

5.15 	Sec. 7. Minnesota Statutes 2008, section 125A.11, subdivision 1, is amended to read:
5.16 		Subdivision 1.Nonresident tuition rate; other costs. (a) For fiscal year 2006, 
5.17 	when a school district provides instruction and services outside the district of residence, 
5.18 	board and lodging, and any tuition to be paid, shall be paid by the district of residence. 
5.19 	The tuition rate to be charged for any child with a disability, excluding a pupil for whom 
5.20 	tuition is calculated according to section 127A.47, subdivision 7, paragraph (d), must be 
5.21 	the sum of (1) the actual cost of providing special instruction and services to the child 
5.22 	including a proportionate amount for special transportation and unreimbursed building 
5.23 	lease and debt service costs for facilities used primarily for special education, plus (2) 
5.24 	the amount of general education revenue and referendum aid attributable to the pupil, 
5.25 	minus (3) the amount of special education aid for children with a disability received 
5.26 	on behalf of that child, minus (4) if the pupil receives special instruction and services 
5.27 	outside the regular classroom for more than 60 percent of the school day, the amount of 
5.28 	general education revenue and referendum aid, excluding portions attributable to district 
5.29 	and school administration, district support services, operations and maintenance, capital 
5.30 	expenditures, and pupil transportation, attributable to that pupil for the portion of time 
5.31 	the pupil receives special instruction and services outside of the regular classroom. If 
5.32 	the boards involved do not agree upon the tuition rate, either board may apply to the 
5.33 	commissioner to fix the rate. Notwithstanding chapter 14, the commissioner must then set 
5.34 	a date for a hearing or request a written statement from each board, giving each board 
6.1 	at least ten days' notice, and after the hearing or review of the written statements the 
6.2 	commissioner must make an order fixing the tuition rate, which is binding on both school 
6.3 	districts. General education revenue and referendum equalization aid attributable to a 
6.4 	pupil must be calculated using the resident district's average general education revenue 
6.5 	and referendum equalization aid per adjusted pupil unit.
6.6 	(b) For fiscal year 2007 and later, when a school district provides special instruction 
6.7 	and services for a pupil with a disability as defined in section 125A.02 outside the district 
6.8 	of residence, excluding a pupil for whom an adjustment to special education aid is 
6.9 	calculated according to section 127A.47, subdivision 7, paragraph (e), special education 
6.10 	aid paid to the resident district must be reduced by an amount equal to (1) the actual 
6.11 	cost of providing special instruction and services to the pupil, including a proportionate 
6.12 	amount for special transportation and unreimbursed building lease and debt service costs 
6.13 	for facilities used primarily for special education, plus (2) the amount of general education 
6.14 	revenue and referendum equalization aid attributable to that pupil, calculated using the 
6.15 	resident district's average general education revenue and referendum equalization aid 
6.16 	per adjusted pupil unit excluding basic skills revenue, elementary sparsity revenue and 
6.17 	secondary sparsity revenue, minus (3) the amount of special education aid for children 
6.18 	with a disability received on behalf of that child, minus (4) if the pupil receives special 
6.19 	instruction and services outside the regular classroom for more than 60 percent of the 
6.20 	school day, the amount of general education revenue and referendum equalization aid, 
6.21 	excluding portions attributable to district and school administration, district support 
6.22 	services, operations and maintenance, capital expenditures, and pupil transportation, 
6.23 	attributable to that pupil for the portion of time the pupil receives special instruction 
6.24 	and services outside of the regular classroom, calculated using the resident district's 
6.25 	average general education revenue and referendum equalization aid per adjusted pupil unit 
6.26 	excluding basic skills revenue, elementary sparsity revenue and secondary sparsity revenue 
6.27 	and the serving district's basic skills revenue, elementary sparsity revenue and secondary 
6.28 	sparsity revenue per adjusted pupil unit. Notwithstanding clauses (1) and (4), for pupils 
6.29 	served by a cooperative unit without a fiscal agent school district, the general education 
6.30 	revenue and referendum equalization aid attributable to a pupil must be calculated using 
6.31 	the resident district's average general education revenue and referendum equalization aid 
6.32 	excluding compensatory revenue, elementary sparsity revenue, and secondary sparsity 
6.33 	revenue. Special education aid paid to the district or cooperative providing special 
6.34 	instruction and services for the pupil must be increased by the amount of the reduction in 
6.35 	the aid paid to the resident district. Amounts paid to cooperatives under this subdivision 
6.36 	and section 127A.47, subdivision 7, shall be recognized and reported as revenues and 
7.1 	expenditures on the resident school district's books of account under sections 123B.75
7.2 	and 123B.76. If the resident district's special education aid is insufficient to make the full 
7.3 	adjustment, the remaining adjustment shall be made to other state aid due to the district.
7.4 	(c) Notwithstanding paragraphs (a) and (b) and section 127A.47, subdivision 7, 
7.5 	paragraphs (d) and (e), a charter school where more than 30 percent of enrolled students 
7.6 	receive special education and related services, a site approved under section 125A.515, 
7.7 	an intermediate district, a special education cooperative, or a school district that served 
7.8 	as the applicant agency for a group of school districts for federal special education aids 
7.9 	for fiscal year 2006 may apply to the commissioner for authority to charge the resident 
7.10 	district an additional amount to recover any remaining unreimbursed costs of serving 
7.11 	pupils with a disability. The application must include a description of the costs and the 
7.12 	calculations used to determine the unreimbursed portion to be charged to the resident 
7.13 	district. Amounts approved by the commissioner under this paragraph must be included 
7.14 	in the tuition billings or aid adjustments under paragraph (a) or (b), or section 127A.47, 
7.15 	subdivision 7, paragraph (d) or (e), as applicable.
7.16 	(d) For purposes of this subdivision and section 127A.47, subdivision 7, paragraphs 
7.17 	(d) and (e), "general education revenue and referendum equalization aid" means the sum 
7.18 	of the general education revenue according to section 126C.10, subdivision 1, excluding 
7.19 	alternative teacher compensation revenue, plus the referendum equalization aid according 
7.20 	to section 126C.17, subdivision 7, as adjusted according to section 127A.47, subdivision 
7.21 	7, paragraphs (a) to (c).

7.22 	Sec. 8. Minnesota Statutes 2008, section 126C.05, subdivision 2, is amended to read:
7.23 		Subd. 2.Foreign exchange pupils. Notwithstanding section 124D.02, subdivision 
7.24 	3, or any other law to the contrary, a foreign exchange pupil enrolled in a district under a 
7.25 	cultural exchange program registered with the Office of the Secretary of State under 
7.26 	section 5A.02 may be counted as a resident pupil for the purposes of this chapter 
7.27 	and chapters 120B, 122A, 123A, 123B, 124D, 125A, and 127A, even if the pupil has 
7.28 	graduated from high school or the equivalent. 

7.29 	Sec. 9. Minnesota Statutes 2008, section 126C.15, subdivision 2, is amended to read:
7.30 		Subd. 2.Building allocation. (a) A district must allocate its compensatory 
7.31 	revenue to each school building in the district where the children who have generated the 
7.32 	revenue are served unless the school district has received permission under Laws 2005, 
7.33 	First Special Session chapter 5, article 1, section 50, to allocate compensatory revenue 
7.34 	according to student performance measures developed by the school board.
8.1 	(b) Notwithstanding paragraph (a), a district may allocate up to five percent of the 
8.2 	amount of compensatory revenue that the district receives to school sites according to a 
8.3 	plan adopted by the school board. The money reallocated under this paragraph must be 
8.4 	spent for the purposes listed in subdivision 1, but may be spent on students in any grade, 
8.5 	including students attending school readiness or other prekindergarten programs.
8.6 	(c) For the purposes of this section and section 126C.05, subdivision 3, "building" 
8.7 	means education site as defined in section 123B.04, subdivision 1.
8.8 	(d) If the pupil is served at a site other than one owned and operated by the district, 
8.9 	the revenue shall be paid to the district and used for services for pupils who generate 
8.10 	the revenue Notwithstanding section 123A. 26, subdivision 1, compensatory revenue 
8.11 	generated by students served at a cooperative unit shall be paid to the cooperative unit.
8.12 	(e) A district with school building openings, school building closings, changes 
8.13 	in attendance area boundaries, or other changes in programs or student demographics 
8.14 	between the prior year and the current year may reallocate compensatory revenue among 
8.15 	sites to reflect these changes. A district must report to the department any adjustments it 
8.16 	makes according to this paragraph and the department must use the adjusted compensatory 
8.17 	revenue allocations in preparing the report required under section 123B.76, subdivision 3, 
8.18 	paragraph (c).

8.19 	Sec. 10. Minnesota Statutes 2008, section 126C.15, subdivision 4, is amended to read:
8.20 		Subd. 4.Separate accounts. Each district and cooperative unit that receives basic 
8.21 	skills revenue shall maintain separate accounts to identify expenditures for salaries and 
8.22 	programs related to basic skills revenue.

8.23 	Sec. 11. Minnesota Statutes 2008, section 126C.17, subdivision 9, is amended to read:
8.24 		Subd. 9.Referendum revenue. (a) The revenue authorized by section 126C.10, 
8.25 	subdivision 1, may be increased in the amount approved by the voters of the district at a 
8.26 	referendum called for the purpose. The referendum may be called by the board or shall be 
8.27 	called by the board upon written petition of qualified voters of the district. The referendum 
8.28 	must be conducted one or two calendar years before the increased levy authority, if 
8.29 	approved, first becomes payable. Only one election to approve an increase may be held 
8.30 	in a calendar year. Unless the referendum is conducted by mail under subdivision 11, 
8.31 	paragraph (a), the referendum must be held on the first Tuesday after the first Monday 
8.32 	in November. The ballot must state the maximum amount of the increased revenue per 
8.33 	resident marginal cost pupil unit. The ballot may state a schedule, determined by the 
8.34 	board, of increased revenue per resident marginal cost pupil unit that differs from year 
9.1 	to year over the number of years for which the increased revenue is authorized or may 
9.2 	state that the amount shall increase annually by the rate of inflation. For this purpose, the 
9.3 	rate of inflation shall be the annual inflationary increase calculated under subdivision 2, 
9.4 	paragraph (b). The ballot may state that existing referendum levy authority is expiring. In 
9.5 	this case, the ballot may also compare the proposed levy authority to the existing expiring 
9.6 	levy authority, and express the proposed increase as the amount, if any, over the expiring 
9.7 	referendum levy authority. The ballot must designate the specific number of years, not to 
9.8 	exceed ten, for which the referendum authorization applies. The ballot, including a ballot 
9.9 	on the question to revoke or reduce the increased revenue amount under paragraph (c), 
9.10 	must abbreviate the term "per resident marginal cost pupil unit" as "per pupil." The notice 
9.11 	required under section 275.60 may be modified to read, in cases of renewing existing 
9.12 	levies at the same amount per pupil as in the previous year:
9.13 	"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU ARE VOTING 
9.14 	TO EXTEND AN EXISTING PROPERTY TAX REFERENDUM THAT IS 
9.15 	SCHEDULED TO EXPIRE."
9.16 	The ballot may contain a textual portion with the information required in this 
9.17 	subdivision and a question stating substantially the following:
9.18 	"Shall the increase in the revenue proposed by (petition to) the board of ........., 
9.19 	School District No. .., be approved?"
9.20 	If approved, an amount equal to the approved revenue per resident marginal cost 
9.21 	pupil unit times the resident marginal cost pupil units for the school year beginning in 
9.22 	the year after the levy is certified shall be authorized for certification for the number of 
9.23 	years approved, if applicable, or until revoked or reduced by the voters of the district at a 
9.24 	subsequent referendum.
9.25 	(b) The board must prepare and deliver by first class mail at least 15 days but no more 
9.26 	than 30 days before the day of the referendum to each taxpayer a notice of the referendum 
9.27 	and the proposed revenue increase. The board need not mail more than one notice to any 
9.28 	taxpayer. For the purpose of giving mailed notice under this subdivision, owners must be 
9.29 	those shown to be owners on the records of the county auditor or, in any county where 
9.30 	tax statements are mailed by the county treasurer, on the records of the county treasurer. 
9.31 	Every property owner whose name does not appear on the records of the county auditor 
9.32 	or the county treasurer is deemed to have waived this mailed notice unless the owner 
9.33 	has requested in writing that the county auditor or county treasurer, as the case may be, 
9.34 	include the name on the records for this purpose. The notice must project the anticipated 
9.35 	amount of tax increase in annual dollars for typical residential homesteads, agricultural 
9.36 	homesteads, apartments, and commercial-industrial property within the school district.
10.1 	The notice for a referendum may state that an existing referendum levy is expiring 
10.2 	and project the anticipated amount of increase over the existing referendum levy in 
10.3 	the first year, if any, in annual dollars for typical residential homesteads, agricultural 
10.4 	homesteads, apartments, and commercial-industrial property within the district.
10.5 	The notice must include the following statement: "Passage of this referendum will 
10.6 	result in an increase in your property taxes." However, in cases of renewing existing levies, 
10.7 	the notice may include the following statement: "Passage of this referendum extends an 
10.8 	existing operating referendum at the same amount per pupil as in the previous year." 
10.9 	(c) A referendum on the question of revoking or reducing the increased revenue 
10.10 	amount authorized pursuant to paragraph (a) may be called by the board and shall be called 
10.11 	by the board upon the written petition of qualified voters of the district. A referendum to 
10.12 	revoke or reduce the revenue amount must state the amount per resident marginal cost 
10.13 	pupil unit by which the authority is to be reduced. Revenue authority approved by the 
10.14 	voters of the district pursuant to paragraph (a) must be available to the school district at 
10.15 	least once before it is subject to a referendum on its revocation or reduction for subsequent 
10.16 	years. Only one revocation or reduction referendum may be held to revoke or reduce 
10.17 	referendum revenue for any specific year and for years thereafter.
10.18 	(d) A petition authorized by paragraph (a) or (c) is effective if signed by a number 
10.19 	of qualified voters in excess of 15 30 percent of the registered voters of the district on 
10.20 	the day the petition is filed with the board. A referendum invoked by petition must be 
10.21 	held on the date specified in paragraph (a).
10.22 	(e) The approval of 50 percent plus one of those voting on the question is required to 
10.23 	pass a referendum authorized by this subdivision.
10.24 	(f) At least 15 days before the day of the referendum, the district must submit a 
10.25 	copy of the notice required under paragraph (b) to the commissioner and to the county 
10.26 	auditor of each county in which the district is located. Within 15 days after the results 
10.27 	of the referendum have been certified by the board, or in the case of a recount, the 
10.28 	certification of the results of the recount by the canvassing board, the district must notify 
10.29 	the commissioner of the results of the referendum.

10.30 	EFFECTIVE DATE. This section is effective for petitions filed after July 1, 2009.

10.31 	Sec. 12. Minnesota Statutes 2008, section 126C.40, subdivision 6, is amended to read:
10.32 		Subd. 6.Lease purchase; installment buys. (a) Upon application to, and approval 
10.33 	by, the commissioner in accordance with the procedures and limits in subdivision 1, 
10.34 	paragraphs (a) and (b), a district, as defined in this subdivision, may:
11.1 	(1) purchase real or personal property under an installment contract or may lease 
11.2 	real or personal property with an option to purchase under a lease purchase agreement, by 
11.3 	which installment contract or lease purchase agreement title is kept by the seller or vendor 
11.4 	or assigned to a third party as security for the purchase price, including interest, if any; and
11.5 	(2) annually levy the amounts necessary to pay the district's obligations under the 
11.6 	installment contract or lease purchase agreement.
11.7 	(b) The obligation created by the installment contract or the lease purchase 
11.8 	agreement must not be included in the calculation of net debt for purposes of section 
11.9 	475.53, and does not constitute debt under other law. An election is not required in 
11.10 	connection with the execution of the installment contract or the lease purchase agreement.
11.11 	(c) The proceeds of the levy authorized by this subdivision must not be used to 
11.12 	acquire a facility to be primarily used for athletic or school administration purposes.
11.13 	(d) For the purposes of this subdivision, "district" means:
11.14 	(1) a school district required to have a comprehensive plan for the elimination of 
11.15 	segregationwhich is eligible for revenue under section 124D.86, subdivision 3, clause (1), 
11.16 	(2), or (3), and whose plan has been determined by the commissioner to be in compliance 
11.17 	with Department of Education rules relating to equality of educational opportunity and 
11.18 	school desegregation and, for a district eligible for revenue under section 124D.86, 
11.19 	subdivision 3, clause (4) or (5), where the acquisition of property under this subdivision is 
11.20 	determined by the commissioner to contribute to the implementation of the desegregation 
11.21 	plan; or
11.22 	(2) a school district that participates in a joint program for interdistrict desegregation 
11.23 	with a district defined in clause (1) if the facility acquired under this subdivision is to 
11.24 	be primarily used for the joint program and the commissioner determines that the joint 
11.25 	programs are being undertaken to implement the districts' desegregation plan.
11.26 	(e) Notwithstanding subdivision 1, the prohibition against a levy by a district to lease 
11.27 	or rent a district-owned building to itself does not apply to levies otherwise authorized 
11.28 	by this subdivision.
11.29 	(f) For the purposes of this subdivision, any references in subdivision 1 to building 
11.30 	or land shall include personal property.

11.31 	Sec. 13. Minnesota Statutes 2008, section 126C.41, subdivision 2, is amended to read:
11.32 		Subd. 2.Retired employee health benefits. (a) A district may levy an amount up 
11.33 	to the amount the district is required by the collective bargaining agreement in effect 
11.34 	on March 30, 1992, to pay for health insurance or unreimbursed medical expenses for 
11.35 	licensed and nonlicensed employees who have terminated services in the employing 
12.1 	district and withdrawn from active teaching service or other active service, as applicable, 
12.2 	before July 1, 1998, if a sunset clause is in effect for the current collective bargaining 
12.3 	agreement. The total amount of the levy each year may not exceed $600,000.
12.4 	(b) In addition to the levy authority granted under paragraph (a), a school district 
12.5 	may levy for other postemployment benefits expenses. For purposes of this subdivision 
12.6 	"postemployment benefits" means benefits giving rise to a liability under Statement No. 
12.7 	45 of the Government Accounting Standards Board. A district seeking levy authority 
12.8 	under this subdivision must:
12.9 	(1) create or have created an actuarial liability to pay postemployment benefits to 
12.10 	employees or officers after their termination of service;
12.11 	(2) have a sunset clause in effect for the current collective bargaining agreement 
12.12 	as required by paragraph (a); and
12.13 	(3) apply for the authority in the form and manner required by the commissioner 
12.14 	of education.
12.15 	If the total levy authority requested under this paragraph exceeds the amount established 
12.16 	in paragraph (c), the commissioner must proportionately reduce each district's maximum 
12.17 	levy authority under this subdivision.
12.18 	(c) The maximum levy authority under paragraph (b) must not exceed the following 
12.19 	amounts:
12.20 	(1) $24,000,000 for taxes payable in 2010;
12.21 	(2) $50,000,000 for taxes payable in 2011; and
12.22 	(3) for taxes payable in 2012 and later, the maximum levy authority must not exceed 
12.23 	the sum of the previous year's authority and $19,000,000.

12.24 	Sec. 14. Minnesota Statutes 2008, section 126C.44, is amended to read:
12.25 	126C.44 SAFE SCHOOLS LEVY.
12.26 	(a) Each district may make a levy on all taxable property located within the district 
12.27 	for the purposes specified in this section. The maximum amount which may be levied 
12.28 	for all costs under this section shall be equal to $30 multiplied by the district's adjusted 
12.29 	marginal cost pupil units for the school year. The proceeds of the levy must be reserved and 
12.30 	used for directly funding the following purposes or for reimbursing the cities and counties 
12.31 	who contract with the district for the following purposes: (1) to pay the costs incurred for 
12.32 	the salaries, benefits, and transportation costs of peace officers and sheriffs for liaison in 
12.33 	services in the district's schools; (2) to pay the costs for a drug abuse prevention program 
12.34 	as defined in section 609.101, subdivision 3, paragraph (e), in the elementary schools; 
12.35 	(3) to pay the costs for a gang resistance education training curriculum in the district's 
13.1 	schools; (4) to pay the costs for security in the district's schools and on school property; (5) 
13.2 	to pay the costs for other crime prevention, drug abuse, student and staff safety, voluntary 
13.3 	opt-in suicide prevention tools, and violence prevention measures taken by the school 
13.4 	district; or (6) to pay costs for licensed school counselors, licensed school nurses, licensed 
13.5 	school social workers, licensed school psychologists, and licensed alcohol and chemical 
13.6 	dependency counselors to help provide early responses to problems. For expenditures 
13.7 	under clause (1), the district must initially attempt to contract for services to be provided 
13.8 	by peace officers or sheriffs with the police department of each city or the sheriff's 
13.9 	department of the county within the district containing the school receiving the services. If 
13.10 	a local police department or a county sheriff's department does not wish to provide the 
13.11 	necessary services, the district may contract for these services with any other police or 
13.12 	sheriff's department located entirely or partially within the school district's boundaries. 
13.13 	(b) A school district that is a member of an intermediate school district may 
13.14 	include in its authority under this section the costs associated with safe schools activities 
13.15 	authorized under paragraph (a) for intermediate school district programs. This authority 
13.16 	must not exceed $10 times the adjusted marginal cost pupil units of the member districts. 
13.17 	This authority is in addition to any other authority authorized under this section. Revenue 
13.18 	raised under this paragraph must be transferred to the intermediate school district.
13.19 	(c) A school district must set aside at least $3 per adjusted marginal cost pupil 
13.20 	unit of the safe schools levy proceeds for the purposes authorized under paragraph (a), 
13.21 	clause (6). The district must annually certify either that: (1) its total spending on services 
13.22 	provided by the employees listed in paragraph (a), clause (6), is not less than the sum of 
13.23 	its expenditures for these purposes, excluding amounts spent under this section, in the 
13.24 	previous year plus the amount spent under this section; or (2) that the district's full-time 
13.25 	equivalent number of employees listed in paragraph (a), clause (6), is not less than the 
13.26 	number for the previous year.

13.27 	EFFECTIVE DATE. This section is effective for revenue for fiscal years 2010 
13.28 	and later.

13.29 	Sec. 15. Minnesota Statutes 2008, section 127A.47, subdivision 7, is amended to read:
13.30 		Subd. 7.Alternative attendance programs. The general education aid and special 
13.31 	education aid for districts must be adjusted for each pupil attending a nonresident district 
13.32 	under sections 123A.05 to 123A.08, 124D.03, 124D.08, and 124D.68. The adjustments 
13.33 	must be made according to this subdivision.
13.34 	(a) General education aid paid to a resident district must be reduced by an amount 
13.35 	equal to the referendum equalization aid attributable to the pupil in the resident district.
14.1 	(b) General education aid paid to a district serving a pupil in programs listed in this 
14.2 	subdivision must be increased by an amount equal to the greater of (1) the referendum 
14.3 	equalization aid attributable to the pupil in the nonresident district; or (2) the product of 
14.4 	the district's open enrollment concentration index, the maximum amount of referendum 
14.5 	revenue in the first tier, and the district's net open enrollment pupil units for that year. A 
14.6 	district's open enrollment concentration index equals the greater of: (i) zero, or (ii) the 
14.7 	lesser of 1.0, or the difference between the district's ratio of open enrollment pupil units 
14.8 	served to its resident pupil units for that year and 0.2. This clause does not apply to a 
14.9 	school district where more than 50 percent of the open enrollment students are enrolled 
14.10 	solely in online learning courses.
14.11 	(c) If the amount of the reduction to be made from the general education aid of the 
14.12 	resident district is greater than the amount of general education aid otherwise due the 
14.13 	district, the excess reduction must be made from other state aids due the district.
14.14 	(d) For fiscal year 2006, the district of residence must pay tuition to a district or an 
14.15 	area learning center, operated according to paragraph (f), providing special instruction and 
14.16 	services to a pupil with a disability, as defined in section 125A.02, or a pupil, as defined in 
14.17 	section 125A.51, who is enrolled in a program listed in this subdivision. The tuition must 
14.18 	be equal to (1) the actual cost of providing special instruction and services to the pupil, 
14.19 	including a proportionate amount for special transportation and unreimbursed building 
14.20 	lease and debt service costs for facilities used primarily for special education, minus (2) 
14.21 	if the pupil receives special instruction and services outside the regular classroom for 
14.22 	more than 60 percent of the school day, the amount of general education revenue and 
14.23 	referendum aid attributable to that pupil for the portion of time the pupil receives special 
14.24 	instruction and services outside of the regular classroom, excluding portions attributable to 
14.25 	district and school administration, district support services, operations and maintenance, 
14.26 	capital expenditures, and pupil transportation, minus (3) special education aid attributable 
14.27 	to that pupil, that is received by the district providing special instruction and services. 
14.28 	For purposes of this paragraph, general education revenue and referendum equalization 
14.29 	aid attributable to a pupil must be calculated using the serving district's average general 
14.30 	education revenue and referendum equalization aid per adjusted pupil unit.
14.31 	(e) For fiscal year 2007 and later, special education aid paid to a resident district 
14.32 	must be reduced by an amount equal to (1) the actual cost of providing special instruction 
14.33 	and services, including special transportation and unreimbursed building lease and debt 
14.34 	service costs for facilities used primarily for special education, for a pupil with a disability, 
14.35 	as defined in section 125A.02, or a pupil, as defined in section 125A.51, who is enrolled 
14.36 	in a program listed in this subdivision, minus (2) if the pupil receives special instruction 
15.1 	and services outside the regular classroom for more than 60 percent of the school day, 
15.2 	the amount of general education revenue and referendum equalization aid attributable 
15.3 	to that pupil for the portion of time the pupil receives special instruction and services 
15.4 	outside of the regular classroom, excluding portions attributable to district and school 
15.5 	administration, district support services, operations and maintenance, capital expenditures, 
15.6 	and pupil transportation, minus (3) special education aid attributable to that pupil, that is 
15.7 	received by the district providing special instruction and services. For purposes of this 
15.8 	paragraph, general education revenue and referendum equalization aid attributable to a 
15.9 	pupil must be calculated using the serving district's average general education revenue 
15.10 	and referendum equalization aid per adjusted pupil unit. Special education aid paid to the 
15.11 	district or cooperative providing special instruction and services for the pupil, or to the 
15.12 	fiscal agent district for a cooperative, must be increased by the amount of the reduction 
15.13 	in the aid paid to the resident district. If the resident district's special education aid is 
15.14 	insufficient to make the full adjustment, the remaining adjustment shall be made to other 
15.15 	state aids due to the district.
15.16 	(f) An area learning center operated by a service cooperative, intermediate district, 
15.17 	education district, or a joint powers cooperative may elect through the action of the 
15.18 	constituent boards to charge the resident district tuition for pupils rather than to have the 
15.19 	general education revenue paid to a fiscal agent school district. Except as provided in 
15.20 	paragraph (d) or (e), the district of residence must pay tuition equal to at least 90 percent of 
15.21 	the district average general education revenue per pupil unit minus an amount equal to the 
15.22 	product of the formula allowance according to section 126C.10, subdivision 2, times .0485, 
15.23 	calculated without basic skills compensatory revenue and transportation sparsity revenue, 
15.24 	times the number of pupil units for pupils attending the area learning center, plus the 
15.25 	amount of compensatory revenue generated by pupils attending the area learning center.

15.26 	Sec. 16. Minnesota Statutes 2008, section 475.58, subdivision 1, is amended to read:
15.27 		Subdivision 1. Approval by electors; exceptions. Obligations authorized by law or 
15.28 	charter may be issued by any municipality upon obtaining the approval of a majority of 
15.29 	the electors voting on the question of issuing the obligations, but an election shall not be 
15.30 	required to authorize obligations issued:
15.31 	(1) to pay any unpaid judgment against the municipality;
15.32 	(2) for refunding obligations;
15.33 	(3) for an improvement or improvement program, which obligation is payable wholly 
15.34 	or partly from the proceeds of special assessments levied upon property specially benefited 
15.35 	by the improvement or by an improvement within the improvement program, or from tax 
16.1 	increments, as defined in section 469.174, subdivision 25, including obligations which are 
16.2 	the general obligations of the municipality, if the municipality is entitled to reimbursement 
16.3 	in whole or in part from the proceeds of such special assessments or tax increments and 
16.4 	not less than 20 percent of the cost of the improvement or the improvement program is to 
16.5 	be assessed against benefited property or is to be paid from the proceeds of federal grant 
16.6 	funds or a combination thereof, or is estimated to be received from tax increments;
16.7 	(4) payable wholly from the income of revenue producing conveniences;
16.8 	(5) under the provisions of a home rule charter which permits the issuance of 
16.9 	obligations of the municipality without election;
16.10 	(6) under the provisions of a law which permits the issuance of obligations of a 
16.11 	municipality without an election;
16.12 	(7) to fund pension or retirement fund or postemployment benefit liabilities pursuant 
16.13 	to section 475.52, subdivision 6;
16.14 	(8) under a capital improvement plan under section 373.40; and
16.15 	(9) under sections 469.1813 to 469.1815 (property tax abatement authority bonds), if 
16.16 	the proceeds of the bonds are not used for a purpose prohibited under section 469.176, 
16.17 	subdivision 4g, paragraph (b); and
16.18 	(10) postemployment benefit liabilities pursuant to section 475.52, subdivision 6, for 
16.19 	municipalities other than school districts.

16.20 	EFFECTIVE DATE. This section is effective for obligations sold after August 
16.21 	1, 2009.

16.22 	Sec. 17. EARLY GRADUATION INCENTIVES PROGRAM WORKING 
16.23 	GROUP.
 16.24 		Subdivision 1.Commissioner of education to convene. The commissioner of 
16.25 	education must convene a working group to study the effects of an early graduation 
16.26 	incentives program for highly motivated high school junior and seniors on Minnesota's 
16.27 	K-12 and Higher Education Systems.
16.28 		Subd. 2.Membership. The working group's membership consists of the 
16.29 	commissioner of education, two representatives chosen by the speaker of the house, two 
16.30 	senators named by the Subcommittee on Committees of the senate Committee on Rules 
16.31 	and Administration, one superintendent selected by the Minnesota Association of School 
16.32 	Administrators, one person selected by the Minnesota School Boards Association, two 
16.33 	high school teachers selected by Education Minnesota, one representative of higher 
16.34 	education chosen by the University of Minnesota, one higher education representative 
16.35 	chosen by the Minnesota State Colleges and Universities board, two persons selected by 
17.1 	the Minnesota Private College Council, one person chosen by the Minnesota Council 
17.2 	for the Gifted and Talented, and at least one representative of the business community 
17.3 	selected by the Minnesota Chamber of Commerce.
17.4 		Subd. 3.Duties. The working group must evaluate the benefits of an early 
17.5 	graduation incentives program designed to engage highly motivated high school juniors 
17.6 	and seniors. The working group must analyze the potential cost savings to the state and the 
17.7 	impact on, and the interplay with, the state's postsecondary enrollment options program.
17.8 		Subd. 4.Compensation. The advisory group is not subject to Minnesota Statutes, 
17.9 	section 15.059.
17.10 		Subd. 5.Report. The advisory group must report its recommendations to the 
17.11 	education policy and finance committees of the legislature by January 15, 2010.

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

17.13 	Sec. 18. ONETIME GENERAL EDUCATION REVENUE REDUCTION 
17.14 	REPLACED WITH FEDERAL FUNDS FROM THE FISCAL STABILIZATION 
17.15 	ACCOUNT.
 17.16 		Subdivision 1.General education reduction. Notwithstanding Minnesota Statutes, 
17.17 	sections 126C.13 and 126C.20, the state total general education aid for fiscal year 2010 is 
17.18 	reduced by $275,600,000. The aid reduction must be allocated among school districts and 
17.19 	charter schools in proportion to the school district or charter school's general education 
17.20 	revenue for fiscal year 2008 under Minnesota Statutes, section 126C.10, or Minnesota 
17.21 	Statutes, section 124D.11, subdivisions 1 and 2.
17.22 		Subd. 2.Allocation of federal fiscal stabilization funds. The commissioner must 
17.23 	offset the onetime general education aid reduction for each school district and charter 
17.24 	school under subdivision 1 with an equal amount of federal aid from the fiscal stabilization 
17.25 	account in the federal fund.

17.26 	Sec. 19. APPROPRIATIONS; GENERAL FUND.
 17.27 		Subdivision 1.Department of Education. The sums indicated in this section are 
17.28 	appropriated from the general fund to the Department of Education for the fiscal years 
17.29 	designated.
17.30 		Subd. 2.General education aid. For general education aid under Minnesota 
17.31 	Statutes, section 126C.13, subdivision 4:

17.32		$
	3,916,460,000
	.....
	2010
	
17.33		$
	5,563,965,000
	.....
	2011
	
18.1 	The 2010 appropriation includes $555,864,000 for 2009 and $3,360,596,000 for 
18.2 	2010.
18.3 	The 2011 appropriation includes $1,438,969,000 for 2010 and $4,124,996,000 
18.4 	for 2011.
18.5 		Subd. 3.Enrollment options transportation. For transportation of pupils attending 
18.6 	postsecondary institutions under Minnesota Statutes, section 124D.09, or for transportation 
18.7 	of pupils attending nonresident districts under Minnesota Statutes, section 124D.03:

18.8		$
	48,000
	.....
	2010
	
18.9		$
	52,000
	.....
	2011
	
18.10 		Subd. 4.Abatement revenue. For abatement aid under Minnesota Statutes, section 
18.11 	127A.49:

18.12		$
	980,000
	.....
	2010
	
18.13		$
	1,056,000
	.....
	2011
	
18.14 	The 2010 appropriation includes $140,000 for 2009 and $840,000 for 2010.
18.15 	The 2011 appropriation includes $310,000 for 2010 and $746,000 for 2011.
18.16 		Subd. 5.Consolidation transition. For districts consolidating under Minnesota 
18.17 	Statutes, section 123A.485:

18.18		$
	693,000
	.....
	2010
	
18.19		$
	931,000
	.....
	2011
	
18.20 	The 2010 appropriation includes $0 for 2009 and $693,000 for 2010.
18.21 	The 2011 appropriation includes $255,000 for 2010 and $676,000 for 2011.
18.22 		Subd. 6.Nonpublic pupil education aid. For nonpublic pupil education aid under 
18.23 	Minnesota Statutes, sections 123B.87 and 123B.40 to 123B.43:

18.24		$
	14,303,000
	.....
	2010
	
18.25		$
	17,785,000
	.....
	2011
	
18.26 	The 2010 appropriation includes $1,647,000 for 2009 and $12,656,000 for 2010.
18.27 	The 2011 appropriation includes $4,680,000 for 2010 and $13,105,000 for 2011.
18.28 		Subd. 7.Nonpublic pupil transportation. For nonpublic pupil transportation aid 
18.29 	under Minnesota Statutes, section 123B.92, subdivision 9:

18.30		$
	18,366,000
	.....
	2010
	
18.31		$
	22,636,000
	.....
	2011
	
18.32 	The 2010 appropriation includes $2,077,000 for 2009 and $16,289,000 for 2010.
18.33 	The 2011 appropriation includes $6,024,000 for 2010 and $16,612,000 for 2011.
19.1 		Subd. 8.One-room schoolhouse. For a grant to Independent School District No. 
19.2 	690, Warroad, to operate the Angle Inlet School:

19.3		$
	65,000
	.....
	2010
	
19.4		$
	65,000
	.....
	2011
	
19.5 		Subd. 9.Independent School District No. 239, Rushford-Peterson. For school 
19.6 	district flood enrollment impact aid as a result of the floods of August 2007:

19.7		$
	158,000
	.....
	2010
	
19.8 	The base appropriation for later fiscal years is zero.
19.9 	The district must provide to the commissioner of education documentation of 
19.10 	the additional pupil transportation costs and the number of pupils in average daily 
19.11 	membership lost as a result of the flood.
19.12 		Subd. 10.Lancaster. For a grant to Independent School District No. 356, Lancaster, 
19.13 	to replace the loss of sparsity revenue:

19.14		$
	100,000
	.....
	2010
	
19.15		$
	100,000
	.....
	2011
	
19.16 	The base appropriation for later fiscal years is zero.
19.17 		Subd. 11.Compensatory revenue pilot project. For grants for participation in the 
19.18 	compensatory revenue pilot program under Laws 2005, First Special Session chapter 5, 
19.19 	article 1, section 50:

19.20		$
	2,175,000
	.....
	2010
	
19.21		$
	2,175,000
	.....
	2011
	
19.22 	Of this amount, $1,500,000 in each year is for a grant to Independent School District 
19.23 	No. 11, Anoka-Hennepin; $210,000 in each year is for a grant to Independent School 
19.24 	District No. 279, Osseo; $160,000 in each year is for a grant to Independent School 
19.25 	District No. 281, Robbinsdale; $75,000 in each year is for a grant to Independent School 
19.26 	District No. 286, Brooklyn Center; $165,000 in each year is for a grant to Independent 
19.27 	School District No. 535, Rochester; and $65,000 in each year is for a grant to Independent 
19.28 	School District No. 833, South Washington.
19.29 	If a grant to a specific school district is not awarded, the commissioner may increase 
19.30 	the aid amounts to any of the remaining participating school districts.
19.31 	This appropriation is part of the base budget for subsequent fiscal years.

19.32 	Sec. 20. APPROPRIATIONS; FEDERAL FUND.
 20.1 		Subdivision 1.Department of Education. The sums indicated in this section are 
20.2 	appropriated from the fiscal stabilization account in the federal fund to the commissioner 
20.3 	of education for the fiscal years designated.
20.4 		Subd. 2.General education offset. To offset the onetime general education revenue 
20.5 	reduction under section 18:

20.6		$
	275,600,000
	.....
	2010
	
20.7 	Any balance does not cancel but is available for obligation until September 30, 2011.

20.8 	ARTICLE 2
20.9 	EDUCATION EXCELLENCE

20.10 	Section 1. Minnesota Statutes 2008, section 6.74, is amended to read:
20.11 	6.74 INFORMATION COLLECTED FROM LOCAL GOVERNMENTS.
20.12 		Subdivision 1.Information generally. The state auditor, or a designated agent, shall 
20.13 	collect annually from all city, county, and other local units of government, information as 
20.14 	to the assessment of property, collection of taxes, receipts from licenses and other sources, 
20.15 	the expenditure of public funds for all purposes, borrowing, debts, principal and interest 
20.16 	payments on debts, and such other information as may be needful. The data shall be 
20.17 	supplied upon forms prescribed by the state auditor, and all public officials so called upon 
20.18 	shall fill out properly and return promptly all forms so transmitted. The state auditor or 
20.19 	assistants, may examine local records in order to complete or verify the information.
20.20 		Subd. 2.Examples of good government in procurement and shared services; 
20.21 	clearinghouse. The state auditor may seek funds from local units of government 
20.22 	and nongovernmental sources to establish an online clearinghouse of examples of 
20.23 	good government in procurement and shared services among political subdivisions. If 
20.24 	established, the clearinghouse shall be designed to allow political subdivisions to submit 
20.25 	examples of good government in procurement and shared services in a form prescribed 
20.26 	by the state auditor.

20.27 	Sec. 2. Minnesota Statutes 2008, section 120B.02, is amended to read:
20.28 	120B.02 EDUCATIONAL EXPECTATIONS FOR MINNESOTA'S 
20.29 	STUDENTS.
20.30 	(a) The legislature is committed to establishing rigorous academic standards for 
20.31 	Minnesota's public school students. To that end, the commissioner shall adopt in rule 
20.32 	statewide academic standards. The commissioner shall not prescribe in rule or otherwise 
20.33 	the delivery system, classroom assessments, or form of instruction that school sites must 
21.1 	use. For purposes of this chapter, a school site is a separate facility, or a separate program 
21.2 	within a facility that a local school board recognizes as a school site for funding purposes.
21.3 	(b) All commissioner actions regarding the rule must be premised on the following:
21.4 	(1) the rule is intended to raise academic expectations for students, teachers, and 
21.5 	schools;
21.6 	(2) any state action regarding the rule must evidence consideration of school district 
21.7 	autonomy; and
21.8 	(3) the Department of Education, with the assistance of school districts, must make 
21.9 	available information about all state initiatives related to the rule to students and parents, 
21.10 	teachers, and the general public in a timely format that is appropriate, comprehensive, and 
21.11 	readily understandable.
21.12 	(c) When fully implemented, the requirements for high school graduation in 
21.13 	Minnesota must require students to satisfactorily complete, as determined by the school 
21.14 	district, the course credit requirements under section 120B.024 and all state academic 
21.15 	standards or local academic standards where state standards do not apply and:
21.16 	(1) for students enrolled in grade 8 before the 2005-2006 school year, to pass the 
21.17 	basic skills test requirements; and
21.18 	(2) for students enrolled in grade 8 in the 2005-2006 school year and later, to pass 
21.19 	the Minnesota Comprehensive Assessments Second Edition (MCA-IIs).
21.20 	(d) The commissioner shall periodically review and report on the state's assessment 
21.21 	process.
21.22 	(e) School districts are not required to adopt specific provisions of the federal 
21.23 	School-to-Work programs.

21.24 	EFFECTIVE DATE. This section is effective August 1, 2012, and applies to 
21.25 	students entering the 9th grade in the 2012-2013 school year and later.

21.26 	Sec. 3. Minnesota Statutes 2008, section 120B.021, subdivision 1, is amended to read:
21.27 		Subdivision 1.Required academic standards. The following subject areas are 
21.28 	required for statewide accountability:
21.29 	(1) language arts;
21.30 	(2) mathematics;
21.31 	(3) science;
21.32 	(4) social studies, including history, geography, economics, and government and 
21.33 	citizenship;
21.34 	(5) health and physical education, for which locally developed academic standards 
21.35 	apply; and
22.1 	(6) the arts, for which statewide or locally developed academic standards apply, 
22.2 	as determined by the school district. Public elementary and middle schools must offer 
22.3 	at least three and require at least two of the following four arts areas: dance; music; 
22.4 	theater; and visual arts. Public high schools, consistent with section 120B.024, paragraph 
22.5 	(a), clause (5), must offer at least three and require at least one of the following five arts 
22.6 	areas: media arts; dance; music; theater; and visual arts.
22.7 	The commissioner must submit proposed standards in science and social studies to 
22.8 	the legislature by February 1, 2004.
22.9 	For purposes of applicable federal law, the academic standards for language arts, 
22.10 	mathematics, and science apply to all public school students, except the very few students 
22.11 	with extreme cognitive or physical impairments for whom an individualized education 
22.12 	plan team has determined that the required academic standards are inappropriate. An 
22.13 	individualized education plan team that makes this determination must establish alternative 
22.14 	standards with appropriate alternate achievement standards based on these academic 
22.15 	standards for students with individualized education plans described under federal law.
22.16 	A school district, no later than the 2007-2008 school year, must adopt graduation 
22.17 	requirements that meet or exceed state graduation requirements established in law or 
22.18 	rule. A school district that incorporates these state graduation requirements before the 
22.19 	2007-2008 school year must provide students who enter the 9th grade in or before 
22.20 	the 2003-2004 school year the opportunity to earn a diploma based on existing locally 
22.21 	established graduation requirements in effect when the students entered the 9th grade. 
22.22 	District efforts to develop, implement, or improve instruction or curriculum as a result 
22.23 	of the provisions of this section must be consistent with sections 120B.10, 120B.11, 
22.24 	and 120B.20.
22.25 	The commissioner must include the contributions of Minnesota American Indian 
22.26 	tribes and communities as they relate to the academic standards during the review and 
22.27 	revision of the required academic standards.

22.28 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
22.29 	later.

22.30 	Sec. 4. Minnesota Statutes 2008, section 120B.022, subdivision 1, is amended to read:
22.31 		Subdivision 1.Elective standards. (a) A district must establish its own standards in 
22.32 	the following subject areas:
22.33 	(1) vocational and technical education; and
22.34 	(2) world languages.
23.1 	A school district must offer courses in all elective subject areas.
23.2 	(b) World languages teachers and other school staff should develop and implement 
23.3 	world languages programs that acknowledge and reinforce the language proficiency and 
23.4 	cultural awareness that non-English language speakers already possess, and encourage 
23.5 	students' proficiency in multiple world languages. Programs under this paragraph must 
23.6 	encompass indigenous American Indian languages and cultures, among other world 
23.7 	languages and cultures. The department shall consult with postsecondary institutions in 
23.8 	developing related professional development opportunities.
23.9 	(c) Any Minnesota public, charter, or nonpublic school may award Minnesota 
23.10 	World Language Proficiency Certificates or Minnesota World Language Proficiency High 
23.11 	Achievement Certificates, consistent with this subdivision.
23.12 	The Minnesota World Language Proficiency Certificate recognizes students who 
23.13 	demonstrate listening, speaking, reading, and writing language skills at the American 
23.14 	Council on the Teaching of Foreign Languages' Intermediate-Low level on a valid and 
23.15 	reliable assessment tool. For languages listed as Category 3 by the United States Foreign 
23.16 	Service Institute or Category 4 by the United States Defense Language Institute, the 
23.17 	standard is Intermediate-Low for listening and speaking and Novice-High for reading 
23.18 	and writing.
23.19 	The Minnesota World Language Proficiency High Achievement Certificate 
23.20 	recognizes students who demonstrate listening, speaking, reading, and writing language 
23.21 	skills at the American Council on the Teaching of Foreign Languages' Pre-Advanced level 
23.22 	for K-12 learners on a valid and reliable assessment tool. For languages listed as Category 
23.23 	3 by the United States Foreign Service Institute or Category 4 by the United States 
23.24 	Defense Language Institute, the standard is Pre-Advanced for listening and speaking and 
23.25 	Intermediate-Mid for reading and writing.

23.26 	Sec. 5. Minnesota Statutes 2008, section 120B.023, subdivision 2, is amended to read:
23.27 		Subd. 2.Revisions and reviews required. (a) The commissioner of education must 
23.28 	revise and appropriately embed technology and information literacy standards consistent 
23.29 	with recommendations from school media specialists into the state's academic standards 
23.30 	and graduation requirements and implement a review cycle for state academic standards 
23.31 	and related benchmarks, consistent with this subdivision. During each review cycle, the 
23.32 	commissioner also must examine the alignment of each required academic standard and 
23.33 	related benchmark with the knowledge and skills students need for college readiness and 
23.34 	advanced work in the particular subject area.
24.1 	(b) The commissioner in the 2006-2007 school year must revise and align the state's 
24.2 	academic standards and high school graduation requirements in mathematics to require 
24.3 	that students satisfactorily complete the revised mathematics standards, beginning in the 
24.4 	2010-2011 school year. Under the revised standards:
24.5 	(1) students must satisfactorily complete an algebra I credit by the end of eighth 
24.6 	grade; and
24.7 	(2) students scheduled to graduate in the 2014-2015 school year or later must 
24.8 	satisfactorily complete an algebra II credit or its equivalent.
24.9 	The commissioner also must ensure that the statewide mathematics assessments 
24.10 	administered to students in grades 3 through 8 and 11 beginning in the 2010-2011 
24.11 	school year are aligned with the state academic standards in mathematics. The statewide 
24.12 	11th grade mathematics test administered to students under clause (2) beginning in 
24.13 	the 2013-2014 school year must include algebra II test items that are aligned with 
24.14 	corresponding state academic standards in mathematics. The commissioner must 
24.15 	implement a review of the academic standards and related benchmarks in mathematics 
24.16 	beginning in the 2015-2016 school year.
24.17 	(c) The commissioner in the 2007-2008 school year must revise and align the state's 
24.18 	academic standards and high school graduation requirements in the arts to require that 
24.19 	students satisfactorily complete the revised arts standards beginning in the 2010-2011
24.20 	2011-2012 school year. The commissioner must implement a review of the academic 
24.21 	standards and related benchmarks in arts beginning in the 2016-2017 2017-2018 school 
24.22 	year.
24.23 	(d) The commissioner in the 2008-2009 school year must revise and align the state's 
24.24 	academic standards and high school graduation requirements in science to require that 
24.25 	students satisfactorily complete the revised science standards, beginning in the 2011-2012
24.26 	2012-2013 school year. Under the revised standards, students scheduled to graduate in the 
24.27 	2014-2015 2015-2016 school year or later must satisfactorily complete a chemistry or 
24.28 	physics credit. The commissioner must implement a review of the academic standards and 
24.29 	related benchmarks in science beginning in the 2017-2018 2018-2019 school year.
24.30 	(e) The commissioner in the 2009-2010 2010-2011 school year must revise and 
24.31 	align the state's academic standards and high school graduation requirements in language 
24.32 	arts to require that students satisfactorily complete the revised language arts standards 
24.33 	beginning in the 2012-2013 2013-2014 school year. The commissioner must implement 
24.34 	a review of the academic standards and related benchmarks in language arts beginning 
24.35 	in the 2018-2019 2019-2020 school year.
25.1 	(f) The commissioner in the 2010-2011 2011-2012 school year must revise and 
25.2 	align the state's academic standards and high school graduation requirements in social 
25.3 	studies to require that students satisfactorily complete the revised social studies standards 
25.4 	beginning in the 2013-2014 2014-2015 school year. The commissioner must implement 
25.5 	a review of the academic standards and related benchmarks in social studies beginning 
25.6 	in the 2019-2020 2020-2021 school year.
25.7 	(g) School districts and charter schools must revise and align local academic 
25.8 	standards and high school graduation requirements in health, physical education, world 
25.9 	languages, and career and technical education to require students to complete the revised 
25.10 	standards beginning in a school year determined by the school district or charter school. 
25.11 	School districts and charter schools must formally establish a periodic review cycle for 
25.12 	the academic standards and related benchmarks in health, physical education, world 
25.13 	languages, and career and technical education.

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

25.15 	Sec. 6. Minnesota Statutes 2008, section 120B.11, subdivision 5, is amended to read:
25.16 		Subd. 5.Report. (a) By October 1 of each year, the school board shall use standard 
25.17 	statewide reporting procedures the commissioner develops and adopt a report, consistent 
25.18 	with section 120B.36, subdivision 1, that includes the following:
25.19 	(1) student achievement goals for meeting state academic standards;
25.20 	(2) results of local assessment data, and any additional test data;
25.21 	(3) the annual school district improvement plans including staff development goals 
25.22 	under section 122A.60;
25.23 	(4) information about district and learning site progress in realizing previously 
25.24 	adopted improvement plans; and
25.25 	(5) the amount and type of revenue attributed to each education site as defined 
25.26 	in section 123B.04.
25.27 	(b) The school board shall publish the report in the local newspaper with the largest 
25.28 	circulation in the district, by mail, or by electronic means such as the district Web site. If 
25.29 	electronic means are used, school districts must publish notice of the report in a periodical 
25.30 	of general circulation in the district. School districts must make copies of the report 
25.31 	available to the public on request. The board shall make a copy of the report available to 
25.32 	the public for inspection. The board shall send a copy of the report to the commissioner 
25.33 	of education by October 15 of each year.
26.1 	(c) The title of the report shall contain the name and number of the school district and 
26.2 	read "Annual Report on Curriculum, Instruction, and Student Achievement." The report 
26.3 	must include at least the following information about advisory committee membership:
26.4 	(1) the name of each committee member and the date when that member's term 
26.5 	expires;
26.6 	(2) the method and criteria the school board uses to select committee members; and
26.7 	(3) the date by which a community resident must apply to next serve on the 
26.8 	committee.

26.9 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
26.10 	later.

26.11 	Sec. 7. Minnesota Statutes 2008, section 120B.13, is amended to read:
26.12 	120B.13 ADVANCED PLACEMENT AND, INTERNATIONAL 
26.13 	BACCALAUREATE, AND CONCURRENT ENROLLMENT PROGRAMS.
26.14 		Subdivision 1.Program structure; training programs for teachers. (a) The 
26.15 	advanced placement and, international baccalaureate, and concurrent enrollment programs 
26.16 	are well-established academic programs for mature, academically directed high school 
26.17 	students. These programs, in addition to providing academic rigor, offer sound curricular 
26.18 	design, accountability, comprehensive external assessment, feedback to students and 
26.19 	teachers, and the opportunity for high school students to compete academically on a 
26.20 	global level. Advanced placement and, international baccalaureate, and concurrent 
26.21 	enrollment programs allow students to leave high school with the academic skills 
26.22 	and self-confidence to succeed in college and beyond. The advanced placement and,
26.23 	international baccalaureate, and concurrent enrollment programs help provide Minnesota 
26.24 	students with world-class educational opportunity.
26.25 	(b) Critical to schools' educational success is ongoing advanced 
26.26 	placement/international baccalaureate-approved teacher training for teachers instructing 
26.27 	students in the advanced placement, international baccalaureate, and concurrent enrollment 
26.28 	programs. A secondary teacher assigned by a district to teach an advanced placement or 
26.29 	international baccalaureate course or other interested educator may participate in a training 
26.30 	program offered by The College Board or International Baccalaureate North America, Inc. 
26.31 	A secondary teacher assigned by a district to teach a concurrent enrollment course, or other 
26.32 	interested educator, may participate in a training program offered by the eligible public 
26.33 	postsecondary institution with which the district has entered into an agreement according 
26.34 	to section 124D.09, subdivision 3, paragraph (a). The state may pay a portion of the tuition, 
27.1 	room, board, and out-of-state travel costs a teacher or other interested educator incurs 
27.2 	in participating in a training program. The commissioner shall determine application 
27.3 	procedures and deadlines, select teachers and other interested educators to participate in 
27.4 	the training program, and determine the payment process and amount of the subsidy. 
27.5 	The procedures determined by the commissioner shall, to the extent possible, ensure 
27.6 	that advanced placement and, international baccalaureate, and concurrent enrollment
27.7 	courses become available in all parts of the state and that a variety of course offerings are 
27.8 	available in school districts. This subdivision does not prevent teacher or other interested 
27.9 	educator participation in training programs offered by The College Board or International 
27.10 	Baccalaureate North America, Inc., when tuition is paid by a source other than the state.
27.11 	(c) The commissioner may award state-funded competitive grants designed to create 
27.12 	advanced placement summer training institutes for secondary teachers. Two-year grants, 
27.13 	beginning and ending on October 1, may be awarded to Minnesota institutions of higher 
27.14 	education that comply with the training requirements outlined by the College Board. The 
27.15 	commissioner shall determine award criteria and the selection process.
27.16 		Subd. 2.Support programs. The commissioner shall provide support programs 
27.17 	during the school year for teachers who attended the training programs and teachers 
27.18 	experienced in teaching advanced placement or, international baccalaureate, or concurrent 
27.19 	enrollment courses. The support programs shall provide teachers with opportunities to 
27.20 	share instructional ideas with other teachers. The state may pay the costs of participating 
27.21 	in the support programs, including substitute teachers, if necessary, and program affiliation 
27.22 	costs.
27.23 		Subd. 3.Subsidy for examination fees. The state may pay all or part of the fee for 
27.24 	advanced placement or international baccalaureate examinations. The commissioner shall 
27.25 	pay all examination fees for all public and nonpublic students of low-income families, as 
27.26 	defined by the commissioner, and to the limit of the available appropriation, shall also pay 
27.27 	a portion or all of the examination fees for other public and nonpublic students sitting for 
27.28 	an advanced placement examination, international baccalaureate examination, or both. 
27.29 	The commissioner shall determine procedures for state payments of fees.
27.30 		Subd. 3a.College credit. The colleges and universities of the Minnesota State 
27.31 	Colleges and Universities system must award, and the University of Minnesota and private 
27.32 	postsecondary institutions are encouraged to award, college credit to high school students 
27.33 	who receive a score of three or higher on an advanced placement or four or higher on the 
27.34 	international baccalaureate program examination.
27.35 		Subd. 4.Information. The commissioner shall submit the following information to 
27.36 	the education committees of the legislature each year by February 1:
28.1 	(1) the number of pupils enrolled in advanced placement and, international 
28.2 	baccalaureate, and concurrent enrollment courses in each school district;
28.3 	(2) the number of teachers in each district attending training programs offered by the 
28.4 	college board or International Baccalaureate North America, Inc.;
28.5 	(3) the number of teachers in each district participating in support programs;
28.6 	(4) recent trends in the field of advanced placement and, international baccalaureate, 
28.7 	and concurrent enrollment programs;
28.8 	(5) expenditures for each category in this section; and
28.9 	(6) other recommendations for the state program.

28.10 	Sec. 8. Minnesota Statutes 2008, section 120B.132, is amended to read:
28.11 	120B.132 RAISED ACADEMIC ACHIEVEMENT; ADVANCED 
28.12 	PLACEMENT AND, INTERNATIONAL BACCALAUREATE, AND 
28.13 	CONCURRENT ENROLLMENT PROGRAMS.
28.14 		Subdivision 1.Establishment; eligibility. A program is established to raise 
28.15 	kindergarten through grade 12 academic achievement through increased student 
28.16 	participation in preadvanced placement, advanced placement, and international 
28.17 	baccalaureate, and concurrent enrollment programs, consistent with section 120B.13. 
28.18 	Schools and charter schools eligible to participate under this section: 
28.19 	(1) must have a three-year plan approved by the local school board to establish a new 
28.20 	international baccalaureate program leading to international baccalaureate authorization, 
28.21 	expand an existing program that leads to international baccalaureate authorization, or 
28.22 	expand an existing authorized international baccalaureate program; or
28.23 	(2) must have a three-year plan approved by the local school board to create a new or 
28.24 	expand an existing program to implement the college board advanced placement courses 
28.25 	and exams or preadvanced placement initiative; and or
28.26 	(3) must have a three-year plan approved by the local school board to create a new 
28.27 	or expand an existing concurrent enrollment program; and
28.28 	(3) (4) must propose to further raise students' academic achievement by: 
28.29 	(i) increasing the availability of and all students' access to advanced placement or,
28.30 	international baccalaureate, or concurrent enrollment courses or programs; 
28.31 	(ii) expanding the breadth of advanced placement or, international baccalaureate, or 
28.32 	concurrent enrollment courses or programs that are available to students; 
28.33 	(iii) increasing the number and the diversity of the students who participate in 
28.34 	advanced placement or, international baccalaureate, or concurrent enrollment courses 
28.35 	or programs and succeed; 
29.1 	(iv) providing low-income and other disadvantaged students with increased access 
29.2 	to advanced placement or, international baccalaureate, or concurrent enrollment courses 
29.3 	and programs; or 
29.4 	(v) increasing the number of high school students, including low-income and other 
29.5 	disadvantaged students, who receive college credit by successfully completing advanced 
29.6 	placement or, international baccalaureate, or concurrent enrollment courses or programs 
29.7 	and achieving satisfactory scores on related exams.
29.8 		Subd. 2.Application and review process; funding priority. (a) Charter schools 
29.9 	and school districts in which eligible schools under subdivision 1 are located may apply to 
29.10 	the commissioner, in the form and manner the commissioner determines, for competitive 
29.11 	funding to further raise students' academic achievement. The application must detail the 
29.12 	specific efforts the applicant intends to undertake in further raising students' academic 
29.13 	achievement, consistent with subdivision 1, and a proposed budget detailing the district or 
29.14 	charter school's current and proposed expenditures for advanced placement, preadvanced 
29.15 	placement, and international baccalaureate, and concurrent enrollment courses and 
29.16 	programs. The proposed budget must demonstrate that the applicant's efforts will support 
29.17 	implementation of advanced placement, preadvanced placement, and international 
29.18 	baccalaureate, and concurrent enrollment courses and programs. Expenditures for 
29.19 	administration must not exceed five percent of the proposed budget. The commissioner 
29.20 	may require an applicant to provide additional information.
29.21 	(b) When reviewing applications, the commissioner must determine whether 
29.22 	the applicant satisfied all the requirements in this subdivision and subdivision 1. 
29.23 	The commissioner may give funding priority to an otherwise qualified applicant that 
29.24 	demonstrates:
29.25 	(1) a focus on developing or expanding preadvanced placement, advanced placement, 
29.26 	or international baccalaureate, or concurrent enrollment courses or programs or increasing 
29.27 	students' participation in, access to, or success with the courses or programs, including the 
29.28 	participation, access, or success of low-income and other disadvantaged students;
29.29 	(2) a compelling need for access to preadvanced placement, advanced placement, or
29.30 	international baccalaureate, or concurrent enrollment courses or programs;
29.31 	(3) an effective ability to actively involve local business and community 
29.32 	organizations in student activities that are integral to preadvanced placement, advanced 
29.33 	placement, or international baccalaureate, or concurrent enrollment courses or programs; 
29.34 	(4) access to additional public or nonpublic funds or in-kind contributions that are 
29.35 	available for preadvanced placement, advanced placement, or international baccalaureate, 
29.36 	or concurrent enrollment courses or programs; or
30.1 	(5) an intent to implement activities that target low-income and other disadvantaged 
30.2 	students.
30.3 		Subd. 3.Funding; permissible funding uses. (a) The commissioner shall award 
30.4 	grants to applicant school districts and charter schools that meet the requirements of 
30.5 	subdivisions 1 and 2. The commissioner must award grants on an equitable geographical 
30.6 	basis to the extent feasible and consistent with this section. Grant awards must not exceed 
30.7 	the lesser of:
30.8 	(1) $85 times the number of pupils enrolled at the participating sites on October 
30.9 	1 of the previous fiscal year; or
30.10 	(2) the approved supplemental expenditures based on the budget submitted under 
30.11 	subdivision 2. For charter schools in their first year of operation, the maximum funding 
30.12 	award must be calculated using the number of pupils enrolled on October 1 of the current 
30.13 	fiscal year. The commissioner may adjust the maximum funding award computed using 
30.14 	prior year data for changes in enrollment attributable to school closings, school openings, 
30.15 	grade level reconfigurations, or school district reorganizations between the prior fiscal 
30.16 	year and the current fiscal year.
30.17 	(b) School districts and charter schools that submit an application and receive 
30.18 	funding under this section must use the funding, consistent with the application, to:
30.19 	(1) provide teacher training and instruction to more effectively serve students, 
30.20 	including low-income and other disadvantaged students, who participate in preadvanced 
30.21 	placement, advanced placement, or international baccalaureate, or concurrent enrollment
30.22 	courses or programs;
30.23 	(2) further develop preadvanced placement, advanced placement, or international 
30.24 	baccalaureate, or concurrent enrollment courses or programs;
30.25 	(3) improve the transition between grade levels to better prepare students, including 
30.26 	low-income and other disadvantaged students, for succeeding in preadvanced placement, 
30.27 	advanced placement, or international baccalaureate, or concurrent enrollment courses or 
30.28 	programs;
30.29 	(4) purchase books and supplies;
30.30 	(5) pay course or program fees;
30.31 	(6) increase students' participation in and success with preadvanced placement, 
30.32 	advanced placement, or international baccalaureate, or concurrent enrollment courses or 
30.33 	programs;
30.34 	(7) expand students' access to preadvanced placement, advanced placement, or
30.35 	international baccalaureate, or concurrent enrollment courses or programs through online 
30.36 	learning;
31.1 	(8) hire appropriately licensed personnel to teach additional advanced placement or
31.2 	international baccalaureate, or concurrent enrollment courses or programs; or
31.3 	(9) engage in other activity directly related to expanding students' access to, 
31.4 	participation in, and success with preadvanced placement, advanced placement, or
31.5 	international baccalaureate, or concurrent enrollment courses or programs, including 
31.6 	low-income and other disadvantaged students.
31.7 		Subd. 4.Annual reports. (a) Each school district and charter school that receives 
31.8 	a grant under this section annually must collect demographic and other student data to 
31.9 	demonstrate and measure the extent to which the district or charter school raised students' 
31.10 	academic achievement under this program and must report the data to the commissioner 
31.11 	in the form and manner the commissioner determines. The commissioner annually by 
31.12 	February 15 must make summary data about this program available to the education 
31.13 	policy and finance committees of the legislature.
31.14 	(b) Each school district and charter school that receives a grant under this section 
31.15 	annually must report to the commissioner, consistent with the Uniform Financial 
31.16 	Accounting and Reporting Standards, its actual expenditures for advanced placement, 
31.17 	preadvanced placement, and international baccalaureate, and concurrent enrollment
31.18 	courses and programs. The report must demonstrate that the school district or charter 
31.19 	school has maintained its effort from other sources for advanced placement, preadvanced 
31.20 	placement, and international baccalaureate, and concurrent enrollment courses and 
31.21 	programs compared with the previous fiscal year, and the district or charter school has 
31.22 	expended all grant funds, consistent with its approved budget.
31.23 		Subd. 5.Accreditation of concurrent enrollment programs. (a) To establish a 
31.24 	uniform standard by which concurrent enrollment courses and professional development 
31.25 	activities may be measured, postsecondary institutions are encouraged to apply for 
31.26 	accreditation by the National Alliance of Concurrent Enrollment Partnership.
31.27 	(b) Beginning in fiscal year 2011, districts offering a concurrent enrollment program 
31.28 	according to an agreement under section 124D.09, subdivision 10, are only eligible for aid 
31.29 	under this section and section 120B.13, if the college or university concurrent enrollment 
31.30 	courses offered by the district are accredited by the National Alliance of Concurrent 
31.31 	Enrollment Partnership, in the process of being accredited, or are shown by clear evidence 
31.32 	to be of comparable standard to accredited courses.

31.33 	Sec. 9. [120B.299] DEFINITIONS.
31.34 		Subdivision 1.Definitions. The definitions in this section apply to this chapter.
32.1 		Subd. 2.Growth. "Growth" compares the difference in a student's achievement 
32.2 	score at two or more distinct points in time.
32.3 		Subd. 3.Value added. "Value added" is the amount of achievement a student 
32.4 	demonstrates above an established baseline. The difference between the student's score 
32.5 	and the baseline defines value added.
32.6 		Subd. 4.Value-added growth. "Value-added growth" is based on a student's 
32.7 	growth score. In a value-added growth system, the student's first test is the baseline, and 
32.8 	the difference between the student's first and next test scores within a defined period is the 
32.9 	measure of value added. Value-added growth models use student-level data to measure 
32.10 	what portion of a student's growth can be explained by inputs related to the educational 
32.11 	environment.
32.12 		Subd. 5.Adequate yearly progress. A school or district makes "adequate yearly 
32.13 	progress" if, for every student subgroup under the federal 2001 No Child Left Behind 
32.14 	Act in the school or district, its proficiency index or other approved adjustments for 
32.15 	performance, based on statewide assessment scores, meets or exceeds federal expectations. 
32.16 	To make adequate yearly progress, the school or district also must satisfy applicable 
32.17 	federal requirements related to student attendance, graduation, and test participation rates.
32.18 		Subd. 6.State growth target. (a) "State growth target" is the average year-two 
32.19 	assessment scores for students with similar year-one assessment scores.
32.20 	(b) The state growth targets for each grade and subject are benchmarked as follows 
32.21 	until the assessment scale changes:
32.22 	(1) beginning in the 2008-2009 school year, the state growth target for grades 3 to 8 
32.23 	is benchmarked to 2006-2007 and 2007-2008 school year data;
32.24 	(2) beginning in the 2008-2009 school year the state growth target for grade 10 is 
32.25 	benchmarked to 2005-2006 and 2006-2007 school year data;
32.26 	(3) for the 2008-2009 school year, the state growth target for grade 11 is 
32.27 	benchmarked to 2005-2006 school year data; and
32.28 	(4) beginning in the 2009-2010 school year, the state growth target for grade 11 is 
32.29 	benchmarked to 2005-2006 and 2006-2007 school year data.
32.30 	(c) Each time before the assessment scale changes, a stakeholder group that includes 
32.31 	assessment and evaluation directors and staff and researchers must recommend a new 
32.32 	state growth target that the commissioner must consider when revising standards under 
32.33 	section 120B.023, subdivision 2. 
32.34 		Subd. 7.Low growth. "Low growth" is an assessment score one-half standard 
32.35 	deviation below the state growth target.
33.1 		Subd. 8.Medium growth. "Medium growth" is an assessment score within one-half 
33.2 	standard deviation above or below the state growth target.
33.3 		Subd. 9.High growth. "High growth" is an assessment score one-half standard 
33.4 	deviation or more above the state growth target.
33.5 		Subd. 10.Proficiency. "Proficiency" for purposes of reporting growth on school 
33.6 	performance report cards under section 120B.36, subdivision 1, means those students 
33.7 	who, in the previous school year, scored at or above "meets standards" on the statewide 
33.8 	assessments under section 120B.30. Each year, school performance report cards must 
33.9 	separately display: (1) the numbers and percentages of students who achieved low growth, 
33.10 	medium growth, and high growth and achieved proficiency in the previous school year; 
33.11 	and (2) the numbers and percentages of students who achieved low growth, medium 
33.12 	growth, and high growth and did not achieve proficiency in the previous school year.
33.13 		Subd. 11.Growth and progress toward proficiency. The categories of low 
33.14 	growth, medium growth, and high growth shall be used to indicate both (1) growth and (2) 
33.15 	progress toward grade-level proficiency that is consistent with subdivision 10.

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

33.17 	Sec. 10. Minnesota Statutes 2008, section 120B.30, is amended to read:
33.18 	120B.30 STATEWIDE TESTING AND REPORTING SYSTEM.
33.19 		Subdivision 1.Statewide testing.  (a) The commissioner, with advice from experts 
33.20 	with appropriate technical qualifications and experience and stakeholders, consistent with 
33.21 	subdivision 1a, shall include in the comprehensive assessment system, for each grade 
33.22 	level to be tested, state-constructed tests developed from and to be computer-adaptive 
33.23 	reading and mathematics assessments for general education students that are aligned with 
33.24 	the state's required academic standards under section 120B.021, include both multiple 
33.25 	choice and constructed response questions, and are administered annually to all students 
33.26 	in grades 3 through 8 and at the high school level. A State-developed testhigh school 
33.27 	tests aligned with the state's required academic standards under section 120B.021 and 
33.28 	administered to all high school students in a subject other than writing, developed after 
33.29 	the 2002-2003 school year, must include both machine-scoreable multiple choice and 
33.30 	constructed response questions. The commissioner shall establish one or more months 
33.31 	during which schools shall administer the tests to students each school year. Schools 
33.32 	that the commissioner identifies for stand-alone field testing or other national sampling 
33.33 	must participate as directed. Superintendents or charter school directors may appeal in 
33.34 	writing to the commissioner for an exemption from a field test based on undue hardship. 
34.1 	The commissioner's decision regarding the appeal is final. For students enrolled in 
34.2 	grade 8 before the 2005-2006 school year, only Minnesota basic skills tests in reading, 
34.3 	mathematics, and writing shall fulfill students' basic skills testing requirements for a 
34.4 	passing state notation. The passing scores of basic skills tests in reading and mathematics 
34.5 	are the equivalent of 75 percent correct for students entering grade 9 in 1997 and 
34.6 	thereafter, as based on the first uniform test administration of administered in February 
34.7 	1998. Students who have not successfully passed a Minnesota basic skills test by the end 
34.8 	of the 2011-2012 school year must pass the graduation-required assessments for diploma 
34.9 	under paragraph (b).
34.10 	(b) For students enrolled in grade 8 in the 2005-2006 school year and later, only the 
34.11 	following options shall fulfill students' state graduation test requirements:
34.12 	(1) for reading and mathematics:
34.13 	(i) obtaining an achievement level equivalent to or greater than proficient as 
34.14 	determined through a standard setting process on the Minnesota comprehensive 
34.15 	assessments in grade 10 for reading and grade 11 for mathematics or achieving a passing 
34.16 	score as determined through a standard setting process on the graduation-required 
34.17 	assessment for diploma in grade 10 for reading and grade 11 for mathematics or 
34.18 	subsequent retests;
34.19 	(ii) achieving a passing score as determined through a standard setting process on the 
34.20 	state-identified language proficiency test in reading and the mathematics test for English 
34.21 	language learners or the graduation-required assessment for diploma equivalent of those 
34.22 	assessments for students designated as English language learners;
34.23 	(iii) achieving an individual passing score on the graduation-required assessment 
34.24 	for diploma as determined by appropriate state guidelines for students with an individual 
34.25 	education plan or 504 plan;
34.26 	(iv) obtaining achievement level equivalent to or greater than proficient as 
34.27 	determined through a standard setting process on the state-identified alternate assessment 
34.28 	or assessments in grade 10 for reading and grade 11 for mathematics for students with 
34.29 	an individual education plan; or
34.30 	(v) achieving an individual passing score on the state-identified alternate assessment 
34.31 	or assessments as determined by appropriate state guidelines for students with an 
34.32 	individual education plan; and
34.33 	(2) for writing:
34.34 	(i) achieving a passing score on the graduation-required assessment for diploma;
35.1 	(ii) achieving a passing score as determined through a standard setting process on 
35.2 	the state-identified language proficiency test in writing for students designated as English 
35.3 	language learners;
35.4 	(iii) achieving an individual passing score on the graduation-required assessment 
35.5 	for diploma as determined by appropriate state guidelines for students with an individual 
35.6 	education plan or 504 plan; or
35.7 	(iv) achieving an individual passing score on the state-identified alternate assessment 
35.8 	or assessments as determined by appropriate state guidelines for students with an 
35.9 	individual education plan.
35.10 	(c) Students enrolled in grade 8 in any school year from the 2005-2006 school 
35.11 	year to the 2009-2010 school year who do not pass the mathematics graduation-required 
35.12 	assessment for diploma under paragraph (b) are eligible to receive a high school diploma 
35.13 	with a passing state notation if they:
35.14 	(1) complete with a passing score or grade all state and local coursework and credits 
35.15 	required for graduation by the school board granting the students their diploma;
35.16 	(2) participate in district-prescribed academic remediation in mathematics; and
35.17 	(3) fully participate in at least two retests of the mathematics GRAD test or until 
35.18 	they pass the mathematics GRAD test, whichever comes first. A school board issuing a 
35.19 	student a high school diploma in any school year from the 2009-2010 school year through 
35.20 	the 2013-2014 school year must record on the student's high school transcript the student's 
35.21 	score as the total number of test items and the number of test items the student answered 
35.22 	correctly on the mathematics graduation-required assessment for diploma under this 
35.23 	subdivision.
35.24 	In addition, the school board granting the students their diplomas may formally 
35.25 	decide to include a notation of high achievement on the high school diplomas of those 
35.26 	graduating seniors who, according to established school board criteria, demonstrate 
35.27 	exemplary academic achievement during high school.
35.28 	(d) The 3rd through 8th grade computer-adaptive assessments and high school level
35.29 	test results shall be available to districts for diagnostic purposes affecting student learning 
35.30 	and district instruction and curriculum, and for establishing educational accountability. 
35.31 	The commissioner must disseminate to the public the computer-adaptive assessments and 
35.32 	high school test results upon receiving those results.
35.33 	(d) State (e) The 3rd through 8th grade computer-adaptive assessments and 
35.34 	high school tests must be constructed and aligned with state academic standards. The
35.35 	commissioner shall determine the testing process and the order of administration shall be 
36.1 	determined by the commissioner. The statewide results shall be aggregated at the site and 
36.2 	district level, consistent with subdivision 1a.
36.3 	(e) (f) In addition to the testing and reporting requirements under this section, the 
36.4 	commissioner shall include the following components in the statewide public reporting 
36.5 	system:
36.6 	(1) uniform statewide testing of all students in grades 3 through 8 and at the high 
36.7 	school level that provides appropriate, technically sound accommodations, or alternate 
36.8 	assessments, or exemptions consistent with applicable federal law, only with parent or 
36.9 	guardian approval, for those very few students for whom the student's individual education 
36.10 	plan team under sections 125A.05 and 125A.06 determines that the general statewide test 
36.11 	is inappropriate for a student, or for a limited English proficiency student under section 
36.12 	124D.59, subdivision 2;
36.13 	(2) educational indicators that can be aggregated and compared across school 
36.14 	districts and across time on a statewide basis, including average daily attendance, high 
36.15 	school graduation rates, and high school drop-out rates by age and grade level;
36.16 	(3) state results on the American College Test; and
36.17 	(4) state results from participation in the National Assessment of Educational 
36.18 	Progress so that the state can benchmark its performance against the nation and other 
36.19 	states, and, where possible, against other countries, and contribute to the national effort 
36.20 	to monitor achievement.
36.21 		Subd. 1a.Statewide and local assessments; results. (a) For purposes of this 
36.22 	section, the following definitions have the meanings given them.
36.23 	(1) "Computer-adaptive assessments" means fully adaptive assessments or partially 
36.24 	adaptive assessments.
36.25 	(2) "Fully adaptive assessments" include test items that are on-grade level and items 
36.26 	that may be above or below a student's grade level.
36.27 	(3) "Partially adaptive assessments" include two portions of test items, where one 
36.28 	portion is limited to on-grade level test items and a second portion includes test items that 
36.29 	are on-grade level or above or below a student's grade level.
36.30 	(4) "On-grade level" test items contain subject area content that is aligned to state 
36.31 	academic standards for the grade level of the student taking the assessment.
36.32 	(5) "Above-grade level" test items contain subject area content that is above the grade 
36.33 	level of the student taking the assessment and are considered aligned with state academic 
36.34 	standards to the extent they are aligned with content represented in state academic 
36.35 	standards above the grade level of the student taking the assessment. Notwithstanding 
37.1 	the student's grade level, administering above-grade level test items to a student does not 
37.2 	violate the requirement that state assessments must be aligned with state standards.
37.3 	(6) "Below-grade level" test items contain subject area content that is below 
37.4 	the grade level of the student taking the test and are considered aligned with state 
37.5 	academic standards to the extent they are aligned with content represented in state 
37.6 	academic standards below the student's current grade level. Notwithstanding the student's 
37.7 	grade level, administering below-grade level test items to a student does not violate the 
37.8 	requirement that state assessments must be aligned with state standards.
37.9 	(b) The commissioner must use fully adaptive assessments to the extent no net loss 
37.10 	of federal and state funds occurs as a result of using these assessments. If a net loss of 
37.11 	federal and state funds were to occur under this subdivision, then the commissioner must 
37.12 	use partially adaptive assessments to meet existing federal educational accountability 
37.13 	requirements.
37.14 	(c) For purposes of conforming with existing federal educational accountability 
37.15 	requirements, the commissioner must develop and implement computer-adaptive reading,
37.16 	and mathematics, and science assessments for grades 3 through 8, state-developed 
37.17 	high school reading and mathematics tests aligned with state academic standards, and 
37.18 	science assessments under clause (2) that districts and sites must use to monitor student 
37.19 	growth toward achieving those standards. The commissioner must not develop statewide 
37.20 	assessments for academic standards in social studies, health and physical education, and 
37.21 	the arts. The commissioner must require:
37.22 	(1) annual computer-adaptive reading and mathematics assessments in grades 3 
37.23 	through 8, and at the high school level for the 2005-2006 school year and later high school 
37.24 	reading and mathematics tests; and
37.25 	(2) annual science assessments in one grade in the grades 3 through 5 span, the 
37.26 	grades 6 through 98 span, and a life sciences assessment in the grades 109 through 12 
37.27 	span for the 2007-2008 school year and later, and the commissioner must not require 
37.28 	students to achieve a passing score on high school science assessments as a condition of 
37.29 	receiving a high school diploma.
37.30 	The commissioner must ensure that for annual computer-adaptive assessments:
37.31 	(i) individual student performance data and achievement and summary reports are 
37.32 	available within three school days of when students take an assessment;
37.33 	(ii) growth information is available for each student from the student's first 
37.34 	assessment to each proximate assessment using a constant measurement scale;
37.35 	(iii) parents, teachers, and school administrators are able to use elementary and 
37.36 	middle school student performance data to project student achievement in high school; and
38.1 	(iv) useful diagnostic information about areas of students' academic strengths and 
38.2 	weaknesses is available to teachers and school administrators for purposes of improving 
38.3 	student instruction and indicating the specific skills and concepts that should be introduced 
38.4 	and developed for students at given score levels, organized by strands within subject areas, 
38.5 	and aligned to state academic standards.
38.6 	When contracting for computer-adaptive assessments under this section, the 
38.7 	weighting criteria the commissioner uses to evaluate contract proposals must give 
38.8 	preference to vendors prepared to provide statewide computer-adaptive assessments and 
38.9 	options for locally selected, locally financed, and locally implemented assessments that are 
38.10 	independently aligned to state standards and used to inform curriculum and instruction. 
38.11 	(b) (d) The commissioner must ensure that all statewide tests administered to 
38.12 	elementary and secondary students measure students' academic knowledge and skills and 
38.13 	not students' values, attitudes, and beliefs.
38.14 	(c) (e) Reporting of assessment results must:
38.15 	(1) provide timely, useful, and understandable information on the performance of 
38.16 	individual students, schools, school districts, and the state;
38.17 	(2) include, by no later than the 2008-2009 school year, a value-added component 
38.18 	that is in addition to a measure for student achievement growth over time growth indicator 
38.19 	of student achievement under section 120B.35, subdivision 3, paragraph (b); and
38.20 	(3)(i) for students enrolled in grade 8 before the 2005-2006 school year, determine 
38.21 	whether students have met the state's basic skills requirements; and
38.22 	(ii) for students enrolled in grade 8 in the 2005-2006 school year and later, determine 
38.23 	whether students have met the state's academic standards.
38.24 	(d) (f) Consistent with applicable federal law and subdivision 1, paragraph (d), 
38.25 	clause (1), the commissioner must include appropriate, technically sound accommodations 
38.26 	or alternative assessments for the very few students with disabilities for whom statewide 
38.27 	assessments are inappropriate and for students with limited English proficiency.
38.28 	(e) (g) A school, school district, and charter school must administer statewide 
38.29 	assessments under this section, as the assessments become available, to evaluate student 
38.30 	progress in achieving the proficiency in the context of the state's grade level academic 
38.31 	standards. If a state assessment is not available, a school, school district, and charter 
38.32 	school must determine locally if a student has met the required academic standards. A 
38.33 	school, school district, or charter school may use a student's performance on a statewide 
38.34 	assessment as one of multiple criteria to determine grade promotion or retention. A 
38.35 	school, school district, or charter school may use a high school student's performance on a 
39.1 	statewide assessment as a percentage of the student's final grade in a course, or place a 
39.2 	student's assessment score on the student's transcript.
39.3 	(h) For each procurement cycle for computer-adaptive assessments, the 
39.4 	commissioner must report to the K-12 education policy and finance committees of the 
39.5 	legislature on the costs of implementing computer-adaptive assessments and demonstrate 
39.6 	that these assessments both represent the greatest value to the state and local school 
39.7 	districts and minimize the need for redundant assessments.
39.8 		Subd. 2.Department of Education assistance. The Department of Education 
39.9 	shall contract for professional and technical services according to competitive bidding 
39.10 	procedures under chapter 16C for purposes of this section.
39.11 		Subd. 3.Reporting. The commissioner shall report test data publicly and to 
39.12 	stakeholders, including the performance achievement levels developed from students' 
39.13 	unweighted test scores in each tested subject and a listing of demographic factors that 
39.14 	strongly correlate with student performance. The commissioner shall also report data that 
39.15 	compares performance results among school sites, school districts, Minnesota and other 
39.16 	states, and Minnesota and other nations. The commissioner shall disseminate to schools 
39.17 	and school districts a more comprehensive report containing testing information that 
39.18 	meets local needs for evaluating instruction and curriculum.
39.19 		Subd. 4.Access to tests. The commissioner must adopt and publish a policy 
39.20 	to provide public and parental access for review of basic skills tests, Minnesota 
39.21 	Comprehensive Assessments, or any other such statewide test and assessment. Upon 
39.22 	receiving a written request, the commissioner must make available to parents or guardians 
39.23 	a copy of their student's actual responses to the test questions to be reviewed by the 
39.24 	parent for their review.

39.25 	EFFECTIVE DATE. This section is effective the day following final enactment. 
39.26 	Subdivision 1, paragraph (c), applies to the 2009-2010 through 2013-2014 school 
39.27 	years only. Notwithstanding any other law to the contrary, requirements related to the 
39.28 	mathematics graduation-required assessment for diploma under this section are repealed 
39.29 	June 30, 2014, and the commissioner of education must not implement any alternative to 
39.30 	the mathematics graduation-required assessment for diploma without specific legislative 
39.31 	authority. Requirements for using computer-adaptive mathematics assessments for grades 
39.32 	3 through 8 apply in the 2010-2011 school year and later and requirements for using 
39.33 	computer-adaptive reading assessments for grades 3 through 8 apply in the 2012-2013 
39.34 	school year and later. 

40.1 	Sec. 11. Minnesota Statutes 2008, section 120B.31, is amended to read:
40.2 	120B.31 SYSTEM ACCOUNTABILITY AND STATISTICAL 
40.3 	ADJUSTMENTS.
40.4 		Subdivision 1.Educational accountability and public reporting. Consistent 
40.5 	with the process direction to adopt a results-oriented graduation rule statewide academic 
40.6 	standards under section 120B.02, the department, in consultation with education and 
40.7 	other system stakeholders, must establish a coordinated and comprehensive system of 
40.8 	educational accountability and public reporting that promotes higher greater academic 
40.9 	achievement, preparation for higher academic education, preparation for the world of 
40.10 	work, citizenship under sections 120B.021, subdivision 1, clause (4), and 120B.024, 
40.11 	paragraph (a), clause (4), and the arts. 
40.12 		Subd. 2.Statewide testing. Each school year, all school districts shall give a 
40.13 	uniform statewide test to students at specified grades to provide information on the status, 
40.14 	needs and performance of Minnesota students.
40.15 		Subd. 3.Educational accountability. (a) The Independent Office of Educational 
40.16 	Accountability, as authorized by Laws 1997, First Special Session chapter 4, article 5, 
40.17 	section 28, subdivision 2, is established, and shall be funded through the Board of Regents 
40.18 	of the University of Minnesota. The office shall advise the education committees of the 
40.19 	legislature and the commissioner of education, at least on a biennial basis, on:
40.20 	(1) the degree to which the statewide educational accountability and reporting system 
40.21 	includes a comprehensive assessment framework that measures school accountability 
40.22 	for students achieving the goals described in the state's results-oriented high school
40.23 	graduation rule;
40.24 	(2) the completeness, integrity, and use of the information provided by the statewide 
40.25 	educational accountability and reporting system in the context of enabling legislators and 
40.26 	other stakeholders to make fully informed education policy decisions consistent with the 
40.27 	best and most current academic research available; and
40.28 	(3) the impact the statewide educational accountability and reporting system has on 
40.29 	prekindergarten through grade 12 education policy, effectiveness, resource distribution, 
40.30 	and structure. 
40.31 	(b) The office shall determine and annually report to the legislature whether and 
40.32 	how effectively: 
40.33 	(1) the statewide system of educational accountability utilizes uses multiple 
40.34 	indicators to provide valid and reliable comparative and contextual data on students, 
40.35 	schools, districts, and the state, and if not, recommend ways to improve the accountability 
40.36 	reporting system;
41.1 	(2) the commissioner makes statistical adjustments when reporting student data over 
41.2 	time, consistent with clause (4);
41.3 	(3) the commissioner uses indicators of student achievement growth a value-added 
41.4 	growth indicator of student achievement over time and a value-added assessment model 
41.5 	that estimates the effects of the school and school district on student achievement to 
41.6 	measure and measures school performance, consistent with section 120B.36, subdivision 
41.7 	1 120B.35, subdivision 3, paragraph (b);
41.8 	(4) the commissioner makes (3) data are available on students who do not pass one 
41.9 	or more of the state's required GRAD tests and do not receive a diploma as a consequence, 
41.10 	and categorizes these data are categorized according to gender, race, eligibility for free 
41.11 	or reduced lunch, and English language proficiency; and
41.12 	(5) the commissioner fulfills (4) the requirements under section 127A.095, 
41.13 	subdivision 2, are met.
41.14 	(b) (c) When the office reviews the statewide educational accountability and 
41.15 	reporting system, it shall also consider:
41.16 	(1) the objectivity and neutrality of the state's educational accountability system; and
41.17 	(2) the impact of a testing program on school curriculum and student learning.
41.18 		Subd. 4.Statistical adjustments; student performance data. In developing 
41.19 	policies and assessment processes to hold schools and districts accountable for high 
41.20 	levels of academic standards under section 120B.021, the commissioner shall aggregate 
41.21 	student data over time to report student performance and growth levels measured at the 
41.22 	school, school district, regional, or and statewide level. When collecting and reporting 
41.23 	the performance data, the commissioner shall: (1) acknowledge the impact of significant 
41.24 	demographic factors such as residential instability, the number of single parent families, 
41.25 	parents' level of education, and parents' income level on school outcomes; and (2) 
41.26 	organize and report the data so that state and local policy makers can understand the 
41.27 	educational implications of changes in districts' demographic profiles over time. Any 
41.28 	report the commissioner disseminates containing summary data on student performance 
41.29 	must integrate student performance and the demographic factors that strongly correlate 
41.30 	with that performance.

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

41.32 	Sec. 12. Minnesota Statutes 2008, section 120B.35, is amended to read:
41.33 	120B.35 STUDENT ACADEMIC ACHIEVEMENT AND PROGRESS
41.34 	GROWTH.
42.1 		Subdivision 1.Adequate yearly progress of schools and students School and 
42.2 	student indicators of growth and achievement. The commissioner must develop and 
42.3 	implement a system for measuring and reporting academic achievement and individual 
42.4 	student progress growth, consistent with the statewide educational accountability and 
42.5 	reporting system. The system components of the system must measure and separately 
42.6 	report the adequate yearly progress of schools and the growth of individual students: 
42.7 	students' current achievement in schools under subdivision 2; and individual students' 
42.8 	educational progress growth over time under subdivision 3. The system also must include 
42.9 	statewide measures of student academic achievement growth that identify schools with 
42.10 	high levels of achievement growth, and also schools with low levels of achievement
42.11 	growth that need improvement. When determining a school's effect, the data must 
42.12 	include both statewide measures of student achievement and, to the extent annual tests 
42.13 	are administered, indicators of achievement growth that take into account a student's 
42.14 	prior achievement. Indicators of achievement and prior achievement must be based on 
42.15 	highly reliable statewide or districtwide assessments. Indicators that take into account a 
42.16 	student's prior achievement must not be used to disregard a school's low achievement or to 
42.17 	exclude a school from a program to improve low achievement levels. The commissioner 
42.18 	by January 15, 2002, must submit a plan for integrating these components to the chairs of 
42.19 	the legislative committees having policy and budgetary responsibilities for elementary 
42.20 	and secondary education.
42.21 		Subd. 2.Federal expectations for student academic achievement. (a) Each school 
42.22 	year, a school district must determine if the student achievement levels at each school site 
42.23 	meet state and local federal expectations. If student achievement levels at a school site do 
42.24 	not meet state and local federal expectations and the site has not made adequate yearly 
42.25 	progress for two consecutive school years, beginning with the 2001-2002 school year, 
42.26 	the district must work with the school site to adopt a plan to raise student achievement 
42.27 	levels to meet state and local federal expectations. The commissioner of education shall 
42.28 	establish student academic achievement levels to comply with this paragraph.
42.29 	(b) School sites identified as not meeting federal expectations must develop 
42.30 	continuous improvement plans in order to meet state and local federal expectations for 
42.31 	student academic achievement. The department, at a district's request, must assist the 
42.32 	district and the school site in developing a plan to improve student achievement. The plan 
42.33 	must include parental involvement components.
42.34 	(c) The commissioner must:
42.35 	(1) provide assistance to assist school sites and districts identified as not meeting 
42.36 	federal expectations; and
43.1 	(2) provide technical assistance to schools that integrate student progress
43.2 	achievement measures under subdivision 3 in into the school continuous improvement 
43.3 	plan.
43.4 	(d) The commissioner shall establish and maintain a continuous improvement Web 
43.5 	site designed to make data on every school and district available to parents, teachers, 
43.6 	administrators, community members, and the general public.
43.7 		Subd. 3.Student progress assessment State growth target; other state measures.
 43.8 	(a) The state's educational assessment system component measuring individual students' 
43.9 	educational progress must be growth is based, to the extent annual tests are administered,
43.10 	on indicators of achievement growth that show an individual student's prior achievement. 
43.11 	Indicators of achievement and prior achievement must be based on highly reliable 
43.12 	statewide or districtwide assessments.
43.13 	(b) The commissioner, in consultation with a stakeholder group that includes 
43.14 	assessment and evaluation directors and staff and researchers must identify effective 
43.15 	models for measuring individual student progress that enable a school district or school 
43.16 	site to perform gains-based analysis, including evaluating the effects of the teacher, 
43.17 	school, and school district on student achievement over time. At least one model must 
43.18 	be a "value-added" assessment model that reliably estimates those effects for classroom 
43.19 	settings where a single teacher teaches multiple subjects to the same group of students, for 
43.20 	team teaching arrangements, and for other teaching circumstances. implement a model 
43.21 	that uses a value-added growth indicator and includes criteria for identifying schools 
43.22 	and school districts that demonstrate medium and high growth under section 120B.299, 
43.23 	subdivisions 8 and 9, and may recommend other value-added measures under section 
43.24 	120B.299, subdivision 3. The model may be used to advance educators' professional 
43.25 	development and replicate programs that succeed in meeting students' diverse learning 
43.26 	needs. Data on individual teachers generated under the model are personnel data under 
43.27 	section 13.43. The model must allow users to:
43.28 	(1) report student growth consistent with this paragraph; and
43.29 	(2) for all student categories, report and compare aggregated and disaggregated state 
43.30 	growth data using the nine student categories identified under the federal 2001 No Child 
43.31 	Left Behind Act and two student gender categories of male and female, respectively, 
43.32 	following appropriate reporting practices to protect nonpublic student data.
43.33 	The commissioner must report separate measures of student growth and proficiency, 
43.34 	consistent with this paragraph.
43.35 	(c) If a district has an accountability plan that includes gains-based analysis or 
43.36 	"value-added" assessment, the commissioner shall, to the extent practicable, incorporate 
44.1 	those measures in determining whether the district or school site meets expectations. The 
44.2 	department must coordinate with the district in evaluating school sites and continuous 
44.3 	improvement plans, consistent with best practices. When reporting student performance 
44.4 	under section 120B.36, subdivision 1, the commissioner annually, beginning July 1, 
44.5 	2011, must report two core measures indicating the extent to which current high school 
44.6 	graduates are being prepared for postsecondary academic and career opportunities:
44.7 	(1) a preparation measure indicating the number and percentage of high school 
44.8 	graduates in the most recent school year who completed course work important to 
44.9 	preparing them for postsecondary academic and career opportunities, consistent with 
44.10 	the core academic subjects required for admission to Minnesota's public colleges and 
44.11 	universities as determined by the Office of Higher Education under chapter 136A; and
44.12 	(2) a rigorous coursework measure indicating the number and percentage of high 
44.13 	school graduates in the most recent school year who successfully completed one or more 
44.14 	college-level advanced placement, international baccalaureate, postsecondary enrollment 
44.15 	options including concurrent enrollment, other rigorous courses of study under section 
44.16 	120B.021, subdivision 1a, or industry certification courses or programs.
44.17 	When reporting the core measures under clauses (1) and (2), the commissioner must also 
44.18 	analyze and report separate categories of information using the nine student categories 
44.19 	identified under the federal 2001 No Child Left Behind Act and two student gender 
44.20 	categories of male and female, respectively following appropriate reporting practices to 
44.21 	protect nonpublic student data.
44.22 	(d) When reporting student performance under section 120B.36, subdivision 1, the 
44.23 	commissioner annually, beginning July 1, 2013, must report summary data on school 
44.24 	safety and students' engagement and connection at school. The summary data under this 
44.25 	paragraph are separate from and must not be used for any purpose related to measuring 
44.26 	or evaluating the performance of classroom teachers. The commissioner, in consultation 
44.27 	with qualified experts on student engagement and connection and classroom teachers, 
44.28 	must identify highly reliable variables that generate summary data under this paragraph. 
44.29 	The summary data may be used at school, district, and state levels only. Any data on 
44.30 	individuals received, collected, or created that are used to generate the summary data 
44.31 	under this paragraph are nonpublic data under section 13.02, subdivision 9.
44.32 		Subd. 4.Improving schools. Consistent with the requirements of this section, 
44.33 	beginning June 20, 2012, the commissioner of education must establish a second 
44.34 	achievement benchmark to identify improving schools. The commissioner must 
44.35 	recommend to annually report to the public and the legislature by February 15, 2002, 
44.36 	indicators in addition to the achievement benchmark for identifying improving schools, 
45.1 	including an indicator requiring a school to demonstrate ongoing successful use of best 
45.2 	teaching practices the organizational and curricular practices implemented in those schools 
45.3 	that demonstrate medium and high growth compared to the state growth target.
45.4 		Subd. 5.Improving graduation rates for students with emotional or behavioral 
45.5 	disorders. (a) A district must develop strategies in conjunction with parents of students 
45.6 	with emotional or behavioral disorders and the county board responsible for implementing 
45.7 	sections 245.487 to 245.4889 to keep students with emotional or behavioral disorders in 
45.8 	school, when the district has a drop-out rate for students with an emotional or behavioral 
45.9 	disorder in grades 9 through 12 exceeding 25 percent. 
45.10 	(b) A district must develop a plan in conjunction with parents of students with 
45.11 	emotional or behavioral disorders and the local mental health authority to increase the 
45.12 	graduation rates of students with emotional or behavioral disorders. A district with a 
45.13 	drop-out rate for children with an emotional or behavioral disturbance in grades 9 through 
45.14 	12 that is in the top 25 percent of all districts shall submit a plan for review and oversight 
45.15 	to the commissioner.

45.16 	EFFECTIVE DATE. Subdivision 3, paragraph (b), applies to students in the 
45.17 	2008-2009 school year and later. Subdivision 3, paragraph (c), applies to students in the 
45.18 	2010-2011 school year and later. Subdivision 3, paragraph (d), applies to data that are 
45.19 	collected in the 2010-2011 school year and later and reported annually beginning July 1, 
45.20 	2013, consistent with advice the commissioner receives from recognized and qualified 
45.21 	experts on student engagement and connection and classroom teachers. Subdivision 4 
45.22 	applies in the 2011-2012 school year and later.

45.23 	Sec. 13. Minnesota Statutes 2008, section 120B.36, is amended to read:
45.24 	120B.36 SCHOOL ACCOUNTABILITY; APPEALS PROCESS.
45.25 		Subdivision 1.School performance report cards. (a) The commissioner shall use 
45.26 	objective criteria based on levels of student performance to report at least student academic 
45.27 	performance under section 120B.35, subdivision 2, the percentages of students showing 
45.28 	low, medium, and high growth under section 120B.35, subdivision 3, paragraph (b), 
45.29 	school safety and student engagement and connection under section 120B.35, subdivision 
45.30 	3, paragraph (d), rigorous coursework under section 120B.35, subdivision 3, paragraph 
45.31 	(c), two separate student-to-teacher ratios that clearly indicate the definition of teacher 
45.32 	consistent with sections 122A.06 and 122A.15 for purposes of determining these ratios, 
45.33 	and staff characteristics excluding salaries, with a value-added component added no later 
45.34 	than the 2008-2009 school year student enrollment demographics, district mobility, and 
46.1 	extracurricular activities. The report also must indicate a school's adequate yearly progress 
46.2 	status, and must not set any designations applicable to high- and low-performing schools 
46.3 	due solely to adequate yearly progress status.
46.4 	(b) The commissioner shall develop, annually update, and post on the department 
46.5 	Web site school performance report cards. 
46.6 	(c) The commissioner must make available the first performance report cards by 
46.7 	November 2003, and during the beginning of each school year thereafter.
46.8 	(d) A school or district may appeal its adequate yearly progress status in writing to 
46.9 	the commissioner within 30 days of receiving the notice of its status. The commissioner's 
46.10 	decision to uphold or deny an appeal is final.
46.11 	(e) School performance report cards card data are nonpublic data under section 
46.12 	13.02, subdivision 9, until not later than ten days after the appeal procedure described in 
46.13 	paragraph (d) concludes. The department shall annually post school performance report 
46.14 	cards to its public Web site no later than September 1. 
46.15 		Subd. 2.Adequate yearly progress and other data. All data the department 
46.16 	receives, collects, or creates for purposes of determining to determine adequate yearly 
46.17 	progress designations status under Public Law 107-110, section 1116, set state growth 
46.18 	targets, and determine student growth are nonpublic data under section 13.02, subdivision 
46.19 	9, until not later than ten days after the appeal procedure described in subdivision 1, 
46.20 	paragraph (d), concludes. Districts must provide parents sufficiently detailed summary 
46.21 	data to permit parents to appeal under Public Law 107-110, section 1116(b)(2). The 
46.22 	department shall annually post federal adequate yearly progress data and state student 
46.23 	growth data to its public Web site no later than September 1. 

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

46.25 	Sec. 14. [120B.3625] QUALITY ACHIEVEMENT IN MINNESOTA SCHOOLS.
46.26 	(a) To improve K-12 educational achievements in Minnesota, schools and 
46.27 	school districts are encouraged to participate in the Minnesota Council for Quality's 
46.28 	organizational assessment and performance improvement process and learn how to 
46.29 	enhance organizational structures and processes, eliminate barriers to students' improved 
46.30 	educational performance, and increase teaching effectiveness and administrative 
46.31 	efficiency. Schools and school districts that achieve improved performance are encouraged 
46.32 	to disseminate information and provide guidance to interested educators about how they 
46.33 	achieved that improvement.
46.34 	(b) The commissioner may recognize schools and school districts that participate 
46.35 	in the Minnesota Council for Quality's organizational assessment and performance 
47.1 	improvement process, receive Minnesota Council for Quality recognition at the 
47.2 	"commitment" level or higher, and implement action plans to continue improvements in 
47.3 	student learning and school performance, consistent with this chapter.

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

47.5 	Sec. 15. Minnesota Statutes 2008, section 121A.15, subdivision 8, is amended to read:
47.6 		Subd. 8.Report. The administrator or other person having general control and 
47.7 	supervision of the elementary or secondary school shall file a report with the commissioner 
47.8 	on all persons enrolled in the school. The superintendent of each district shall file a report 
47.9 	with the commissioner for all persons within the district receiving instruction in a home 
47.10 	school in compliance with sections 120A.22 and 120A.24. The parent of persons receiving 
47.11 	instruction in a home school shall submit the statements as required by subdivisions 1, 2, 
47.12 	3, and 4 to the superintendent of the district in which the person resides by October 1 of 
47.13 	each school year the first year of their home schooling and the 7th grade year. The school 
47.14 	report must be prepared on forms developed jointly by the commissioner of health and the 
47.15 	commissioner of education and be distributed to the local districts by the commissioner 
47.16 	of health. The school report must state the number of persons attending the school, the 
47.17 	number of persons who have not been immunized according to subdivision 1 or 2, and 
47.18 	the number of persons who received an exemption under subdivision 3, clause (c) or (d). 
47.19 	The school report must be filed with the commissioner of education within 60 days of the 
47.20 	commencement of each new school term. Upon request, a district must be given a 60-day 
47.21 	extension for filing the school report. The commissioner of education shall forward the 
47.22 	report, or a copy thereof, to the commissioner of health who shall provide summary 
47.23 	reports to boards of health as defined in section 145A.02, subdivision 2. The administrator 
47.24 	or other person having general control and supervision of the child care facility shall file a 
47.25 	report with the commissioner of human services on all persons enrolled in the child care 
47.26 	facility. The child care facility report must be prepared on forms developed jointly by 
47.27 	the commissioner of health and the commissioner of human services and be distributed 
47.28 	to child care facilities by the commissioner of health. The child care facility report 
47.29 	must state the number of persons enrolled in the facility, the number of persons with no 
47.30 	immunizations, the number of persons who received an exemption under subdivision 3, 
47.31 	clause (c) or (d), and the number of persons with partial or full immunization histories. 
47.32 	The child care facility report must be filed with the commissioner of human services by 
47.33 	November 1 of each year. The commissioner of human services shall forward the report, 
47.34 	or a copy thereof, to the commissioner of health who shall provide summary reports to 
47.35 	boards of health as defined in section 145A.02, subdivision 2. The report required by this 
48.1 	subdivision is not required of a family child care or group family child care facility, for 
48.2 	prekindergarten children enrolled in any elementary or secondary school provided services 
48.3 	according to sections 125A.05 and 125A.06, nor for child care facilities in which at least 
48.4 	75 percent of children in the facility participate on a onetime only or occasional basis to a 
48.5 	maximum of 45 hours per child, per month. 

48.6 	Sec. 16. Minnesota Statutes 2008, section 122A.07, subdivision 2, is amended to read:
48.7 		Subd. 2.Eligibility; board composition. Except for the representatives of higher 
48.8 	education and the public, to be eligible for appointment to the Board of Teaching a person 
48.9 	must be a teacher currently teaching in a Minnesota school and fully licensed for the 
48.10 	position held and have at least five years teaching experience in Minnesota, including the 
48.11 	two years immediately preceding nomination and appointment. Each nominee, other than 
48.12 	a public nominee, must be selected on the basis of professional experience and knowledge 
48.13 	of teacher education, accreditation, and licensure. The board must be composed of:
48.14 	(1) six teachers who are currently teaching in a Minnesota school or who were 
48.15 	teaching at the time of the appointment, at least four of whom must be teaching in a 
48.16 	public school;
48.17 	(2) one higher education representative, who must be a faculty member preparing 
48.18 	teachers;
48.19 	(3) one school administrator; and
48.20 	(4) three members of the public, two of whom must be present or former members 
48.21 	of school boards.

48.22 	Sec. 17. Minnesota Statutes 2008, section 122A.07, subdivision 3, is amended to read:
48.23 		Subd. 3.Vacant position. With the exception of a teacher who retires from teaching 
48.24 	during the course of completing a board term, the position of a member who leaves 
48.25 	Minnesota or whose employment status changes to a category different from that from 
48.26 	which appointed is deemed vacant.

48.27 	Sec. 18. Minnesota Statutes 2008, section 122A.18, subdivision 4, is amended to read:
48.28 		Subd. 4.Expiration and renewal. (a) Each license the Department of Education 
48.29 	issues through its licensing section must bear the date of issue. Licenses must expire 
48.30 	and be renewed according to the respective rules the Board of Teaching, the Board 
48.31 	of School Administrators, or the commissioner of education adopts. Requirements for 
48.32 	renewing a license must include showing satisfactory evidence of successful teaching or 
48.33 	administrative experience for at least one school year during the period covered by the 
49.1 	license in grades or subjects for which the license is valid or completing such additional 
49.2 	preparation as the Board of Teaching prescribes. The Board of School Administrators 
49.3 	shall establish requirements for renewing the licenses of supervisory personnel except 
49.4 	athletic coaches. The State Board of Teaching shall establish requirements for renewing 
49.5 	the licenses of athletic coaches.
49.6 	(b) Relicensure applicants, as a condition of relicensure, must present to their 
49.7 	local continuing education and relicensure committee or other local relicensure 
49.8 	committee evidence of work that demonstrates professional reflection and growth in best 
49.9 	teaching practices. The applicant must include a reflective statement of professional 
49.10 	accomplishment and the applicant's own assessment of professional growth showing 
49.11 	evidence of:
49.12 	(1) support for student learning;
49.13 	(2) use of best practices techniques and their applications to student learning;
49.14 	(3) collaborative work with colleagues that includes examples of collegiality such as 
49.15 	attested-to committee work, collaborative staff development programs, and professional 
49.16 	learning community work; or
49.17 	(4) continual professional development that may include job-embedded or other 
49.18 	ongoing formal professional learning during the relicensure period.
49.19 	The Board of Teaching must ensure that its teacher relicensing requirements also include 
49.20 	this paragraph.
49.21 	(b) (c) The Board of Teaching shall offer alternative continuing relicensure options 
49.22 	for teachers who are accepted into and complete the National Board for Professional 
49.23 	Teaching Standards certification process, and offer additional continuing relicensure 
49.24 	options for teachers who earn National Board for Professional Teaching Standards 
49.25 	certification. Continuing relicensure requirements for teachers who do not maintain 
49.26 	National Board for Professional Teaching Standards certification are those the board 
49.27 	prescribes, consistent with this section.

49.28 	EFFECTIVE DATE. This section is effective the day following final enactment 
49.29 	and applies to licensees seeking relicensure beginning July 1, 2012.

49.30 	Sec. 19. Minnesota Statutes 2008, section 122A.40, subdivision 6, is amended to read:
49.31 		Subd. 6.Peer review Mentoring for probationary teachers. A school board and 
49.32 	an exclusive representative of the teachers in the district must develop a probationary 
49.33 	teacher peer review process through joint agreement. The process may include having 
50.1 	trained observers serve as mentors or coaches or having teachers participate in professional 
50.2 	learning communities.

50.3 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
50.4 	later.

50.5 	Sec. 20. Minnesota Statutes 2008, section 122A.40, subdivision 8, is amended to read:
50.6 		Subd. 8.Peer review coaching for continuing contract teachers. A school board 
50.7 	and an exclusive representative of the teachers in the district shall develop a peer review 
50.8 	process for continuing contract teachers through joint agreement. The process may 
50.9 	include having trained observers serve as peer coaches or having teachers participate in 
50.10 	professional learning communities.

50.11 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
50.12 	later.

50.13 	Sec. 21. Minnesota Statutes 2008, section 122A.41, subdivision 3, is amended to read:
50.14 		Subd. 3.Peer review Mentoring for probationary teachers. A board and an 
50.15 	exclusive representative of the teachers in the district must develop a probationary teacher 
50.16 	peer review process through joint agreement. The process may include having trained 
50.17 	observers serve as mentors or coaches or having teachers participate in professional 
50.18 	learning communities.

50.19 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
50.20 	later.

50.21 	Sec. 22. Minnesota Statutes 2008, section 122A.41, subdivision 5, is amended to read:
50.22 		Subd. 5.Peer review coaching for continuing contract teachers. A school 
50.23 	board and an exclusive representative of the teachers in the district must develop a peer 
50.24 	review process for nonprobationary teachers through joint agreement. The process may 
50.25 	include having trained observers serve as peer coaches or having teachers participate in 
50.26 	professional learning communities.

50.27 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
50.28 	later.

50.29 	Sec. 23. Minnesota Statutes 2008, section 122A.413, subdivision 2, is amended to read:
51.1 		Subd. 2.Plan components. The educational improvement plan must be approved 
51.2 	by the school board and have at least these elements:
51.3 	(1) assessment and evaluation tools to measure student performance and progress;
51.4 	(2) performance goals and benchmarks for improvement;
51.5 	(3) measures of student attendance and completion rates;
51.6 	(4) a rigorous research and practice-based professional development system, based 
51.7 	on national and state standards of effective teaching practice and consistent with section 
51.8 	122A.60, that is aligned with educational improvement, and designed to achieve ongoing 
51.9 	and schoolwide progress and growth in teaching quality improvement, and consistent with 
51.10 	clearly defined research-based standards practice;
51.11 	(5) measures of student, family, and community involvement and satisfaction;
51.12 	(6) a data system about students and their academic progress that provides parents 
51.13 	and the public with understandable information;
51.14 	(7) a teacher induction and mentoring program for probationary teachers that 
51.15 	provides continuous learning and sustained teacher support; and
51.16 	(8) substantial participation by the exclusive representative of the teachers in 
51.17 	developing the plan.

51.18 	EFFECTIVE DATE. This section is effective the day following final enactment 
51.19 	and applies to plans developed in the 2009-2010 school year and later.

51.20 	Sec. 24. Minnesota Statutes 2008, section 122A.414, subdivision 2, is amended to read:
51.21 		Subd. 2.Alternative teacher professional pay system. (a) To participate in this 
51.22 	program, a school district, intermediate school district, school site, or charter school must 
51.23 	have an educational improvement plan under section 122A.413 and an alternative teacher 
51.24 	professional pay system agreement under paragraph (b). A charter school participant also 
51.25 	must comply with subdivision 2a.
51.26 	(b) The alternative teacher professional pay system agreement must:
51.27 	(1) describe how teachers can achieve career advancement and additional 
51.28 	compensation;
51.29 	(2) describe how the school district, intermediate school district, school site, or 
51.30 	charter school will provide teachers with career advancement options that allow teachers 
51.31 	to retain primary roles in student instruction and facilitate site-focused professional 
51.32 	development that helps other teachers improve their skills;
51.33 	(3) reform the "steps and lanes" salary schedule, prevent any teacher's compensation 
51.34 	paid before implementing the pay system from being reduced as a result of participating 
52.1 	in this system, and base at least 60 percent of any compensation increase on teacher 
52.2 	performance using:
52.3 	(i) schoolwide student achievement gains under section 120B.35 or locally selected 
52.4 	standardized assessment outcomes, or both;
52.5 	(ii) measures of student achievement; and
52.6 	(iii) an objective evaluation program and evidence of effective practice that includes
52.7 	include:
52.8 	(A) individual teacher evaluations aligned with the educational improvement plan 
52.9 	under section 122A.413 and the staff development plan under section 122A.60; and
52.10 	(B) objective evaluations using multiple criteria conducted by a locally selected and 
52.11 	periodically trained evaluation team that understands teaching and learning including
52.12 	a professional framework outlined in teacher evaluation best practices, supported by 
52.13 	multiple criteria, and conducted in a professional and supportive environment; and
52.14 	(c) reflection and growth in best teaching practices shown through support for 
52.15 	student learning, collaborative work with colleagues, or continual professional learning, 
52.16 	consistent with section 122A.18, subdivision 4, paragraph (b), clauses (1) to (3);
52.17 	(4) provide integrated ongoing site-based professional development activities to 
52.18 	improve instructional skills and learning that are aligned with student needs under section 
52.19 	122A.413, consistent with the staff development plan under section 122A.60 and led 
52.20 	during the school day by trained teacher leaders such as master or mentor teachers or 
52.21 	peer coaches;
52.22 	(5) allow any teacher in a participating school district, intermediate school district, 
52.23 	school site, or charter school that implements an alternative pay system to participate in 
52.24 	that system without any quota or other limit; and
52.25 	(6) encourage collaboration rather than competition among teachers.

52.26 	EFFECTIVE DATE. This section is effective the day following final enactment 
52.27 	and applies to all alternative teacher professional pay system agreements entered into or 
52.28 	modified after that date.

52.29 	Sec. 25. Minnesota Statutes 2008, section 122A.414, subdivision 2b, is amended to 
52.30 	read:
52.31 		Subd. 2b.Approval process. (a) Consistent with the requirements of this section 
52.32 	and sections 122A.413 and 122A.415, the department must prepare and transmit to 
52.33 	interested school districts, intermediate school districts, school sites, and charter schools 
52.34 	a standard form for applying to participate in the alternative teacher professional pay 
52.35 	system. The commissioner annually must establish three dates as deadlines by which 
53.1 	interested applicants must submit an application to the commissioner under this section. 
53.2 	An interested school district, intermediate school district, school site, or charter school 
53.3 	must submit to the commissioner a completed application executed by the district 
53.4 	superintendent and the exclusive bargaining representative of the teachers if the applicant 
53.5 	is a school district, intermediate school district, or school site, or executed by the charter 
53.6 	school board of directors if the applicant is a charter school. The application must include 
53.7 	the proposed alternative teacher professional pay system agreement under subdivision 
53.8 	2. The department must convene a review committee that at least includes teachers 
53.9 	and administrators a completed application within 30 days of receiving a completed 
53.10 	application to the most recent application deadline and recommend to the commissioner 
53.11 	whether to approve or disapprove the application. The commissioner must approve 
53.12 	applications on a first-come, first-served basis. The applicant's alternative teacher 
53.13 	professional pay system agreement must be legally binding on the applicant and the 
53.14 	collective bargaining representative before the applicant receives alternative compensation 
53.15 	revenue. The commissioner must approve or disapprove an application based on the 
53.16 	requirements under subdivisions 2 and 2a.
53.17 	(b) If the commissioner disapproves an application, the commissioner must give the 
53.18 	applicant timely notice of the specific reasons in detail for disapproving the application. 
53.19 	The applicant may revise and resubmit its application and related documents to the 
53.20 	commissioner within 30 days of receiving notice of the commissioner's disapproval and 
53.21 	the commissioner must approve or disapprove the revised application, consistent with this 
53.22 	subdivision. Applications that are revised and then approved are considered submitted on 
53.23 	the date the applicant initially submitted the application.

53.24 	EFFECTIVE DATE. This section is effective the day following final enactment 
53.25 	and applies to all applications submitted after that date.

53.26 	Sec. 26. Minnesota Statutes 2008, section 122A.60, subdivision 2, is amended to read:
53.27 		Subd. 2.Contents of the plan. The plan must include the staff development 
53.28 	outcomes under subdivision 3, the means to achieve the outcomes, and procedures for 
53.29 	evaluating progress at each school site toward meeting education outcomes., consistent 
53.30 	with relicensure requirements under section 122A.18, subdivision 2, paragraph (b). The 
53.31 	plan also must:
53.32 	(1) support stable and productive professional communities achieved through 
53.33 	ongoing and schoolwide progress and growth in teaching practice;
53.34 	(2) emphasize coaching, professional learning communities, classroom action 
53.35 	research, and other job-embedded models;
54.1 	(3) maintain a strong subject matter focus premised on students' learning goals;
54.2 	(4) ensure specialized preparation and learning about issues related to teaching 
54.3 	students with special needs and limited English proficiency; and
54.4 	(5) reinforce national and state standards of effective teaching practice.

54.5 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
54.6 	later.

54.7 	Sec. 27. Minnesota Statutes 2008, section 123A.05, is amended to read:
54.8 	123A.05 AREA LEARNING CENTER STATE-APPROVED ALTERNATIVE 
54.9 	PROGRAM ORGANIZATION.
54.10 		Subdivision 1.Governance. (a) A district may establish an area learning center 
54.11 	either by itself or in cooperation with other districts, alternative learning program, or 
54.12 	contract alternative in accordance with sections 124D.68, subdivision 3, paragraph (d), 
54.13 	and 124D.69.
54.14 	(b) An area learning center is encouraged to cooperate with a service cooperative, an 
54.15 	intermediate school district, a local education and employment transitions partnership, 
54.16 	public and private secondary and postsecondary institutions, public agencies, businesses, 
54.17 	and foundations. Except for a district located in a city of the first class, a an area 
54.18 	learning center must be established in cooperation with other districts and must serve 
54.19 	the geographic area of at least two districts. An area learning center must provide 
54.20 	comprehensive educational services to enrolled secondary students throughout the year, 
54.21 	including a daytime school within a school or separate site for both high school and 
54.22 	middle school level students.
54.23 	(c) An alternative learning program may serve the students of one or more districts, 
54.24 	may designate which grades are served, and may make program hours and a calendar 
54.25 	optional.
54.26 	(d) A contract alternative is an alternative learning program operated by a private 
54.27 	organization that has contracted with a school district to provide educational services for 
54.28 	students under section 124D.68, subdivision 2.
54.29 		Subd. 2.Reserve revenue. Each district that is a member of an area learning center 
54.30 	or alternative learning program must reserve revenue in an amount equal to the sum of (1) 
54.31 	at least 90 percent of the district average general education revenue per pupil unit minus 
54.32 	an amount equal to the product of the formula allowance according to section 126C.10, 
54.33 	subdivision 2, times .0485, calculated without basic skills revenue and transportation 
54.34 	sparsity revenue, times the number of pupil units attending an area learning center or 
55.1 	alternative learning program under this section, plus (2) the amount of basic skills revenue 
55.2 	generated by pupils attending the area learning center or alternative learning program. The 
55.3 	amount of reserved revenue under this subdivision may only be spent on program costs 
55.4 	associated with the area learning center or alternative learning program.
55.5 		Subd. 3.Access to services. A center state-approved alternative program shall have 
55.6 	access to the district's regular education programs, special education programs, technology 
55.7 	facilities, and staff. It may contract with individuals or postsecondary institutions. It shall 
55.8 	seek the involvement of community education programs, postsecondary institutions, 
55.9 	interagency collaboratives, culturally based organizations, mutual assistance associations, 
55.10 	and other community resources, businesses, and other federal, state, and local public 
55.11 	agencies.
55.12 		Subd. 4.Nonresident pupils. A pupil who does not reside in the district may 
55.13 	attend a center state-approved alternative program without consent of the school board of 
55.14 	the district of residence.

55.15 	Sec. 28. Minnesota Statutes 2008, section 123A.06, is amended to read:
55.16 	123A.06 CENTER STATE-APPROVED ALTERNATIVE PROGRAMS AND 
55.17 	SERVICES.
55.18 		Subdivision 1.Program focus. (a) The programs and services of a center
55.19 	state-approved alternative program must focus on academic and learning skills, applied 
55.20 	learning opportunities, trade and vocational skills, work-based learning opportunities, 
55.21 	work experience, youth service to the community, transition services, and English 
55.22 	language and literacy programs for children whose primary language is a language other 
55.23 	than English. Applied learning, work-based learning, and service learning may best be 
55.24 	developed in collaboration with a local education and transitions partnership, culturally 
55.25 	based organizations, mutual assistance associations, or other community resources. 
55.26 	In addition to offering programs, the center state-approved alternative program shall 
55.27 	coordinate the use of other available educational services, special education services, 
55.28 	social services, health services, and postsecondary institutions in the community and 
55.29 	services area.
55.30 	(b) Consistent with the requirements of sections 121A.40 to 121A.56, a school 
55.31 	district may provide an alternative education program for a student who is within the 
55.32 	compulsory attendance age under section 120A.20, and who is involved in severe or 
55.33 	repeated disciplinary action. 
55.34 		Subd. 2.People to be served. A center state-approved alternative program shall 
55.35 	provide programs for secondary pupils and adults. A center may also provide programs 
56.1 	and services for elementary and secondary pupils who are not attending the center
56.2 	state-approved alternative program to assist them in being successful in school. A center 
56.3 	shall use research-based best practices for serving limited English proficient students and 
56.4 	their parents. An individual education plan team may identify a center state-approved 
56.5 	alternative program as an appropriate placement to the extent a center state-approved 
56.6 	alternative program can provide the student with the appropriate special education services 
56.7 	described in the student's plan. Pupils eligible to be served are those who qualify under 
56.8 	the graduation incentives program in section 124D.68, subdivision 2, those enrolled 
56.9 	under section 124D.02, subdivision 2, or those pupils who are eligible to receive special 
56.10 	education services under sections 125A.03 to 125A.24, and 125A.65. 
56.11 		Subd. 3.Hours of instruction exemption. Notwithstanding any law to the contrary, 
56.12 	the area learning center programs must be available throughout the entire year. A center 
56.13 	may petition the state board under Minnesota Rules, part 3500.1000, for exemption from 
56.14 	other rules.
56.15 		Subd. 4.Granting a diploma. Upon successful completion of the area learning 
56.16 	center program, a pupil is entitled to receive a high school diploma. The pupil may elect 
56.17 	to receive a diploma from either the district of residence or the district in which the area 
56.18 	learning center is located.

56.19 	Sec. 29. Minnesota Statutes 2008, section 123A.08, is amended to read:
56.20 	123A.08 CENTER STATE-APPROVED ALTERNATIVE PROGRAM
56.21 	FUNDING.
56.22 		Subdivision 1.Outside sources for resources and services. A center
56.23 	state-approved alternative program may accept:
56.24 	(1) resources and services from postsecondary institutions serving center
56.25 	state-approved alternative program pupils;
56.26 	(2) resources from Job Training Partnership Workforce Investment Act programs, 
56.27 	including funding for jobs skills training for various groups and the percentage reserved 
56.28 	for education;
56.29 	(3) resources from the Department of Human Services and county welfare funding;
56.30 	(4) resources from a local education and employment transitions partnership; or
56.31 	(5) private resources, foundation grants, gifts, corporate contributions, and other 
56.32 	grants.
56.33 		Subd. 2.General education aid. Payment of general education aid for nonresident 
56.34 	pupils enrolled in the center area learning centers and alternative learning programs must 
56.35 	be made according to section 127A.47, subdivision 7.
57.1 		Subd. 3.Special education revenue. Payment of special education revenue for 
57.2 	nonresident pupils enrolled in the center state-approved alternative program must be made 
57.3 	according to section 125A.15 127A.47, subdivision 7.

57.4 	Sec. 30. Minnesota Statutes 2008, section 123B.03, subdivision 1, is amended to read:
57.5 		Subdivision 1.Background check required. (a) A school hiring authority shall 
57.6 	request a criminal history background check from the superintendent of the Bureau of 
57.7 	Criminal Apprehension on all individuals who are offered employment in a school and 
57.8 	on all individuals, except enrolled student volunteers, who are offered the opportunity to 
57.9 	provide athletic coaching services or other extracurricular academic coaching services 
57.10 	to a school, regardless of whether any compensation is paid. In order for an individual 
57.11 	to be eligible for employment or to provide the services, the individual must provide an 
57.12 	executed criminal history consent form and a money order or check payable to either the 
57.13 	Bureau of Criminal Apprehension or the school hiring authority, at the discretion of the 
57.14 	school hiring authority, in an amount equal to the actual cost to the Bureau of Criminal 
57.15 	Apprehension and the school district of conducting the criminal history background 
57.16 	check. A school hiring authority deciding to receive payment may, at its discretion, accept 
57.17 	payment in the form of a negotiable instrument other than a money order or check and 
57.18 	shall pay the superintendent of the Bureau of Criminal Apprehension directly to conduct 
57.19 	the background check. The superintendent of the Bureau of Criminal Apprehension shall 
57.20 	conduct the background check by retrieving criminal history data maintained in the 
57.21 	criminal justice information system computers. A school hiring authority, at its discretion, 
57.22 	may decide not to request a criminal history background check on an individual who holds 
57.23 	an initial entrance license issued by the State Board of Teaching or the commissioner of 
57.24 	education within the 12 months preceding an offer of employment.
57.25 	(b) A school hiring authority may use the results of a criminal background check 
57.26 	conducted at the request of another school hiring authority if:
57.27 	(1) the results of the criminal background check are on file with the other school 
57.28 	hiring authority or otherwise accessible;
57.29 	(2) the other school hiring authority conducted a criminal background check within 
57.30 	the previous 12 months;
57.31 	(3) the individual who is the subject of the criminal background check executes a 
57.32 	written consent form giving a school hiring authority access to the results of the check; and
57.33 	(4) there is no reason to believe that the individual has committed an act subsequent 
57.34 	to the check that would disqualify the individual for employment.
58.1 	(c) A school hiring authority may, at its discretion, request a criminal history 
58.2 	background check from the superintendent of the Bureau of Criminal Apprehension on 
58.3 	any individual who seeks to enter a school or its grounds for the purpose of serving as a 
58.4 	school volunteer or working as an independent contractor or student employee. In order 
58.5 	for an individual to enter a school or its grounds under this paragraph when the school 
58.6 	hiring authority decides to request a criminal history background check on the individual, 
58.7 	the individual first must provide an executed criminal history consent form and a money 
58.8 	order, check, or other negotiable instrument payable to the school district in an amount 
58.9 	equal to the actual cost to the Bureau of Criminal Apprehension and the school district 
58.10 	of conducting the criminal history background check. Notwithstanding section 299C.62, 
58.11 	subdivision 1, the cost of the criminal history background check under this paragraph is 
58.12 	the responsibility of the individual A school hiring authority may decide to pay the cost of 
58.13 	conducting a background check under this paragraph, in which case the individual who is 
58.14 	the subject of the background check need not pay for the background check.
58.15 	(d) For all nonstate residents who are offered employment in a school, a school 
58.16 	hiring authority shall request a criminal history background check on such individuals 
58.17 	from the superintendent of the Bureau of Criminal Apprehension and from the government 
58.18 	agency performing the same function in the resident state or, if no government entity 
58.19 	performs the same function in the resident state, from the Federal Bureau of Investigation. 
58.20 	Such individuals must provide an executed criminal history consent form and a money 
58.21 	order, check, or other negotiable instrument payable to the school hiring authority in an 
58.22 	amount equal to the actual cost to the government agencies and the school district of 
58.23 	conducting the criminal history background check. Notwithstanding section 299C.62, 
58.24 	subdivision 1, the cost of the criminal history background check under this paragraph is 
58.25 	the responsibility of the individual.
58.26 	(e) At the beginning of each school year or when a student enrolls, a school hiring 
58.27 	authority must notify parents and guardians about the school hiring authority's policy 
58.28 	requiring a criminal history background check on employees and other individuals who 
58.29 	provide services to the school, and identify those positions subject to a background check 
58.30 	and the extent of the hiring authority's discretion in requiring a background check. The 
58.31 	school hiring authority may include the notice in the student handbook, a school policy 
58.32 	guide, or other similar communication. Nothing in this paragraph affects a school hiring 
58.33 	authority's ability to request a criminal history background check on an individual under 
58.34 	paragraph (c).

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

59.1 	Sec. 31. Minnesota Statutes 2008, section 123B.03, subdivision 1a, is amended to read:
59.2 		Subd. 1a.Investigation of disciplinary actions taken against prospective 
59.3 	teachers. (a) At the time a school board or other hiring authority conducts the criminal 
59.4 	history background check required under subdivision 1 on an individual offered 
59.5 	employment as a teacher, the school board or other hiring authority must contact the 
59.6 	Board of Teaching to determine whether the board has taken disciplinary action against 
59.7 	the teacher based on a board determination that sexual misconduct or attempted sexual 
59.8 	misconduct occurred between the teacher and a student or other misconduct resulting in 
59.9 	board disciplinary action. If disciplinary action has been taken based on this type of
59.10 	misconduct, the school board or other hiring authority must obtain access to data that are 
59.11 	public under section 13.41, subdivision 5, that relate to the substance of the disciplinary 
59.12 	action. In addition, the school board or other hiring authority must require the individual 
59.13 	to provide information in the employment application regarding all current and previous 
59.14 	disciplinary actions in Minnesota and other states taken against the individual's teaching 
59.15 	license as a result of sexual misconduct or attempted sexual misconduct with a student 
59.16 	or other misconduct and indicate to the applicant that intentionally submitting false or 
59.17 	incomplete information is a ground for dismissal.
59.18 	(b) For purposes of this subdivision, "disciplinary action" does not include an action 
59.19 	based on court-ordered child support or maintenance payment arrearages under section 
59.20 	214.101 or delinquent state taxes under section 270C.72.

59.21 	EFFECTIVE DATE. This section is effective May 1, 2009.

59.22 	Sec. 32. [123B.045] DISTRICT-CREATED SITE-GOVERNED SCHOOLS.
59.23 		Subdivision 1.Authority. (a) A school board may approve site-governed schools 
59.24 	under this section by requesting site-governing school proposals. The request for 
59.25 	proposals must include what types of schools or education innovations the board intends 
59.26 	to create. A current site may submit a proposal to create a different model for the site if 
59.27 	60 percent or more of the teachers at the site support the proposal. A group of licensed 
59.28 	district professionals from one or multiple district sites may submit a proposal. The 
59.29 	group submitting the proposal must include parents or other community members in the 
59.30 	development of the proposal. A proposal may request approval for a model of a school not 
59.31 	included in the request for proposal of the board.
59.32 	(b) The school board and the applicable bargaining unit representing district 
59.33 	employees must enter into memoranda of understanding specifying how applicable 
59.34 	sections of current contracts will enable the provisions of subdivision 2, clauses (7) and 
59.35 	(8), to be implemented.
60.1 	(c) Within 60 days of receipt of the application, the school board shall determine 
60.2 	whether to approve, deny, or return the application to the applicants for further information 
60.3 	or development.
60.4 	(d) Upon approval of the proposal, an agreement between the district and the site 
60.5 	council shall be developed identifying the powers and duties delegated to the site and 
60.6 	outlining the details of the proposal including the provisions of subdivisions 2, 3, and 
60.7 	5. Any powers or duties not specifically delegated to the school site in the agreement 
60.8 	remains with the school board.
60.9 		Subd. 2.Roles and responsibilities of site-governed schools. (a) Site-governed 
60.10 	schools approved by the school board have the following autonomy and responsibilities at 
60.11 	the discretion of the site:
60.12 	(1) to create the site-governing council of the school. The council shall include 
60.13 	teachers, administrators, parents, students if appropriate, community members, and other 
60.14 	representatives of the community as determined by the site-governing council. Teachers 
60.15 	may comprise a majority of the site-governing council at the option of a majority of 
60.16 	the teachers at the site. The number of members on the site-governing council and the 
60.17 	composition shall be included in the proposal approved by the school board;
60.18 	(2) to determine the leadership model for the site including: selecting a principal, 
60.19 	operating as a teacher professional practices model with school leadership functions 
60.20 	performed by one or more teachers or administrators at the school or other model 
60.21 	determined by the site;
60.22 	(3) to determine the budget for the site and the allocation and expenditure of the 
60.23 	revenue based on provisions of subdivision 3;
60.24 	(4) to determine the learning model and organization of the school consistent with 
60.25 	the application approved by the school board;
60.26 	(5) to select and develop its curriculum and determine formative and summative 
60.27 	assessment practices;
60.28 	(6) to set policies for the site including student promotion, attendance, discipline, 
60.29 	graduation requirements which may exceed the school board standards, and other such 
60.30 	rules as approved by the school board consistent with the mission, goals, and learning 
60.31 	program of the school site;
60.32 	(7) to determine the length of the school day and year and employee work rules 
60.33 	covered by the terms and conditions of the employment contract;
60.34 	(8) to select teachers and other staff consistent with current law and collective 
60.35 	bargaining agreements and memoranda of understanding provided for in subdivision 1, 
60.36 	paragraph (b). At least 70 percent of the teachers must be selected by the site prior to final 
61.1 	approval of the agreement. Prior to requesting the district to employ staff not currently 
61.2 	employed by the district, the site must first select current district staff including those on 
61.3 	requested and unrequested leave as provided for in sections 122A.40 and 122A.41. The 
61.4 	school board shall be the legal employer of all staff at the site and all teachers and other 
61.5 	staff members of the applicable bargaining units. Teachers and other employees may be 
61.6 	required to sign an individual work agreement with the site-governing council committing 
61.7 	themselves to the mission and learning program of the school and the requirements of 
61.8 	the site-governing council; and
61.9 	(9) to fulfill other provisions as agreed to by the district and site-governing council.
61.10 	(b) If a self-governed school created under this section is supervised by a principal, 
61.11 	that principal must be licensed, consistent with section 123B.147, subdivision 2.
61.12 		Subd. 3.Revenue to self-governed school. (a) The revenue that shall be allocated 
61.13 	by the site includes the general education revenue generated by the students at the site from 
61.14 	state, local, and private sources, referendum revenue, federal revenue from the Elementary 
61.15 	and Secondary Education Act, Individuals with Disabilities Education Act, Carl Perkins 
61.16 	Act, and other federal programs as agreed to by the school board and site council.
61.17 	(b) The district may retain an administrative fee for managing the federal 
61.18 	programs, private revenues, and general administrative functions including school board, 
61.19 	superintendent, district legal counsel, finance, accountability and self-governed school 
61.20 	contract oversight, facilities maintenance, districtwide special education programs, and 
61.21 	other such services as agreed to by the site and school board. The administrative fee 
61.22 	shall be included in the agreement.
61.23 	(c) As part of the agreement, the district may provide specific services for the site 
61.24 	and may specify the amount to be paid for each service and retain the revenues for that 
61.25 	amount. The formula or procedures for determining the amount of revenue to be allocated 
61.26 	to the site each year shall be consistent with this subdivision and incorporated in the site 
61.27 	budget annually following a timeline and process that is included in the agreement with 
61.28 	the school board. The site is responsible for allocating revenue for all staff at the site and 
61.29 	for the other provisions of the agreement with the district board.
61.30 	(d) All unspent revenue shall be carried over to following years for the sole use 
61.31 	of the site.
61.32 		Subd. 4.Exemption from statutes and rules. Except as outlined in this section, 
61.33 	site-governed schools established under this section are exempt from and subject to the 
61.34 	same laws and rules as are chartered schools under section 124D.10, except that the 
61.35 	schools shall be subject to chapters 13, 13D, and 179A, and sections 122A.40, 122A.41, 
61.36 	122A.50, and 122A.51.
62.1 		Subd. 5.Performance standards. (a) The school board and the site council shall 
62.2 	include in the agreement performance standards and expectations that shall include at 
62.3 	least the following:
62.4 	(1) student achievement targets on multiple indicators including either a growth 
62.5 	model or value-added growth model;
62.6 	(2) the criteria and process to be followed if it is determined that the site failed 
62.7 	to comply with district oversight and accountability requirements as outlined in the 
62.8 	agreement; and
62.9 	(3) other performance provisions as agreed to.
62.10 	(b) All agreements shall be filed with the commissioner. The initial agreement shall 
62.11 	be for up to three years, shall be reviewed annually, and may be renewed by the district 
62.12 	board for additional terms of up to five years based on the performance of the school.
62.13 		Subd. 6.Board termination of self-governed school authority. (a) The district 
62.14 	board may terminate the agreement for one or more of the following reasons:
62.15 	(1) failure of the site to meet the provisions specified in the agreement in subdivision 
62.16 	5;
62.17 	(2) violations of law; or
62.18 	(3) other good cause shown.
62.19 	(b) Site-governed schools that are terminated or not renewed for reasons other than 
62.20 	cause may request to convert to charter school status as provided for in section 124D.10 
62.21 	and, if chartered by the board, shall become the owner of all materials, supplies, and 
62.22 	equipment purchased during the period the school was a site-governed school.

62.23 	Sec. 33. Minnesota Statutes 2008, section 123B.143, subdivision 1, is amended to read:
62.24 		Subdivision 1.Contract; duties. All districts maintaining a classified secondary 
62.25 	school must employ a superintendent who shall be an ex officio nonvoting member of the 
62.26 	school board. The authority for selection and employment of a superintendent must be 
62.27 	vested in the board in all cases. An individual employed by a board as a superintendent 
62.28 	shall have an initial employment contract for a period of time no longer than three years 
62.29 	from the date of employment. Any subsequent employment contract must not exceed a 
62.30 	period of three years. A board, at its discretion, may or may not renew an employment 
62.31 	contract. A board must not, by action or inaction, extend the duration of an existing 
62.32 	employment contract. Beginning 365 days prior to the expiration date of an existing 
62.33 	employment contract, a board may negotiate and enter into a subsequent employment 
62.34 	contract to take effect upon the expiration of the existing contract. A subsequent contract 
62.35 	must be contingent upon the employee completing the terms of an existing contract. If a 
63.1 	contract between a board and a superintendent is terminated prior to the date specified in 
63.2 	the contract, the board may not enter into another superintendent contract with that same 
63.3 	individual that has a term that extends beyond the date specified in the terminated contract. 
63.4 	A board may terminate a superintendent during the term of an employment contract for any 
63.5 	of the grounds specified in section 122A.40, subdivision 9 or 13. A superintendent shall 
63.6 	not rely upon an employment contract with a board to assert any other continuing contract 
63.7 	rights in the position of superintendent under section 122A.40. Notwithstanding the 
63.8 	provisions of sections 122A.40, subdivision 10 or 11, 123A.32, 123A.75, or any other law 
63.9 	to the contrary, no individual shall have a right to employment as a superintendent based 
63.10 	on order of employment in any district. If two or more districts enter into an agreement for 
63.11 	the purchase or sharing of the services of a superintendent, the contracting districts have 
63.12 	the absolute right to select one of the individuals employed to serve as superintendent 
63.13 	in one of the contracting districts and no individual has a right to employment as the 
63.14 	superintendent to provide all or part of the services based on order of employment in a 
63.15 	contracting district. The superintendent of a district shall perform the following: 
63.16 	(1) visit and supervise the schools in the district, report and make recommendations 
63.17 	about their condition when advisable or on request by the board;
63.18 	(2) recommend to the board employment and dismissal of teachers;
63.19 	(3) superintend school grading practices and examinations for promotions;
63.20 	(4) make reports required by the commissioner; and
63.21 	(5) by January 10, submit an annual report to the commissioner in a manner 
63.22 	prescribed by the commissioner, in consultation with school districts, identifying the 
63.23 	expenditures that the district requires to ensure an 80 percent student passage rate on 
63.24 	the MCA-IIs taken in the eighth grade, identifying the highest student passage rate the 
63.25 	district expects it will be able to attain on the MCA-IIs by grade 12, and the amount of 
63.26 	expenditures that the district requires to attain the targeted student passage rate; and
63.27 	(6) perform other duties prescribed by the board.

63.28 	EFFECTIVE DATE. This section is effective the day following final enactment 
63.29 	and applies to the 2009-2010 school year and later.

63.30 	Sec. 34. Minnesota Statutes 2008, section 123B.51, is amended by adding a 
63.31 	subdivision to read:
63.32 		Subd. 5a.Temporary closing. A school district that proposes to temporarily close a 
63.33 	schoolhouse or that intends to lease the facility to another entity for use as a schoolhouse 
63.34 	for three or fewer years is not subject to subdivision 5 if the school board holds a public 
63.35 	meeting and allows public comment on the schoolhouse's future.

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

64.2 	Sec. 35. Minnesota Statutes 2008, section 124D.095, subdivision 2, is amended to read:
64.3 		Subd. 2.Definitions. For purposes of this section, the following terms have the 
64.4 	meanings given them.
64.5 	(a) "Online learning" is an interactive course or program that delivers instruction 
64.6 	from a teacher to a student by computer; is combined with other traditional delivery 
64.7 	methods that include frequent student assessment and may include actual teacher contact 
64.8 	time; and meets or exceeds state academic standards.
64.9 	(b) "Online learning provider" is a school district, an intermediate school district, an 
64.10 	organization of two or more school districts operating under a joint powers agreement, or 
64.11 	a charter school located in Minnesota that provides online learning to students.
64.12 	(c) "Student" is a Minnesota resident enrolled in a school under section 120A.22, 
64.13 	subdivision 4, in kindergarten through grade 12.
64.14 	(d) "Online learning student" is a student enrolled in an online learning course or 
64.15 	program delivered by an online provider under paragraph (b).
64.16 	(e) "Enrolling district" means the school district or charter school in which a student 
64.17 	is enrolled under section 120A.22, subdivision 4, for purposes of compulsory attendance.
64.18 	(f) "Supplemental online learning" means an online course taken in place of a course 
64.19 	period during the regular school day at a local district school.
64.20 	(g) "Full-time online provider" means an enrolling school authorized by the 
64.21 	department to deliver comprehensive public education at any or all of the elementary, 
64.22 	middle, or high school levels.
64.23 	(h) "Online course syllabus" is a written document that an online learning provider 
64.24 	makes available to the enrolling district using a format prescribed by the commissioner to 
64.25 	identify the state academic standards embedded in an online course, the course content 
64.26 	outline, required course assessments, expectations for actual teacher contact time and 
64.27 	other student-to-teacher communications, and academic support available to the online 
64.28 	learning student.

64.29 	Sec. 36. Minnesota Statutes 2008, section 124D.095, subdivision 3, is amended to read:
64.30 		Subd. 3.Authorization; notice; limitations on enrollment. (a) A student may 
64.31 	apply for full-time enrollment in an approved online learning program under section 
64.32 	124D.03, 124D.08 or 124D.10, or for supplemental online learning. Notwithstanding 
64.33 	sections 124D.03, 124D.08, and 124D.10, procedures for enrolling in supplemental online 
64.34 	learning shall be as provided in this subdivision. A student age 17 or younger must 
65.1 	have the written consent of a parent or guardian to apply. No school district or charter 
65.2 	school may prohibit a student from applying to enroll in online learning. In order that a 
65.3 	student may enroll in online learning, the student and the student's parents must submit an 
65.4 	application to the online learning provider and identify the reason for enrolling in online 
65.5 	learning. The online learning provider that accepts a student under this section must within 
65.6 	ten days notify the student and the enrolling district in writing if the enrolling district is 
65.7 	not the online learning provider. The student and family must notify the online learning 
65.8 	provider of their intent to enroll in online learning within ten days of acceptance, at which 
65.9 	time the student and parent must sign a statement of assurance that they have reviewed the 
65.10 	online course or program and understand the expectations of online learning enrollment. 
65.11 	The online learning provider must notify the enrolling district of the student's enrollment
65.12 	application to enroll in online learning in writing on a form provided by the department.
65.13 	(b) Supplemental online learning notification to the enrolling district upon student 
65.14 	enrollment in application to the online learning program provider will include the 
65.15 	courses or program, credits to be awarded, and the start date of online enrollment, and 
65.16 	confirmation that the courses will meet the student's graduation plan. An online learning 
65.17 	provider must provide the enrolling district with an online course syllabus. Within 15 days 
65.18 	after the online learning provider makes the supplemental online course syllabus available 
65.19 	to the enrolling district, the enrolling district must notify the online provider whether or 
65.20 	not the student, parent or guardian, and enrolling district agree that the course meets 
65.21 	the enrolling district's graduation requirements. A student may enroll in supplemental 
65.22 	online learning courses up to the midpoint of the enrolling district's term. The enrolling 
65.23 	district may waive this requirement for special circumstances and upon acceptance by the 
65.24 	online provider. An online learning course or program that meets or exceeds a graduation 
65.25 	standard or grade progression requirements at the enrolling district as demonstrated on 
65.26 	the online provider's syllabus must be considered to meet the corresponding graduation 
65.27 	requirements of the student in the enrolling district. If the enrolling district decides that 
65.28 	the course does not meet its graduation requirements, then:
65.29 	(1) the district shall provide a written explanation of its decision upon request by the 
65.30 	student, parent or guardian, or online provider;
65.31 	(2) the district shall allow the online provider the opportunity to respond in writing 
65.32 	to the district's written explanation of its decision for the purpose of describing how the 
65.33 	course may meet the district's graduation requirement; and
65.34 	(3) the student, parent or guardian, or online provider may request that the 
65.35 	Department of Education review the district's decision to determine whether it is consistent 
65.36 	with this section.
66.1 	(c) An online learning provider must notify the commissioner that it is delivering 
66.2 	online learning and report the number of online learning students it is accepting and the 
66.3 	online learning courses and programs it is delivering.
66.4 	(d) An online learning provider may limit enrollment if the provider's school board 
66.5 	or board of directors adopts by resolution specific standards for accepting and rejecting 
66.6 	students' applications.
66.7 	(e) An enrolling district may reduce an online learning student's regular classroom 
66.8 	instructional membership in proportion to the student's membership in online learning 
66.9 	courses.
66.10 	(f) The online provider must report or provide access to information on an individual 
66.11 	student's progress and accumulated credit to the student, parent or guardian, and enrolling 
66.12 	district in a manner specified by the commissioner unless another manner is agreed upon 
66.13 	by the enrolling district and the online provider and submitted to the commissioner. The 
66.14 	enrolling district must designate a contact person to assist in facilitating and monitoring 
66.15 	the student's progress and accumulated credit towards graduation. 

66.16 	Sec. 37. Minnesota Statutes 2008, section 124D.095, subdivision 4, is amended to read:
66.17 		Subd. 4.Online learning parameters. (a) An online learning student must receive 
66.18 	academic credit for completing the requirements of an online learning course or program. 
66.19 	Secondary credits granted to an online learning student must be counted toward the 
66.20 	graduation and credit requirements of the enrolling district. An online learning provider 
66.21 	must make available to the enrolling district the course syllabus, standard alignment, 
66.22 	content outline, assessment requirements, and contact information for supplemental online 
66.23 	courses taken by students in the enrolling district. The enrolling district must apply the 
66.24 	same graduation requirements to all students, including online learning students, and 
66.25 	must continue to provide nonacademic services to online learning students. If a student 
66.26 	completes an online learning course or program that meets or exceeds a graduation 
66.27 	standard or grade progression requirement at the enrolling district, that standard or 
66.28 	requirement is met. The enrolling district must use the same criteria for accepting online 
66.29 	learning credits or courses as it does for accepting credits or courses for transfer students 
66.30 	under section 124D.03, subdivision 9. The enrolling district may reduce the course 
66.31 	schedule of an online learning student in proportion to the number of online learning 
66.32 	courses the student takes from an online learning provider that is not the enrolling district.
66.33 	(b) An online learning student may:
66.34 	(1) enroll in supplemental online learning courses during a single school year to a 
66.35 	maximum of 50 percent of the student's full schedule of courses per term. A student may 
67.1 	exceed the supplemental online learning registration limit if the enrolling district grants 
67.2 	permission for supplemental online learning enrollment above the limit, or if an agreement 
67.3 	is made between the enrolling district and the online learning provider for instructional 
67.4 	services;
67.5 	(2) complete course work at a grade level that is different from the student's current 
67.6 	grade level; and
67.7 	(3) enroll in additional courses with the online learning provider under a separate 
67.8 	agreement that includes terms for payment of any tuition or course fees.
67.9 	(c) An online learning student has the same access to the computer hardware and 
67.10 	education software available in a school as all other students in the enrolling district. An 
67.11 	online learning provider must assist an online learning student whose family qualifies 
67.12 	for the education tax credit under section 290.0674 to acquire computer hardware and 
67.13 	educational software for online learning purposes.
67.14 	(d) An enrolling district may offer online learning to its enrolled students. Such 
67.15 	online learning does not generate online learning funds under this section. An enrolling 
67.16 	district that offers online learning only to its enrolled students is not subject to the 
67.17 	reporting requirements or review criteria under subdivision 7, unless the enrolling district 
67.18 	is a full-time online provider. A teacher with a Minnesota license must assemble and 
67.19 	deliver instruction to enrolled students receiving online learning from an enrolling district. 
67.20 	The delivery of instruction occurs when the student interacts with the computer or the 
67.21 	teacher and receives ongoing assistance and assessment of learning. The instruction may 
67.22 	include curriculum developed by persons other than a teacher with a Minnesota license.
67.23 	(e) AnBoth full-time and supplemental online learning provider that is not the 
67.24 	enrolling district is providers are subject to the reporting requirements and review criteria 
67.25 	under subdivision 7. A teacher with a Minnesota license must assemble and deliver 
67.26 	instruction to online learning students. The delivery of instruction occurs when the student 
67.27 	interacts with the computer or the teacher and receives ongoing assistance and assessment 
67.28 	of learning. The instruction may include curriculum developed by persons other than a 
67.29 	teacher with a Minnesota license. Unless the commissioner grants a waiver, a teacher 
67.30 	providing online learning instruction must not instruct more than 40 students in any one 
67.31 	online learning course or program.
67.32 	(f) To enroll in more than 50 percent of the student's full schedule of courses per term 
67.33 	in online learning, the student must qualify to exceed the supplemental online learning 
67.34 	registration limit under paragraph (b) or apply for enrollment to an approved full-time 
67.35 	online learning program following appropriate procedures in subdivision 3, paragraph (a). 
68.1 	Full-time online learning students may enroll in classes at a local school per contract for 
68.2 	instructional services between the online learning provider and the school district.

68.3 	Sec. 38. Minnesota Statutes 2008, section 124D.095, subdivision 7, is amended to read:
68.4 		Subd. 7.Department of Education. (a) The department must review and 
68.5 	certify online learning providers. The online learning courses and programs must be 
68.6 	rigorous, aligned with state academic standards, and contribute to grade progression 
68.7 	in a single subject. Online learning providers must demonstrate to the commissioner 
68.8 	that online learning courses have equivalent standards or instruction, curriculum, and 
68.9 	assessment requirements as other courses offered to enrolled students. The online 
68.10 	learning provider must also demonstrate expectations for actual teacher contact time 
68.11 	or other student-to-teacher communication The online provider must provide a written 
68.12 	statement that: (1) all courses meet state academic standards; and (2) the online learning 
68.13 	curriculum, instruction, and assessment, expectations for actual teacher-contact time or 
68.14 	other student-to-teacher communication, and academic support meet nationally recognized 
68.15 	professional standards and are demonstrated as such in a syllabus provided according to 
68.16 	the commissioner's requirements. Once an online learning provider is approved under 
68.17 	this paragraph, all of its online learning course offerings are eligible for payment under 
68.18 	this section unless a course is successfully challenged by an enrolling district or the 
68.19 	department under paragraph (b).
68.20 	(b) An enrolling district may challenge the validity of a course offered by an online 
68.21 	learning provider. The department must review such challenges based on the certification 
68.22 	procedures under paragraph (a). The department may initiate its own review of the validity 
68.23 	of an online learning course offered by an online learning provider.
68.24 	(c) The department may collect a fee not to exceed $250 for certifying online 
68.25 	learning providers or $50 per course for reviewing a challenge by an enrolling district.
68.26 	(d) The department must develop, publish, and maintain a list of approved online 
68.27 	learning providers and online learning courses and programs that it has reviewed and 
68.28 	certified.

68.29 	Sec. 39. Minnesota Statutes 2008, section 124D.095, subdivision 10, is amended to 
68.30 	read:
68.31 		Subd. 10.Online Learning Advisory Council. (a) An Online Learning Advisory 
68.32 	Council is established under section 15.059, except that. The term for each council 
68.33 	member shall be three years. The advisory council is composed of 12 members from 
68.34 	throughout the state who have demonstrated experience with or interest in online learning. 
69.1 	The members of the council shall be appointed by the commissioner. The advisory council 
69.2 	shall bring to the attention of the commissioner any matters related to online learning and 
69.3 	provide input to the department in matters related, but not restricted, to:
69.4 	(1) quality assurance;
69.5 	(2) teacher qualifications;
69.6 	(3) program approval;
69.7 	(4) special education;
69.8 	(5) attendance;
69.9 	(6) program design and requirements; and
69.10 	(7) fair and equal access to programs.
69.11 	(b) The Online Learning Advisory Council under this subdivision expires June 
69.12 	30, 2008 2013.

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

69.14 	Sec. 40. Minnesota Statutes 2008, section 124D.10, is amended to read:
69.15 	124D.10 CHARTER SCHOOLS.
69.16 		Subdivision 1.Purposes. (a) The purpose of this section is to:
69.17 	(1) improve pupil learning and achievement;
69.18 	(2) increase learning opportunities for pupils;
69.19 	(3) encourage the use of different and innovative teaching methods;
69.20 	(4) require the measurement ofmeasure learning outcomes and create through the 
69.21 	creation and use of different and innovative forms of measuring outcomes;
69.22 	(5) establish new forms of accountability for schools; or
69.23 	(6) create new professional opportunities for teachers, including the opportunity to 
69.24 	be responsible for the learning program at the school site.
69.25 	(b) This section does not provide a means to keep open a school that otherwise 
69.26 	would be closed. Applicants in these circumstances bear the burden of proving that 
69.27 	conversion to a charter school fulfills a purpose specified in this subdivision, independent 
69.28 	of the school's closing.
69.29 		Subd. 2.Applicability. This section applies only to charter schools formed and 
69.30 	operated under this section.
69.31 		Subd. 2a.Charter School Advisory Council. (a) A Charter School Advisory 
69.32 	Council is established under section 15.059 except that the term for each council member 
69.33 	shall be three years. The advisory council is composed of seven members from throughout 
69.34 	the state who have demonstrated experience with or interest in charter schools. The 
70.1 	members of the council shall be appointed by the commissioner. The advisory council 
70.2 	shall bring to the attention of the commissioner any matters related to charter schools 
70.3 	that the council deems necessary and shall:
70.4 	(1) encourage school boards to make full use of charter school opportunities;
70.5 	(2) encourage the creation of innovative schools;
70.6 	(3) provide leadership and support for charter school sponsors to increase the 
70.7 	innovation in and the effectiveness, accountability, and fiscal soundness of charter schools;
70.8 	(4) serve an ombudsman function in facilitating the operations of new and existing 
70.9 	charter schools;
70.10 	(5) promote timely financial management training for newly elected members of 
70.11 	a charter school board of directors and ongoing training for other members of a charter 
70.12 	school board of directors; and
70.13 	(6) facilitate compliance with auditing and other reporting requirements. The 
70.14 	advisory council shall refer all its proposals to the commissioner who shall provide time 
70.15 	for reports from the council.
70.16 	(b) The Charter School Advisory Council under this subdivision expires June 30, 
70.17 	2007.
70.18 		Subd. 3.Sponsor Authorizer. (a) For purposes of this section, the terms defined in 
70.19 	this subdivision have the meanings given them.
70.20 	"Application" to receive approval as an authorizer means the proposal an eligible 
70.21 	authorizer submits to the commissioner under paragraph (c) before that authorizer is able 
70.22 	to submit any affidavit to charter to a school.
70.23 	"Application" under subdivision 4 means the charter school business plan a 
70.24 	school developer submits to an authorizer for approval to establish a charter school that 
70.25 	documents the school developer's mission statement, school purposes, program design, 
70.26 	financial plan, governance and management structure, and background and experience, 
70.27 	plus any other information the authorizer requests. The application also shall include a 
70.28 	"statement of assurances" of legal compliance prescribed by the commissioner.
70.29 	"Affidavit" means a written statement the authorizer submits to the commissioner 
70.30 	for approval to establish a charter school under subdivision 4 attesting to its review and 
70.31 	approval process before chartering a school.
70.32 	(b) The following organizations may authorize one or more charter schools:
70.33 	(1) a school board; intermediate school district school board; education district 
70.34 	organized under sections 123A.15 to 123A.19;
70.35 	(2) a charitable organization under section 501(c)(3) of the Internal Revenue Code 
70.36 	of 1986, excluding a nonpublic sectarian or religious institution, any person other than a 
71.1 	natural person that directly or indirectly, through one or more intermediaries, controls, 
71.2 	is controlled by, or is under common control with the nonpublic sectarian or religious 
71.3 	institution, and any other charitable organization under this clause that in the federal IRS 
71.4 	Form 1023, Part IV, describes activities indicating a religious purpose, that:
71.5 	(i) is a member of the Minnesota Council of Nonprofits or the Minnesota Council on 
71.6 	Foundations,;
71.7 	(ii) is registered with the attorney general's office, and;
71.8 	(iii) reports an end-of-year fund balance of at least $2,000,000; and 
71.9 	(iv) is incorporated in the state of Minnesota;
71.10 	(3) a Minnesota private college, notwithstanding clause (2), that grants two- or 
71.11 	four-year degrees and is registered with the Minnesota Office of Higher Education under 
71.12 	chapter 136A; community college, state university, or technical college, governed by the 
71.13 	Board of Trustees of the Minnesota State Colleges and Universities; or the University of 
71.14 	Minnesota may sponsor one or more charter schools.; or
71.15 	(b) (4) a nonprofit corporation subject to chapter 317A, described in section 
71.16 	317A.905, and exempt from federal income tax under section 501(c)(6) of the Internal 
71.17 	Revenue Code of 1986, may sponsor authorize one or more charter schools if the charter 
71.18 	school has operated for at least three years under a different sponsor authorizer and if the 
71.19 	nonprofit corporation has existed for at least 25 years.
71.20 	(c) An eligible authorizer under this subdivision must apply to the commissioner for 
71.21 	approval as an authorizer before submitting any affidavit to the commissioner to charter 
71.22 	a school. The application for approval as a charter school authorizer must demonstrate 
71.23 	the applicant's ability to implement the procedures and satisfy the criteria for chartering a 
71.24 	school under this section. The commissioner must approve or disapprove an application 
71.25 	within 60 business days of the application deadline. If the commissioner disapproves 
71.26 	the application, the commissioner must notify the applicant of the deficiencies and the 
71.27 	applicant then has 20 business days to address the deficiencies to the commissioner's 
71.28 	satisfaction. Failing to address the deficiencies to the commissioner's satisfaction makes 
71.29 	an applicant ineligible to be an authorizer. The commissioner, in establishing criteria for 
71.30 	approval, must consider the applicant's:
71.31 	(1) capacity and infrastructure;
71.32 	(2) application criteria and process;
71.33 	(3) contracting process;
71.34 	(4) ongoing oversight and evaluation processes; and 
71.35 	(5) renewal criteria and processes.
72.1 	A disapproved applicant under this paragraph may resubmit an application during a 
72.2 	future application period.
72.3 	(d) The authorizer must participate in ongoing department-approved training.
72.4 	(e) An authorizer that chartered a school before August 1, 2009, must apply by 
72.5 	June 30, 2012, to the commissioner for approval under paragraph (c) to continue as an 
72.6 	authorizer under this section. For purposes of this paragraph, an authorizer that fails to 
72.7 	submit a timely application is ineligible to charter a school.
72.8 	(f) The commissioner shall review an authorizer's performance at least once every 
72.9 	five years in a manner and form determined by the commissioner, and may review an 
72.10 	authorizer's performance more frequently at the commissioner's own initiative or at the 
72.11 	request of a charter school developer, operator, board member, or other interested party. 
72.12 	The commissioner, after completing the review, shall transmit a report with findings to the 
72.13 	authorizer. If, consistent with this section, the commissioner finds that an authorizer has 
72.14 	not performed satisfactorily, the commissioner may subject the authorizer to corrective 
72.15 	action, which may include terminating the contract with the board of a school it chartered. 
72.16 	The commissioner must notify the authorizer in writing of any findings that may subject 
72.17 	the authorizer to corrective action and the authorizer then has 15 business days to request 
72.18 	an informal hearing before the commissioner takes corrective action.
72.19 	(g) The commissioner may take corrective action against an authorizer, including 
72.20 	terminating an authorizer's eligibility to charter a school for:
72.21 	(1) failing to satisfy the criteria under which the commissioner approved the 
72.22 	authorizer;
72.23 	(2) failing to perform satisfactorily as an approved authorizer; or
72.24 	(3) violating a term of the chartering contract between the authorizer and charter 
72.25 	school board.
72.26 		Subd. 4.Formation of school. (a) A sponsor An authorizer, after receiving an 
72.27 	application from a school developer, may authorize charter a licensed teacher under 
72.28 	section 122A.18, subdivision 1, or a group of individuals that includes one or more 
72.29 	licensed teachers under section 122A.18, subdivision 1, to operate a charter school subject 
72.30 	to the commissioner's approval by the commissionerof the authorizer's affidavit under 
72.31 	paragraph (b). A board must vote on charter school application for sponsorship no later 
72.32 	than 90 days after receiving the application. The school must be organized and operated 
72.33 	as a cooperative under chapter 308A or nonprofit corporation under chapter 317A and 
72.34 	the provisions under the applicable chapter shall apply to the school except as provided 
72.35 	in this section. 
73.1 	Notwithstanding sections 465.717 and 465.719, a school district, subject to this 
73.2 	section and section 124D.11, may create a corporation for the purpose of creating
73.3 	establishing a charter school.
73.4 	(b) Before the operators may form establish and operate a school, the sponsor
73.5 	authorizer must file an affidavit with the commissioner stating its intent to authorize a
73.6 	charter a school. An authorizer must file a separate affidavit for each school it intends 
73.7 	to charter. The affidavit must state the terms and conditions under which the sponsor
73.8 	authorizer would authorize a charter a school and how the sponsor authorizer intends 
73.9 	to oversee the fiscal and student performance of the charter school and to comply with 
73.10 	the terms of the written contract between the sponsor authorizer and the charter school 
73.11 	board of directors under subdivision 6. The commissioner must approve or disapprove 
73.12 	the sponsor's proposed authorizationauthorizer's affidavit within 9060 business days of 
73.13 	receipt of the affidavit. If the commissioner disapproves the affidavit, the commissioner 
73.14 	shall notify the authorizer of the deficiencies in the affidavit and the authorizer then has 20 
73.15 	business days to address the deficiencies. If the authorizer does not address deficiencies to 
73.16 	the commissioner's satisfaction, the commissioner's disapproval is final. Failure to obtain 
73.17 	commissioner approval precludes a sponsoran authorizer from authorizing chartering the 
73.18 	charter school that was is the subject of the this affidavit.
73.19 	(c) The authorizer may prevent an approved charter school from opening for 
73.20 	operation if, among other grounds, the charter school violates this section or does not meet 
73.21 	the ready-to-open standards that are part of the authorizer's oversight and evaluation 
73.22 	process or are stipulated in the charter school contract.
73.23 	(d) The operators authorized to organize and operate a school, before entering into 
73.24 	a contract or other agreement for professional or other services, goods, or facilities, 
73.25 	must incorporate as a cooperative under chapter 308A or as a nonprofit corporation 
73.26 	under chapter 317A and must establish a board of directors composed of at least five 
73.27 	members who are not related parties until a timely election for members of the ongoing 
73.28 	charter school board of directors is held according to the school's articles and bylaws
73.29 	under paragraph (f). A charter school board of directors must be composed of at least 
73.30 	five members who are not related parties. Any Staff members who are employed at the 
73.31 	school, including teachers providing instruction under a contract with a cooperative, and 
73.32 	all parents or legal guardians of children enrolled in the school may participate in the 
73.33 	election for are the voters eligible to elect the members of the school's board of directors. 
73.34 	Licensed teachers employed at the school, including teachers providing instruction under 
73.35 	a contract with a cooperative, must be a majority of the members of the board of directors 
73.36 	before the school completes its third year of operation, unless the commissioner waives 
74.1 	the requirement for a majority of licensed teachers on the board. A charter school must 
74.2 	notify eligible voters of the school board election dates at least 30 days before the election.
74.3 	Board of director meetings must comply with chapter 13D.
74.4 	(d) (e) Upon the request of an individual, the charter school must make available 
74.5 	in a timely fashion the minutes of meetings of the board of directors, and of members 
74.6 	and committees having any board-delegated authority; financial statements showing all 
74.7 	operations and transactions affecting income, surplus, and deficit during the school's last 
74.8 	annual accounting period; and a balance sheet summarizing assets and liabilities on the 
74.9 	closing date of the accounting period. A charter school also must post on its official Web 
74.10 	site information identifying its authorizer and indicate how to contact that authorizer and 
74.11 	include that same information about its authorizer in other school materials that it makes 
74.12 	available to the public.
74.13 	(f) Every charter school board member shall attend department-approved training 
74.14 	on board governance, the board's role and responsibilities, employment policies and 
74.15 	practices, and financial management. A board member who does not complete the 
74.16 	required training within 12 months of being seated on the board is ineligible to continue to 
74.17 	serve as a board member.
74.18 	(g) The ongoing board must be elected before the school completes its third year of 
74.19 	operation. The board of directors shall be (i) a teacher majority board made up of licensed 
74.20 	teachers employed at the school or (ii) a board having at least 20 percent of its members 
74.21 	as licensed teachers employed at the school and must include charter school parents or 
74.22 	guardians and interested community members. Licensed teachers employed by the school, 
74.23 	or those providing instruction under a contract with a cooperative, may be members of the 
74.24 	board of directors. The chief financial officer and chief administrator are nonvoting board 
74.25 	members. Board bylaws shall outline the internal process and procedures for changing 
74.26 	the board's governance model. A board may change between the governance models 
74.27 	established in this paragraph only with approval from the authorizer and a voting majority 
74.28 	of the board of directors and the licensed teachers employed at the school, including 
74.29 	teachers providing instruction under a contract with a cooperative.
74.30 	(h) The granting or renewal of a charter by a sponsoring entity an authorizer must 
74.31 	not be conditioned upon the bargaining unit status of the employees of the school.
74.32 	(e) A sponsor (i) The granting or renewal of a charter school by an authorizer must 
74.33 	not be contingent on the charter school being required to contract, lease, or purchase 
74.34 	services from the authorizer. Any potential contract, lease, or purchase of service from 
74.35 	an authorizer must be disclosed to the commissioner, accepted through an open bidding 
74.36 	process, and be a separate contract from the charter contract. The school must document 
75.1 	the open bidding process. An authorizer must not enter into a contract to provide 
75.2 	management and financial services for a school that it authorizes, unless the school 
75.3 	documents that it received at least two competitive bids.
75.4 	(j) The charter school shall not offer any services or goods of value to students, 
75.5 	parents, or guardians as an inducement, term, or condition of enrolling a student in a 
75.6 	charter school.
75.7 	(k) An authorizer may authorize permit the operators board of directors of a charter 
75.8 	school to expand the operation of the charter school to additional sites or to add additional 
75.9 	grades at the school beyond those described in the sponsor's application authorizer's 
75.10 	original affidavit as approved by the commissioner only after submitting a supplemental 
75.11 	application affidavit for approval to the commissioner in a form and manner prescribed by 
75.12 	the commissioner. The supplemental application affidavit must provide evidence show
75.13 	that:
75.14 	(1) the expansion of proposed by the charter school is supported by need and 
75.15 	projected enrollment;
75.16 	(2) the charter school expansion is warranted, at a minimum, by longitudinal data 
75.17 	demonstrating students' improved academic performance and growth on statewide 
75.18 	assessments under chapter 120B;
75.19 	(2) (3) the charter school is fiscally sound and has the financial capacity to implement 
75.20 	the proposed expansion; and
75.21 	(3) (4) the sponsor supports the authorizer finds that the charter school has the 
75.22 	management capacity to carry out its expansion; and.
75.23 	(4) the building of the additional site meets all health and safety requirements to 
75.24 	be eligible for lease aid.
75.25 	(f) The commissioner annually must provide timely financial management training 
75.26 	to newly elected members of a charter school board of directors and ongoing training to 
75.27 	other members of a charter school board of directors. Training must address ways to:
75.28 	(1) proactively assess opportunities for a charter school to maximize all available 
75.29 	revenue sources;
75.30 	(2) establish and maintain complete, auditable records for the charter school;
75.31 	(3) establish proper filing techniques;
75.32 	(4) document formal actions of the charter school, including meetings of the charter 
75.33 	school board of directors;
75.34 	(5) properly manage and retain charter school and student records;
75.35 	(6) comply with state and federal payroll record-keeping requirements; and
76.1 	(7) address other similar factors that facilitate establishing and maintaining complete 
76.2 	records on the charter school's operations.
76.3 	(l) The commissioner shall have 30 business days to review and comment on the 
76.4 	supplemental affidavit. The commissioner shall notify the authorizer of any deficiencies 
76.5 	in the supplemental affidavit and the authorizer then has 30 business days to address, 
76.6 	to the commissioner's satisfaction, any deficiencies in the supplemental affidavit. The 
76.7 	school may not expand grades or add sites until the commissioner has reviewed and 
76.8 	commented on the supplemental affidavit. The commissioner's approval or disapproval of 
76.9 	a supplemental affidavit is final.
76.10 		Subd. 4a.Conflict of interest. (a) A member of a charter school board of directors
76.11 	An individual is prohibited from serving as a member of the charter school board of 
76.12 	directors or as if the individual, an immediate family member, or the individual's partner is
76.13 	an owner, employee or agent of or a contractor with a for-profit or nonprofit entity with 
76.14 	whom the charter school contracts, directly or indirectly, for professional services, goods, 
76.15 	or facilities. A violation of this prohibition renders a contract voidable at the option of 
76.16 	the commissioner or the charter school board of directors. A member of a charter school 
76.17 	board of directors who violates this prohibition shall be is individually liable to the charter 
76.18 	school for any damage caused by the violation.
76.19 	(b) No member of the board of directors, employee, officer, or agent of a charter 
76.20 	school shall participate in selecting, awarding, or administering a contract if a conflict 
76.21 	of interest exists. A conflict exists when:
76.22 	(1) the board member, employee, officer, or agent;
76.23 	(2) the immediate family of the board member, employee, officer, or agent;
76.24 	(3) the partner of the board member, employee, officer, or agent; or
76.25 	(4) an organization that employs, or is about to employ any individual in clauses 
76.26 	(1) to (3),
76.27 	has a financial or other interest in the entity with which the charter school is contracting. 
76.28 	A violation of this prohibition renders the contract void.
76.29 	(c) Any employee, agent, or board member of the authorizer who participates 
76.30 	in the initial review, approval, ongoing oversight, evaluation, or the charter renewal or 
76.31 	nonrenewal process or decision is ineligible to serve on the board of directors of a school 
76.32 	chartered by that authorizer.
76.33 	(b) (d) An individual may serve as a member of the board of directors if no conflict 
76.34 	of interest under paragraph (a) exists.
76.35 	(c) A member of a charter school board of directors that serves as a member of the 
76.36 	board of directors or as an employee or agent of or a contractor with a nonprofit entity 
77.1 	with whom the charter school contracts, directly or indirectly, for professional services, 
77.2 	goods, or facilities, must disclose all potential conflicts to the commissioner.
77.3 	(d) (e) The conflict of interest provisions under this subdivision do not apply to 
77.4 	compensation paid to a teacher employed by the charter school who also serves as a 
77.5 	member of the board of directors.
77.6 	(e) (f) The conflict of interest provisions under this subdivision do not apply to a 
77.7 	teacher who provides services to a charter school through a cooperative formed under 
77.8 	chapter 308A when the teacher also serves on the charter school board of directors.
77.9 		Subd. 5.Conversion of existing schools. A board of an independent or special 
77.10 	school district may convert one or more of its existing schools to charter schools under 
77.11 	this section if 60 percent of the full-time teachers at the school sign a petition seeking 
77.12 	conversion. The conversion must occur at the beginning of an academic year.
77.13 		Subd. 6.Charter contract. The sponsor's authorization for a charter school must 
77.14 	be in the form of a written contract signed by the sponsor authorizer and the board of 
77.15 	directors of the charter school. The contract must be completed within 90 45 business
77.16 	days of the commissioner's approval of the sponsor's proposed authorization.authorizer's 
77.17 	affidavit. The authorizer shall submit to the commissioner a copy of the signed charter 
77.18 	contract within ten business days of its execution. The contract for a charter school must 
77.19 	be in writing and contain at least the following:
77.20 	(1) a description of a program that carries out one or more of the purposes
77.21 	declaration of the purposes in subdivision 1 that the school intends to carry out and how 
77.22 	the school will report its implementation of those purposes;
77.23 	(2) a description of the school program and the specific academic and nonacademic 
77.24 	outcomes that pupils are to must achieve under subdivision 10;
77.25 	(3) a statement of admission policies and procedures;
77.26 	(4) a governance, management, and administration of plan for the school;
77.27 	(5) signed agreements from charter school board members to comply with all federal 
77.28 	and state laws governing organizational, programmatic, and financial requirements and 
77.29 	procedures for program and financial audits applicable to charter schools;
77.30 	(6) how the school will comply with subdivisions 8, 13, 16, and 23 the criteria, 
77.31 	processes, and procedures that the authorizer will use for ongoing oversight of operational, 
77.32 	financial, and academic performance;
77.33 	(7) assumption of liability by the charter school the performance evaluation that is a 
77.34 	prerequisite for reviewing a charter contract under subdivision 15;
77.35 	(8) types and amounts of insurance liability coverage to be obtained by the charter 
77.36 	school;
78.1 	(9) the term of the contract, which may be up to three years for an initial contract 
78.2 	plus an additional preoperational planning year, and up to five years for a renewed contract 
78.3 	if warranted by the school's academic, financial, and operational performance;
78.4 	(10) if how the board of directors or the operators of the charter school will provide 
78.5 	special instruction and services for children with a disability under sections 125A.03
78.6 	to 125A.24, and 125A.65, a description of the financial parameters within which the 
78.7 	charter school will operate to provide the special instruction and services to children 
78.8 	with a disability; and
78.9 	(11) the process and criteria the sponsor authorizer intends to use to monitor 
78.10 	and evaluate the fiscal and student performance of the charter school, consistent with 
78.11 	subdivision 15.; and
78.12 	(12) the plan for an orderly closing of the school under chapter 308A or 317A, if the 
78.13 	closure is a termination for cause, a voluntary termination, or a nonrenewal of the contract, 
78.14 	and that includes establishing the responsibilities of the school board of directors and the 
78.15 	authorizer and notifying the commissioner, authorizer, school district in which the charter 
78.16 	school is located, and parents of enrolled students about the closure, the transfer of student 
78.17 	records to students' resident districts, and procedures for closing financial operations.
78.18 		Subd. 6a.Audit report. (a) The charter school must submit an audit report to the 
78.19 	commissioner and its authorizer by December 31 each year. The commissioner may 
78.20 	withhold the charter school's state aid if the charter school does not submit an audit by 
78.21 	January 31.
78.22 	(b) The charter school, with the assistance of the auditor conducting the audit, must 
78.23 	include with the report a copy of all charter school agreements for corporate management 
78.24 	services. If the entity that provides the professional services to the charter school is 
78.25 	exempt from taxation under section 501 of the Internal Revenue Code of 1986, that entity 
78.26 	must file with the commissioner by February 15 a copy of the annual return required under 
78.27 	section 6033 of the Internal Revenue Code of 1986.
78.28 	(c) If the commissioner receives as part of the an audit report a management letter
78.29 	indicating that a material weakness exists in the financial reporting systems of a charter 
78.30 	school, the charter school must submit a written report to the commissioner explaining 
78.31 	how the material weakness will be resolved.
78.32 	 Upon the request of an individual, the charter school must make available in a timely 
78.33 	fashion the minutes of meetings of members, the board of directors, and committees 
78.34 	having any of the authority of the board of directors, and statements showing the financial 
78.35 	result of all operations and transactions affecting income and surplus during the school's 
79.1 	last annual accounting period and a balance sheet containing a summary of its assets and 
79.2 	liabilities as of the closing date of the accounting period.
79.3 		Subd. 7.Public status; exemption from statutes and rules. A charter school is a 
79.4 	public school and is part of the state's system of public education. Except as provided in 
79.5 	this section, a charter school is exempt from all statutes and rules applicable to a school, a 
79.6 	board, or a district, although it may elect to comply with one or more provisions of statutes 
79.7 	or rules. A charter school is exempt from all statutes and rules applicable to a school, 
79.8 	school board, or school district unless a statute or rule is made specifically applicable to a 
79.9 	charter school or is included in this section.
79.10 		Subd. 8.State and local requirements. (a) A charter school shall meet all 
79.11 	applicable federal, state, and local health and safety requirements applicable to school 
79.12 	districts.
79.13 	(b) A school must comply with statewide education accountability requirements 
79.14 	governing standards and assessments in chapter 120B and must work with the Department 
79.15 	of Education to make available to the public valid and highly reliable comparisons 
79.16 	of student academic growth and achievement across schools consistent with school 
79.17 	performance report card information under section 120B.36.
79.18 	(c) A school sponsored authorized by a school board may be located in any district, 
79.19 	unless the school board of the district of the proposed location disapproves by written 
79.20 	resolution.
79.21 	(c) (d) A charter school must be nonsectarian in its programs, admission policies, 
79.22 	employment practices, and all other operations. A sponsor An authorizer may not 
79.23 	authorize a charter a school or program that is affiliated with a nonpublic sectarian 
79.24 	school or a religious institution. A charter school student must be released for religious 
79.25 	instruction, consistent with section 120A.22, subdivision 12, clause (3).
79.26 	(d) (e) Charter schools must not be used as a method of providing education or 
79.27 	generating revenue for students who are being home-schooled.
79.28 	(e) (f) The primary focus of a charter school must be to provide a comprehensive 
79.29 	program of instruction for at least one grade or age group from five through 18 years 
79.30 	of age. Instruction may be provided to people younger than five years and older than 
79.31 	18 years of age.
79.32 	(f) (g) A charter school may not charge tuition to students who reside in Minnesota.
79.33 	(g) (h) A charter school is subject to and must comply with chapter 363A and 
79.34 	section 121A.04.
80.1 	(h) (i) A charter school is subject to and must comply with the Pupil Fair Dismissal 
80.2 	Act, sections 121A.40 to 121A.56, and the Minnesota Public School Fee Law, sections 
80.3 	123B.34 to 123B.39.
80.4 	(i) (j) A charter school is subject to the same financial audits, audit procedures, and 
80.5 	audit requirements as a district. Audits must be conducted in compliance with generally 
80.6 	accepted governmental auditing standards, the Federal Single Audit Act, if applicable, 
80.7 	and section 6.65. A charter school is subject to and must comply with sections 15.054; 
80.8 	118A.01; 118A.02; 118A.03; 118A.04; 118A.05; 118A.06; 123B.52, subdivision 5;
80.9 	471.38; 471.391; 471.392; and471.425; 471.87; 471.88, subdivisions 1, 2, 3, 4, 5, 6, 
80.10 	12, 13, and 15; 471.881; and 471.89. The audit must comply with the requirements of 
80.11 	sections 123B.75 to 123B.83, except to the extent deviations are necessary because of the 
80.12 	program at the school. Deviations must be approved by the commissioner and authorizer. 
80.13 	The Department of Education, state auditor, or legislative auditor, or authorizer may 
80.14 	conduct financial, program, or compliance audits. A charter school determined to be in 
80.15 	statutory operating debt under sections 123B.81 to 123B.83 must submit a plan under 
80.16 	section 123B.81, subdivision 4.
80.17 	(j) (k) A charter school is a district for the purposes of tort liability under chapter 466.
80.18 	(k) (l) A charter school must comply with chapters 13 and 13D; and sections 13.32;
80.19 	120A.22, subdivision 7; 121A.75; and 260B.171, subdivisions 3 and 5.
80.20 	(l) (m) A charter school is subject to the Pledge of Allegiance requirement under 
80.21 	section 121A.11, subdivision 3.
80.22 	(n) A charter school is subject to chapter 181.
80.23 	(o) A charter school must comply with section 120A.22, subdivision 7, governing 
80.24 	the transfer of students' educational records and sections 138.163 and 138.17 governing 
80.25 	the management of local records.
80.26 		Subd. 8a.Aid reduction. The commissioner may reduce a charter school's state aid 
80.27 	under section 127A.42 or 127A.43 if the charter school board fails to correct a violation 
80.28 	under this section.
80.29 		Subd. 8b.Aid reduction for violations. The commissioner may reduce a charter 
80.30 	school's state aid by an amount not to exceed 60 percent of the charter school's basic 
80.31 	revenue for the period of time that a violation of law occurs.
80.32 		Subd. 9.Admission requirements. A charter school may limit admission to:
80.33 	(1) pupils within an age group or grade level; or
80.34 	(2) people who are eligible to participate in the graduation incentives program 
80.35 	under section 124D.68; or.
81.1 	(3) residents of a specific geographic area where the percentage of the population 
81.2 	of non-Caucasian people of that area is greater than the percentage of the non-Caucasian 
81.3 	population in the congressional district in which the geographic area is located, and as 
81.4 	long as the school reflects the racial and ethnic diversity of the specific area.
81.5 	A charter school shall enroll an eligible pupil who submits a timely application, 
81.6 	unless the number of applications exceeds the capacity of a program, class, grade level, 
81.7 	or building. In this case, pupils must be accepted by lot. If a charter school is the only 
81.8 	school located in a town serving pupils within a particular grade level, then pupils that 
81.9 	are residents of the town must be given preference for enrollment before accepting pupils 
81.10 	by lot. If a pupil lives within two miles of a charter school and the next closest public 
81.11 	school is more than five miles away, the charter school must give those pupils preference 
81.12 	for enrollment before accepting other pupils by lot. The charter school must develop and 
81.13 	publish a lottery policy and process that it must use when accepting pupils by lot.
81.14 	A charter school shall give preference for enrollment to a sibling of an enrolled pupil 
81.15 	and to a foster child of that pupil's parents and may give preference for enrolling children 
81.16 	of the school's employees before accepting other pupils by lot.
81.17 	A charter school may not limit admission to pupils on the basis of intellectual ability, 
81.18 	measures of achievement or aptitude, or athletic ability and may not establish any criteria 
81.19 	or requirements for admission that are inconsistent with this subdivision.
81.20 		Subd. 10.Pupil performance. A charter school must design its programs to at 
81.21 	least meet the outcomes adopted by the commissioner for public school students. In the 
81.22 	absence of the commissioner's requirements, the school must meet the outcomes contained 
81.23 	in the contract with the sponsor authorizer. The achievement levels of the outcomes 
81.24 	contained in the contract may exceed the achievement levels of any outcomes adopted by 
81.25 	the commissioner for public school students.
81.26 		Subd. 11.Employment and other operating matters. A charter school must 
81.27 	employ or contract with necessary teachers, as defined by section 122A.15, subdivision 1, 
81.28 	who hold valid licenses to perform the particular service for which they are employed in 
81.29 	the school. The charter school's state aid may be reduced under section 127A.42 127A.43
81.30 	if the school employs a teacher who is not appropriately licensed or approved by the 
81.31 	board of teaching. The school may employ necessary employees who are not required to 
81.32 	hold teaching licenses to perform duties other than teaching and may contract for other 
81.33 	services. The school may discharge teachers and nonlicensed employees. The charter 
81.34 	school board is subject to section 181.932. When offering employment to a prospective 
81.35 	employee, a charter school must give that employee a written description of the terms and 
81.36 	conditions of employment and the school's personnel policies. A person, without holding 
82.1 	a valid administrator's license, may perform administrative, supervisory, or instructional 
82.2 	leadership duties.
82.3 	The board of directors also shall decide matters related to the operation of the school, 
82.4 	including budgeting, curriculum and operating procedures.
82.5 		Subd. 12.Pupils with a disability. A charter school must comply with sections 
82.6 	125A.02, 125A.03 to 125A.24, and 125A.65 and rules relating to the education of pupils 
82.7 	with a disability as though it were a district.
82.8 		Subd. 13.Length of school year. A charter school must provide instruction 
82.9 	each year for at least the number of days required by section 120A.41. It may provide 
82.10 	instruction throughout the year according to sections 124D.12 to 124D.127 or 124D.128.
82.11 		Subd. 14.Annual public reports. A charter school must publish an annual report at 
82.12 	least annually to its sponsor and the commissioner the information required by the sponsor 
82.13 	or the commissioner approved by the charter school board of directors. The annual report 
82.14 	must at least include information on school enrollment, governance and management, 
82.15 	staffing, finances, academic performance, operational performance, innovative practices 
82.16 	and implementation, and future plans. A charter school must distribute the annual 
82.17 	report by publication, mail, or electronic means to the commissioner, authorizer, school 
82.18 	employees, and parents and legal guardians of students enrolled in the charter school and 
82.19 	also must post the report on the charter school's official Web site. The reports are public 
82.20 	data under chapter 13.
82.21 		Subd. 15.Review and comment. (a) The department must review and comment on 
82.22 	the evaluation, by the sponsor, of the performance of a charter school before the charter 
82.23 	school's contract is renewed for another contract term. The sponsor must submit to 
82.24 	the commissioner timely information for the review and comment. The commissioner 
82.25 	must review and comment on the authorizer's performance evaluation process at the 
82.26 	time the authorizer submits its application for approval as an authorizer and each time 
82.27 	the authorizer undergoes its five-year review under subdivision 3, paragraph (f). Before 
82.28 	renewing a charter contract, the authorizer shall provide the commissioner with a formal, 
82.29 	written evaluation of the school's performance.
82.30 	(b) A sponsor An authorizer shall monitor and evaluate the fiscal and student 
82.31 	performance of the school, and may for this purpose annually assess a charter school: (1)
82.32 	in its first, second, or third year of operation up to $30 per student up to a maximum of 
82.33 	$10,000; and (2) in its fourth or a subsequent year of operation up to $10 per student up to 
82.34 	a maximum of $3,500 a fee according to paragraph (c).
82.35 	(c) The minimum fee that each charter school pays to an authorizer is the basic 
82.36 	formula allowance for that year. Beginning in fiscal year 2013, the maximum fee is four 
83.1 	times the formula allowance for that year. Beginning in fiscal year 2013, each charter 
83.2 	school's fee, subject to the minimum and maximum fees, equals the product of .015, the 
83.3 	formula allowance for that year, and the charter school's adjusted marginal cost pupil 
83.4 	units for that year.
83.5 	(d) Notwithstanding paragraph (c), the following charter school fees apply, subject 
83.6 	to the minimum and maximum fee in paragraph (c):
83.7 	(1) for fiscal year 2010 only, each charter school's fee equals the product of .01, the 
83.8 	formula allowance for that year, and the charter school's adjusted marginal cost pupil units 
83.9 	for that year and the maximum fee is two times the basic formula allowance for that year;
83.10 	(2) for fiscal year 2011 only, each charter school's fee equals the product of .01, the 
83.11 	formula allowance for that year, and the charter school's adjusted marginal cost pupil 
83.12 	units for that year and the maximum fee is three times the basic formula allowance for 
83.13 	that year; and
83.14 	(3) for fiscal year 2012 only, each charter school's fee equals the product of .013, the 
83.15 	formula allowance for that year, and the charter school's adjusted marginal cost pupil units 
83.16 	for that year and the maximum fee is four times the basic formula allowance for that year.
83.17 	(e) For the preoperational planning period, the authorizer may assess a charter school 
83.18 	the formula allowance for one pupil unit.
83.19 	(f) Each year by September 30, an authorizer shall submit to the commissioner a 
83.20 	statement of expenditures related to authorizing activities during the previous school year 
83.21 	ending on June 30. The authorizer must transmit a copy of the statement to all schools 
83.22 	chartered by the authorizer.
83.23 		Subd. 16.Transportation. (a) A charter school after its first fiscal year of operation 
83.24 	by March 1 of each fiscal year and a charter school by July 1 of its first fiscal year of 
83.25 	operation must notify the district in which the school is located and the Department of 
83.26 	Education if it will provide its own transportation or use the transportation services of the 
83.27 	district in which it is located for the fiscal year.
83.28 	(b) If a charter school elects to provide transportation for pupils, the transportation 
83.29 	must be provided by the charter school within the district in which the charter school is 
83.30 	located. The state must pay transportation aid to the charter school according to section 
83.31 	124D.11, subdivision 2.
83.32 	For pupils who reside outside the district in which the charter school is located, the 
83.33 	charter school is not required to provide or pay for transportation between the pupil's 
83.34 	residence and the border of the district in which the charter school is located. A parent 
83.35 	may be reimbursed by the charter school for costs of transportation from the pupil's 
83.36 	residence to the border of the district in which the charter school is located if the pupil is 
84.1 	from a family whose income is at or below the poverty level, as determined by the federal 
84.2 	government. The reimbursement may not exceed the pupil's actual cost of transportation 
84.3 	or 15 cents per mile traveled, whichever is less. Reimbursement may not be paid for 
84.4 	more than 250 miles per week.
84.5 	At the time a pupil enrolls in a charter school, the charter school must provide the 
84.6 	parent or guardian with information regarding the transportation.
84.7 	(c) If a charter school does not elect to provide transportation, transportation for 
84.8 	pupils enrolled at the school must be provided by the district in which the school is 
84.9 	located, according to sections 123B.88, subdivision 6, and 124D.03, subdivision 8, for a 
84.10 	pupil residing in the same district in which the charter school is located. Transportation 
84.11 	may be provided by the district in which the school is located, according to sections 
84.12 	123B.88, subdivision 6, and 124D.03, subdivision 8, for a pupil residing in a different 
84.13 	district. If the district provides the transportation, the scheduling of routes, manner and 
84.14 	method of transportation, control and discipline of the pupils, and any other matter relating 
84.15 	to the transportation of pupils under this paragraph shall be within the sole discretion, 
84.16 	control, and management of the district.
84.17 		Subd. 17.Leased space. (a) A charter school may lease space from a an 
84.18 	independent or special school board eligible to be a sponsor or an authorizer, other public 
84.19 	or organization, private, nonprofit nonsectarian organization, private property owner, 
84.20 	or a sectarian organization if the leased space is constructed as a school facility. The 
84.21 	department must review and approve or disapprove leases in a timely manner. If a charter 
84.22 	school is unable to lease appropriate space from an eligible board or other public or private 
84.23 	nonprofit nonsectarian organization, the school may lease space from another nonsectarian 
84.24 	organization if the Department of Education, in consultation with the Department of 
84.25 	Administration, approves the lease. If the school is unable to lease appropriate space from 
84.26 	public or private nonsectarian organizations, the school may lease space from a sectarian 
84.27 	organization if the leased space is constructed as a school facility and the Department of 
84.28 	Education, in consultation with the Department of Administration, approves the lease.
84.29 	The lease aid payments for charter schools that lease a facility from a school district or 
84.30 	other government entity is limited to the same level of lease aid as defined in Minnesota 
84.31 	Statutes 2008, section 124D.11, subdivision 4.
84.32 	(b) Upon approval of the authorizer, a charter school that has operated at least five 
84.33 	consecutive years may form a separate affiliated nonprofit building company to provide a 
84.34 	school facility. The authorizer shall submit a supplemental affidavit to the commissioner 
84.35 	stating that the authorizer has reviewed:
84.36 	(1) the school's feasibility study on facility options;
85.1 	(2) documents showing the school's need and projected enrollment for such a 
85.2 	facility; and
85.3 	(3) the school's financial plan and financial status.
85.4 	The school is prohibited from organizing the nonprofit building company until the 
85.5 	authorizer files a supplementary affidavit with the commissioner and receives approval 
85.6 	from the commissioner.
85.7 	(c) A charter school that leases a facility from a building company under paragraph 
85.8 	(b) must include in its lease agreement a clause that recognizes the reductions in lease aid 
85.9 	applicable under section 124D.11, subdivision 4, when the bonds or mortgage to cover the 
85.10 	original purchase and renovation or construction of the facility have been retired.
85.11 		Subd. 18.Authority to raise initial working capital. A sponsor may authorize 
85.12 	a charter school before the applicant has secured its space, equipment, facilities, and 
85.13 	personnel if the applicant indicates the authority is necessary for it to raise working 
85.14 	capital. A sponsor may not authorize a school before the commissioner has approved the 
85.15 	authorization.
85.16 		Subd. 19.Disseminate information. (a) The sponsor authorizer, the operators, and 
85.17 	the Department of Education department must disseminate information to the public 
85.18 	on how to form and operate a charter school and. Charter schools must disseminate 
85.19 	information about how to utilize use the offerings of a charter school. Particular Targeted
85.20 	groups to be targeted include low-income families and communities, and students of 
85.21 	color, and students who are at risk of academic failure.
85.22 	(b) Authorizers, operators, and the department also may disseminate information 
85.23 	about the successful best practices in teaching and learning demonstrated by charter 
85.24 	schools.
85.25 		Subd. 20.Leave to teach in a charter school. If a teacher employed by a district 
85.26 	makes a written request for an extended leave of absence to teach at a charter school, 
85.27 	the district must grant the leave. The district must grant a leave not to exceed a total of 
85.28 	five years. Any request to extend the leave shall be granted only at the discretion of the 
85.29 	school board. The district may require that the request for a leave or extension of leave 
85.30 	be made up to 90 days before the teacher would otherwise have to report for duty before 
85.31 	February 1 in the school year preceding the school year in which the teacher intends 
85.32 	to leave, or February 1 of the calendar year in which the teacher's leave is scheduled 
85.33 	to terminate. Except as otherwise provided in this subdivision and except for section 
85.34 	122A.46, subdivision 7, the leave is governed by section 122A.46, including, but not 
85.35 	limited to, reinstatement, notice of intention to return, seniority, salary, and insurance.
86.1 	During a leave, the teacher may continue to aggregate benefits and credits in the 
86.2 	Teachers' Retirement Association account by paying both the employer and employee 
86.3 	contributions based upon the annual salary of the teacher for the last full pay period before 
86.4 	the leave began. The retirement association may impose reasonable requirements to 
86.5 	efficiently administer this subdivision under chapters 354 and 354A, consistent with 
86.6 	subdivision 22.
86.7 		Subd. 21.Collective bargaining. Employees of the board of directors of a charter 
86.8 	school may, if otherwise eligible, organize under chapter 179A and comply with its 
86.9 	provisions. The board of directors of a charter school is a public employer, for the 
86.10 	purposes of chapter 179A, upon formation of one or more bargaining units at the school. 
86.11 	Bargaining units at the school must be separate from any other units within the sponsoring
86.12 	an authorizing district, except that bargaining units may remain part of the appropriate 
86.13 	unit within the sponsoring an authorizing district, if the employees of the school, the 
86.14 	board of directors of the school, the exclusive representative of the appropriate unit in the 
86.15 	sponsoring authorizing district, and the board of the sponsoring authorizing district agree 
86.16 	to include the employees in the appropriate unit of the sponsoring authorizing district.
86.17 		Subd. 22.Teacher and other employee retirement. (a) Teachers in a charter 
86.18 	school must be public school teachers for the purposes of chapters 354 and 354a.
86.19 	(b) Except for teachers under paragraph (a), employees in a charter school must be 
86.20 	public employees for the purposes of chapter 353.
86.21 		Subd. 23.Causes for nonrenewal or termination of charter school contract. (a) 
86.22 	The duration of the contract with a sponsorauthorizer must be for the term contained in 
86.23 	the contract according to subdivision 6. The sponsorauthorizer may or may not renew a 
86.24 	contract at the end of the term for any ground listed in paragraph (b). A sponsorauthorizer 
86.25 	may unilaterally terminate a contract during the term of the contract for any ground 
86.26 	listed in paragraph (b). At least 60 days before not renewing or terminating a contract, 
86.27 	the sponsor authorizer shall notify the board of directors of the charter school of the 
86.28 	proposed action in writing. The notice shall state the grounds for the proposed action in 
86.29 	reasonable detail and that the charter school's board of directors may request in writing an 
86.30 	informal hearing before the sponsorauthorizer within 14 15 business days of receiving 
86.31 	notice of nonrenewal or termination of the contract. Failure by the board of directors to 
86.32 	make a written request for a hearing within the 14-day 15-business-day period shall be 
86.33 	treated as acquiescence to the proposed action. Upon receiving a timely written request 
86.34 	for a hearing, the sponsorauthorizer shall give reasonable ten business days' notice to 
86.35 	the charter school's board of directors of the hearing date. The sponsorauthorizer shall 
86.36 	conduct an informal hearing before taking final action. The sponsor authorizer shall take 
87.1 	final action to renew or not renew a contract by the last day of classes in the school year. 
87.2 	If the sponsor is a local board, the school's board of directors may appeal the sponsor's 
87.3 	decision to the commissioner no later than 20 business days before the proposed date for 
87.4 	terminating the contract or the end date of the contract.
87.5 	(b) A contract may be terminated or not renewed upon any of the following grounds:
87.6 	(1) failure to meet the requirements for pupil performance contained in the contract;
87.7 	(2) failure to meet generally accepted standards of fiscal management;
87.8 	(3) violations of law; or
87.9 	(4) other good cause shown.
87.10 	If a contract is terminated or not renewed under this paragraph, the school must be 
87.11 	dissolved according to the applicable provisions of chapter 308A or 317A, except when 
87.12 	the commissioner approves the decision of a different eligible sponsor to authorize the 
87.13 	charter school.
87.14 	(c) If at the end of a contract term, either the sponsor orauthorizer and the charter 
87.15 	school board of directors wants mutually agree to voluntarily terminate or not renew 
87.16 	the contract, a change in sponsors authorizers is allowed if the commissioner approves 
87.17 	the decision of transfer to a different eligible sponsor approved authorizer to authorize
87.18 	charter the charter school. The party intending to terminate the contract must notify the 
87.19 	other party and the commissioner of its intent at least 90 days before the date on which the 
87.20 	contract ends. Both parties jointly must submit their intent in writing to the commissioner 
87.21 	to mutually terminate the contract. The sponsor authorizer that is a party to the existing 
87.22 	contract at least must inform the approved different eligible sponsor new authorizer about 
87.23 	the fiscal and operational status, and student performance of the school. If no different 
87.24 	eligible sponsor transfer of authorizer is approved, the school must be dissolved according 
87.25 	to applicable law and the terms of the contract.
87.26 	(d) The commissioner, after providing reasonable notice to the board of directors of 
87.27 	a charter school and the existing sponsor authorizer, and after providing an opportunity for 
87.28 	a public hearing, may terminate the existing sponsorial relationship contract between the 
87.29 	authorizer and the charter school board if the charter school has a history of:
87.30 	(1) failure to meet pupil performance requirements contained in the contract;
87.31 	(2) financial mismanagement or failure to meet generally accepted standards of 
87.32 	fiscal management; or
87.33 	(2) (3) repeated or major violations of the law.
87.34 	(e) If the commissioner terminates a charter school contract because the authorizer 
87.35 	fails to comply with subdivision 3, paragraph (g), the commissioner shall provide the 
87.36 	charter school with information about other eligible authorizers.
88.1 		Subd. 23a.Related party lease costs. (a) A charter school is prohibited from 
88.2 	entering a lease of real property with a related party as defined in subdivision 26, unless 
88.3 	the lessor is a nonprofit corporation under chapter 317A or a cooperative under chapter 
88.4 	308A, and the lease cost is reasonable under section 124D.11, subdivision 4, clause (1).
88.5 	(b) For purposes of this section and section 124D.11:
88.6 	(1) "related party" means an affiliate or immediate relative of the other party in 
88.7 	question, an affiliate of an immediate relative, or an immediate relative of an affiliate;
88.8 	(2) "affiliate" means a person that directly or indirectly, through one or more 
88.9 	intermediaries, controls, is controlled by, or is under common control with another person;
88.10 	(3) "immediate family" means an individual whose relationship by blood, marriage, 
88.11 	adoption, or partnering is no more remote than first cousin;
88.12 	(4) "person" means an individual or entity of any kind; and
88.13 	(5) "control" means the ability to affect the management, operations, or policy 
88.14 	actions or decisions of a person, whether through ownership of voting securities, by 
88.15 	contract, or otherwise.
88.16 	(c) A lease of real property to be used for a charter school, not excluded in paragraph 
88.17 	(a), must contain the following statement: "This lease is subject to Minnesota Statutes, 
88.18 	section 124D.10, subdivision 23a."
88.19 	(c) (d) If a charter school enters into as lessee a lease with a related party and the 
88.20 	charter school subsequently closes, the commissioner has the right to recover from the 
88.21 	lessor any lease payments in excess of those that are reasonable under section 124D.11, 
88.22 	subdivision 4, clause (1).
88.23 		Subd. 24.Pupil enrollment upon nonrenewal or termination of charter school 
88.24 	contract. If a contract is not renewed or is terminated according to subdivision 23, a 
88.25 	pupil who attended the school, siblings of the pupil, or another pupil who resides in the 
88.26 	same place as the pupil may enroll in the resident district or may submit an application 
88.27 	to a nonresident district according to section 124D.03 at any time. Applications and 
88.28 	notices required by section 124D.03 must be processed and provided in a prompt manner. 
88.29 	The application and notice deadlines in section 124D.03 do not apply under these 
88.30 	circumstances. The closed charter school must transfer the student's educational records 
88.31 	within ten business days of closure to the student's school district of residence where the 
88.32 	records must be retained or transferred under section 120A.22, subdivision 7.
88.33 		Subd. 25.Extent of specific legal authority. (a) The board of directors of a charter 
88.34 	school may sue and be sued.
88.35 	(b) The board may not levy taxes or issue bonds.
89.1 	(c) The commissioner, a sponsor an authorizer, members of the board of a sponsor
89.2 	an authorizer in their official capacity, and employees of a sponsor an authorizer are 
89.3 	immune from civil or criminal liability with respect to all activities related to a charter 
89.4 	school they approve or sponsor authorize. The board of directors shall obtain at least 
89.5 	the amount of and types of insurance required by the contract, according to subdivision 
89.6 	6. up to the applicable tort liability limits under chapter 466. The charter school board 
89.7 	must submit a copy of the insurance policy to its authorizer before starting operations. 
89.8 	The charter school board must submit changes in its insurance carrier or policy to its 
89.9 	authorizer within 20 business days of the change.
89.10 		Subd. 26.Definitions. For purposes of this section and section 124D.11:
89.11 	(1) A "Related party" is an affiliate or close relative of the other party in question, an 
89.12 	affiliate of a close relative, or a close relative of an affiliate.
89.13 	(2) "Affiliate" means a person that directly, or indirectly through one or more 
89.14 	intermediaries, controls, or is controlled by, or is under common control with, another 
89.15 	person.
89.16 	(3) "Close relative" means an individual whose relationship by blood, marriage, or 
89.17 	adoption to another individual is no more remote than first cousin.
89.18 	(4) "Person" means an individual or entity of any kind.
89.19 	(5) "Control" includes the terms "controlling," "controlled by," and "under common 
89.20 	control with" and means the possession, direct or indirect, of the power to direct or cause 
89.21 	the direction of the management, operations, or policies of a person, whether through the 
89.22 	ownership of voting securities, by contract, or otherwise.

89.23 	EFFECTIVE DATE. (a) This section is effective the day following final enactment 
89.24 	and applies beginning August 1, 2009, unless otherwise specified in this effective date.
89.25 	(b) Subdivision 3, paragraph (b), clause (2), applies to an authorizer seeking 
89.26 	approval to charter a school after the effective date of this act. The changes in subdivision 
89.27 	3, paragraph (b), clause (2), shall not apply to a sponsor under Minnesota Statutes 2008, 
89.28 	section 124D.10, that is a party to a charter contract on the effective date of this act 
89.29 	except that subdivision 3, paragraph (b), clause (2), item (iv), applies to such sponsors 
89.30 	beginning July 1, 2012.

89.31 	Sec. 41. Minnesota Statutes 2008, section 124D.11, subdivision 4, is amended to read:
89.32 		Subd. 4.Building lease aid. (a) When a charter school finds it economically 
89.33 	advantageous to rent or lease a building or land for any instructional purposes and it 
89.34 	determines that the total operating capital revenue under section 126C.10, subdivision 13, 
89.35 	is insufficient for this purpose, it may apply to the commissioner for building lease aid 
90.1 	for this purpose. The commissioner must review and either approve or deny a lease aid 
90.2 	application using the following criteria:  
90.3 	(1) the reasonableness of the price based on current market values;
90.4 	(2) the extent to which the lease conforms to applicable state laws and rules; and
90.5 	(3) the appropriateness of the proposed lease in the context of the space needs and 
90.6 	financial circumstances of the charter school.
90.7 	A charter school must not use the building lease aid it receives for custodial, maintenance 
90.8 	service, utility, or other operating costs. The amount of building lease aid per pupil unit 
90.9 	served for a charter school for any year shall not exceed the lesser of (a) 90 percent of 
90.10 	the approved cost or (b) the product of the pupil units served for the current school year 
90.11 	times the greater of the charter school's building lease aid per pupil unit served for fiscal 
90.12 	year 2003, excluding the adjustment under Laws 2002, chapter 392, article 6, section 4, 
90.13 	or $1,200.
90.14 	(b) A charter school using lease aid to make payments to a building corporation, 
90.15 	school district, or other governmental entity for the purpose of retiring the debt on that 
90.16 	building is eligible for the amount of lease aid calculated under paragraph (a) until 
90.17 	such time as the bonds or mortgage to cover the original purchase and renovation or 
90.18 	construction are retired. For each subsequent year, the charter school is eligible for lease 
90.19 	aid equal to 50 percent of the maximum lease aid amount in paragraph (a) unless the 
90.20 	commissioner approves an expansion of the charter school facility, in which case the 
90.21 	charter school is eligible for the full amount of lease aid under paragraph (a) until the 
90.22 	additional debt is retired.

90.23 	EFFECTIVE DATE. This section is effective the day following final enactment 
90.24 	and applies beginning August 1, 2009.

90.25 	Sec. 42. Minnesota Statutes 2008, section 124D.11, subdivision 9, is amended to read:
90.26 		Subd. 9.Payment of aids to charter schools. (a) Notwithstanding section 
90.27 	127A.45, subdivision 3, aid payments for the current fiscal year to a charter school not in 
90.28 	its first year of operation shall be of an equal amount on each of the 23 24 payment dates. 
90.29 	A charter school in its first year of operation shall receive, on its first payment date, ten 
90.30 	percent of its cumulative amount guaranteed for the year and 22 payments of an equal 
90.31 	amount thereafter the sum of which shall equal the current year aid payment percentage 
90.32 	multiplied by the cumulative amount guaranteed.
90.33 	(b) Notwithstanding paragraph (a) and section 127A.45, for a charter school ceasing 
90.34 	operation on or prior to the end of a school year, the current year aid payment percentage 
91.1 	multiplied by the amount due for the school year may be paid to the school after audit 
91.2 	of prior fiscal year and current fiscal year pupil counts. June 30 of a school year, for the 
91.3 	payment periods occurring after the school ceases serving students, the commissioner shall 
91.4 	withhold the estimated state aid owed the school. The charter school board of directors 
91.5 	and authorizer must submit to the commissioner a closure plan under chapter 308A or 
91.6 	317A, and financial information about the school's liabilities and assets. After receiving 
91.7 	the closure plan, financial information, an audit of pupil counts, documentation of lease 
91.8 	expenditures, and monitoring of special education expenditures, the commissioner may 
91.9 	release cash withheld and may continue regular payments up to the current year payment 
91.10 	percentages if further amounts are owed. If, based on audits and monitoring, the school 
91.11 	received state aid in excess of the amount owed, the commissioner shall retain aid withheld 
91.12 	sufficient to eliminate the aid overpayment. For a charter school ceasing operations 
91.13 	prior to, or at the end of, a school year, notwithstanding section 127A.45, subdivision 
91.14 	3, preliminary final payments may be made after receiving the closure plan, audit of 
91.15 	pupil counts, monitoring of special education expenditures, and documentation of lease 
91.16 	expenditures, and school submission of Uniform Financial Accounting and Reporting 
91.17 	Standards (UFARS) financial data for the final year of operation. Final payment may be 
91.18 	made upon receipt of audited financial statements under section 123B.77, subdivision 3.
91.19 	(c) If a charter school fails to comply with the commissioner's directive to return, 
91.20 	for cause, federal or state funds administered by the department, the commissioner may 
91.21 	withhold an amount of state aid sufficient to satisfy the directive.
91.22 	(d) If, within the timeline under section 471.425, a charter school fails to pay the state 
91.23 	of Minnesota, a school district, intermediate school district, or service cooperative after 
91.24 	receiving an undisputed invoice for goods and services, the commissioner may withhold 
91.25 	an amount of state aid sufficient to satisfy the claim and shall distribute the withheld 
91.26 	aid to the interested state agency, school district, intermediate school district, or service 
91.27 	cooperative. An interested state agency, school district, intermediate school district, or 
91.28 	education cooperative shall notify the commissioner when a charter school fails to pay an 
91.29 	undisputed invoice within 75 business days of when it received the original invoice.
91.30 	(e) Notwithstanding section 127A.45, subdivision 3, and paragraph (a), 80 percent 
91.31 	of the start-up cost aid under subdivision 8 shall be paid within 45 days after the first day 
91.32 	of student attendance for that school year. 
91.33 	(d) (f) In order to receive state aid payments under this subdivision, a charter school 
91.34 	in its first three years of operation must submit a school calendar in the form and manner 
91.35 	requested by the department and a quarterly report to the Department of Education. The 
91.36 	report must list each student by grade, show the student's start and end dates, if any, 
92.1 	with the charter school, and for any student participating in a learning year program, 
92.2 	the report must list the hours and times of learning year activities. The report must be 
92.3 	submitted not more than two weeks after the end of the calendar quarter to the department. 
92.4 	The department must develop a Web-based reporting form for charter schools to use 
92.5 	when submitting enrollment reports. A charter school in its fourth and subsequent year of 
92.6 	operation must submit a school calendar and enrollment information to the department in 
92.7 	the form and manner requested by the department.
92.8 	(e) (g) Notwithstanding sections 317A.701 to 317A.791, upon closure of a charter 
92.9 	school and satisfaction of creditors, cash and investment balances remaining shall be 
92.10 	returned to the state.

92.11 	Sec. 43. Minnesota Statutes 2008, section 124D.128, subdivision 2, is amended to read:
92.12 		Subd. 2.Commissioner designation. (a) An area learning center A state-approved 
92.13 	alternative program designated by the state must be a site. An area learning center A 
92.14 	state-approved alternative program must provide services to students who meet the criteria 
92.15 	in section 124D.68 and who are enrolled in:
92.16 	(1) a district that is served by the center state-approved alternative program; or
92.17 	(2) a charter school located within the geographic boundaries of a district that is 
92.18 	served by the center state-approved alternative program.
92.19 	(b) A school district or charter school may be approved biennially by the state to 
92.20 	provide additional instructional programming that results in grade level acceleration. The 
92.21 	program must be designed so that students make grade progress during the school year 
92.22 	and graduate prior to the students' peers.
92.23 	(c) To be designated, a district, charter school, or center state-approved alternative 
92.24 	program must demonstrate to the commissioner that it will:
92.25 	(1) provide a program of instruction that permits pupils to receive instruction 
92.26 	throughout the entire year; and
92.27 	(2) develop and maintain a separate record system that, for purposes of section 
92.28 	126C.05, permits identification of membership attributable to pupils participating in the 
92.29 	program. The record system and identification must ensure that the program will not have 
92.30 	the effect of increasing the total average daily membership attributable to an individual 
92.31 	pupil as a result of a learning year program. The record system must include the date the 
92.32 	pupil originally enrolled in a learning year program, the pupil's grade level, the date of 
92.33 	each grade promotion, the average daily membership generated in each grade level, the 
92.34 	number of credits or standards earned, and the number needed to graduate. 
93.1 	(d) A student who has not completed a school district's graduation requirements 
93.2 	may continue to enroll in courses the student must complete in order to graduate until 
93.3 	the student satisfies the district's graduation requirements or the student is 21 years old, 
93.4 	whichever comes first.

93.5 	Sec. 44. Minnesota Statutes 2008, section 124D.128, subdivision 3, is amended to read:
93.6 		Subd. 3.Student planning. A district, charter school, or area learning center
93.7 	state-approved alternative program must inform all pupils and their parents about the 
93.8 	learning year program and that participation in the program is optional. A continual 
93.9 	learning plan must be developed at least annually for each pupil with the participation 
93.10 	of the pupil, parent or guardian, teachers, and other staff; each participant must sign and 
93.11 	date the plan. The plan must specify the learning experiences that must occur during the 
93.12 	entire fiscal year and are necessary for grade progression or, for secondary students, 
93.13 	graduation. The plan must include:
93.14 	(1) the pupil's learning objectives and experiences, including courses or credits the 
93.15 	pupil plans to complete each year and, for a secondary pupil, the graduation requirements 
93.16 	the student must complete;
93.17 	(2) the assessment measurements used to evaluate a pupil's objectives;
93.18 	(3) requirements for grade level or other appropriate progression; and
93.19 	(4) for pupils generating more than one average daily membership in a given grade, 
93.20 	an indication of which objectives were unmet.
93.21 	The plan may be modified to conform to district schedule changes. The district may 
93.22 	not modify the plan if the modification would result in delaying the student's time of 
93.23 	graduation.

93.24 	Sec. 45. Minnesota Statutes 2008, section 124D.42, subdivision 6, is amended to read:
93.25 		Subd. 6.Program training. The commission must, within available resources:
93.26 	(1) orient each grantee organization in the nature, philosophy, and purpose of the 
93.27 	program; and
93.28 	(2) build an ethic of community service through general community service training; 
93.29 	and.
93.30 	(3) provide additional training as it determines necessary, which may include 
93.31 	training in evaluating early literacy skills and teaching reading to preschool children 
93.32 	through the St. Croix River Education District under Laws 2001, First Special Session 
93.33 	chapter 6, article 2, section 70, to assist local Head Start organizations in establishing and 
93.34 	evaluating Head Start programs for developing children's early literacy skills.

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

94.2 	Sec. 46. Minnesota Statutes 2008, section 124D.42, is amended by adding a 
94.3 	subdivision to read:
94.4 		Subd. 6a.Minnesota reading corps program. (a) A Minnesota reading corps 
94.5 	program is established to provide Americorps members with a data-based problem-solving 
94.6 	model of literacy instruction to use in helping to train local Head Start program providers, 
94.7 	other prekindergarten program providers, and staff in schools with students in kindergarten 
94.8 	through grade 3 to evaluate and teach early literacy skills to children age 3 to grade 3. 
94.9 	(b) Literacy programs under this subdivision must comply with the provisions 
94.10 	governing literacy program goals and data use under section 119A.50, subdivision 3, 
94.11 	paragraph (b).

94.12 	Sec. 47. Minnesota Statutes 2008, section 124D.68, subdivision 2, is amended to read:
94.13 		Subd. 2.Eligible pupils. A pupil under the age of 21 or who meets the requirements 
94.14 	of section 120A.20, subdivision 1, paragraph (c), is eligible to participate in the graduation 
94.15 	incentives program, if the pupil:
94.16 	(1) performs substantially below the performance level for pupils of the same age 
94.17 	in a locally determined achievement test;
94.18 	(2) is at least one year behind in satisfactorily completing coursework or obtaining 
94.19 	credits for graduation;
94.20 	(3) is pregnant or is a parent;
94.21 	(4) has been assessed as chemically dependent;
94.22 	(5) has been excluded or expelled according to sections 121A.40 to 121A.56;
94.23 	(6) has been referred by a school district for enrollment in an eligible program or 
94.24 	a program pursuant to section 124D.69;
94.25 	(7) is a victim of physical or sexual abuse;
94.26 	(8) has experienced mental health problems;
94.27 	(9) has experienced homelessness sometime within six months before requesting a 
94.28 	transfer to an eligible program;
94.29 	(10) speaks English as a second language or has limited English proficiency; or
94.30 	(11) has withdrawn from school or has been chronically truant; or
94.31 	(12) is being treated in a hospital in the seven-county metropolitan area for cancer or 
94.32 	other life threatening illness or is the sibling of an eligible pupil who is being currently 
94.33 	treated, and resides with the pupil's family at least 60 miles beyond the outside boundary 
94.34 	of the seven-county metropolitan area.

95.1 	Sec. 48. Minnesota Statutes 2008, section 124D.68, subdivision 3, is amended to read:
95.2 		Subd. 3.Eligible programs. (a) A pupil who is eligible according to subdivision 2 
95.3 	may enroll in area learning centers a state-approved alternative program under sections 
95.4 	123A.05 to 123A.08. 
95.5 	(b) A pupil who is eligible according to subdivision 2 and who is between the ages 
95.6 	of 16 and 21 a high school junior or senior may enroll in postsecondary courses under 
95.7 	section 124D.09. 
95.8 	(c) A pupil who is eligible under subdivision 2, may enroll in any public elementary 
95.9 	or secondary education program. 
95.10 	(d) A pupil who is eligible under subdivision 2, may enroll in any nonpublic, 
95.11 	nonsectarian school that has contracted with the serving school district to provide 
95.12 	educational services. However, notwithstanding other provisions of this section, only a 
95.13 	pupil who is eligible under subdivision 2, clause (12), may enroll in a contract alternative 
95.14 	school that is specifically structured to provide educational services to such a pupil.
95.15 	(e) A pupil who is between the ages of 16 and 21 may enroll in any adult basic 
95.16 	education programs approved under section 124D.52 and operated under the community 
95.17 	education program contained in section 124D.19. 

95.18 	Sec. 49. Minnesota Statutes 2008, section 124D.68, subdivision 4, is amended to read:
95.19 		Subd. 4.Additional eligible program. A pupil who is at least 16 years of age, 
95.20 	who is eligible under subdivision 2, clause (a), and who has been enrolled only in a 
95.21 	public school, if the pupil has been enrolled in any school, during the year immediately 
95.22 	before transferring under this subdivision, may transfer to any nonpublic school that has 
95.23 	contracted with the serving school district to provide nonsectarian educational services. 
95.24 	The school must enroll every eligible pupil who seeks to transfer to the school under 
95.25 	this program subject to available space.

95.26 	Sec. 50. Minnesota Statutes 2008, section 124D.68, subdivision 5, is amended to read:
95.27 		Subd. 5.Pupil enrollment. (a) Any eligible pupil may apply to enroll in an eligible 
95.28 	program. Approval of the resident district is not required for:
95.29 	(1) an eligible pupil to enroll in any eligible program in a nonresident district 
95.30 	under subdivision 3 or 4 or an area learning center a state-approved alternative program
95.31 	established under section 123A.05; or
95.32 	(2) an eligible pupil under subdivision 2, to enroll in an adult basic education 
95.33 	program approved under section 124D.52.
96.1 	(b) Notwithstanding paragraph (a), a nonresident district must first approve the 
96.2 	enrollment application of any eligible pupil who was expelled under section 121A.45 for a 
96.3 	reason stated in section 124D.03, subdivision 1, paragraph (b).

96.4 	EFFECTIVE DATE. This section is effective for the 2009-2010 school year and 
96.5 	later.

96.6 	Sec. 51. Minnesota Statutes 2008, section 124D.83, subdivision 4, is amended to read:
96.7 		Subd. 4.Early childhood family education revenue. A school receiving aid 
96.8 	under this section is eligiblemay apply annually to the commissioner to receive an early 
96.9 	childhood family education revenue grant to provide early childhood family education 
96.10 	programs for parents and children who are enrolled or eligible for enrollment in a federally 
96.11 	recognized tribe. The revenue equals 1.5 times the statewide average expenditure per 
96.12 	participant under section 124D.135, times the number of children and parents participating 
96.13 	full time in the program. The program must grant must be used for programs and services 
96.14 	that comply with section 124D.13, except that the school is not required to provide a 
96.15 	community education program or establish a community education advisory council. The 
96.16 	program must be designed to improve the skills of parents and promote American Indian 
96.17 	history, language, and culture. The school must make affirmative efforts to encourage 
96.18 	participation by fathers. Admission may not be limited to those enrolled in or eligible for 
96.19 	enrollment in a federally recognized tribe.

96.20 	Sec. 52. Minnesota Statutes 2008, section 124D.86, subdivision 1, is amended to read:
96.21 		Subdivision 1.Use of revenue. (a) An adjoining district that develops a plan under 
96.22 	Minnesota Rules, parts 3535.0160 and 3535.0170, is not required to implement the plan.
96.23 	(b) Districts must use integration revenue under this section must be used for 
96.24 	programs established under a desegregation plan filed with the Department of Education 
96.25 	according to Minnesota Rules, parts 3535.0100 to 3535.0180, or under court order. The 
96.26 	revenue must be used to create or enhance learning opportunities which are designed to 
96.27 	provide opportunities for students to have increased and sustained interracial contacts 
96.28 	and improved educational opportunities and outcomes designed to close the academic 
96.29 	achievement gap between white students and protected students as defined in Minnesota 
96.30 	Rules, part 3535.0110, subpart 4, through classroom experiences, staff initiatives, and 
96.31 	other educationally related programs, consistent with subdivision 1b.

96.32 	EFFECTIVE DATE. This section is effective for the 2010-2011 school year and 
96.33 	later.

97.1 	Sec. 53. Minnesota Statutes 2008, section 124D.86, subdivision 1a, is amended to read:
97.2 		Subd. 1a.Budget approval process. Each year before a district receives any 
97.3 	revenue under subdivision 3, clause (4), (5), or (6), the district by April 1 must submit to 
97.4 	the Department of Education, for its review and approval by April 30 a budget detailing the 
97.5 	costs of the desegregation/integration plan filed under Minnesota Rules, parts 3535.0100 
97.6 	to 3535.0180. Notwithstanding chapter 14, the department may develop criteria for 
97.7 	budget approval, consistent with subdivision 1b. The department shall consult with the 
97.8 	Desegregation Advisory Board in developing these criteria. The criteria developed by the 
97.9 	department should must address, at a minimum, the following:
97.10 	(1) budget items cannot be approved unless they are part of any overall desegregation 
97.11 	plan approved by the district for isolated sites or by the Multidistrict Collaboration 
97.12 	Council and participation participating individual members;
97.13 	(2) the budget must indicate how revenue expenditures will be used specifically to 
97.14 	support increased opportunities for and sustained interracial contact contacts and improved 
97.15 	educational opportunities and outcomes designed to close the academic achievement 
97.16 	gap between white students and protected students as defined in Minnesota Rules, part 
97.17 	3535.0110, subpart 4, consistent with subdivision 1b;
97.18 	(3) components of the budget to be considered by the department, including staffing, 
97.19 	curriculum, transportation, facilities, materials, and equipment and reasonable planning 
97.20 	costs, as determined by the department; and
97.21 	(4) if plans are proposed to enhance existing programs, the total budget being 
97.22 	appropriated to the program must be included, indicating what part is to be funded using 
97.23 	integration revenue and what part is to be funded using other revenues.

97.24 	EFFECTIVE DATE. This section is effective for the 2010-2011 school year and 
97.25 	later.

97.26 	Sec. 54. Minnesota Statutes 2008, section 124D.86, subdivision 1b, is amended to read:
97.27 		Subd. 1b.Plan components. Each year a district's board must approve the plans 
97.28 	submitted by each district under Minnesota Rules, parts 3535.0160 and 3535.0170, 
97.29 	must be approved by the district's board each year before integration revenue will be is
97.30 	awarded. If a district is applying for revenue for a plan that is part of a multidistrict 
97.31 	council, the individual district shall not receive revenue unless it ratifies the plan adopted 
97.32 	by its multidistrict council or approves a modified plan with a written explanation of 
97.33 	any modifications. Each plan shall contain:
97.34 	(1) an identification of identify the integration issues at the sites or districts covered 
97.35 	by Minnesota Rules, parts 3535.0100 to 3535.0180;
98.1 	(2) a description of describe the community outreach that preceded the integration 
98.2 	plan, such that the commissioner can determine whether the membership of the planning 
98.3 	councils complied with the requirements of Minnesota Rules, parts 3535.0100 to 
98.4 	3535.0180; and
98.5 	(3) the identify specific goals of the integration plan that is premised on valid and 
98.6 	reliable measures, effective and efficient use of resources, and continuous adaptation of 
98.7 	best practices;
98.8 	(4) provide for implementing  innovative and practical strategies and programs such 
98.9 	as magnet schools, transportation, research-based programs to improve the performance of 
98.10 	protected students with lower measured achievement on state or local assessments, staff 
98.11 	development for teachers in cultural competency, formative assessments, and increased 
98.12 	numbers of teachers of color that enable the district to achieve annual progress in realizing 
98.13 	the goals in its plan; and
98.14 	(5) establish valid and reliable longitudinal measures for the district to use in 
98.15 	demonstrating to the commissioner the amount of progress it has achieved in realizing 
98.16 	the goals in its plan.
98.17 	By June 30 of the subsequent fiscal year, each district shall report to the commissioner in 
98.18 	writing about the extent to which the integration goals identified in the plan were met.

98.19 	EFFECTIVE DATE. This section is effective for the 2010-2011 school year and 
98.20 	later.

98.21 	Sec. 55. Minnesota Statutes 2008, section 126C.05, subdivision 15, is amended to read:
98.22 		Subd. 15.Learning year pupil units. (a) When a pupil is enrolled in a learning 
98.23 	year program under section 124D.128, an area learning center or an alternative learning 
98.24 	program approved by the commissioner under sections 123A.05 and 123A.06, an 
98.25 	alternative program approved by the commissioner, or a contract alternative program 
98.26 	under section 124D.68, subdivision 3, paragraph (d), or subdivision 3a, for more than 
98.27 	1,020 hours in a school year for a secondary student, more than 935 hours in a school year 
98.28 	for an elementary student, or more than 425 hours in a school year for a kindergarten 
98.29 	student without a disability, that pupil may be counted as more than one pupil in average 
98.30 	daily membership for purposes of section 126C.10, subdivision 2a. The amount in excess 
98.31 	of one pupil must be determined by the ratio of the number of hours of instruction 
98.32 	provided to that pupil in excess of: (i) the greater of 1,020 hours or the number of hours 
98.33 	required for a full-time secondary pupil in the district to 1,020 for a secondary pupil; (ii) 
98.34 	the greater of 935 hours or the number of hours required for a full-time elementary pupil 
99.1 	in the district to 935 for an elementary pupil in grades 1 through 6; and (iii) the greater of 
99.2 	425 hours or the number of hours required for a full-time kindergarten student without a 
99.3 	disability in the district to 425 for a kindergarten student without a disability. Hours that 
99.4 	occur after the close of the instructional year in June shall be attributable to the following 
99.5 	fiscal year. A kindergarten student must not be counted as more than 1.2 pupils in average 
99.6 	daily membership under this subdivision. A student in grades 1 through 12 must not be 
99.7 	counted as more than 1.2 pupils in average daily membership under this subdivision. 
99.8 	(b)(i) To receive general education revenue for a pupil in an area learning center 
99.9 	or alternative learning program that has an independent study component, a district 
99.10 	must meet the requirements in this paragraph. The district must develop, for the pupil, 
99.11 	a continual learning plan consistent with section 124D.128, subdivision 3. Each school 
99.12 	district that has a state-approved public an area learning center or alternative learning 
99.13 	program must reserve revenue in an amount equal to at least 90 percent of the district 
99.14 	average general education revenue per pupil unit less compensatory revenue per pupil 
99.15 	unit, minus an amount equal to the product of the formula allowance according to section 
99.16 	126C.10, subdivision 2, times .0485, calculated without basic skills and transportation 
99.17 	sparsity revenue, times the number of pupil units generated by students attending a 
99.18 	state-approved public an area learning center or alternative learning program. The amount 
99.19 	of reserved revenue available under this subdivision may only be spent for program costs 
99.20 	associated with the state-approved public area learning center or alternative learning 
99.21 	program. Compensatory revenue must be allocated according to section 126C.15, 
99.22 	subdivision 2.Basic skills revenue generated according to section 126C.10, subdivision 4, 
99.23 	by pupils attending the eligible program must be allocated to the program.
99.24 	(ii) General education revenue for a pupil in an approved a state-approved
99.25 	alternative program without an independent study component must be prorated for a 
99.26 	pupil participating for less than a full year, or its equivalent. The district must develop a 
99.27 	continual learning plan for the pupil, consistent with section 124D.128, subdivision 3. 
99.28 	Each school district that has a state-approved public an area learning center or alternative 
99.29 	learning program must reserve revenue in an amount equal to at least 90 percent of the 
99.30 	district average general education revenue per pupil unit less compensatory revenue per 
99.31 	pupil unit, minus an amount equal to the product of the formula allowance according 
99.32 	to section 126C.10, subdivision 2, times .0485, calculated without basic skills and 
99.33 	transportation sparsity revenue, times the number of pupil units generated by students 
99.34 	attending a state-approved public an area learning center or alternative learning program. 
99.35 	The amount of reserved revenue available under this subdivision may only be spent for 
99.36 	program costs associated with the state-approved public area learning center or alternative 
100.1 	learning program. Compensatory revenue must be allocated according to section 126C.15, 
100.2 	subdivision 2. Basic skills revenue generated according to section 126C.10, subdivision 4, 
100.3 	by pupils attending the eligible program must be allocated to the program.
100.4 	(iii) General education revenue for a pupil in an approved a state-approved
100.5 	alternative program that has an independent study component must be paid for each hour 
100.6 	of teacher contact time and each hour of independent study time completed toward a 
100.7 	credit or graduation standards necessary for graduation. Average daily membership for a 
100.8 	pupil shall equal the number of hours of teacher contact time and independent study 
100.9 	time divided by 1,020.
100.10 	(iv) For an a state-approved alternative program having an independent study 
100.11 	component, the commissioner shall require a description of the courses in the program, the 
100.12 	kinds of independent study involved, the expected learning outcomes of the courses, and 
100.13 	the means of measuring student performance against the expected outcomes.

100.14 	Sec. 56. Minnesota Statutes 2008, section 126C.05, subdivision 20, is amended to read:
100.15 		Subd. 20.Project-based average daily membership. (a) Project-based is an 
100.16 	instructional program where students complete coursework for credit at an individual pace 
100.17 	that is primarily student-led and may be completed on site, in the community, or online. A 
100.18 	project-based program may be made available to all or designated students and grades 
100.19 	in a school. To receive general education revenue for a pupil enrolled in a public school 
100.20 	with a project-based program, a school must meet the requirements in this paragraph. 
100.21 	The school must:
100.22 	(1) register with the commissioner as a project-based program by May 30 of the 
100.23 	preceding fiscal year apply and receive approval from the commissioner as a project-based 
100.24 	program at least 90 days prior to starting the program;
100.25 	(2) provide a minimum teacher contact of no less than one hour per week per 
100.26 	project-based credit for each pupil;
100.27 	(3) ensure that the program will not increase the total average daily membership 
100.28 	generated by the student and that there will be the expectation that the students will be 
100.29 	making typical progression towards high school graduation;
100.30 	(3) (4) maintain a record system that shows when each credit or portion thereof was 
100.31 	reported for membership for each pupil; and
100.32 	(4) (5) report pupil membership consistent with paragraph (b).
100.33 	(b) The commissioner must develop a formula for reporting pupil membership to 
100.34 	compute average daily membership for each registeredapproved project-based school
101.1 	program. Average daily membership for a pupil in a registeredan approved project-based 
101.2 	program is the lesser of:
101.3 	(1) 1.0; or
101.4 	(2) the ratio of (i) the number of membership hours generated by project-based 
101.5 	credits completed during the school year plus membership hours generated by credits 
101.6 	completed in a seat-based setting to (ii) the annual required instructional hours at that 
101.7 	grade level. Membership hours for a partially completed project-based credit must be 
101.8 	prorated. General education revenue for a pupil in a project-based program must be 
101.9 	prorated for a pupil participating for less than a full year, or its equivalent.
101.10 	(c) For a program that has not been approved by the commissioner for project-based 
101.11 	learning but an auditor or other site visit deems that any portion or credits awarded 
101.12 	by the school are project-based, student membership must be computed according to 
101.13 	paragraph (b).

101.14 	Sec. 57. Minnesota Statutes 2008, section 126C.10, subdivision 34, is amended to read:
101.15 		Subd. 34.Basic alternative teacher compensation aid. (a) For fiscal years 
101.16 	2007 and later, 2008, and 2009, the basic alternative teacher compensation aid for a 
101.17 	school district with a plan approved under section 122A.414, subdivision 2b, equals 65
101.18 	73.1 percent of the alternative teacher compensation revenue under section 122A.415, 
101.19 	subdivision 1. The basic alternative teacher compensation aid for an intermediate school 
101.20 	district or charter school with a plan approved under section 122A.414, subdivisions 2a 
101.21 	and 2b, if the recipient is a charter school, equals $260 times the number of pupils enrolled 
101.22 	in the school on October 1 of the previous fiscal year, or on October 1 of the current fiscal 
101.23 	year for a charter school in the first year of operation, times the ratio of the sum of the 
101.24 	alternative teacher compensation aid and alternative teacher compensation levy for all 
101.25 	participating school districts to the maximum alternative teacher compensation revenue 
101.26 	for those districts under section 122A.415, subdivision 1.
101.27 	(b) For fiscal years 2010 and later, the basic alternative teacher compensation aid for 
101.28 	a school with a plan approved under section 122A.414, subdivision 2b, equals 65 percent 
101.29 	of the alternative teacher compensation revenue under section 122A.415, subdivision 1. 
101.30 	The basic alternative teacher compensation aid for an intermediate school district or 
101.31 	charter school with a plan approved under section 122A.414, subdivisions 2a and 2b, if 
101.32 	the recipient is a charter school, equals $260 times the number of pupils enrolled in the 
101.33 	school on October 1 of the previous year, or on October 1 of the current year for a charter 
101.34 	school in the first year of operation, times the ratio of the sum of the alternative teacher 
101.35 	compensation aid and alternative teacher compensation levy for all participating school 
102.1 	districts to the maximum alternative teacher compensation revenue for those districts 
102.2 	under section 122A.415, subdivision 1.
102.3 	(b) (c) Notwithstanding paragraphs (a) and (b) and section 122A.415, subdivision 
102.4 	1, the state total basic alternative teacher compensation aid entitlement must not exceed 
102.5 	$75,636,000 for fiscal year 2007 and later. The commissioner must limit the amount 
102.6 	of alternative teacher compensation aid approved under section 122A.415 so as not to 
102.7 	exceed these limits.

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

102.9 	Sec. 58. [127A.70] MINNESOTA P-20 EDUCATION PARTNERSHIP.
102.10 		Subdivision 1.Establishment; membership. A P-20 education partnership is 
102.11 	established to create a seamless system of education that maximizes achievements of 
102.12 	all students, from early childhood through elementary, secondary, and postsecondary 
102.13 	education, while promoting the efficient use of financial and human resources. The 
102.14 	partnership shall consist of major statewide educational groups or constituencies or 
102.15 	noneducational statewide organizations with a stated interest in P-20 education. The initial 
102.16 	membership of the partnership includes the members serving on the Minnesota P-16 
102.17 	Education Partnership and four legislators appointed as follows:
102.18 	(1) one senator from the majority party and one senator from the minority party, 
102.19 	appointed by the Subcommittee on Committees of the Committee on Rules and 
102.20 	Administration; and
102.21 	(2) one member of the house of representatives appointed by the speaker of the 
102.22 	house and one member appointed by the minority leader of the house of representatives.
102.23 	The chair of the P-16 education partnership must convene the first meeting of the 
102.24 	P-20 partnership. Prospective members may be nominated by any partnership member and 
102.25 	new members will be added with the approval of a two-thirds majority of the partnership. 
102.26 	The partnership will also seek input from nonmember organizations whose expertise can 
102.27 	help inform the partnership's work.
102.28 	Partnership members shall be represented by the chief executives, presidents, or 
102.29 	other formally designated leaders of their respective organizations, or their designees. The 
102.30 	partnership shall meet at least three times during each calendar year.
102.31 		Subd. 2.Powers and duties; report. The partnership shall develop 
102.32 	recommendations to the governor and the legislature designed to maximize the 
102.33 	achievement of all P-20 students while promoting the efficient use of state resources, 
102.34 	thereby helping the state realize the maximum value for its investment. These 
103.1 	recommendations may include, but are not limited to, strategies, policies, or other actions 
103.2 	focused on:
103.3 	(1) improving the quality of and access to education at all points from preschool 
103.4 	through graduate education;
103.5 	(2) improving preparation for, and transitions to, postsecondary education and 
103.6 	work; and
103.7 	(3) ensuring educator quality by creating rigorous standards for teacher recruitment, 
103.8 	teacher preparation, induction and mentoring of beginning teachers, and continuous 
103.9 	professional development for career teachers.
103.10 	By January 15 of each year, the partnership shall submit a report to the governor 
103.11 	and to the chairs and ranking minority members of the legislative committees and 
103.12 	divisions with jurisdiction over P-20 education policy and finance that summarizes the 
103.13 	partnership's progress in meeting its goals and identifies the need for any draft legislation 
103.14 	when necessary to further the goals of the partnership to maximize student achievement 
103.15 	while promoting efficient use of resources.
103.16 		Subd. 3.Expiration. Notwithstanding section 15.059, subdivision 5, the partnership 
103.17 	is permanent and does not expire.

103.18 	Sec. 59. Minnesota Statutes 2008, section 171.05, subdivision 2, is amended to read:
103.19 		Subd. 2.Person less than 18 years of age. (a) Notwithstanding any provision 
103.20 	in subdivision 1 to the contrary, the department may issue an instruction permit to an 
103.21 	applicant who is 15, 16, or 17 years of age and who:
103.22 	(1) has completed a course of driver education in another state, has a previously 
103.23 	issued valid license from another state, or is enrolled in either:
103.24 	(i) a public, private, or commercial driver education program that is approved by 
103.25 	the commissioner of public safety and that includes classroom and behind-the-wheel 
103.26 	training; or
103.27 	(ii) an approved behind-the-wheel driver education program when the student is 
103.28 	receiving full-time instruction in a home school within the meaning of sections 120A.22
103.29 	and 120A.24, the student is working toward a homeschool diploma, the student's status 
103.30 	as a homeschool student has been certified by the superintendent of the school district in 
103.31 	which the student resides, and the student is taking home-classroom driver training with 
103.32 	classroom materials approved by the commissioner of public safety, and the student's 
103.33 	parent or guardian has certified the student's homeschool and home-classroom driver 
103.34 	training status on the form approved by the commissioner;
103.35 	(2) has completed the classroom phase of instruction in the driver education program;
104.1 	(3) has passed a test of the applicant's eyesight;
104.2 	(4) has passed a department-administered test of the applicant's knowledge of traffic 
104.3 	laws;
104.4 	(5) has completed the required application, which must be approved by (i) either 
104.5 	parent when both reside in the same household as the minor applicant or, if otherwise, then 
104.6 	(ii) the parent or spouse of the parent having custody or, in the event there is no court order 
104.7 	for custody, then (iii) the parent or spouse of the parent with whom the minor is living 
104.8 	or, if items (i) to (iii) do not apply, then (iv) the guardian having custody of the minor or, 
104.9 	in the event a person under the age of 18 has no living father, mother, or guardian, or is 
104.10 	married or otherwise legally emancipated, then (v) the applicant's adult spouse, adult close 
104.11 	family member, or adult employer; provided, that the approval required by this clause 
104.12 	contains a verification of the age of the applicant and the identity of the parent, guardian, 
104.13 	adult spouse, adult close family member, or adult employer; and
104.14 	(6) has paid the fee required in section 171.06, subdivision 2.
104.15 	(b) For the purposes of determining compliance with the certification of paragraph 
104.16 	(a), clause (1), item (ii), the commissioner may request verification of a student's 
104.17 	homeschool status from the superintendent of the school district in which the student 
104.18 	resides and the superintendent shall provide that verification.
104.19 	(c) The instruction permit is valid for two years from the date of application and 
104.20 	may be renewed upon payment of a fee equal to the fee for issuance of an instruction 
104.21 	permit under section 171.06, subdivision 2.

104.22 	Sec. 60. Minnesota Statutes 2008, section 171.17, subdivision 1, is amended to read:
104.23 		Subdivision 1.Offenses. (a) The department shall immediately revoke the license 
104.24 	of a driver upon receiving a record of the driver's conviction of:
104.25 	(1) manslaughter resulting from the operation of a motor vehicle or criminal 
104.26 	vehicular homicide or injury under section 609.21;
104.27 	(2) a violation of section 169A.20 or 609.487;
104.28 	(3) a felony in the commission of which a motor vehicle was used;
104.29 	(4) failure to stop and disclose identity and render aid, as required under section 
104.30 	169.09, in the event of a motor vehicle accident, resulting in the death or personal injury 
104.31 	of another;
104.32 	(5) perjury or the making of a false affidavit or statement to the department under 
104.33 	any law relating to the application, ownership or operation of a motor vehicle, including 
104.34 	on the certification required under section 171.05, subdivision 2, clause (1), item (ii), to 
104.35 	issue an instruction permit to a homeschool student;
105.1 	(6) except as this section otherwise provides, three charges of violating within a 
105.2 	period of 12 months any of the provisions of chapter 169 or of the rules or municipal 
105.3 	ordinances enacted in conformance with chapter 169, for which the accused may be 
105.4 	punished upon conviction by imprisonment;
105.5 	(7) two or more violations, within five years, of the misdemeanor offense described 
105.6 	in section 169.444, subdivision 2, paragraph (a);
105.7 	(8) the gross misdemeanor offense described in section 169.444, subdivision 2, 
105.8 	paragraph (b);
105.9 	(9) an offense in another state that, if committed in this state, would be grounds for 
105.10 	revoking the driver's license; or
105.11 	(10) a violation of an applicable speed limit by a person driving in excess of 100 
105.12 	miles per hour. The person's license must be revoked for six months for a violation of 
105.13 	this clause, or for a longer minimum period of time applicable under section 169A.53, 
105.14 	169A.54, or 171.174.
105.15 	(b) The department shall immediately revoke the school bus endorsement of a driver 
105.16 	upon receiving a record of the driver's conviction of the misdemeanor offense described in 
105.17 	section 169.443, subdivision 7.

105.18 	Sec. 61. Minnesota Statutes 2008, section 171.22, subdivision 1, is amended to read:
105.19 		Subdivision 1.Violations. With regard to any driver's license, including a 
105.20 	commercial driver's license, it shall be unlawful for any person:
105.21 	(1) to display, cause or permit to be displayed, or have in possession, any fictitious 
105.22 	or fraudulently altered driver's license or Minnesota identification card;
105.23 	(2) to lend the person's driver's license or Minnesota identification card to any other 
105.24 	person or knowingly permit the use thereof by another;
105.25 	(3) to display or represent as one's own any driver's license or Minnesota 
105.26 	identification card not issued to that person;
105.27 	(4) to use a fictitious name or date of birth to any police officer or in any application 
105.28 	for a driver's license or Minnesota identification card, or to knowingly make a false 
105.29 	statement, or to knowingly conceal a material fact, or otherwise commit a fraud in any 
105.30 	such application;
105.31 	(5) to alter any driver's license or Minnesota identification card;
105.32 	(6) to take any part of the driver's license examination for another or to permit 
105.33 	another to take the examination for that person;
105.34 	(7) to make a counterfeit driver's license or Minnesota identification card;
106.1 	(8) to use the name and date of birth of another person to any police officer for the 
106.2 	purpose of falsely identifying oneself to the police officer; or
106.3 	(9) to display as a valid driver's license any canceled, revoked, or suspended driver's 
106.4 	license. A person whose driving privileges have been withdrawn may display a driver's 
106.5 	license only for identification purposes; or
106.6 	(10) to submit a false affidavit or statement to the department on the certification 
106.7 	required under section 171.05, subdivision 2, clause (1), item (ii), to issue an instruction 
106.8 	permit to a homeschool student.

106.9 	Sec. 62. Minnesota Statutes 2008, section 181A.05, subdivision 1, is amended to read:
106.10 		Subdivision 1.When issued. Any minor 14 or 15 years of age who wishes to work 
106.11 	on school days during school hours shall first secure an employment certificate. The 
106.12 	certificate shall be issued only by the school district superintendent, the superintendent's 
106.13 	agent, or some other person designated by the Board of Education, or by the person in 
106.14 	charge of providing instruction for students enrolled in nonpublic schools as defined in 
106.15 	section 120A.22, subdivision 4. The employment certificate shall be issued only for 
106.16 	a specific position with a designated employer and shall be issued only in the following 
106.17 	circumstances:
106.18 	(1) if a minor is to be employed in an occupation not prohibited by rules promulgated 
106.19 	under section 181A.09 and as evidence thereof presents a signed statement from the 
106.20 	prospective employer; and 
106.21 	(2) if the parent or guardian of the minor consents to the employment; and
106.22 	(3) if the issuing officer believes the minor is physically capable of handling the job 
106.23 	in question and further believes the best interests of the minor will be served by permitting 
106.24 	the minor to work.

106.25 	Sec. 63. Minnesota Statutes 2008, section 471.975, is amended to read:
106.26 	471.975 MAY PAY DIFFERENTIAL OF RESERVE ON ACTIVE DUTY.
106.27 	(a) Except as provided in paragraph (b), a statutory or home rule charter city, county, 
106.28 	town, or other political subdivision may pay to each eligible member of the National 
106.29 	Guard or other reserve component of the armed forces of the United States an amount 
106.30 	equal to the difference between the member's basicbase  active duty military salary and the 
106.31 	salary the member would be paid as an active political subdivision employee, including 
106.32 	any adjustments the member would have received if not on leave of absence. This 
106.33 	payment may be made only to a person whose basicbase  active duty military salary is less 
106.34 	than the salary the person would be paid as an active political subdivision employee. Back 
107.1 	pay authorized by this section may be paid in a lump sum. Payment under this section 
107.2 	must not extend beyond four years from the date the employee reported for active service, 
107.3 	plus any additional time the employee may be legally required to serve.
107.4 	(b) Subject to the limits under paragraph (g), each school district shall pay to each 
107.5 	eligible member of the National Guard or other reserve component of the armed forces of 
107.6 	the United States an amount equal to the difference between the member's basicbase  active 
107.7 	duty military salary and the salary the member would be paid as an active school district 
107.8 	employee, including any adjustments the member would have received if not on leave of 
107.9 	absence. The pay differential must be based on a comparison between the member's daily 
107.10 	base rate of active duty pay, calculated by dividing the member's base military monthly 
107.11 	salary by the number of paid days in the month, and the member's daily rate of pay for the 
107.12 	member's school district salary, calculated by dividing the member's total school district 
107.13 	salary by the number of contract days. The member's salary as a school district employee 
107.14 	must include the member's basic salary and any additional salary the member earns from 
107.15 	the school district for cocurricular and extracurricular activities. The differential payment 
107.16 	under this paragraph must be the difference between the daily base rates of military pay 
107.17 	times the number of school district contract days the member misses because of military 
107.18 	active duty. This payment may be made only to a person whose basic active duty military 
107.19 	salary daily base rate of active duty pay is less than the salary the person would be paid
107.20 	person's daily rate of pay as an active school district employee. Payments may be made at 
107.21 	the intervals at which the member received pay as a school district employee. Payment 
107.22 	under this section must not extend beyond four years from the date the employee reported 
107.23 	for active service, plus any additional time the employee may be legally required to serve.
107.24 	(c) An eligible member of the reserve components of the armed forces of the United 
107.25 	States is a reservist or National Guard member who was an employee of a political 
107.26 	subdivision at the time the member reported for active service on or after May 29, 2003, 
107.27 	or who is on active service on May 29, 2003.
107.28 	(d) Except as provided in paragraph (e) and elsewhere in Minnesota Statutes, a 
107.29 	statutory or home rule charter city, county, town, or other political subdivision has total 
107.30 	discretion regarding employee benefit continuation for a member who reports for active 
107.31 	service and the terms and conditions of any benefit.
107.32 	(e) A school district must continue the employee's enrollment in health and dental 
107.33 	coverage, and the employer contribution toward that coverage, until the employee is 
107.34 	covered by health and dental coverage provided by the armed forces. If the employee had 
107.35 	elected dependent coverage for health or dental coverage as of the time that the employee 
107.36 	reported for active service, a school district must offer the employee the option to continue 
108.1 	the dependent coverage at the employee's own expense. A school district must permit 
108.2 	the employee to continue participating in any pretax account in which the employee 
108.3 	participated when the employee reported for active service, to the extent of employee pay 
108.4 	available for that purpose.
108.5 	(f) For purposes of this section, "active service" has the meaning given in section 
108.6 	190.05, subdivision 5, but excludes service performed exclusively for purposes of:
108.7 	(1) basic combat training, advanced individual training, annual training, and periodic 
108.8 	inactive duty training;
108.9 	(2) special training periodically made available to reserve members; and
108.10 	(3) service performed in accordance with section 190.08, subdivision 3.
108.11 	(g) A school district making payments under paragraph (b) shall place a sum equal 
108.12 	to any difference between the amount of salary that would have been paid to the employee 
108.13 	who is receiving the payments and the amount of salary being paid to substitutes for 
108.14 	that employee into a special fund that must be used to pay or partially pay the deployed 
108.15 	employee's payments under paragraph (b). A school district is required to pay only this 
108.16 	amount to the deployed school district employee.

108.17 	EFFECTIVE DATE. This section is effective the day following final enactment 
108.18 	and applies to members of the National Guard and other reserve components of the United 
108.19 	States armed forces serving in active military service on or after that date.

108.20 	Sec. 64. IMPLEMENTING RIGOROUS COURSEWORK MEASURES 
108.21 	RELATED TO STUDENT PERFORMANCE.
 108.22 	To implement the requirements of Minnesota Statutes, section 120B.35, subdivision 
108.23 	3, paragraph (c), clauses (1) and (2), and to help parents and members of the public better 
108.24 	understand the reported data, the commissioner of education must convene a group 
108.25 	of recognized and qualified experts and interested stakeholders, including parents and 
108.26 	teachers among other stakeholders, to develop a model projecting anticipated performance 
108.27 	of each high school on preparation and rigorous coursework measures that compares the 
108.28 	school with similar schools. The model must use information about entering high school 
108.29 	students based on particular background characteristics that are predictive of differing 
108.30 	rates of college readiness. These characteristics include grade 8 achievement levels, high 
108.31 	school student mobility, high school student attendance, and the size of each entering ninth 
108.32 	grade class. The group of experts and stakeholders may examine other characteristics not 
108.33 	part of the prediction model including the nine student categories identified under the 
108.34 	federal 2001 No Child Left Behind Act, and two student gender categories of male and 
108.35 	female, respectively. The commissioner annually must use the predicted level of entering 
109.1 	students' performance to provide a context for interpreting graduating students' actual 
109.2 	performance. The group convened under this section expires June 30, 2011.

109.3 	EFFECTIVE DATE. This section is effective the day following final enactment 
109.4 	and applies to school report cards beginning July 1, 2011.

109.5 	Sec. 65. IMPLEMENTING MEASURES FOR ASSESSING SCHOOL SAFETY 
109.6 	AND STUDENTS' ENGAGEMENT AND CONNECTION AT SCHOOL .
 109.7 	(a) To implement the requirements of Minnesota Statutes, section 120B.35, 
109.8 	subdivision 3, paragraph (d), the commissioner of education, in consultation with 
109.9 	interested stakeholders, including parents and teachers among other stakeholders, 
109.10 	must convene a group of recognized and qualified experts on student engagement and 
109.11 	connection and classroom teachers currently teaching in Minnesota schools to:
109.12 	(1) identify highly reliable variables of student engagement and connection that 
109.13 	may include student attendance, home support for learning, and student participation in 
109.14 	out-of-school activities, among other variables; and
109.15 	(2) determine how to report "safety" in order to comply with federal law.
109.16 	(b) The commissioner must submit a written report and all the group's working 
109.17 	papers to the education committees of the house of representatives and senate by February 
109.18 	15, 2010, presenting the group's responses to paragraph (a), clauses (1) and (2). The 
109.19 	commissioner must submit a second, related report to the education committees of the 
109.20 	legislature by February 15, 2013, indicating the content and analysis of and the format 
109.21 	for reporting the data collected in the 2010-2011 and 2011-2012 school years under 
109.22 	Minnesota Statutes, section 120B.35, subdivision 3, paragraph (d). The group convened 
109.23 	under this section expires December 31, 2013.

109.24 	EFFECTIVE DATE. This section is effective the day following final enactment 
109.25 	and applies to school report cards beginning July 1, 2013.

109.26 	Sec. 66. EXAMINING THE CHARACTERISTICS AND IMPACT OF HIGH 
109.27 	STAKES MATH AND SCIENCE TESTS IN THE CONTEXT OF AWARDING 
109.28 	HIGH SCHOOL DIPLOMAS.
 109.29 	(a) To carefully and responsibly determine the state policy of administering high 
109.30 	stakes math and science tests in the context of awarding high school diplomas, the 
109.31 	Independent Office of Educational Accountability under Minnesota Statutes, section 
109.32 	120B.31, subdivision 3, must convene and facilitate an advisory group that includes 
109.33 	measurement experts selected by the State Council on Measurement in Education, 
110.1 	three regionally diverse school district research and evaluation directors selected by the 
110.2 	Minnesota Assessment Group, one school superintendent selected by the Minnesota 
110.3 	Association of School Administrators, one high school principal selected by the Minnesota 
110.4 	Board of School Administrators, one University of Minnesota faculty member selected 
110.5 	by the dean of the College of Education and Human Development, one licensed math 
110.6 	teacher and one licensed science teacher selected by Education Minnesota, the director of 
110.7 	evaluation and testing at the Minnesota Department of Education, two parents of currently 
110.8 	enrolled high school students selected by the Minnesota Parent Teacher Association, 
110.9 	one representative of the business community selected by the Minnesota Chamber of 
110.10 	Commerce, one representative of the business community selected by the Minnesota 
110.11 	Business Partnership, one representative of Minnesota's two-year postsecondary 
110.12 	institutions selected by Minnesota State Colleges and Universities, one representative of 
110.13 	Minnesota's four-year postsecondary institutions selected by the University of Minnesota, 
110.14 	an interested member of the public, and mathematicians, scientists, and workforce 
110.15 	development experts that the Office of Educational Accountability selects to consider and 
110.16 	recommend how best to motivate students and improve students' academic achievement in 
110.17 	the context of high stakes math and science exams required for high school graduation. 
110.18 	The advisory group at least must evaluate and make recommendations on:
110.19 	(1) particular kinds of math and science exams that Minnesota might use as high 
110.20 	stakes exams to award or deny students a high school diploma;
110.21 	(2) appropriate levels of high school math and science proficiency and the 
110.22 	educational support to help students achieve those proficiency levels;
110.23 	(3) the relationship between math and science proficiency levels and state definitions 
110.24 	of college and career readiness;
110.25 	(4) the interrelationship between requiring students to demonstrate math and science 
110.26 	proficiency and college or career readiness, and awarding or denying students a high 
110.27 	school diploma;
110.28 	(5) the interrelationship between high stakes testing and other coursework and 
110.29 	credits required for graduation or college and career readiness; and
110.30 	(6) appropriate accommodations for students with individualized education plans 
110.31 	and students with limited English proficiency in some circumstances.
110.32 	(b) The advisory group under paragraph (a) is not subject to Minnesota Statutes, 
110.33 	section 15.059. The Office of Educational Accountability must present the advisory 
110.34 	group's evaluation and recommendations under paragraph (a) to the education policy 
110.35 	and finance committees of the legislature by February 15, 2010. The advisory group 
110.36 	expires on June 1, 2010.

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

111.2 	Sec. 67. LEGISLATIVE REPORT ON DISTRICTS' USE OF AND NEED FOR 
111.3 	INTEGRATION REVENUE.
 111.4 	The commissioner must analyze the substance of school district integration plans 
111.5 	under Minnesota Statutes, section 124D.86, subdivision 1b, to identify the elements of 
111.6 	and trends in district strategies and programs, the amount of success districts achieved 
111.7 	in realizing the specific goals contained in their plans, and the estimated funds districts 
111.8 	need to fully implement those plans. The commissioner must include in the analysis the 
111.9 	impact of demographic changes experienced at school sites and school districts involving 
111.10 	students of color, students with limited English proficiency, and students who are homeless 
111.11 	or highly mobile, as well as changes in immigration patterns and housing patterns 
111.12 	experienced by schools and districts, and the availability of and districts' participation in 
111.13 	interdistrict integration opportunities. The commissioner must submit a report on the 
111.14 	substance of the analysis and any resulting recommendations to the K-12 education policy 
111.15 	and finance committees of the legislature by February 1, 2011.

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

111.17 	Sec. 68. APPROPRIATIONS.
 111.18 		Subdivision 1.Department of Education. The sums indicated in this section are 
111.19 	appropriated from the general fund to the Department of Education for the fiscal years 
111.20 	designated.
111.21 		Subd. 2.Charter school building lease aid. For building lease aid under Minnesota 
111.22 	Statutes, section 124D.11, subdivision 4: 

111.23		$
	33,512,000
	.....
	2010
	
111.24		$
	44,030,000
	.....
	2011
	
111.25 	The 2010 appropriation includes $3,704,000 for 2009 and $29,808,000 for 2010.
111.26 	The 2011 appropriation includes $11,024,000 for 2010 and $33,006,000 for 2011.
111.27 		Subd. 3.Charter school startup aid. For charter school startup cost aid under 
111.28 	Minnesota Statutes, section 124D.11:

111.29		$
	1,245,000
	.....
	2010
	
111.30		$
	1,133,000
	.....
	2011
	
111.31 	The 2010 appropriation includes $202,000 for 2009 and $1,043,000 for 2010.
111.32 	The 2011 appropriation includes $385,000 for 2010 and $748,000 for 2011.
112.1 		Subd. 4.Integration aid. For integration aid under Minnesota Statutes, section 
112.2 	124D.86, subdivision 5:

112.3		$
	54,167,000
	.....
	2010
	
112.4		$
	65,549,000
	.....
	2011
	
112.5 	The 2010 appropriation includes $6,110,000 for 2009 and $48,057,000 for 2010.
112.6 	The 2011 appropriation includes $17,774,000 for 2010 and $47,775,000 for 2011.
112.7 		Subd. 5.Magnet school grants. For magnet school and program grants under 
112.8 	Minnesota Statutes, section 124D.88:

112.9		$
	750,000
	.....
	2010
	
112.10		$
	750,000
	.....
	2011
	
112.11 		Subd. 6.Interdistrict desegregation or integration transportation grants. For 
112.12 	interdistrict desegregation or integration transportation grants under Minnesota Statutes, 
112.13 	section 124D.87:

112.14		$
	14,468,000
	.....
	2010
	
112.15		$
	17,582,000
	.....
	2011
	
112.16 		Subd. 7.Success for the future. For American Indian success for the future grants 
112.17 	under Minnesota Statutes, section 124D.81:

112.18		$
	1,774,000
	.....
	2010
	
112.19		$
	2,137,000
	.....
	2011
	
112.20 	The 2010 appropriation includes $213,000 for 2009 and $1,561,000 for 2010.
112.21 	The 2011 appropriation includes $576,000 for 2010 and $1,561,000 for 2011.
112.22 		Subd. 8.American Indian teacher preparation grants. For joint grants to assist 
112.23 	American Indian people to become teachers under Minnesota Statutes, section 122A.63:

112.24		$
	190,000
	.....
	2010
	
112.25		$
	190,000
	.....
	2011
	
112.26 		Subd. 9.Tribal contract schools. For tribal contract school aid under Minnesota 
112.27 	Statutes, section 124D.83:

112.28		$
	1,683,000
	.....
	2010
	
112.29		$
	2,179,000
	.....
	2011
	
112.30 	The 2010 appropriation includes $191,000 for 2009 and $1,492,000 for 2010.
112.31 	The 2011 appropriation includes $551,000 for 2010 and $1,628,000 for 2011.
113.1 		Subd. 10.Early childhood programs at tribal schools. For early childhood 
113.2 	family education programs at tribal contract schools under Minnesota Statutes, section 
113.3 	124D.83, subdivision 4:

113.4		$
	68,000
	.....
	2010
	
113.5		$
	68,000
	.....
	2011
	
113.6 		Subd. 11.Statewide testing and reporting system. For the statewide testing and 
113.7 	reporting system under Minnesota Statutes, section 120B.30:

113.8		$
	15,150,000
	.....
	2010
	
113.9		$
	15,150,000
	.....
	2011
	
113.10 	$1,150,000 each year is for the value-added index assessment model.
113.11 	Any balance in the first year does not cancel but is available in the second year.
113.12 		Subd. 12.Examination fees; teacher training and support programs. (a) For 
113.13 	students' advanced placement and international baccalaureate examination fees under 
113.14 	Minnesota Statutes, section 120B.13, subdivision 3, and the training and related costs 
113.15 	for teachers and other interested educators under Minnesota Statutes, section 120B.13, 
113.16 	subdivision 1:

113.17		$
	4,500,000
	.....
	2010
	
113.18		$
	4,500,000
	.....
	2011
	
113.19 	(b) The advanced placement program shall receive 75 percent of the appropriation 
113.20 	each year and the international baccalaureate program shall receive 25 percent of the 
113.21 	appropriation each year. The department, in consultation with representatives of the 
113.22 	advanced placement and international baccalaureate programs selected by the Advanced 
113.23 	Placement Advisory Council and IBMN, respectively, shall determine the amounts of 
113.24 	the expenditures each year for examination fees and training and support programs for 
113.25 	each program.
113.26 	(c) Notwithstanding Minnesota Statutes, section 120B.13, subdivision 1, at least 
113.27 	$500,000 each year is for teachers to attend subject matter summer training programs 
113.28 	and follow-up support workshops approved by the advanced placement or international 
113.29 	baccalaureate programs. The commissioner shall determine the payment process and 
113.30 	the amount of the subsidy.
113.31 	(d) The commissioner shall pay all examination fees for all students of low-income 
113.32 	families under Minnesota Statutes, section 120B.13, subdivision 3, and to the extent 
113.33 	of available appropriations shall also pay examination fees for students sitting for an 
113.34 	advanced placement examination, international baccalaureate examination, or both.
113.35 	Any balance in the first year does not cancel but is available in the second year.
114.1 		Subd. 13.Concurrent enrollment programs. For concurrent enrollment programs 
114.2 	under Minnesota Statutes, section 120B.132, and concurrent enrollment teacher training 
114.3 	under Minnesota Statutes, section 120B.13, subdivision 1:

114.4		$
	2,000,000
	.....
	2010
	
114.5		$
	2,000,000
	.....
	2011
	
114.6 	Any balance in the first year does not cancel but is available in the second year.
114.7 		Subd. 14.Collaborative urban educator. For the collaborative urban educator 
114.8 	grant program:

114.9		$
	528,000
	.....
	2010
	
114.10		$
	528,000
	.....
	2011
	
114.11 	Any balance in the first year does not cancel but is available in the second year.
114.12 		Subd. 15.Youth works program. For funding youth works programs under 
114.13 	Minnesota Statutes, sections 124D.37 to 124D.45:

114.14		$
	900,000
	.....
	2010
	
114.15		$
	900,000
	.....
	2011
	
114.16 	A grantee organization may provide health and child care coverage to the dependents 
114.17 	of each participant enrolled in a full-time youth works program to the extent such coverage 
114.18 	is not otherwise available.
114.19 		Subd. 16.Student organizations. For student organizations:

114.20		$
	725,000
	.....
	2010
	
114.21		$
	725,000
	.....
	2011
	
114.22 	$40,000 each year is for student organizations serving health occupations.
114.23 	$38,000 each year is for student organizations serving service occupations.
114.24 	$88,000 each year is for student organizations serving trade and industry occupations.
114.25 	$84,000 each year is for student organizations serving business occupations.
114.26 	$131,000 each year is for student organizations serving agriculture occupations.
114.27 	$125,000 each year is for student organizations serving family and consumer science 
114.28 	occupations.
114.29 	$95,000 each year is for student organizations serving marketing occupations.
114.30 	Any balance in the first year does not cancel but is available in the second year.
114.31 		Subd. 17.Education Planning and Assessment System (EPAS) program. For 
114.32 	the Educational Planning and Assessment System (EPAS) program under Minnesota 
114.33 	Statutes, section 120B.128:

115.1		$
	829,000
	.....
	2010
	
115.2		$
	829,000
	.....
	2011
	
115.3 	Any balance in the first year does not cancel but is available in the second year.
115.4 		Subd. 18.Early childhood literacy programs. For early childhood literacy 
115.5 	programs under Minnesota Statutes, section 124D.42:

115.6		$
	1,000,000
	.....
	2010
	
115.7		$
	1,000,000
	.....
	2011
	
115.8 	$1,000,000 each year is for leveraging federal and private funding to support 
115.9 	AmeriCorps members serving in the Minnesota Reading Corps program established by 
115.10 	Serve Minnesota, including costs associated with the training and teaching of early literacy 
115.11 	skills to children age three to grade 3 and the evaluation of the impact of the program 
115.12 	under Minnesota Statutes, sections 124D.38, subdivision 2, and 124D.42.
115.13 	Any balance in the first year does not cancel but is available in the second year.

115.14 	Sec. 69.  REPEALER.
 115.15 	Minnesota Statutes 2008, sections 120B.362; 120B.39; 122A.628; 122A.75; and 
115.16 	124D.091, are repealed.

115.17 	ARTICLE 3
115.18 	SPECIAL PROGRAMS

115.19 	Section 1. Minnesota Statutes 2008, section 121A.41, subdivision 7, is amended to 
115.20 	read:
115.21 		Subd. 7.Pupil. (a) "Pupil" means any student:
115.22 	(1) without a disability under 21 years of age old; or
115.23 	(2) with a disability until September 1 after the child with a disability becomes 22 
115.24 	years of age under 21 years old who has not received a regular high school diploma or 
115.25 	for a child with a disability who becomes 21 years old during the school year but has not 
115.26 	received a regular high school diploma, until the end of that school year;
115.27 	(3) and who remains eligible to attend a public elementary or secondary school.
115.28 	(b) A "student with a disability" or a "pupil with a disability" has the same meaning 
115.29 	as a "child with a disability" under section 125A.02.

115.30 	Sec. 2. Minnesota Statutes 2008, section 121A.41, subdivision 10, is amended to read:
115.31 		Subd. 10.Suspension. "Suspension" means an action by the school administration, 
115.32 	under rules promulgated by the school board, prohibiting a pupil from attending school 
116.1 	for a period of no more than ten school days. If a suspension is longer than five days, 
116.2 	the suspending administrator must provide the superintendent with a reason for the 
116.3 	longer suspension. This definition does not apply to dismissal from school for one school 
116.4 	day or less, except as provided in federal law for a student with a disability. Each 
116.5 	suspension action may include a readmission plan. The readmission plan shall include, 
116.6 	where appropriate, a provision for implementing alternative educational services upon 
116.7 	readmission and may not be used to extend the current suspension. Consistent with section 
116.8 	125A.091, subdivision 5, the readmission plan must not obligate a parent to provide a 
116.9 	sympathomimetic medication for the parent's child as a condition of readmission. The 
116.10 	school administration may not impose consecutive suspensions against the same pupil 
116.11 	for the same course of conduct, or incident of misconduct, except where the pupil will 
116.12 	create an immediate and substantial danger to self or to surrounding persons or property, 
116.13 	or where the district is in the process of initiating an expulsion, in which case the school 
116.14 	administration may extend the suspension to a total of 15 school days. In the case 
116.15 	of a student with a disability, the student's individual education plan team must meet 
116.16 	immediately but not more than ten school days after the date on which the decision to 
116.17 	remove the student from the student's current education placement is made. The individual 
116.18 	education plan team and other qualified personnel shall at that meeting: conduct a review 
116.19 	of the relationship between the child's disability and the behavior subject to disciplinary 
116.20 	action; and determine the appropriateness of the child's education plan.
116.21 	The requirements of the individual education plan team meeting apply when:
116.22 	(1) the parent requests a meeting;
116.23 	(2) the student is removed from the student's current placement for five or more 
116.24 	consecutive days; or
116.25 	(3) the student's total days of removal from the student's placement during the 
116.26 	school year exceed ten cumulative days in a school year. The school administration shall 
116.27 	implement alternative educational services when the suspension exceeds five days. A 
116.28 	separate administrative conference is required for each period of suspension.

116.29 	Sec. 3. Minnesota Statutes 2008, section 121A.43, is amended to read:
116.30 	121A.43 EXCLUSION AND EXPULSION OF PUPILS WITH A DISABILITY.
116.31 	(a) Consistent with federal law governing days of removal and section 121A.46, 
116.32 	school personnel may suspend a child with a disability.  When a child with a disability 
116.33 	has been suspended for more than five consecutive school days or ten cumulative school 
116.34 	days in the same school year, and that suspension does not involve a recommendation 
116.35 	for expulsion or exclusion or other change of placement under federal law, relevant 
117.1 	members of the child's individualized education program team, including at least one of 
117.2 	the child's teachers, shall meet and determine the extent the child needs services in order 
117.3 	to continue to participate in the general education curriculum, although in another setting, 
117.4 	and to progress toward meeting the goals in the child's individualized education program. 
117.5 	That meeting must occur as soon as possible, but no more than ten days after the sixth 
117.6 	consecutive day of suspension or the tenth cumulative day of suspension has elapsed.
117.7 	(b) A dismissal for one school day or less is a day of suspension if the child with a 
117.8 	disability does not receive regular or special education instruction during that dismissal 
117.9 	period. The notice requirements under section 121A.46 do not apply to a dismissal 
117.10 	of one day or less. 
117.11 	(c) A child with a disability shall be provided alternative educational services to the 
117.12 	extent a suspension exceeds five consecutive school days. 
117.13 	(d) Before initiating an expulsion or exclusion under sections 121A.40 to 121A.56, 
117.14 	the district, relevant members of the child's individualized education program team, 
117.15 	and the child's parent shall, consistent with federal law, determine whether the child's 
117.16 	behavior was caused by or had a direct and substantial relationship to the child's disability 
117.17 	and whether the child's conduct was a direct result of a failure to implement the child's 
117.18 	individualized education program. When a pupil child with a disability who has an 
117.19 	individual individualized education plan program is excluded or expelled under sections 
117.20 	121A.40 to 121A.56 for misbehavior that is not a manifestation of the pupil's child's
117.21 	disability, the district shall continue to provide special education and related services after 
117.22 	a period of suspension, if suspension is imposed. The district shall initiate a review of 
117.23 	the pupil's individual education plan and conduct a review of the relationship between 
117.24 	the pupil's disability and the behavior subject to disciplinary action and determine 
117.25 	the appropriateness of the pupil's education plan before commencing an expulsion or 
117.26 	exclusion during the exclusion or expulsion.  

117.27 	Sec. 4. Minnesota Statutes 2008, section 122A.31, subdivision 4, is amended to read:
117.28 		Subd. 4.Reimbursement. (a) For purposes of revenue under section 125A.78
117.29 	125A.76, the Department of Education must only reimburse school districts for the 
117.30 	services of those interpreters/transliterators who satisfy the standards of competency 
117.31 	under this section.
117.32 	(b) Notwithstanding paragraph (a), a district shall be reimbursed for the services 
117.33 	of interpreters with a nonrenewable provisional certificate, interpreters/transliterators 
117.34 	employed to mentor the provisional certified interpreters, and persons for whom a 
118.1 	time-limited extension has been granted under subdivision 1, paragraph (d), or subdivision 
118.2 	2, paragraph (c).

118.3 	Sec. 5. Minnesota Statutes 2008, section 125A.02, is amended to read:
118.4 	125A.02 CHILD WITH A DISABILITY DEFINED.
118.5 		Subdivision 1. Child with a disability. Every child who has "Child with a 
118.6 	disability" means a child identified under federal and state special education law as 
118.7 	having a hearing impairment, blindness, visual disability, speech or language impairment, 
118.8 	physical disability, other health impairment, mental disability, emotional/behavioral 
118.9 	disorder, specific learning disability, autism, traumatic brain injury, multiple disabilities, or 
118.10 	deaf/blind disability and who needs special instruction and education and related services, 
118.11 	as determined by the standards rules of the commissioner, is a child with a disability. A 
118.12 	licensed physician, an advanced practice nurse, or a licensed psychologist is qualified 
118.13 	to make a diagnosis and determination of attention deficit disorder or attention deficit 
118.14 	hyperactivity disorder for purposes of identifying a child with a disability. 
118.15 		Subd. 1a.Children ages three through seven experiencing developmental 
118.16 	delays. In addition, every child under age three, and at local district discretion from age 
118.17 	three to age seven, who needs special instruction and services, as determined by the 
118.18 	standards rules of the commissioner, because the child has a substantial delay or has 
118.19 	an identifiable physical or mental condition known to hinder normal development is 
118.20 	a child with a disability. 
118.21 		Subd. 2.Not a child with a disability. A child with a short-term or temporary 
118.22 	physical or emotional illness or disability, as determined by the standards rules of the 
118.23 	commissioner, is not a child with a disability.

118.24 	Sec. 6. [125A.031] GENERAL SCHOOL DISTRICT OBLIGATIONS TO 
118.25 	CHILDREN WITH DISABILITIES.
118.26 	(a) Except as specifically provided in other law, the following requirements 
118.27 	governing school district obligations to children with disabilities apply.
118.28 	(b) A resident school district must identify, locate, and evaluate every child with 
118.29 	a disability who is in need of special education and related services, including a child 
118.30 	from birth to age 3.
118.31 	(c) A resident school district must make available a free appropriate public education 
118.32 	to:
118.33 	(1) a child with a disability under 21 years old who has not received a regular high 
118.34 	school diploma; and
119.1 	(2) for the duration of the school year, a child with a disability who becomes 21 
119.2 	years old during that school year but has not received a regular high school diploma.
119.3 	(d) The resident school district must ensure that a child with a disability who is 
119.4 	enrolled in a nonpublic school or facility receives special education and related services, 
119.5 	consistent with the child's individualized education program, at no cost to the child's parent 
119.6 	if the district places the child in the nonpublic school or facility to meet the requirements 
119.7 	of this section or applicable federal law.
119.8 	(e) Consistent with the number of children with disabilities who are enrolled by their 
119.9 	parents in a nonpublic school or facility located within a district, the district in which the 
119.10 	nonpublic school or facility is located must ensure that those children have an opportunity 
119.11 	to participate in special education and related services and that the amount the district 
119.12 	spends to provide such services must be at least equal to the proportionate amount of 
119.13 	federal funds made available under this chapter.

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

119.15 	Sec. 7. Minnesota Statutes 2008, section 125A.07, is amended to read:
119.16 	125A.07 RULES OF COMMISSIONER RULEMAKING.
119.17 	(a) As defined in Consistent with this paragraph section, the commissioner must
119.18 	shall adopt new rules and amend existing rules relative to qualifications of essential 
119.19 	personnel, courses of study, methods of instruction, pupil eligibility, size of classes, rooms, 
119.20 	equipment, supervision, parent consultation, and other necessary rules for instruction of 
119.21 	children with a disability. These rules must provide standards and procedures appropriate 
119.22 	for the implementation of and within the limitations of sections 125A.08 and 125A.091. 
119.23 	These rules must also provide standards for the discipline, control, management, and 
119.24 	protection of children with a disability. The commissioner must not adopt rules for pupils 
119.25 	served primarily in the regular classroom establishing either case loads or the maximum 
119.26 	number of pupils that may be assigned to special education teachers. The commissioner, in 
119.27 	consultation with the Departments of Health and Human Services, must adopt permanent 
119.28 	rules for instruction and services for children under age five and their families. These 
119.29 	rules are binding on state and local education, health, and human services agencies. The 
119.30 	commissioner must adopt rules to determine eligibility for special education services. The 
119.31 	rules must include procedures and standards by which to grant variances for experimental 
119.32 	eligibility criteria. The commissioner must, according to section 14.05, subdivision 4, 
119.33 	notify a district applying for a variance from the rules within 45 calendar days of receiving 
119.34 	the request whether the request for the variance has been granted or denied. If a request is 
120.1 	denied, the commissioner must specify the program standards used to evaluate the request 
120.2 	and the reasons for denying the request related to children with disabilities only under 
120.3 	specific authority and consistent with the requirements of chapter 14 and paragraph (c).
120.4 	(b) As provided in this paragraph, the state's regulatory scheme should support 
120.5 	schools by assuring that all state special education rules adopted by the commissioner 
120.6 	result in one or more of the following outcomes:
120.7 	(1) increased time available to teachers and, where appropriate, to support staff 
120.8 	including school nurses for educating students through direct and indirect instruction;
120.9 	(2) consistent and uniform access to effective education programs for students with 
120.10 	disabilities throughout the state;
120.11 	(3) reduced inequalities and conflict, appropriate due process hearing procedures 
120.12 	and reduced court actions related to the delivery of special education instruction and 
120.13 	services for students with disabilities;
120.14 	(4) clear expectations for service providers and for students with disabilities;
120.15 	(5) increased accountability for all individuals and agencies that provide instruction 
120.16 	and other services to students with disabilities;
120.17 	(6) greater focus for the state and local resources dedicated to educating students 
120.18 	with disabilities; and
120.19 	(7) clearer standards for evaluating the effectiveness of education and support 
120.20 	services for students with disabilities.
120.21 	(c) Subject to chapter 14, the commissioner may adopt, amend, or rescind a rule 
120.22 	related to children with disabilities if such action is specifically required by federal law.

120.23 	Sec. 8. Minnesota Statutes 2008, section 125A.08, is amended to read:
120.24 	125A.08 SCHOOL DISTRICT OBLIGATIONS INDIVIDUALIZED 
120.25 	EDUCATION PROGRAMS.
120.26 	(a) At the beginning of each school year, each school district shall have in effect, for 
120.27 	each child with a disability, an individualized education program.
120.28 	(b) As defined in this section, every district must ensure the following:
120.29 	(1) all students with disabilities are provided the special instruction and services 
120.30 	which are appropriate to their needs. Where the individual education plan team has 
120.31 	determined appropriate goals and objectives based on the student's needs, including the 
120.32 	extent to which the student can be included in the least restrictive environment, and where 
120.33 	there are essentially equivalent and effective instruction, related services, or assistive 
120.34 	technology devices available to meet the student's needs, cost to the district may be among 
120.35 	the factors considered by the team in choosing how to provide the appropriate services, 
121.1 	instruction, or devices that are to be made part of the student's individual education plan. 
121.2 	The individual education plan team shall consider and may authorize services covered 
121.3 	by medical assistance according to section 256B.0625, subdivision 26. The student's 
121.4 	needs and the special education instruction and services to be provided must be agreed 
121.5 	upon through the development of an individual education plan. The plan must address 
121.6 	the student's need to develop skills to live and work as independently as possible within 
121.7 	the community. The individual education plan team must consider positive behavioral 
121.8 	interventions, strategies, and supports that address behavior for children with attention 
121.9 	deficit disorder or attention deficit hyperactivity disorder. By During grade 9 or age 14, 
121.10 	the plan must address the student's needs for transition from secondary services to 
121.11 	postsecondary education and training, employment, community participation, recreation, 
121.12 	and leisure and home living. In developing the plan, districts must inform parents of the 
121.13 	full range of transitional goals and related services that should be considered. The plan 
121.14 	must include a statement of the needed transition services, including a statement of the 
121.15 	interagency responsibilities or linkages or both before secondary services are concluded;
121.16 	(2) children with a disability under age five and their families are provided special 
121.17 	instruction and services appropriate to the child's level of functioning and needs;
121.18 	(3) children with a disability and their parents or guardians are guaranteed procedural 
121.19 	safeguards and the right to participate in decisions involving identification, assessment 
121.20 	including assistive technology assessment, and educational placement of children with a 
121.21 	disability;
121.22 	(4) eligibility and needs of children with a disability are determined by an initial 
121.23 	assessment or reassessment, which may be completed using existing data under United 
121.24 	States Code, title 20, section 33, et seq.;
121.25 	(5) to the maximum extent appropriate, children with a disability, including those 
121.26 	in public or private institutions or other care facilities, are educated with children who 
121.27 	are not disabled, and that special classes, separate schooling, or other removal of children 
121.28 	with a disability from the regular educational environment occurs only when and to the 
121.29 	extent that the nature or severity of the disability is such that education in regular classes 
121.30 	with the use of supplementary services cannot be achieved satisfactorily;
121.31 	(6) in accordance with recognized professional standards, testing and evaluation 
121.32 	materials, and procedures used for the purposes of classification and placement of children 
121.33 	with a disability are selected and administered so as not to be racially or culturally 
121.34 	discriminatory; and
121.35 	(7) the rights of the child are protected when the parents or guardians are not known 
121.36 	or not available, or the child is a ward of the state.
122.1 	(b) (c) For paraprofessionals employed to work in programs for students with 
122.2 	disabilities, the school board in each district shall ensure that:
122.3 	(1) before or immediately upon employment, each paraprofessional develops 
122.4 	sufficient knowledge and skills in emergency procedures, building orientation, roles and 
122.5 	responsibilities, confidentiality, vulnerability, and reportability, among other things, to 
122.6 	begin meeting the needs of the students with whom the paraprofessional works;
122.7 	(2) annual training opportunities are available to enable the paraprofessional to 
122.8 	continue to further develop the knowledge and skills that are specific to the students with 
122.9 	whom the paraprofessional works, including understanding disabilities, following lesson 
122.10 	plans, and implementing follow-up instructional procedures and activities; and
122.11 	(3) a districtwide process obligates each paraprofessional to work under the ongoing 
122.12 	direction of a licensed teacher and, where appropriate and possible, the supervision of a 
122.13 	school nurse.

122.14 	Sec. 9. Minnesota Statutes 2008, section 125A.091, is amended to read:
122.15 	125A.091 ALTERNATIVE DISPUTE RESOLUTION AND DUE PROCESS 
122.16 	HEARINGS.
122.17 		Subdivision 1.District obligation. A school district must use the procedures in 
122.18 	federal law and state law and rule to reach decisions about the identification, evaluation, 
122.19 	educational placement, manifestation determination, interim alternative educational 
122.20 	placement, or the provision of a free appropriate public education to a child with a 
122.21 	disability.
122.22 		Subd. 2.Prior written notice. A parent must receive prior written notice 
122.23 	a reasonable time before the district proposes or refuses to initiate or change the 
122.24 	identification, evaluation, educational placement, or the provision of a free appropriate 
122.25 	public education to a child with a disability.
122.26 		Subd. 3.Content of notice. The notice under subdivision 2 must:
122.27 	(1) describe the action the district proposes or refuses;
122.28 	(2) explain why the district proposes or refuses to take the action;
122.29 	(3) describe any other option the district considered and the reason why it rejected 
122.30 	the option;
122.31 	(4) describe each evaluation procedure, test, record, or report the district used as a 
122.32 	basis for the proposed or refused action;
122.33 	(5) describe any other factor affecting the proposal or refusal of the district to take 
122.34 	the action;
123.1 	(6) state that the parent of a child with a disability is protected by procedural 
123.2 	safeguards and, if this notice is not an initial referral for evaluation, how a parent can get a 
123.3 	description of the procedural safeguards; and
123.4 	(7) identify where a parent can get help in understanding this law.
123.5 		Subd. 3a.Additional requirements for prior written notice. In addition to federal 
123.6 	law requirements, a prior written notice shall:
123.7 	(1) inform the parent that except for the initial placement of a child in special 
123.8 	education, the school district will proceed with its proposal for the child's placement or 
123.9 	for providing special education services unless the child's parent notifies the district of 
123.10 	an objection within 14 days of when the district sends the prior written notice to the 
123.11 	parent; and
123.12 	(2) state that a parent who objects to a proposal or refusal in the prior written notice 
123.13 	may request a conciliation conference under subdivision 7 or another alternative dispute 
123.14 	resolution procedure under subdivision 8 or 9.
123.15 		Subd. 4.Understandable notice. (a) The written notice under subdivision 2 must 
123.16 	be understandable to the general public and available in the parent's native language or by 
123.17 	another communication form, unless it is clearly not feasible to do so.
123.18 	(b) If the parent's native language or other communication form is not written, 
123.19 	the district must take steps to ensure that:
123.20 	(1) the notice is translated orally or by other means to the parent in the parent's 
123.21 	native language or other communication form;
123.22 	(2) the parent understands the notice; and
123.23 	(3) written evidence indicates the requirements in subdivision 2 are met.
123.24 		Subd. 5.Initial action; parent consent. (a) The district must not proceed with the 
123.25 	initial evaluation of a child, the initial placement of a child in a special education program, 
123.26 	or the initial provision of special education services for a child without the prior written 
123.27 	consent of the child's parent. A district may not override the written refusal of a parent to 
123.28 	consent to an initial evaluation or reevaluation.
123.29 	(b) A parent, after consulting with health care, education, or other professional 
123.30 	providers, may agree or disagree to provide the parent's child with sympathomimetic 
123.31 	medications unless section 144.344 applies. 
123.32 		Subd. 6.Dispute resolution processes; generally. Parties are encouraged to 
123.33 	resolve disputes over the identification, evaluation, educational placement, manifestation 
123.34 	determination, interim alternative educational placement, or the provision of a free 
123.35 	appropriate public education to a child with a disability through conciliation, mediation, 
123.36 	facilitated team meetings, or other alternative process. All dispute resolution options are 
124.1 	voluntary on the part of the parent and must not be used to deny or delay the right to a 
124.2 	due process hearing. All dispute resolution processes under this section are provided 
124.3 	at no cost to the parent.
124.4 		Subd. 7.Conciliation conference. A parent must have an opportunity to meet 
124.5 	with appropriate district staff in at least one conciliation conference if the parent objects 
124.6 	to any proposal of which the parent receives notice under subdivision 2 3a. If the parent 
124.7 	refuses district efforts to conciliate the dispute, the conciliation requirement is satisfied. 
124.8 	Following a conciliation conference A district must hold a conciliation conference within 
124.9 	ten calendar days from the date the district receives a parent's objection to a proposal or 
124.10 	refusal in the prior written notice. Except as provided in this section, all discussions held 
124.11 	during a conciliation conference are confidential and are not admissible in a due process 
124.12 	hearing. Within five school days after the final conciliation conference, the district must 
124.13 	prepare and provide to the parent a conciliation conference memorandum that describes 
124.14 	the district's final proposed offer of service. This memorandum is admissible in evidence 
124.15 	in any subsequent proceeding.
124.16 		Subd. 8.Voluntary dispute resolution options. In addition to offering at least 
124.17 	one conciliation conference, a district must inform a parent of other dispute resolution 
124.18 	processes, including at least mediation and facilitated team meetings. The fact that 
124.19 	an alternative dispute resolution process was used is admissible in evidence at any 
124.20 	subsequent proceeding. State-provided mediators and team meeting facilitators shall not 
124.21 	be subpoenaed to testify at a due process hearing or civil action under federal special 
124.22 	education law nor are any records of mediators or state-provided team meeting facilitators 
124.23 	accessible to the parties.
124.24 		Subd. 9.Mediation. Mediation is a dispute resolution process that involves a 
124.25 	neutral party provided by the state to assist a parent and a district in resolving disputes 
124.26 	over the identification, evaluation, educational placement, manifestation determination, 
124.27 	interim alternative educational placement, or the provision of a free appropriate public 
124.28 	education to a child with a disability. A mediation process is available as an informal 
124.29 	alternative to a due process hearing but must not be used to deny or postpone the 
124.30 	opportunity of a parent or district to obtain a due process hearing. Mediation is voluntary 
124.31 	for all parties. All mediation discussions are confidential and inadmissible in evidence 
124.32 	in any subsequent proceeding, unless the:
124.33 	(1) parties expressly agree otherwise;
124.34 	(2) evidence is otherwise available; or
124.35 	(3) evidence is offered to prove bias or prejudice of a witness.
125.1 		Subd. 10.Mediated agreements. Mediated agreements are not admissible unless 
125.2 	the parties agree otherwise or a party to the agreement believes the agreement is not being 
125.3 	implemented, in which case the aggrieved party may enter the agreement into evidence at 
125.4 	a due process hearing. The parties may request another mediation to resolve a dispute over 
125.5 	implementing the mediated agreement. After a due process hearing is requested, a party 
125.6 	may request mediation and the commissioner must provide a mediator who conducts a 
125.7 	mediation session no later than the third business day after the mediation request is made 
125.8 	to the commissioner. If the parties resolve all or a portion of the dispute, or agree to use 
125.9 	another procedure to resolve the dispute, the mediator shall ensure that the resolution 
125.10 	or agreement is in writing and signed by the parties and each party is given a copy of 
125.11 	the document. The written resolution or agreement shall state that all discussions that 
125.12 	occurred during mediation are confidential and may not be used as evidence in any hearing 
125.13 	or civil proceeding. The resolution or agreement is legally binding upon the parties and is 
125.14 	enforceable in the state or federal district court. A party may request another mediation to 
125.15 	resolve a dispute over implementing the mediated agreement.
125.16 		Subd. 11.Facilitated team meeting. A facilitated team meeting is an IEP, IFSP, 
125.17 	or IIIP team meeting led by an impartial state-provided facilitator to promote effective 
125.18 	communication and assist a team in developing an individualized education plan.
125.19 		Subd. 12.Impartial due process hearing. (a) A parent or a district is entitled to 
125.20 	an impartial due process hearing conducted by the state when a dispute arises over the 
125.21 	identification, evaluation, educational placement, manifestation determination, interim 
125.22 	alternative educational placement, or the provision of a free appropriate public education 
125.23 	to a child with a disability. The hearing must be held in the district responsible for 
125.24 	ensuring that a free appropriate public education is provided according to state and federal 
125.25 	law. The proceedings must be recorded and preserved, at state expense, pending ultimate 
125.26 	disposition of the action. The parent and the district shall receive, at state expense, a copy 
125.27 	of the hearing transcript or recording and the hearing officer's findings of fact, conclusion 
125.28 	of law, and decisions.
125.29 	(b) The due process hearing must be conducted according to the rules of the 
125.30 	commissioner and federal law.
125.31 		Subd. 13.Hearing officer qualifications. The commissioner must appoint an 
125.32 	individual who is qualified under this subdivision to serve as a hearing officer. The 
125.33 	commissioner shall maintain a list of qualified hearing officers who are not employees of 
125.34 	or otherwise under contract with the department or the school district except when under 
125.35 	contract with the department as a hearing officer, and who do not have a personal or 
125.36 	professional interest that conflicts with their objectivity when serving as hearing officers 
126.1 	in hearings under this section. The list shall include a statement of the qualifications of 
126.2 	each person listed. A hearing officer must know and understand state and federal special 
126.3 	education laws, rules, and regulations, and legal interpretations by federal and state courts. 
126.4 	A hearing officer also must have the knowledge and ability to conduct hearings and render 
126.5 	and write decisions according to appropriate, standard legal practice. Upon receipt of a 
126.6 	written request for a hearing, the commissioner shall appoint a hearing officer from the 
126.7 	list. The hearing officer must:
126.8 	(1) be knowledgeable and impartial;
126.9 	(2) have no personal interest in or specific involvement with the student who is a 
126.10 	party to the hearing;
126.11 	(3) not have been employed as an administrator by the district that is a party to 
126.12 	the hearing;
126.13 	(4) not have been involved in selecting the district administrator who is a party 
126.14 	to the hearing;
126.15 	(5) have no personal, economic, or professional interest in the outcome of the 
126.16 	hearing other than properly administering federal and state laws, rules, and policies;
126.17 	(6) have no substantial involvement in developing state or local policies or 
126.18 	procedures challenged in the hearing;
126.19 	(7) not be a current employee or board member of a Minnesota public school district, 
126.20 	education district, intermediate unit or regional education agency, or the department if 
126.21 	the department is the service provider; and
126.22 	(8) not be a current employee or board member of a disability advocacy organization 
126.23 	or group.
126.24 		Subd. 14.Request for hearing. A request for a due process hearing must:
126.25 	(1) be in writing;
126.26 	(2) describe the nature of the dispute about providing special education services to 
126.27 	the student including facts relating to the dispute; and
126.28 	(3) state, to the extent known, the relief sought.
126.29 	Any school district administrator receiving a request for a due process hearing 
126.30 	must immediately forward the request to the commissioner. Within two business days of 
126.31 	receiving a request for a due process hearing, the commissioner must appoint a hearing 
126.32 	officer. The commissioner must not deny a request for hearing because the request 
126.33 	is incomplete. A party may disqualify a hearing officer only by affirmatively showing 
126.34 	prejudice or bias to the commissioner or to the chief administrative law judge if the hearing 
126.35 	officer is an administrative law judge. If a party affirmatively shows prejudice against a 
126.36 	hearing officer, the commissioner must assign another hearing officer to hear the matter. (a) 
127.1 	A parent or a school district may file a written request for a due process hearing regarding 
127.2 	a proposal or refusal to initiate or change that child's evaluation, individualized education 
127.3 	program, or educational placement, or to provide a free appropriate public education.
127.4 	(b) The parent shall include in the hearing request the name of the child, the address 
127.5 	of the child's residence, the name of the school the child attends, a description of the 
127.6 	child's problem relating to the proposed or refused initiation or change, including facts 
127.7 	relating to the problem, and a proposed resolution of the problem to the extent known 
127.8 	and available to the parents at the time.
127.9 	(c) A parent or a school district may file a written request for a hearing under United 
127.10 	States Code, title 20, section 1415, paragraph (k).
127.11 	(d) A parent or school district filing a request for a hearing under this subdivision 
127.12 	must provide the request to the other party and a copy of the request to the department. 
127.13 	Upon receiving a request for a hearing, the department shall give to the child's parent a 
127.14 	copy of the procedural safeguards notice available to a parent under federal regulations.
127.15 	(e)(1) If the parent of a child with a disability files a written request for a hearing, 
127.16 	and the school district has not previously sent a written notice to the parent under 
127.17 	subdivision 3a, regarding the subject matter of the hearing request, the school district 
127.18 	shall, within ten days of receiving the hearing request, send to the child's parent a written 
127.19 	explanation of why the school district proposed or refused to take the action raised in the 
127.20 	hearing request, a description of other options that the individualized education program 
127.21 	team considered and the reason why those options were rejected, a description of each 
127.22 	evaluation procedure, assessment, record, or report that the school district used as the 
127.23 	basis for the proposed or refused action, and a description of the factors that are relevant 
127.24 	to the school district's proposal or refusal. A response by a school district under this 
127.25 	subdivision does not preclude the school district from asserting that the parent's request 
127.26 	for a hearing is insufficient under clause (2).
127.27 	(2) A hearing may not occur until the party requesting the hearing files a request that 
127.28 	meets the requirements of paragraph (b). The request under paragraph (b) is considered 
127.29 	sufficient unless the party receiving the request notifies the hearing officer and the other 
127.30 	party in writing within 15 days of receiving the request that the receiving party believes 
127.31 	the request does not meet the requirements of paragraph (b). Within five days of receiving 
127.32 	a notice under this subdivision, the hearing officer shall determine whether the request 
127.33 	meets the requirements under paragraph (b) and notify the parties.
127.34 	(f) Except as provided in paragraph (e), clause (1), the party receiving a request for a 
127.35 	hearing shall send to the party requesting the hearing a written response that addresses the 
127.36 	issues raised in the hearing request within ten days of receiving the request.
128.1 		Subd. 15.Prehearing conference. A prehearing conference must be held within 
128.2 	five business days of the date the commissioner appoints the hearing officer. The hearing 
128.3 	officer must initiate the prehearing conference which may be conducted in person, at a 
128.4 	location within the district, or by telephone. The hearing officer must create a written 
128.5 	verbatim record of the prehearing conference which is available to either party upon 
128.6 	request. At the prehearing conference, the hearing officer must:
128.7 	(1) identify the questions that must be answered to resolve the dispute and eliminate 
128.8 	claims and complaints that are without merit;
128.9 	(2) set a scheduling order for the hearing and additional prehearing activities;
128.10 	(3) determine if the hearing can be disposed of without an evidentiary hearing and, if 
128.11 	so, establish the schedule and procedure for doing so; and
128.12 	(4) establish the management, control, and location of the hearing to ensure its fair, 
128.13 	efficient, and effective disposition.
128.14 		Subd. 16.Burden of proof. The burden of proof at a due process hearing is on the 
128.15 	district to demonstrate, by a preponderance of the evidence, that it is complying with the 
128.16 	law and offered or provided a free appropriate public education to the child in the least 
128.17 	restrictive environment. If the district has not offered or provided a free appropriate public 
128.18 	education in the least restrictive environment and the parent wants the district to pay for a 
128.19 	private placement, the burden of proof is on the parent to demonstrate, by a preponderance 
128.20 	of the evidence, that the private placement is appropriate party seeking relief.
128.21 		Subd. 17.Admissible evidence. The hearing officer may admit all evidence 
128.22 	that possesses probative value, including hearsay, if it is the type of evidence on which 
128.23 	reasonable, prudent persons are accustomed to rely in conducting their serious affairs. The 
128.24 	hearing officer must give effect to the rules of privilege recognized by law and exclude 
128.25 	evidence that is incompetent, irrelevant, immaterial, or unduly repetitious.
128.26 		Subd. 18.Hearing officer authority. (a) A hearing officer must limit an impartial 
128.27 	due process hearing to the time sufficient for each party to present its case.
128.28 	(b) A hearing officer must establish and maintain control and manage the hearing. 
128.29 	This authority includes, but is not limited to:
128.30 	(1) requiring attorneys representing parties at the hearing, after notice and an 
128.31 	opportunity to be heard, to pay court reporting and hearing officer costs, or fines payable 
128.32 	to the state, for failing to: (i) obey scheduling or prehearing orders, (ii) appear, (iii) be 
128.33 	prepared, or (iv) participate in the hearing process in good faith;
128.34 	(2) administering oaths and affirmations;
128.35 	(3) issuing subpoenas;
129.1 	(4) determining the responsible and providing districts and joining those districts, if 
129.2 	not already notified, in the proceedings;
129.3 	(5) making decisions involving identification, evaluation, educational placement, 
129.4 	manifestation determination, interim alternative educational placement, or the provision of 
129.5 	a free appropriate public education to a child with a disability; and
129.6 	(6) ordering an independent educational evaluation of a child at district expense; and
129.7 	(7) extending the hearing decision timeline for good cause shown.
129.8 	(c) Good cause includes, but is not limited to, the time required for mediation or 
129.9 	other settlement discussions, independent educational evaluation, complexity and volume 
129.10 	of issues, or finding or changing counsel.
129.11 		Subd. 19.Expedited due process hearings. Consistent with federal law, a parent 
129.12 	has the right to or a school district may file a written request for an expedited due process 
129.13 	hearing when there is a dispute over a manifestation determination or a proposed or actual 
129.14 	placement in an interim alternative educational setting. A district has the right to an 
129.15 	expedited due process hearing when proposing or seeking to maintain placement in an 
129.16 	interim alternative educational setting. A hearing officer must hold an expedited due 
129.17 	process hearing within 20 school days of the date the expedited due process request is 
129.18 	filed and must issue a decision within ten calendar school days of after the request for a
129.19 	hearing. A hearing officer may extend by up to five additional calendar days the time for 
129.20 	issuing a decision in an expedited due process hearing. All policies in this section apply 
129.21 	to expedited due process hearings to the extent they do not conflict with federal law. A 
129.22 	resolution meeting must occur within seven days of receiving the request for an expedited 
129.23 	due process hearing unless the parent and the school district agree in writing either to 
129.24 	waive the resolution meeting or use the mediation process. The expedited due process 
129.25 	hearing may proceed unless the matter has been resolved to the satisfaction of both parties 
129.26 	within 15 days of receiving the expedited due process hearing request.
129.27 		Subd. 20.Hearing officer's decision; time period. (a) The hearing officer must 
129.28 	issue a decision within 45 calendar days of the date on which the commissioner receives 
129.29 	the request for a due process hearing ensure that not later than 45 days after the 30-day 
129.30 	period or the adjusted time periods under federal regulations expire, the hearing officer 
129.31 	reaches a final decision in the due process hearing and transmits a copy of the decision to 
129.32 	each party. A hearing officer, at the request of either party, may grant specific extensions 
129.33 	of time beyond the 45-day period under subdivision 18. The hearing officer must conduct 
129.34 	the oral arguments in a hearing at a time and place that is reasonably convenient to the 
129.35 	parents and child involved. A hearing officer is encouraged to accelerate the time line to 
129.36 	30 days for a child under the age of three whose needs change rapidly and who requires 
130.1 	quick resolution of a dispute. A hearing officer may not extend the time beyond the 45-day 
130.2 	period unless requested by either party for good cause shown on the record. Extensions 
130.3 	of time must not exceed a total of 30 calendar days unless both parties and the hearing 
130.4 	officer agree or time is needed to complete an independent educational evaluation. Good 
130.5 	cause includes, but is not limited to, the time required for mediation or other settlement 
130.6 	discussions, independent educational evaluation, complexity and volume of issues, or 
130.7 	finding or changing counsel.
130.8 	(b) The hearing officer's decision must:
130.9 	(1) be in writing;
130.10 	(2) state the controlling and material facts upon which the decision is made in order 
130.11 	to apprise the reader of the basis and reason for the decision; and
130.12 	(3) be based on local standards, state statute, the rules of the commissioner, and 
130.13 	federal law.
130.14 	(b) Once the hearing officer has issued a final decision, the hearing officer lacks 
130.15 	authority to amend the decision except for clerical or mathematical errors.
130.16 	(c) Nothing in this subdivision precludes a hearing officer from ordering a school 
130.17 	district to comply with federal procedural safeguards under the federal Individuals with 
130.18 	Disabilities Education Act.
130.19 		Subd. 21.Compensatory educational services. The hearing officer may require 
130.20 	the resident or responsible district to provide compensatory educational services to the 
130.21 	child if the hearing officer finds that the district has not offered or made available to 
130.22 	the child a free appropriate public education in the least restrictive environment and the 
130.23 	child suffered a loss of educational benefit. Such services take the form of direct and 
130.24 	indirect special education and related services designed to address any loss of educational 
130.25 	benefit that may have occurred. The hearing officer's finding must be based on a present 
130.26 	determination of whether the child has suffered a loss of educational benefit.
130.27 		Subd. 22.Child's educational placement during due process hearing. (a) Until a 
130.28 	due process hearing under this section is completed or the district and the parent agree 
130.29 	otherwise, the child must remain in the child's current educational placement and must 
130.30 	not be denied initial admission to school.
130.31 	(b) Until an expedited due process hearing challenging an interim alternative 
130.32 	educational placement is completed, the child must remain in the interim alternative 
130.33 	educational setting until the decision of the hearing officer or the expiration of the 45 days 
130.34 	permitted for an interim alternative educational setting, whichever occurs first, unless the 
130.35 	parent and district agree otherwise.
131.1 		Subd. 23.Implementation of hearing officer order. (a) That portion of a hearing 
131.2 	officer's decision granting relief requested by the parent must be implemented upon 
131.3 	issuance.
131.4 	(b) Except as provided under paragraph (a) or the district and parent agree otherwise, 
131.5 	following a hearing officer's decision granting relief requested by the district, the child 
131.6 	must remain in the current educational placement until the time to request judicial review 
131.7 	under subdivision 24 expires or, if judicial review is requested, at the time the Minnesota 
131.8 	Court of Appeals or the federal district court issues its decision, whichever is later.
131.9 		Subd. 24.Review of hearing officer decisions. The parent or district may seek 
131.10 	review of the hearing officer's decision in the Minnesota Court of Appeals or in the federal 
131.11 	district court, consistent with federal law. A party must appeal to the Minnesota Court 
131.12 	of Appeals within 60 days of receiving the hearing officer's decision or must appeal to 
131.13 	federal district court within 90 days of receiving the hearing officer's decision.
131.14 		Subd. 25.Enforcement of orders. The commissioner must monitor final hearing 
131.15 	officer decisions and ensure enforcement of hearing officer orders decisions.
131.16 		Subd. 26.Hearing officer and person conducting alternative dispute resolution 
131.17 	are state employees. A hearing officer or person conducting alternative dispute resolution 
131.18 	under this section is an employee of the state under section 3.732 for purposes of section 
131.19 	3.736 only. 
131.20 		Subd. 27.Hearing officer training. A hearing officer must participate in training 
131.21 	and follow procedures established offered by the commissioner.
131.22 		Subd. 28.District liability. A district is not liable for harmless technical violations 
131.23 	of this section or rules implementing this section federal or state laws, rules, or regulations 
131.24 	governing special education if the school district can demonstrate on a case-by-case basis
131.25 	that the violations did not harm a student's educational progress or the parent's right to 
131.26 	notice, participation, or due process. This subdivision is applicable to due process hearings 
131.27 	and special education complaints filed with the department.

131.28 	Sec. 10. [125A.094] RESTRICTIVE PROCEDURES FOR CHILDREN WITH 
131.29 	DISABILITIES.
131.30 	The use of restrictive procedures for children with disabilities is governed by 
131.31 	sections 125A.0941 and 125A.0942.

131.32 	EFFECTIVE DATE. This section is effective August 1, 2011.

131.33 	Sec. 11. [125A.0941] DEFINITIONS.
131.34 	(a) The following terms have the meanings given them.
132.1 	(b) "Emergency" means a situation where immediate intervention is needed to protect 
132.2 	a child or other individual from physical injury or to prevent serious property damage.
132.3 	(c) "Physical holding" means physical intervention intended to hold a child immobile 
132.4 	or limit a child's movement and where body contact is the only source of physical restraint. 
132.5 	The term physical holding does not mean physical contact that:
132.6 	(1) helps a child respond or complete a task;
132.7 	(2) assists a child without restricting the child's movement;
132.8 	(3) is needed to administer an authorized health-related service or procedure; or
132.9 	(4) is needed to physically escort a child when the child does not resist or the child's 
132.10 	resistance is minimal.
132.11 	(d) "Positive behavioral interventions and supports" means interventions and 
132.12 	strategies to improve the school environment and teach children the skills to behave 
132.13 	appropriately.
132.14 	(e) "Restrictive procedures" means the use of physical holding or seclusion in an 
132.15 	emergency.
132.16 	(f) "Seclusion" means confining a child alone in a room from which egress is barred. 
132.17 	Removing a child from an activity to a location where the child cannot participate in or 
132.18 	observe the activity is not seclusion.

132.19 	EFFECTIVE DATE. This section is effective August 1, 2011.

132.20 	Sec. 12. [125A.0942] STANDARDS FOR RESTRICTIVE PROCEDURES.
132.21 		Subdivision 1.Restrictive procedures plan. Schools that intend to use restrictive 
132.22 	procedures shall maintain and make publicly accessible a restrictive procedures plan for 
132.23 	children that includes at least the following:
132.24 	(1) the list of  restrictive procedures the school intends to use;
132.25 	(2) how the school will monitor and review the use of restrictive procedures, 
132.26 	including conducting post-use debriefings and convening an oversight committee; and
132.27 	(3) a written description and documentation of the training staff completed under 
132.28 	subdivision 5.
132.29 		Subd. 2.Restrictive procedures. (a) Restrictive procedures may be used only 
132.30 	by a licensed special education teacher, school social worker, school psychologist, 
132.31 	behavior analyst certified by the National Behavior Analyst Certification Board, a person 
132.32 	with a master's degree in behavior analysis, other licensed education professional, 
132.33 	paraprofessional under section 120B.363, or mental health professional under section 
132.34 	245.4871, subdivision 27, who has completed the training program under subdivision 5.
133.1 	(b) A school shall make reasonable efforts to notify the parent on the same day a 
133.2 	restrictive procedure is used on the child, or if the school is unable to provide same-day 
133.3 	notice, notice is sent within two days by written or electronic means or as otherwise 
133.4 	indicated by the child's parent under paragraph (d).
133.5 	(c) When restrictive procedures are used twice in 30 days or when a pattern emerges 
133.6 	and restrictive procedures are not included in a child's individualized education program or 
133.7 	behavior intervention plan, the district must hold a meeting of the individualized education 
133.8 	plan team, conduct or review a functional behavioral analysis, review data, consider 
133.9 	developing additional or revised positive behavioral interventions and supports, consider 
133.10 	actions to reduce the use of restrictive procedures, and modify the individualized education 
133.11 	plan or behavior intervention plan as appropriate. At the meeting, the team must review 
133.12 	any known medical or psychological limitations that contraindicate the use of a restrictive 
133.13 	procedure, consider whether to prohibit that restrictive procedure, and document any 
133.14 	prohibition in the individualized education program or behavior intervention plan.
133.15 	(d) An individualized education plan team may plan for using restrictive procedures 
133.16 	and may include these procedures in a child's individualized education program or 
133.17 	behavior intervention plan; however, the restrictive procedures may be used only in 
133.18 	response to behavior that constitutes an emergency, consistent with this section. The 
133.19 	individualized education program or behavior intervention plan shall indicate how the 
133.20 	parent wants to be notified when a restrictive procedure is used.
133.21 		Subd. 3.Physical holding or seclusion. Physical holding or seclusion may be used 
133.22 	only in an emergency. A school that uses physical holding or seclusion shall meet the 
133.23 	following requirements:
133.24 	(1) the physical holding or seclusion must be the least intrusive intervention that 
133.25 	effectively responds to the emergency;
133.26 	(2) physical holding or seclusion must end when the threat of harm ends and the 
133.27 	staff determines that the child can safely return to the classroom or activity;
133.28 	(3) staff must directly observe the child while physical holding or seclusion is being 
133.29 	used;
133.30 	(4) each time physical holding or seclusion is used, the staff person who implements 
133.31 	or oversees the physical holding or seclusion shall document, as soon as possible after the 
133.32 	incident concludes, the following information:
133.33 	(i) a description of the incident that led to the physical holding or seclusion;
133.34 	(ii) why a less restrictive measure failed or was determined by staff to be 
133.35 	inappropriate or impractical;
134.1 	(iii) the time the physical holding or seclusion began and the time the child was 
134.2 	released; and
134.3 	(iv) a brief record of the child's behavioral and physical status;
134.4 	(5) the room used for seclusion must:
134.5 	(i) be at least six feet by five feet;
134.6 	(ii) be well lit, well ventilated, adequately heated, and clean;
134.7 	(iii) have a window that allows staff to directly observe a child in seclusion;
134.8 	(iv) have tamperproof fixtures, electrical switches located immediately outside the 
134.9 	door, and secure ceilings;
134.10 	(v) have doors that open out and are unlocked, locked with keyless locks that 
134.11 	have immediate release mechanisms, or locked with locks that have immediate release 
134.12 	mechanisms connected with a fire and emergency system; and
134.13 	(vi) not contain objects that a child may use to injure the child or others; and
134.14 	(6) before using a room for seclusion, a school must:
134.15 	(i) receive written notice from local authorities that the room and the locking 
134.16 	mechanisms comply with applicable building, fire, and safety codes; and
134.17 	(ii) register the room with the commissioner, who may view that room.
134.18 		Subd. 4.Prohibitions. The following actions or procedures are prohibited:
134.19 	(1) engaging in conduct prohibited under section 121A.58;
134.20 	(2) requiring a child to assume and maintain a specified physical position, activity, 
134.21 	or posture that induces physical pain;
134.22 	(3) totally or partially restricting a child's senses as punishment;
134.23 	(4) presenting an intense sound, light, or other sensory stimuli using smell, taste, 
134.24 	substance, or spray as punishment;
134.25 	(5) denying or restricting a child's access to equipment and devices such as walkers, 
134.26 	wheelchairs, hearing aids, and communication boards that facilitate the child's functioning, 
134.27 	except when temporarily removing the equipment or device is needed to prevent injury 
134.28 	to the child or others or serious damage to the equipment or device, in which case the 
134.29 	equipment or device shall be returned to the child as soon as possible;
134.30 	(6) interacting with a child in a manner that constitutes sexual abuse, neglect, or 
134.31 	physical abuse under section 626.556;
134.32 	(7) withholding regularly scheduled meals or water;
134.33 	(8) denying access to bathroom facilities; and
134.34 	(9) physical holding that restricts or impairs a child's ability to breathe.
135.1 		Subd. 5.Training for staff. (a) To meet the requirements of subdivision 1, 
135.2 	staff who use restrictive procedures shall complete training in the following skills and 
135.3 	knowledge areas:
135.4 	(1) positive behavioral interventions;
135.5 	(2) communicative intent of behaviors;
135.6 	(3) relationship building;
135.7 	(4) alternatives to  restrictive procedures, including techniques to identify events and 
135.8 	environmental factors that may escalate behavior;
135.9 	(5) de-escalation methods;
135.10 	(6) standards for using restrictive procedures;
135.11 	(7) obtaining emergency medical assistance;
135.12 	(8) the physiological and psychological impact of physical holding and seclusion;
135.13 	(9) monitoring and responding to a child's physical signs of distress when physical 
135.14 	holding is being used; and
135.15 	(10) recognizing the symptoms of and interventions that may cause positional 
135.16 	asphyxia when physical holding is used.
135.17 	(b) The commissioner, after consulting with the commissioner of human services, 
135.18 	must develop and maintain a list of training programs that satisfy the requirements of 
135.19 	paragraph (a). The district shall maintain records of staff who have been trained and the 
135.20 	organization or professional that conducted the training. The district may collaborate with 
135.21 	children's community mental health providers to coordinate trainings.
135.22 		Subd. 6.Behavior supports. School districts are encouraged to establish effective 
135.23 	schoolwide systems of positive behavior interventions and supports. Nothing in this 
135.24 	section or section 125A.0941 precludes the use of reasonable force under sections 
135.25 	121A.582; 609.06, subdivision 1; and 609.379.

135.26 	EFFECTIVE DATE. This section is effective August 1, 2011.

135.27 	Sec. 13. Minnesota Statutes 2008, section 125A.15, is amended to read:
135.28 	125A.15 PLACEMENT IN ANOTHER DISTRICT; RESPONSIBILITY.
135.29 	The responsibility for special instruction and services for a child with a disability 
135.30 	temporarily placed in another district for care and treatment shall be determined in the 
135.31 	following manner:
135.32 	(a) The district of residence of a child shall be the district in which the child's parent 
135.33 	resides, if living, or the child's guardian, or the district designated by the commissioner if 
135.34 	neither parent nor guardian is living within the state.
136.1 	(b) If a district other than the resident district places a pupil for care and treatment, 
136.2 	the district placing the pupil must notify and give the resident district an opportunity to 
136.3 	participate in the placement decision. When an immediate emergency placement of a 
136.4 	pupil is necessary and time constraints foreclose a resident district from participating in 
136.5 	the emergency placement decision, the district in which the pupil is temporarily placed 
136.6 	must notify the resident district of the emergency placement within 15 days. The resident 
136.7 	district has up to five business days after receiving notice of the emergency placement 
136.8 	to request an opportunity to participate in the placement decision, which the placing 
136.9 	district must then provide.
136.10 	(c) When a child is temporarily placed for care and treatment in a day program 
136.11 	located in another district and the child continues to live within the district of residence 
136.12 	during the care and treatment, the district of residence is responsible for providing 
136.13 	transportation to and from the care and treatment facilityprogram and an appropriate 
136.14 	educational program for the child. The resident district may establish reasonable 
136.15 	restrictions on transportation, except if a Minnesota court or agency orders the child 
136.16 	placed at a day care and treatment program and the resident district receives a copy of 
136.17 	the order, then the resident district must provide transportation to and from the program 
136.18 	unless the court or agency orders otherwise. Transportation shall only be provided by the 
136.19 	resident district during regular operating hours of the resident district. The resident district 
136.20 	may provide the educational program at a school within the district of residence, at the 
136.21 	child's residence, or in the district in which the day treatment center is located by paying 
136.22 	tuition to that district.
136.23 	(c) (d) When a child is temporarily placed in a residential program for care and 
136.24 	treatment, the nonresident district in which the child is placed is responsible for providing 
136.25 	an appropriate educational program for the child and necessary transportation while the 
136.26 	child is attending the educational program; and must bill the district of the child's residence 
136.27 	for the actual cost of providing the program, as outlined in section 125A.11, except as 
136.28 	provided in paragraph (d) (e). However, the board, lodging, and treatment costs incurred 
136.29 	in behalf of a child with a disability placed outside of the school district of residence by 
136.30 	the commissioner of human services or the commissioner of corrections or their agents, 
136.31 	for reasons other than providing for the child's special educational needs must not become 
136.32 	the responsibility of either the district providing the instruction or the district of the child's 
136.33 	residence. For the purposes of this section, the state correctional facilities operated on a 
136.34 	fee-for-service basis are considered to be residential programs for care and treatment.
136.35 	(d) (e) A privately owned and operated residential facility may enter into a contract 
136.36 	to obtain appropriate educational programs for special education children and services 
137.1 	with a joint powers entity. The entity with which the private facility contracts for special 
137.2 	education services shall be the district responsible for providing students placed in that 
137.3 	facility an appropriate educational program in place of the district in which the facility is 
137.4 	located. If a privately owned and operated residential facility does not enter into a contract 
137.5 	under this paragraph, then paragraph (c) (d) applies.
137.6 	(e) (f) The district of residence shall pay tuition and other program costs, not 
137.7 	including transportation costs, to the district providing the instruction and services. 
137.8 	The district of residence may claim general education aid for the child as provided by 
137.9 	law. Transportation costs must be paid by the district responsible for providing the 
137.10 	transportation and the state must pay transportation aid to that district.

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

137.12 	Sec. 14. Minnesota Statutes 2008, section 125A.28, is amended to read:
137.13 	125A.28 STATE INTERAGENCY COORDINATING COUNCIL.
137.14 	An Interagency Coordinating Council of at least 17, but not more than 25 members 
137.15 	is established, in compliance with Public Law 108-446, section 641. The members 
137.16 	must be appointed by the governor. Council members must elect the council chair. The 
137.17 	representative of the commissioner may not serve as the chair. The council must be 
137.18 	composed of at least five parents, including persons of color, of children with disabilities 
137.19 	under age 12, including at least three parents of a child with a disability under age seven, 
137.20 	five representatives of public or private providers of services for children with disabilities 
137.21 	under age five, including a special education director, county social service director, 
137.22 	local Head Start director, and a community health services or public health nursing 
137.23 	administrator, one member of the senate, one member of the house of representatives, one 
137.24 	representative of teacher preparation programs in early childhood-special education or 
137.25 	other preparation programs in early childhood intervention, at least one representative of 
137.26 	advocacy organizations for children with disabilities under age five, one physician who 
137.27 	cares for young children with special health care needs, one representative each from the 
137.28 	commissioners of commerce, education, health, human services, a representative from the 
137.29 	state agency responsible for child care, foster care, mental health, homeless coordinator 
137.30 	of education of homeless children and youth, and a representative from Indian health 
137.31 	services or a tribal council. Section 15.059, subdivisions 2 to 5, apply to the council. 
137.32 	The council must meet at least quarterly.
138.1 	The council must address methods of implementing the state policy of developing 
138.2 	and implementing comprehensive, coordinated, multidisciplinary interagency programs of 
138.3 	early intervention services for children with disabilities and their families.
138.4 	The duties of the council include recommending policies to ensure a comprehensive 
138.5 	and coordinated system of all state and local agency services for children under age five 
138.6 	with disabilities and their families. The policies must address how to incorporate each 
138.7 	agency's services into a unified state and local system of multidisciplinary assessment 
138.8 	practices, individual intervention plans, comprehensive systems to find children in need of 
138.9 	services, methods to improve public awareness, and assistance in determining the role of 
138.10 	interagency early intervention committees.
138.11 	On the date that Minnesota Part C Annual Performance Report is submitted to the 
138.12 	federal Office of Special Education, the council must recommend to the governor and the 
138.13 	commissioners of education, health, human services, commerce, and employment and 
138.14 	economic development policies for a comprehensive and coordinated system.
138.15 	Notwithstanding any other law to the contrary, the State Interagency Coordinating 
138.16 	Council expires on June 30, 2009 2014.

138.17 	Sec. 15. Minnesota Statutes 2008, section 125A.51, is amended to read:
138.18 	125A.51 PLACEMENT OF CHILDREN WITHOUT DISABILITIES; 
138.19 	EDUCATION AND TRANSPORTATION.
138.20 	The responsibility for providing instruction and transportation for a pupil without a 
138.21 	disability who has a short-term or temporary physical or emotional illness or disability, as 
138.22 	determined by the standards of the commissioner, and who is temporarily placed for care 
138.23 	and treatment for that illness or disability, must be determined as provided in this section.
138.24 	(a) The school district of residence of the pupil is the district in which the pupil's 
138.25 	parent or guardian resides.
138.26 	(b) When parental rights have been terminated by court order, the legal residence 
138.27 	of a child placed in a residential or foster facility for care and treatment is the district in 
138.28 	which the child resides.
138.29 	(c) Before the placement of a pupil for care and treatment, the district of residence 
138.30 	must be notified and provided an opportunity to participate in the placement decision. 
138.31 	When an immediate emergency placement is necessary and time does not permit 
138.32 	resident district participation in the placement decision, the district in which the pupil is 
138.33 	temporarily placed, if different from the district of residence, must notify the district 
138.34 	of residence of the emergency placement within 15 days of the placement. When a 
138.35 	nonresident district makes an emergency placement without first consulting with the 
139.1 	resident district, the resident district has up to five business days after receiving notice 
139.2 	of the emergency placement to request an opportunity to participate in the placement 
139.3 	decision, which the placing district must then provide.
139.4 	(d) When a pupil without a disability is temporarily placed for care and treatment 
139.5 	in a day program and the pupil continues to live within the district of residence during 
139.6 	the care and treatment, the district of residence must provide instruction and necessary 
139.7 	transportation to and from the care and treatment facilityprogram for the pupil. The 
139.8 	resident district may establish reasonable restrictions on transportation, except if a 
139.9 	Minnesota court or agency orders the child placed at a day care and treatment program 
139.10 	and the resident district receives a copy of the order, then the resident district must provide 
139.11 	transportation to and from the program unless the court or agency orders otherwise. 
139.12 	Transportation shall only be provided by the resident district during regular operating 
139.13 	hours of the resident district. The resident district may provide the instruction at a school 
139.14 	within the district of residence, at the pupil's residence, or in the case of a placement 
139.15 	outside of the resident district, in the district in which the day treatment program is located 
139.16 	by paying tuition to that district. The district of placement may contract with a facility to 
139.17 	provide instruction by teachers licensed by the state Board of Teaching.
139.18 	(e) When a pupil without a disability is temporarily placed in a residential program 
139.19 	for care and treatment, the district in which the pupil is placed must provide instruction 
139.20 	for the pupil and necessary transportation while the pupil is receiving instruction, and in 
139.21 	the case of a placement outside of the district of residence, the nonresident district must 
139.22 	bill the district of residence for the actual cost of providing the instruction for the regular 
139.23 	school year and for summer school, excluding transportation costs.
139.24 	(f) Notwithstanding paragraph (e), if the pupil is homeless and placed in a public or 
139.25 	private homeless shelter, then the district that enrolls the pupil under section 127A.47, 
139.26 	subdivision 2, shall provide the transportation, unless the district that enrolls the pupil 
139.27 	and the district in which the pupil is temporarily placed agree that the district in which 
139.28 	the pupil is temporarily placed shall provide transportation. When a pupil without a 
139.29 	disability is temporarily placed in a residential program outside the district of residence, 
139.30 	the administrator of the court placing the pupil must send timely written notice of the 
139.31 	placement to the district of residence. The district of placement may contract with a 
139.32 	residential facility to provide instruction by teachers licensed by the state Board of 
139.33 	Teaching. For purposes of this section, the state correctional facilities operated on a 
139.34 	fee-for-service basis are considered to be residential programs for care and treatment.
139.35 	(g) The district of residence must include the pupil in its residence count of pupil 
139.36 	units and pay tuition as provided in section 123A.488 to the district providing the 
140.1 	instruction. Transportation costs must be paid by the district providing the transportation 
140.2 	and the state must pay transportation aid to that district. For purposes of computing state 
140.3 	transportation aid, pupils governed by this subdivision must be included in the disabled 
140.4 	transportation category if the pupils cannot be transported on a regular school bus route 
140.5 	without special accommodations.

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

140.7 	Sec. 16. Minnesota Statutes 2008, section 125A.56, is amended to read:
140.8 	125A.56 ALTERNATE INSTRUCTION REQUIRED BEFORE ASSESSMENT 
140.9 	REFERRAL.
140.10 		Subdivision 1.Requirement. (a) Before a pupil is referred for a special education 
140.11 	evaluation, the district must conduct and document at least two scientific, research-based 
140.12 	 instructional strategies, alternatives, or interventions using a system of scientific, 
140.13 	research-based instruction and intervention in academics or behavior, based on the pupil's 
140.14 	needs, while the pupil is in the regular classroom. The pupil's teacher must and document 
140.15 	the results. A special education evaluation team may waive this requirement when it 
140.16 	determines the pupil's need for the evaluation is urgent. A district may not use this section 
140.17 	may not be used to deny a pupil's right to a special education evaluation.
140.18 	(b) A school district shall use alternative intervention services, including the 
140.19 	assurance of mastery program under section 124D.66, the supplemental early education 
140.20 	program under section 124D.081, or an early intervening services program under 
140.21 	subdivision 2 to serve at-risk pupils who demonstrate a need for alternative instructional 
140.22 	strategies, alternatives, or interventions. 
140.23 		Subd. 1a.Definitions. (a) For purposes of this section, the terms defined in this 
140.24 	subdivision have the meaning given them.
140.25 	(b) "Benchmark assessments" means screening that is administered at least three 
140.26 	times per year to pupils in kindergarten through grade 8 who are at-risk or in need of early 
140.27 	intervening services and may be administered to pupils in grades 9 through 12.
140.28 	(c) "Early intervening services" means providing additional academic and behavioral 
140.29 	support in a general education environment to pupils who have not been identified as 
140.30 	needing special education or related services.
140.31 	(d) "General outcome measures" means valid and reliable measures based on 
140.32 	monitoring of pupils' progress, including both general screening of all pupils and more 
140.33 	frequent progress monitoring of pupil responses to specific interventions.
141.1 	(e) "Incidental benefit" means the benefit received by a nondisabled pupil (i) who 
141.2 	receives academic or behavioral instruction provided by a special education teacher to 
141.3 	a small group of primarily pupils with disabilities to implement their individualized 
141.4 	education programs, (ii) who needs the support to succeed in the general education 
141.5 	environment, and (iii) for whom no special education staff are added to meet that 
141.6 	nondisabled pupil's needs.
141.7 	(f) "Progress monitoring" means a standardized, scientifically based practice using 
141.8 	ongoing assessments that compare expected and actual rates of learning to measure pupils' 
141.9 	progress towards meeting a particular goal.
141.10 	(g) "Scientific, research-based instructional strategies, alternatives, and 
141.11 	interventions" means instruction and intervention derived from systematically applying 
141.12 	rigorous and objective procedures to obtain valid and reliable knowledge about educational 
141.13 	activities and programs.
141.14 		Subd. 2.Early intervening services program. (a) A district may meet the 
141.15 	requirement under subdivision 1 by establishing An early intervening services program 
141.16 	that includes:
141.17 	(1) a system of valid and reliable screening and general outcome measures aligned 
141.18 	to state academic standards that is administered at least three times per year to pupils 
141.19 	in kindergarten through grade 8 who need additional academic or behavioral support 
141.20 	to succeed in the general education environment. The school must provide interim 
141.21 	assessments that measure pupils' performance three times per year and implement that use 
141.22 	valid and reliable benchmark assessments;
141.23 	(2)  progress monitoring appropriate to the pupil. For purposes of this section, 
141.24 	"progress monitoring" means the frequent and continuous measurement of a pupil's 
141.25 	performance that includes these three interim assessments and other pupil assessments 
141.26 	during the school year. A school, at its discretion, may allow pupils in grades 9 through 
141.27 	12 to participate in interim assessments data that document the effectiveness of specific 
141.28 	interventions for each pupil and compare a pupil's performance against general outcome 
141.29 	measures;
141.30 	(2) (3) a system of scientific, research-based instruction and intervention
141.31 	instructional strategies, alternatives, and interventions; and
141.32 	(3) (4) an organizational plan that allows teachers, paraprofessionals, and volunteers 
141.33 	funded through various sources to deliver instruction, work collaboratively as a grade-level 
141.34 	team or use another configuration across grades and settings to deliver instruction. The 
141.35 	team must be trained, and receive training in scientific, research-based instruction and 
141.36 	intervention. Teachers and paraprofessionals at a site operating under this paragraph 
142.1 	must work collaboratively with those pupils who need additional academic or behavioral 
142.2 	support to succeed in a general education environment.
142.3 		Subd. 3.Incidental benefit. (b)(a) As an intervention under paragraph (a)
142.4 	subdivision 2, clause (2) (3), staff generating special education aid under section 125A.76
142.5 	may provide small group instruction to pupils who need additional academic or behavioral 
142.6 	support to succeed in the general education environment. Small group instruction that 
142.7 	includes pupils with a disability may be provided in the general education environment if:
142.8 	(1) the needs of the pupils with a disability are met, consistent with their individual 
142.9 	education plans, and; 
142.10 	(2) all pupils in the group receive the same level of instruction and make the same 
142.11 	progress in the instruction or intervention; and
142.12 	(3) during each 60-day period that a nondisabled pupil participates in small group 
142.13 	instruction under this paragraph, the pupil's progress monitoring data are examined to 
142.14 	determine whether the pupil is making progress and, if the pupil is not making progress, 
142.15 	the pupil's intervention strategies must be changed or the pupil must be referred for 
142.16 	a special education evaluation. 
142.17 	Teachers and paraprofessionals must ensure that the needs of pupils with a disability 
142.18 	participating in small group instruction under this paragraph remain the focus of the 
142.19 	instruction. Expenditures attributable to the time special education staff spends providing 
142.20 	instruction to nondisabled pupils in this circumstance is eligible for special education aid 
142.21 	under section 125A.76 as an incidental benefit if:
142.22 	(1) the group consists primarily of disabled pupils;
142.23 	(2) no special education staff are added to meet nondisabled pupils' needs; and
142.24 	(3) the primary purpose of the instruction is to implement the individual education 
142.25 	plans of pupils with a disability in this group.
142.26 	(b) Expenditures attributable to the time special education staff spends providing 
142.27 	small group instruction to nondisabled pupils that affords more than an incidental benefit 
142.28 	to such pupils is not eligible for special education aid under section 125A.76, except 
142.29 	that such expenditures may be included in the alternative delivery initial aid adjustment 
142.30 	under section 125A.78 if the district has an approved program under section 125A.50. 
142.31 	During each 60-day period that a nondisabled pupil participates in small group instruction 
142.32 	under this paragraph, the pupil's progress monitoring data must be examined to determine 
142.33 	whether the pupil is making progress and, if the pupil is not making progress, the pupil's 
142.34 	intervention strategies must be changed or the pupil must be referred for a special 
142.35 	education evaluation.

143.1 	Sec. 17. Minnesota Statutes 2008, section 125A.57, subdivision 2, is amended to read:
143.2 		Subd. 2.Assistive technology device. "Assistive technology device" means any 
143.3 	item, piece of equipment, software, or product system, whether acquired commercially 
143.4 	off the shelf, modified, or customized, that is used to increase, maintain, or improve 
143.5 	functional capabilities of children with disabilities a child with a disability. The term does 
143.6 	not include a surgically implanted medical device or a replacement of that device.

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

143.8 	Sec. 18. Minnesota Statutes 2008, section 125A.63, subdivision 2, is amended to read:
143.9 		Subd. 2.Programs. The resource centers must offer summer institutes and like 
143.10 	programsor other training programs throughout the state for deaf or hard of hearing, blind 
143.11 	or visually impaired, and multiply disabled pupils. The resource centers must also offer 
143.12 	workshops for teachers, and leadership development for teachers.
143.13 	A program offered through the resource centers must promote and develop education 
143.14 	programs offered by school districts or other organizations. The program must assist 
143.15 	school districts or other organizations to develop innovative programs.

143.16 	Sec. 19. Minnesota Statutes 2008, section 125A.63, subdivision 4, is amended to read:
143.17 		Subd. 4.Advisory committees. The commissioner shall establish an 
143.18 	advisory committee for each resource center. The advisory committees shall develop 
143.19 	recommendations regarding the resource centers and submit an annual report to the 
143.20 	commissioner on the form and in the manner prescribed by the commissioner. The 
143.21 	advisory committee for the Resource Center for the Deaf and Hard of Hearing shall meet 
143.22 	at least four times a year and submit an annual report to the commissioner, the legislature, 
143.23 	and the Commission of Deaf, DeafBlind and Hard of Hearing Minnesotans.
143.24 	The recommendations must include:
143.25 	(1) aggregate data-based education outcomes over time for deaf and hard-of-hearing 
143.26 	children, consistent with state academic standards and assessments under chapter 120B; 
143.27 	and
143.28 	(2) a data-based plan that includes evidence-based best practices known to improve 
143.29 	the educational outcomes of deaf and hard-of-hearing children.

143.30 	Sec. 20. Minnesota Statutes 2008, section 125A.76, subdivision 1, is amended to read:
143.31 		Subdivision 1.Definitions. For the purposes of this section, the definitions in this 
143.32 	subdivision apply.
144.1 	(a) "Basic revenue" has the meaning given it in section 126C.10, subdivision 2. 
144.2 	For the purposes of computing basic revenue pursuant to this section, each child with a 
144.3 	disability shall be counted as prescribed in section 126C.05, subdivision 1.
144.4 	(b) "Essential personnel" means teachers, cultural liaisons, related services, and 
144.5 	support services staff providing direct services to students. Essential personnel may also 
144.6 	include special education paraprofessionals or clericals providing support to teachers and 
144.7 	students by preparing paperwork and making arrangements related to special education 
144.8 	compliance requirements, including parent meetings and individual education plans.
144.9 	Essential personnel does not include administrators and supervisors.
144.10 	(c) "Average daily membership" has the meaning given it in section 126C.05.
144.11 	(d) "Program growth factor" means 1.046 for fiscal year 2012 and later.

144.12 	Sec. 21. APPROPRIATIONS.
 144.13 		Subdivision 1.Department of Education. The sums indicated in this section are 
144.14 	appropriated from the general fund to the Department of Education for the fiscal years 
144.15 	designated.
144.16 		Subd. 2.Special education; regular. For special education aid under Minnesota 
144.17 	Statutes, section 125A.75:

144.18		$
	609,003,000
	.....
	2010
	
144.19		$
	772,845,000
	.....
	2011
	
144.20 	The 2010 appropriation includes $71,947,000 for 2009 and $537,056,000 for 2010.
144.21 	The 2011 appropriation includes $198,637,000 for 2010 and $574,208,000 for 2011.
144.22 		Subd. 3.Special education; excess costs. For excess cost aid under Minnesota 
144.23 	Statutes, section 125A.79, subdivision 7:

144.24		$
	96,926,000
	.....
	2010
	
144.25		$
	110,871,000
	.....
	2011
	
144.26 	The 2010 appropriation includes $37,046,000 for 2009 and $59,880,000 for 2010.
144.27 	The 2011 appropriation includes $50,967,000 for 2010 and $59,904,000 for 2011.
144.28 		Subd. 4.Aid for children with disabilities. For aid under Minnesota Statutes, 
144.29 	section 125A.75, subdivision 3, for children with disabilities placed in residential facilities 
144.30 	within the district boundaries for whom no district of residence can be determined:

144.31		$
	1,717,000
	.....
	2010
	
144.32		$
	1,895,000
	.....
	2011
	
145.1 	If the appropriation for either year is insufficient, the appropriation for the other 
145.2 	year is available.
145.3 		Subd. 5.Travel for home-based services. For aid for teacher travel for home-based 
145.4 	services under Minnesota Statutes, section 125A.75, subdivision 1:

145.5		$
	214,000
	.....
	2010
	
145.6		$
	278,000
	.....
	2011
	
145.7 	The 2010 appropriation includes $24,000 for 2009 and $190,000 for 2010.
145.8 	The 2011 appropriation includes $70,000 for 2010 and $208,000 for 2011.
145.9 		Subd. 6.Court-placed special education revenue. For reimbursing serving 
145.10 	school districts for unreimbursed eligible expenditures attributable to children placed in 
145.11 	the serving school district by court action under Minnesota Statutes, section 125A.79, 
145.12 	subdivision 4:

145.13		$
	76,000
	.....
	2010
	
145.14		$
	78,000
	.....
	2011
	
145.15 		Subd. 7.Special education out-of-state tuition. For special education out-of-state 
145.16 	tuition according to Minnesota Statutes, section 125A.79, subdivision 8:

145.17		$
	250,000
	.....
	2010
	
145.18		$
	250,000
	.....
	2011

145.19 	Sec. 22.  REPEALER.
 145.20 	(a) Minnesota Statutes 2008, sections 125A.03; 125A.05; and 125A.18, are repealed.
145.21 	(b) Minnesota Statutes 2008, sections 121A.66; and 121A.67, subdivision 1, are 
145.22 	repealed effective July 1, 2011.
145.23 	(c) Minnesota Rules, parts 3525.0210, subparts 5, 6, 9, 13, 17, 29, 30, 46, and 47; 
145.24 	3525.1100, subpart 2, item F; and 3525.2900, subpart 5;  are repealed effective July 1, 2011.
145.25 	(d) Minnesota Rules, parts 3525.0210, subparts 34 and 43; 3525.0400; 3525.2445; 
145.26 	and 3525.4220, are repealed effective the day following final enactment.

145.27 	ARTICLE 4
145.28 	FACILITIES AND TECHNOLOGY

145.29 	Section 1. Minnesota Statutes 2008, section 123B.02, subdivision 21, is amended to 
145.30 	read:
145.31 		Subd. 21.Wind energy conversion system. The board, or more than one board 
145.32 	acting jointly under the authority granted by section 471.59, may construct, acquire, 
146.1 	own in whole or in part, operate, and sell and retain and spend the payment received 
146.2 	from selling energy from a wind energy conversion system, as defined in section 
146.3 	216C.06, subdivision 19. TheAn individual school board's share of the installed 
146.4 	capacity of the wind energy conversion systems authorized by this subdivision must not 
146.5 	exceed 3.3 megawatts of nameplate capacity, provided that if more than one board is 
146.6 	acting jointly, each board may have a separate share of no more than 3.3 megawatts of 
146.7 	nameplate capacity. A board owning, operating, or selling energy from a wind energy 
146.8 	conversion system must integrate information about wind energy conversion systems in its 
146.9 	educational programming. The board, or more than one board acting jointly under the 
146.10 	authority granted by section 471.59, may be a limited partner in a partnership, a member 
146.11 	of a limited liability company, or a shareholder in a corporation, established for the sole 
146.12 	purpose of constructing, acquiring, owning in whole or in part, financing, or operating a 
146.13 	wind energy conversion system for the benefit of the district or districts in accordance 
146.14 	with this section. A board individually, or acting jointly, or an entity of which a board is a 
146.15 	limited partner, member, or shareholder, may not sell, transmit, or distribute the electrical 
146.16 	energy at retail or provide for end use of the electrical energy at an off-site facility of the 
146.17 	board or entity. Nothing in this subdivision modifies the exclusive service territories or 
146.18 	exclusive right to serve as provided in sections 216B.37 to 216B.43.

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

146.20 	Sec. 2. Minnesota Statutes 2008, section 123B.57, subdivision 1, is amended to read:
146.21 		Subdivision 1.Health and safety program. (a) To receive health and safety 
146.22 	revenue for any fiscal year a district must submit to the commissioner an application for 
146.23 	aid and levy by the date determined by the commissioner. The application may be for 
146.24 	hazardous substance removal, fire and life safety code repairs, labor and industry regulated 
146.25 	facility and equipment violations, and health, safety, and environmental management, 
146.26 	including indoor air quality management. The application must include a health and safety 
146.27 	program adopted by the school district board. The program must include the estimated 
146.28 	cost, per building, of the program by fiscal year. Upon approval through the adoption of 
146.29 	a resolution by each of an intermediate district's member school district boards and the 
146.30 	approval of the Department of Education, a school district may include its proportionate 
146.31 	share of the costs of health and safety projects for an intermediate district in its application.
146.32 	(b) Health and safety projects with an estimated cost of $500,000 or more per site, 
146.33 	approved after February 1, 2003, are not eligible for health and safety revenue. Health 
146.34 	and safety projects with an estimated cost of $500,000 or more per site, approved after 
146.35 	February 1, 2003, that meet all other requirements for health and safety funding, are 
147.1 	eligible for alternative facilities bonding and levy revenue according to section 123B.59. 
147.2 	A school board shall not separate portions of a single project into components to qualify 
147.3 	for health and safety revenue, and shall not combine unrelated projects into a single project 
147.4 	to qualify for alternative facilities bonding and levy revenue. 

147.5 	EFFECTIVE DATE. This section is effective July 1, 2009.

147.6 	Sec. 3. Minnesota Statutes 2008, section 123B.59, subdivision 2, is amended to read:
147.7 		Subd. 2.Facility plan. (a) A district qualifying under subdivision 1, paragraph 
147.8 	(a), must have a ten-year facility plan approved by the commissioner that includes an 
147.9 	inventory of projects and costs that would be eligible for:
147.10 	(1) health and safety revenue, without restriction as to project size;
147.11 	(2) disabled access levy; and
147.12 	(3) deferred capital expenditures and maintenance projects necessary to prevent 
147.13 	further erosion of facilities.
147.14 	(b) A district qualifying under subdivision 1, paragraph (b), must have a five-year 
147.15 	plan approved by the commissioner that includes an inventory of projects and costs for 
147.16 	health and safety projects with an estimated cost of $500,000 or more per site that would 
147.17 	qualify for health and safety revenue except for the project size limitation in section 
147.18 	123B.57, subdivision 1, paragraph (b).  
147.19 	(c) The school district must:
147.20 	(1) annually update the plans;
147.21 	(2) biennially submit a facility maintenance plan; and
147.22 	(3) indicate whether the district will issue bonds to finance the plan or levy for 
147.23 	the costs.

147.24 	EFFECTIVE DATE. This section is effective July 1, 2009.

147.25 	Sec. 4. Minnesota Statutes 2008, section 123B.59, subdivision 3, is amended to read:
147.26 		Subd. 3.Bond authorization. (a) A school district may issue general obligation 
147.27 	bonds under this section to finance facilities plans approved by its board and the 
147.28 	commissioner. Chapter 475, except sections 475.58 and 475.59, must be complied with. 
147.29 	The district may levy under subdivision 5 for the debt service revenue. The authority to 
147.30 	issue bonds under this section is in addition to any bonding authority authorized by this 
147.31 	chapter, or other law. The amount of bonding authority authorized under this section must 
147.32 	be disregarded in calculating the bonding or net debt limits of this chapter, or any other 
147.33 	law other than section 475.53, subdivision 4.
148.1 	(b) At least 20 days before the earliest of solicitation of bids, the issuance of bonds, 
148.2 	or the final certification of levies under subdivision 5, the district must publish notice 
148.3 	of the intended projects, the amount of the bond issue, and the total amount of district 
148.4 	indebtedness, and the commissioner's review and comment, if applicable.

148.5 	EFFECTIVE DATE. This section is effective July 1, 2009.

148.6 	Sec. 5. Minnesota Statutes 2008, section 123B.59, subdivision 3a, is amended to read:
148.7 		Subd. 3a.Levy authorization. (a) A school district may levy under this section to 
148.8 	finance the portion of facilities plans approved by its board and the commissioner that are 
148.9 	not financed through bond issues according to subdivision 3.
148.10 	(b) At least 20 days before a final district certification of levies under subdivision 
148.11 	5, the district must publish notice of the intended projects, including the total estimated 
148.12 	project cost, and the commissioner's review and comment, if applicable.

148.13 	EFFECTIVE DATE. This section is effective July 1, 2009.

148.14 	Sec. 6. Minnesota Statutes 2008, section 123B.70, subdivision 1, is amended to read:
148.15 		Subdivision 1.Commissioner approval. (a) In determining whether to give a 
148.16 	school facility a positive, negative, or unfavorable review and comment, the commissioner 
148.17 	must evaluate the proposals for facilities using the information provided under section 
148.18 	123B.71, subdivision 9.  
148.19 	(b) In the case of a proposal for a new school, the local school board retains the 
148.20 	authority to determine the minimum acreage needed to accommodate the school and 
148.21 	related facilities. The commissioner may evaluate the proposals but must not issue a 
148.22 	negative or unfavorable review and comment under this section for a school facility solely 
148.23 	based on too little acreage of the proposed school site.
148.24 	(c) In the case of a proposal to renovate an existing school, the local school board 
148.25 	retains the authority to determine whether to renovate an existing school or to build a new 
148.26 	school regardless of the acreage of the current school site or the cost of the renovation 
148.27 	relative to the cost of building a new school. The commissioner's evaluation of whether 
148.28 	to replace a facility must not be solely based upon the ratio of renovation costs to 
148.29 	replacement costs.

148.30 	EFFECTIVE DATE. This section is effective for review and comments issued 
148.31 	after July 1, 2009.

148.32 	Sec. 7. Minnesota Statutes 2008, section 123B.71, subdivision 8, is amended to read:
149.1 		Subd. 8.Review and comment. A school district, a special education cooperative, 
149.2 	or a cooperative unit of government, as defined in section 123A.24, subdivision 2, must not 
149.3 	initiate an installment contract for purchase or a lease agreement, hold a referendum for 
149.4 	bonds, nor solicit bids for new construction, expansion, or remodeling of an educational 
149.5 	facility that requires an expenditure in excess of $500,000 per school site if the district has 
149.6 	an outstanding capital loan or $1,400,000 for all other school districts, special education 
149.7 	cooperatives, or cooperative units of government per school site prior to review and 
149.8 	comment by the commissioner. The commissioner may exempt a facility maintenance 
149.9 	project funded with general education aid and levy, alternative facilities bonding and levy 
149.10 	program, or health and safety revenue from this provision after reviewing a written request 
149.11 	from a school district describing the scope of work. A school board shall not separate 
149.12 	portions of a single project into components to avoid the requirements of this subdivision.
149.13 	The commissioner must exempt a facility maintenance project funded with capital 
149.14 	facilities bonding under section 123B.62, alternative facilities bonding and levy under 
149.15 	section 123B.59, or health and safety revenue under section 123B.57 from this provision. 

149.16 	EFFECTIVE DATE. This section is effective July 1, 2009.

149.17 	Sec. 8. Minnesota Statutes 2008, section 123B.71, subdivision 9, is amended to read:
149.18 		Subd. 9.Information required. A school board proposing to construct a facility 
149.19 	described in subdivision 8 shall submit to the commissioner a proposal containing 
149.20 	information including at least the following:
149.21 	(1) the geographic area and population to be served, preschool through grade 12 
149.22 	student enrollments for the past five years, and student enrollment projections for the 
149.23 	next five years;
149.24 	(2) a list of existing facilities by year constructed, their uses, and an assessment of 
149.25 	the extent to which alternate facilities are available within the school district boundaries 
149.26 	and in adjacent school districts;
149.27 	(3) a list of the specific deficiencies of the facility that demonstrate the need for a 
149.28 	new or renovated facility to be provided, and a list of the specific benefits that the new 
149.29 	or renovated facility will provide to the students, teachers, and community users served 
149.30 	by the facility;
149.31 	(4) the relationship of the project to any priorities established by the school district, 
149.32 	educational cooperatives that provide support services, or other public bodies in the 
149.33 	service area;
150.1 	(5) a description of the pedestrian, bicycle, and transit connections between the 
150.2 	school and nearby residential areas that make it easier for children, teachers, and parents 
150.3 	to get to the school by walking, bicycling, and taking transit;
150.4 	(5) (6) a specification of how the project will increase community use of the facility
150.5 	maximizes the opportunity for cooperative use of existing park, recreation, and other 
150.6 	public facilities and whether and how the project will increase collaboration with other 
150.7 	governmental or nonprofit entities;
150.8 	(6) (7) a description of the project, including the specification of site and outdoor 
150.9 	space acreage and square footage allocations for classrooms, laboratories, and support 
150.10 	spaces; estimated expenditures for the major portions of the project; and the dates the 
150.11 	project will begin and be completed;
150.12 	(7) (8) a specification of the source of financing the project; the scheduled date 
150.13 	for a bond issue or school board action; a schedule of payments, including debt service 
150.14 	equalization aid; and the effect of a bond issue on local property taxes by the property 
150.15 	class and valuation;
150.16 	(8) (9) an analysis of how the proposed new or remodeled facility will affect school 
150.17 	district operational or administrative staffing costs, and how the district's operating budget 
150.18 	will cover any increased operational or administrative staffing costs;
150.19 	(9) (10) a description of the consultation with local or state road and transportation 
150.20 	officials on multimodal school site access and safety issues, and the ways that the project 
150.21 	will address those issues;
150.22 	(10) (11) a description of how indoor air quality issues have been considered and a 
150.23 	certification that the architects and engineers designing the facility will have professional 
150.24 	liability insurance;
150.25 	(11) (12) as required under section 123B.72, for buildings coming into service 
150.26 	after July 1, 2002, a certification that the plans and designs for the extensively renovated 
150.27 	or new facility's heating, ventilation, and air conditioning systems will meet or exceed 
150.28 	code standards; will provide for the monitoring of outdoor airflow and total airflow of 
150.29 	ventilation systems; and will provide an indoor air quality filtration system that meets 
150.30 	ASHRAE standard 52.1;
150.31 	(12) (13) a specification of any desegregation requirements that cannot be met 
150.32 	by any other reasonable means;
150.33 	(13) (14) a specification, if applicable, of how the facility will utilize environmentally 
150.34 	sustainable school facility design concepts; and
150.35 	(14) (15) a description of how the architects and engineers have considered 
150.36 	the American National Standards Institute Acoustical Performance Criteria, Design 
151.1 	Requirements and Guidelines for Schools of the maximum background noise level and 
151.2 	reverberation times.; and
151.3 	(16) any existing information from the relevant local unit of government about the 
151.4 	cumulative costs to provide infrastructure to serve the school, such as utilities, sewer, 
151.5 	roads, and sidewalks.

151.6 	Sec. 9. Minnesota Statutes 2008, section 123B.71, subdivision 12, is amended to read:
151.7 		Subd. 12.Publication. (a) At least 20 days but not more than 60 days before a 
151.8 	referendum for bonds or solicitation of bids for a project that has received a positive or 
151.9 	unfavorable review and comment under section 123B.70, the school board shall publish 
151.10 	the commissioner's review and comment of that project in the legal newspaper of the 
151.11 	district. Supplementary information shall be available to the public.
151.12 	(b) The publication requirement in paragraph (a) does not apply to alternative 
151.13 	facilities projects approved under section 123B.59. Publication for alternative facilities 
151.14 	projects shall be as specified in section 123B.59, subdivisions 3 and 3a.

151.15 	EFFECTIVE DATE. This section is effective July 1, 2009.

151.16 	Sec. 10. Minnesota Statutes 2008, section 125B.26, is amended to read:
151.17 	125B.26 TELECOMMUNICATIONS/INTERNET ACCESS EQUITY AID.
151.18 		Subdivision 1.Costs to be submitted. (a) A district or, charter school, or 
151.19 	intermediate school district shall submit its actual telecommunications/Internet access 
151.20 	costs for the previous fiscal year, adjusted for any e-rate revenue received, to the 
151.21 	department by August 15 of each year as prescribed by the commissioner. Costs eligible 
151.22 	for reimbursement under this program are limited to the following:
151.23 	(1) ongoing or recurring telecommunications/Internet access costs associated with 
151.24 	Internet access, data lines, and video links providing:
151.25 	(i) the equivalent of one data line, video link, or integrated data/video link that relies 
151.26 	on a transport medium that operates at a minimum speed of 1.544 megabytes per second 
151.27 	(T1) for each elementary school, middle school, or high school under section 120A.05, 
151.28 	subdivisions 9, 11, and 13, including the recurring telecommunications line lease costs 
151.29 	and ongoing Internet access service fees; or
151.30 	(ii) the equivalent of one data line or video circuit, or integrated data/video link that 
151.31 	relies on a transport medium that operates at a minimum speed of 1.544 megabytes per 
151.32 	second (T1) for each district, including recurring telecommunications line lease costs 
151.33 	and ongoing Internet access service fees;
152.1 	(2) recurring costs of contractual or vendor-provided maintenance on the school 
152.2 	district's wide area network to the point of presence at the school building up to the router, 
152.3 	codec, or other service delivery equipment located at the point of presence termination 
152.4 	at the school or school district;
152.5 	(3) recurring costs of cooperative, shared arrangements for regional delivery of 
152.6 	telecommunications/Internet access between school districts, postsecondary institutions, 
152.7 	and public libraries including network gateways, peering points, regional network 
152.8 	infrastructure, Internet2 access, and network support, maintenance, and coordination; and
152.9 	(4) service provider installation fees for installation of new telecommunications lines 
152.10 	or increased bandwidth.
152.11 	(b) Costs not eligible for reimbursement under this program include:
152.12 	(1) recurring costs of school district staff providing network infrastructure support;
152.13 	(2) recurring costs associated with voice and standard telephone service;
152.14 	(3) costs associated with purchase of network hardware, telephones, computers, or 
152.15 	other peripheral equipment needed to deliver telecommunications access to the school or 
152.16 	school district;
152.17 	(4) costs associated with laying fiber for telecommunications access;
152.18 	(5) costs associated with wiring school or school district buildings;
152.19 	(6) costs associated with purchase, installation, or purchase and installation of 
152.20 	Internet filtering; and
152.21 	(7) costs associated with digital content, including online learning or distance 
152.22 	learning programming, and information databases.
152.23 		Subd. 2.E-rates. To be eligible for aid under this section, a district or, charter 
152.24 	school, or intermediate school district is required to file an e-rate application either 
152.25 	separately or through its telecommunications access cluster and have a current technology 
152.26 	plan on file with the department. Discounts received on telecommunications expenditures 
152.27 	shall be reflected in the costs submitted to the department for aid under this section.
152.28 		Subd. 3.Reimbursement criteria. The commissioner shall develop criteria 
152.29 	for approving costs submitted by organized school districts and, charter schools, and 
152.30 	intermediate school districts under subdivision 1.
152.31 		Subd. 4.District aid. For fiscal year 2006 and later, a district or, charter school's
152.32 	school, or intermediate school district's Internet access equity aid equals the district or,
152.33 	charter school's school, or intermediate school district's approved cost for the previous 
152.34 	fiscal year according to subdivision 1 exceeding $15 times the district's adjusted marginal 
152.35 	cost pupil units for the previous fiscal year or no reduction if the district is part of an 
152.36 	organized telecommunications access cluster. Equity aid must be distributed to the 
153.1 	telecommunications access cluster for districts, charter schools, or intermediate school 
153.2 	districts that are members of the cluster or to individual districts and, charter schools, or 
153.3 	intermediate school districts not part of a telecommunications access cluster.
153.4 		Subd. 5.Telecommunications/Internet access services for nonpublic schools.
 153.5 	(a) Districts shall provide each year upon formal request by or on behalf of a nonpublic 
153.6 	school, not including home schools, located in that district or area, ongoing or recurring 
153.7 	telecommunications access services to the nonpublic school either through existing district 
153.8 	providers or through separate providers.
153.9 	(b) The amount of district aid for telecommunications access services for each 
153.10 	nonpublic school under this subdivision equals the lesser of:
153.11 	(1) 90 percent of the nonpublic school's approved cost for the previous fiscal year 
153.12 	according to subdivision 1 exceeding $10 for fiscal year 2006 and later times the number 
153.13 	of weighted pupils enrolled at the nonpublic school as of October 1 of the previous 
153.14 	school year; or
153.15 	(2) the product of the district's aid per pupil unit according to subdivision 4 times 
153.16 	the number of weighted pupils enrolled at the nonpublic school as of October 1 of the 
153.17 	previous school year.
153.18 	(c) For purposes of this subdivision, nonpublic school pupils shall be weighted by 
153.19 	grade level using the weighting factors defined in section 126C.05, subdivision 1.
153.20 	(d) Each year, a district providing services under paragraph (a) may claim up to five 
153.21 	percent of the aid determined in paragraph (b) for costs of administering this subdivision. 
153.22 	No district may expend an amount for these telecommunications access services which 
153.23 	exceeds the amount allocated under this subdivision. The nonpublic school is responsible 
153.24 	for the Internet access costs not covered by this section.
153.25 	(e) At the request of a nonpublic school, districts may allocate the amount 
153.26 	determined in paragraph (b) directly to the nonpublic school to pay for or offset the 
153.27 	nonpublic school's costs for telecommunications access services; however, the amount 
153.28 	allocated directly to the nonpublic school may not exceed the actual amount of the school's 
153.29 	ongoing or recurring telecommunications access costs.
153.30 		Subd. 6.Severability. If any portion of this section is found by a court to be 
153.31 	unconstitutional, the remaining portions of the section shall remain in effect.

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

153.33 	Sec. 11. APPROPRIATIONS.
 154.1 		Subdivision 1.Department of Education. The sums indicated in this section are 
154.2 	appropriated from the general fund to the Department of Education for the fiscal years 
154.3 	designated.
154.4 		Subd. 2.Health and safety revenue. For health and safety aid according to 
154.5 	Minnesota Statutes, section 123B.57, subdivision 5:

154.6		$
	132,000
	.....
	2010
	
154.7		$
	162,000
	.....
	2011
	
154.8 	The 2010 appropriation includes $10,000 for 2009 and $122,000 for 2010.
154.9 	The 2011 appropriation includes $45,000 for 2010 and $117,000 for 2011.
154.10 		Subd. 3.Debt service equalization. For debt service aid according to Minnesota 
154.11 	Statutes, section 123B.53, subdivision 6:

154.12		$
	6,608,000
	.....
	2010
	
154.13		$
	9,012,000
	.....
	2011
	
154.14 	The 2010 appropriation includes $851,000 for 2009 and $5,757,000 for 2010.
154.15 	The 2011 appropriation includes $2,128,000 for 2010 and $6,884,000 for 2011.
154.16 		Subd. 4.Alternative facilities bonding aid. For alternative facilities bonding aid, 
154.17 	according to Minnesota Statutes, section 123B.59, subdivision 1:

154.18		$
	16,008,000
	.....
	2010
	
154.19		$
	19,287,000
	.....
	2011
	
154.20 	The 2010 appropriation includes $1,928,000 for 2009 and $14,080,000 for 2010.
154.21 	The 2011 appropriation includes $5,207,000 for 2010 and $14,080,000 for 2011.
154.22 		Subd. 5.Equity in telecommunications access. For equity in telecommunications 
154.23 	access:

154.24		$
	3,750,000
	.....
	2010
	
154.25		$
	3,750,000
	.....
	2011
	
154.26 	If the appropriation amount is insufficient, the commissioner shall reduce the 
154.27 	reimbursement rate in Minnesota Statutes, section 125B.26, subdivisions 4 and 5, and the 
154.28 	revenue for fiscal years 2010 and 2011 shall be prorated.
154.29 	Any balance in the first year does not cancel but is available in the second year.
154.30 		Subd. 6.Deferred maintenance aid. For deferred maintenance aid, according to 
154.31 	Minnesota Statutes, section 123B.591, subdivision 4:

154.32		$
	1,916,000
	.....
	2010
	
154.33		$
	2,110,000
	.....
	2011
	
155.1 	The 2010 appropriation includes $260,000 for 2009 and $1,656,000 for 2010.
155.2 	The 2011 appropriation includes $612,000 for 2010 and $1,498,000 for 2011.

155.3 	ARTICLE 5
155.4 	LIBRARIES, NUTRITION, AND ACCOUNTING

155.5 	Section 1. Minnesota Statutes 2008, section 123B.10, subdivision 1, is amended to read:
155.6 		Subdivision 1.Budgets; form of notification. (a) Every board must publish revenue 
155.7 	and expenditure budgets for the current year and the actual revenues, expenditures, fund 
155.8 	balances for the prior year and projected fund balances for the current year in a form 
155.9 	prescribed by the commissioner within one week of the acceptance of the final audit by 
155.10 	the board, or November 30, whichever is earlier. The forms prescribed must be designed 
155.11 	so that year to year comparisons of revenue, expenditures and fund balances can be made. 
155.12 	(b) A school board annually must notify the public of its revenue, expenditures, fund 
155.13 	balances, and other relevant budget information. The board must include the budget 
155.14 	information required by this section in the materials provided as a part of its truth in 
155.15 	taxation hearing, post the materials in a conspicuous place on the district's official Web 
155.16 	site, including a link to the district's school report card on the Department of Education's 
155.17 	Web site, and publish a summary of the information and the address of the district's 
155.18 	official Web site where the information can be found in a qualified newspaper of general 
155.19 	circulation in the district.

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

155.21 	Sec. 2. Minnesota Statutes 2008, section 123B.14, subdivision 7, is amended to read:
155.22 		Subd. 7.Clerk records. The clerk shall keep a record of all meetings of the 
155.23 	district and the board in books provided by the district for that purpose. The clerk shall, 
155.24 	within three days after an election, notify all persons elected of their election. By August
155.25 	September 15 of each year the clerk shall file with the board a report of the revenues, 
155.26 	expenditures and balances in each fund for the preceding fiscal year. The report together 
155.27 	with vouchers and supporting documents shall subsequently be examined by a public 
155.28 	accountant or the state auditor, either of whom shall be paid by the district, as provided 
155.29 	in section 123B.77, subdivision 3. The board shall by resolution approve the report or 
155.30 	require a further or amended report. By AugustSeptember 15 of each year, the clerk shall 
155.31 	make and transmit to the commissioner certified reports, showing:
155.32 	(1) The condition and value of school property;
156.1 	(2) the revenues and expenditures in detail, and such other financial information 
156.2 	required by law, rule, or as may be called for by the commissioner;
156.3 	(3) (2) the length of school term and the enrollment and attendance by grades; and
156.4 	(4) (3) such other items of information as may be called for by the commissioner.
156.5 	The clerk shall enter in the clerk's record book copies of all reports and of the 
156.6 	teachers' term reports, as they appear in the registers, and of the proceedings of any 
156.7 	meeting as furnished by the clerk pro tem, and keep an itemized account of all the 
156.8 	expenses of the district. The clerk shall furnish to the auditor of the proper county, by 
156.9 	October 10September 30 of each year, an attested copy of the clerk's record, showing 
156.10 	the amount of moneyproposed property tax voted by the district or the board for school 
156.11 	purposes; draw and sign all orders upon the treasurer for the payment of money for bills 
156.12 	allowed by the board for salaries of officers and for teachers' wages and all claims, to be 
156.13 	countersigned by the chair. Such orders must state the consideration, payee, and the 
156.14 	fund and the clerk shall take a receipt therefor. Teachers' wages shall have preference in 
156.15 	the order in which they become due, and no money applicable for teachers' wages shall 
156.16 	be used for any other purpose, nor shall teachers' wages be paid from any fund except 
156.17 	that raised or apportioned for that purpose.

156.18 	Sec. 3. Minnesota Statutes 2008, section 123B.75, subdivision 5, is amended to read:
156.19 		Subd. 5.Levy recognition. (a) "School district tax settlement revenue" means the 
156.20 	current, delinquent, and manufactured home property tax receipts collected by the county 
156.21 	and distributed to the school district.
156.22 	(b) For fiscal year 2004 and later years, in June of each year In June of 2009, the 
156.23 	school district must recognize as revenue, in the fund for which the levy was made, the 
156.24 	lesser of:
156.25 	(1) the sum of May, June, and July school district tax settlement revenue received in 
156.26 	that calendar year, plus general education aid according to section 126C.13, subdivision 
156.27 	4, received in July and August of that calendar year; or
156.28 	(2) the sum of:
156.29 	(i) 31 percent of the referendum levy certified according to section 126C.17, in 
156.30 	calendar year 2000; and
156.31 	(ii) the entire amount of the levy certified in the prior calendar year according to 
156.32 	section 124D.86, subdivision 4, for school districts receiving revenue under sections 
156.33 	124D.86, subdivision 3, clauses (1), (2), and (3); 126C.41, subdivisions 1, 2, and 3, 
156.34 	paragraphs (b), (c), and (d); 126C.43, subdivision 2; 126C.457; and 126C.48, subdivision 
156.35 	6.
157.1 	(c) For fiscal year 2010 and later years, in June of each year, the school district must 
157.2 	recognize as revenue, in the fund for which the levy was made, the lesser of:
157.3 	(1) the sum of May, June, and July school district tax settlement revenue received in 
157.4 	that calendar year, plus general education aid according to section 126C.13, subdivision 
157.5 	4, received in July and August of that calendar year; or
157.6 	(2) the sum of:
157.7 	(i) the greater of 49.1 percent of the referendum levy certified according to section 
157.8 	126C.17, in the prior calendar year or 31 percent of the referendum levy certified 
157.9 	according to section 126C.17, in calendar year 2000; plus
157.10 	(ii) the entire amount of the levy certified in the prior calendar year according to 
157.11 	section 124D.86, subdivision 4, for school districts receiving revenue under sections 
157.12 	124D.86, subdivision 3, clauses (1), (2), and (3); 126C.41, subdivisions 1, 2, and 3, 
157.13 	paragraphs (b), (c), and (d); 126C.43, subdivision 2; 126C.457; and 126C.48, subdivision 
157.14 	6; plus
157.15 	(iii) 49.1 percent of the amount of the levy certified in the prior calendar year for the 
157.16 	school district's general and community service funds, plus or minus auditor's adjustments, 
157.17 	not including the levy portions that are assumed by the state, that remains after subtracting 
157.18 	the referendum levy certified according to section 126C.17 and the amount recognized 
157.19 	according to clause (ii).

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

157.21 	Sec. 4. Minnesota Statutes 2008, section 123B.76, subdivision 3, is amended to read:
157.22 		Subd. 3.Expenditures by building. (a) For the purposes of this section, "building" 
157.23 	means education site as defined in section 123B.04, subdivision 1.
157.24 	(b) Each district shall maintain separate accounts to identify general fund 
157.25 	expenditures for each building to the extent provided by the uniform financial accounting 
157.26 	and reporting standards for school units. All expenditures for regular instruction, 
157.27 	secondary vocational instruction, and school administration must be reported to 
157.28 	the department separately for each building. All expenditures for special education 
157.29 	instruction, instructional support services, and pupil support services provided within a 
157.30 	specific building must be reported to the department separately for each building. Salary 
157.31 	expenditures reported by building must reflect actual salaries for staff at the building and 
157.32 	must not be based on districtwide averages. All other General fund expenditures not 
157.33 	available at the building level through the uniform financial accounting and reporting 
157.34 	standards may be reported by building or on a districtwide basis.
158.1 	(c) The department must annually report information showing school district general 
158.2 	fund expenditures per pupil by program category for each building and estimated school 
158.3 	district general fund revenue generated by pupils attending each building on its Web 
158.4 	site. For purposes of this report:
158.5 	(1) expenditures not reported by building shall be allocated among buildings on a 
158.6 	uniform per pupil basis;
158.7 	(2) basic skills revenue shall be allocated according to section 126C.10, subdivision 
158.8 	4;
158.9 	(3) secondary sparsity revenue and elementary sparsity revenue shall be allocated 
158.10 	according to section 126C.10, subdivisions 7 and 8;
158.11 	(4) alternative teacher compensation revenue shall be allocated according to section 
158.12 	122A.415, subdivision 1;
158.13 	(5) other general education revenue shall be allocated on a uniform per pupil unit 
158.14 	basis;
158.15 	(6) first grade preparedness aid shall be allocated according to section 124D.081;
158.16 	(7) state and federal special education aid and Title I aid shall be allocated in 
158.17 	proportion to district expenditures for these programs by building; and
158.18 	(8) other general fund revenues shall be allocated on a uniform per pupil basis, 
158.19 	except that the department may allocate other revenues attributable to specific buildings 
158.20 	directly to those buildings.

158.21 	EFFECTIVE DATE. This section is effective for fiscal years 2010 and later.

158.22 	Sec. 5. Minnesota Statutes 2008, section 123B.79, subdivision 7, is amended to read:
158.23 		Subd. 7.Account transfer for certain severance pay designated separation 
158.24 	and retirement benefits. A district may separately maintain in a reserve for certain 
158.25 	severance pay designated for separation and retirement benefit account not more than 50 
158.26 	percent of the amount necessary to meet the obligations for the portion of severance 
158.27 	pay that constitutes compensation for accumulated sick leave to be used for payment of 
158.28 	premiums for group insurance provided for former employees by the district separation 
158.29 	and retirement benefits, including compensated absences, termination benefits, pension 
158.30 	benefits, and other postemployment benefits, not accounted for elsewhere. The amount 
158.31 	necessary must be calculated according to standards established by the department.

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

158.33 	Sec. 6. Minnesota Statutes 2008, section 123B.81, subdivision 3, is amended to read:
159.1 		Subd. 3.Debt verification. The commissioner shall establish a uniform auditing or 
159.2 	other verification procedure for districts to determine whether a statutory operating debt 
159.3 	exists in any Minnesota school district as of June 30, 1977. This procedure must identify 
159.4 	all interfund transfers made during fiscal year 1977 from a fund included in computing 
159.5 	statutory operating debt to a fund not included in computing statutory operating debt. The 
159.6 	standards for this uniform auditing or verification procedure must be promulgated by the 
159.7 	state board pursuant to chapter 14 commissioner. If a district applies to the commissioner 
159.8 	for a statutory operating debt verification or if the unaudited financial statement for the 
159.9 	school year ending June 30, 1977 reveals that a statutory operating debt might exist, the 
159.10 	commissioner shall require a verification of the amount of the statutory operating debt 
159.11 	which actually does exist.

159.12 	Sec. 7. Minnesota Statutes 2008, section 123B.81, subdivision 4, is amended to read:
159.13 		Subd. 4.Debt elimination. If an audit or other verification procedure conducted 
159.14 	pursuant to subdivision 3 determines that a statutory operating debt exists, a district 
159.15 	must follow the procedures set forth in this section 123B.83 to eliminate this statutory 
159.16 	operating debt. 

159.17 	Sec. 8. Minnesota Statutes 2008, section 123B.81, subdivision 5, is amended to read:
159.18 		Subd. 5.Certification of debt. The commissioner shall certify the amount of 
159.19 	statutory operating debt for each district. Prior to June 30, 1979, the commissioner may, 
159.20 	on the basis of corrected figures, adjust the total amount of statutory operating debt 
159.21 	certified for any district.

159.22 	Sec. 9. Minnesota Statutes 2008, section 124D.111, subdivision 3, is amended to read:
159.23 		Subd. 3.School food service fund. (a) The expenses described in this subdivision 
159.24 	must be recorded as provided in this subdivision.
159.25 	(b) In each district, the expenses for a school food service program for pupils must 
159.26 	be attributed to a school food service fund. Under a food service program, the school 
159.27 	food service may prepare or serve milk, meals, or snacks in connection with school or 
159.28 	community service activities.
159.29 	(c) Revenues and expenditures for food service activities must be recorded in the 
159.30 	food service fund. The costs of processing applications, accounting for meals, preparing 
159.31 	and serving food, providing kitchen custodial services, and other expenses involving the 
159.32 	preparing of meals or the kitchen section of the lunchroom may be charged to the food 
159.33 	service fund or to the general fund of the district. The costs of lunchroom supervision, 
160.1 	lunchroom custodial services, lunchroom utilities, and other administrative costs of the 
160.2 	food service program must be charged to the general fund.
160.3 	That portion of superintendent and fiscal manager costs that can be documented as 
160.4 	attributable to the food service program may be charged to the food service fund provided 
160.5 	that the school district does not employ or contract with a food service director or other 
160.6 	individual who manages the food service program, or food service management company. 
160.7 	If the cost of the superintendent or fiscal manager is charged to the food service fund, 
160.8 	the charge must be at a wage rate not to exceed the statewide average for food service 
160.9 	directors as determined by the department.
160.10 	(d) Capital expenditures for the purchase of food service equipment must be made 
160.11 	from the general fund and not the food service fund, unless two conditions apply:
160.12 	(1) the unreserved balance in the food service fund at the end of the last fiscal year is 
160.13 	greater than the cost of the equipment to be purchased; and
160.14 	(2) the department has approved the purchase of the equipment.
160.15 	(e) If the two conditions set out in paragraph (d) apply, the equipment may be 
160.16 	purchased from the food service fund.
160.17 	(f) If a deficit in the food service fund exists at the end of a fiscal year, and the deficit 
160.18 	is not eliminated by revenues from food service operations in the next fiscal year, then the 
160.19 	deficit must be eliminated by a permanent fund transfer from the general fund at the end of 
160.20 	thatthe second fiscal year following the year in which the deficit occurred. However, if a 
160.21 	district contracts with a food service management company during the period in which 
160.22 	the deficit has accrued, the deficit must be eliminated by a payment fromattributed to the 
160.23 	food service management company or the district or both.
160.24 	The amount of the deficit attributable to the district shall be the revenue shortfall 
160.25 	caused by the difference between the contractually agreed upon prices for meals, a la 
160.26 	carte, vending and catering and the actual prices charged by the district plus the amount of 
160.27 	expenditures charged to the food service fund by the district in excess of the contractually 
160.28 	agreed upon budget. The remaining amount of the deficit shall be attributable to the food 
160.29 	service management company.
160.30 	 The amount of the deficit attributable to the food service management company 
160.31 	must be eliminated by a payment to the district by the end of the fiscal year following the 
160.32 	year in which the deficit occurred. If the payment is not made by the end of the fiscal year 
160.33 	following the year in which the deficit occurred, the food service management company 
160.34 	may not bid on any food service management contracts throughout the state until such 
160.35 	payment has been made.
161.1 	(g) Notwithstanding paragraph (f), a district may incur a deficit in the food service 
161.2 	fund for up to three years without making the permanent transfer if the district submits 
161.3 	to the commissioner by January 1 of the second fiscal year a plan for eliminating that 
161.4 	deficit at the end of the third fiscal year.
161.5 	(h) If a surplus in the food service fund exists at the end of a fiscal year for three 
161.6 	successive years, a district may recode for that fiscal year the costs of lunchroom 
161.7 	supervision, lunchroom custodial services, lunchroom utilities, and other administrative 
161.8 	costs of the food service program charged to the general fund according to paragraph (c) 
161.9 	and charge those costs to the food service fund in a total amount not to exceed the amount 
161.10 	of surplus in the food service fund.

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

161.12 	Sec. 10. Minnesota Statutes 2008, section 127A.441, is amended to read:
161.13 	127A.441 AID REDUCTION; LEVY REVENUE RECOGNITION CHANGE.
161.14 	Each year, the state aids payable to any school district for that fiscal year that are 
161.15 	recognized as revenue in the school district's general and community service funds shall 
161.16 	be adjusted by an amount equal to (1) the amount the district recognized as revenue for the 
161.17 	prior fiscal year pursuant to section 123B.75, subdivision 5, paragraph (b) or (c), minus (2) 
161.18 	the amount the district recognized as revenue for the current fiscal year pursuant to section 
161.19 	123B.75, subdivision 5, paragraph (b) or (c). For purposes of making the aid adjustments 
161.20 	under this section, the amount the district recognizes as revenue for either the prior fiscal 
161.21 	year or the current fiscal year pursuant to section 123B.75, subdivision 5, paragraph (b), 
161.22 	shall not include any amount levied pursuant to section 124D.86, subdivision 4, for school 
161.23 	districts receiving revenue under sections 124D.86, subdivision 3, clauses (1), (2), and (3); 
161.24 	126C.41, subdivisions 1, 2, and 3, paragraphs (b), (c), and (d); 126C.43, subdivision 2; 
161.25 	126C.457; and 126C.48, subdivision 6. Payment from the permanent school fund shall not 
161.26 	be adjusted pursuant to this section. The school district shall be notified of the amount of 
161.27 	the adjustment made to each payment pursuant to this section. 

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

161.29 	Sec. 11. Minnesota Statutes 2008, section 127A.45, subdivision 2, is amended to read:
161.30 		Subd. 2.Definitions. (a) The term "Other district receipts" means payments by 
161.31 	county treasurers pursuant to section 276.10, apportionments from the school endowment 
161.32 	fund pursuant to section 127A.33, apportionments by the county auditor pursuant to 
162.1 	section 127A.34, subdivision 2, and payments to school districts by the commissioner of 
162.2 	revenue pursuant to chapter 298.
162.3 	(b) The term "Cumulative amount guaranteed" means the product of
162.4 	(1) the cumulative disbursement percentage shown in subdivision 3; times
162.5 	(2) the sum of
162.6 	(i) the current year aid payment percentage of the estimated aid and credit 
162.7 	entitlements paid according to subdivision 13; plus
162.8 	(ii) 100 percent of the entitlements paid according to subdivisions 11 and 12; plus
162.9 	(iii) the other district receipts.
162.10 	(c) The term "Payment date" means the date on which state payments to districts 
162.11 	are made by the electronic funds transfer method. If a payment date falls on a Saturday, 
162.12 	a Sunday, or a weekday which is a legal holiday, the payment shall be made on the 
162.13 	immediately preceding business day. The commissioner may make payments on dates 
162.14 	other than those listed in subdivision 3, but only for portions of payments from any 
162.15 	preceding payment dates which could not be processed by the electronic funds transfer 
162.16 	method due to documented extenuating circumstances.
162.17 	(d) The current year aid payment percentage equals 90 73.

162.18 	EFFECTIVE DATE. This section is effective for revenue for fiscal years 2010 
162.19 	and later.

162.20 	Sec. 12. Minnesota Statutes 2008, section 127A.45, subdivision 3, is amended to read:
162.21 		Subd. 3.Payment dates and percentages. (a) For fiscal year 2004 and later,
162.22 	The commissioner shall pay to a district on the dates indicated an amount computed 
162.23 	as follows: the cumulative amount guaranteed minus the sum of (a) the district's other 
162.24 	district receipts through the current payment, and (b) the aid and credit payments through 
162.25 	the immediately preceding payment. For purposes of this computation, the payment dates 
162.26 	and the cumulative disbursement percentages are as follows:

162.27		Payment date
	Percentage
	
162.28	Payment 1
	July 15:
	5.5
	
162.29	Payment 2
	July 30:
	8.0
	
162.30	Payment 3
	August 15:
	17.5
	
162.31	Payment 4
	August 30:
	20.0
	
162.32	Payment 5
	September 15:
	22.5
	
162.33	Payment 6
	September 30:
	25.0
	
162.34	Payment 7
	October 15:
	27.0
	
162.35	Payment 8
	October 30:
	30.0
	
162.36	Payment 9
	November 15:
	32.5
	
163.1	Payment 10
	November 30:
	36.5
	
163.2	Payment 11
	December 15:
	42.0
	
163.3	Payment 12
	December 30:
	45.0
	
163.4	Payment 13
	January 15:
	50.0
	
163.5	Payment 14
	January 30:
	54.0
	
163.6	Payment 15
	February 15:
	58.0
	
163.7	Payment 16
	February 28:
	63.0
	
163.8	Payment 17
	March 15:
	68.0
	
163.9	Payment 18
	March 30:
	74.0
	
163.10	Payment 19
	April 15:
	78.0
	
163.11	Payment 20
	April 30:
	85.0
	
163.12	Payment 21
	May 15:
	90.0
	
163.13	Payment 22
	May 30:
	95.0
	
163.14	Payment 23
	June 20:
	100.0
	
163.15 	(b) In addition to the amounts paid under paragraph (a), for fiscal year 2004, the 
163.16 	commissioner shall pay to a district on the dates indicated an amount computed as follows:

163.17
163.18	Payment 3
	August 15: the final adjustment for the prior fiscal year for the state paid 
property tax credits established in section 273.1392
	
163.19
163.20	Payment 4
	August 30: one-third of the final adjustment for the prior fiscal year for 
all aid entitlements except state paid property tax credits
	
163.21
163.22	Payment 6
	September 30: one-third of the final adjustment for the prior fiscal year 
for all aid entitlements except state paid property tax credits
	
163.23
163.24	Payment 8
	October 30: one-third of the final adjustment for the prior fiscal year for 
all aid entitlements except state paid property tax credits
	
163.25 	(c) In addition to the amounts paid under paragraph (a), for fiscal year 2005 and 
163.26 	later, the commissioner shall pay to a district on the dates indicated an amount computed 
163.27 	as follows:

163.28
163.29	Payment 3
	August 15: the final adjustment for the prior fiscal year for the state paid 
property tax credits established in section 273.1392
	
163.30
163.31	Payment 4
	August 30: 30 percent of the final adjustment for the prior fiscal year for 
all aid entitlements except state paid property tax credits
	
163.32
163.33	Payment 6
	September 30: 40 percent of the final adjustment for the prior fiscal year 
for all aid entitlements except state paid property tax credits
	
163.34
163.35	Payment 8
	October 30: 30 percent of the final adjustment for the prior fiscal year 
for all aid entitlements except state paid property tax credits

163.36 	Sec. 13. Minnesota Statutes 2008, section 127A.45, is amended by adding a 
163.37 	subdivision to read:
163.38 		Subd. 7b.Advance final payment. (a) Notwithstanding subdivisions 3 and 7, 
163.39 	a school district or charter school exceeding its expenditure limitations under section 
163.40 	123B.83 as of June 30 of the prior fiscal year may receive a portion of its final payment 
164.1 	for the current fiscal year on June 20, if requested by the district or charter school. The 
164.2 	amount paid under this subdivision must not exceed the lesser of:
164.3 	(1) the difference between 90 percent and the current year payment percentage in 
164.4 	subdivision 2, paragraph (d), in the current fiscal year times the sum of the district or 
164.5 	charter school's general education aid plus the aid adjustment in section 127A.50 for 
164.6 	the current fiscal year; or
164.7 	(2) the amount by which the district's or charter school's net negative unreserved 
164.8 	general fund balance as of June 30 of the prior fiscal year exceeds 2.5 percent of the 
164.9 	district or charter school's expenditures for that fiscal year.
164.10 	(b) The state total advance final payment under this subdivision for any year must 
164.11 	not exceed $7,500,000. If the amount request exceeds $7,500,000, the advance final 
164.12 	payment for each eligible district must be reduced proportionately.

164.13 	EFFECTIVE DATE. This section is effective for revenue for fiscal years 2010 
164.14 	and later.

164.15 	Sec. 14. Minnesota Statutes 2008, section 127A.45, subdivision 13, is amended to read:
164.16 		Subd. 13.Aid payment percentage. Except as provided in subdivisions 11, 12, 12a, 
164.17 	and 14, each fiscal year, all education aids and credits in this chapter and chapters 120A, 
164.18 	120B, 121A, 122A, 123A, 123B, 124D, 125A, 125B, 126C, 134, and section 273.1392, 
164.19 	shall be paid at the current year aid payment percentage of the estimated entitlement during 
164.20 	the fiscal year of the entitlement. For the purposes of this subdivision, a district's estimated 
164.21 	entitlement for special education excess cost aid under section 125A.79 for fiscal year 
164.22 	2005 equals 70 percent of the district's entitlement for the second prior fiscal year. For the 
164.23 	purposes of this subdivision, a district's estimated entitlement for special education excess 
164.24 	cost aid under section 125A.79 for fiscal year 2006 and later equals 74.0 percent of the 
164.25 	district's entitlement for the current fiscal year. The final adjustment payment, according 
164.26 	to subdivision 9, must be the amount of the actual entitlement, after adjustment for actual 
164.27 	data, minus the payments made during the fiscal year of the entitlement.

164.28 	Sec. 15. Minnesota Statutes 2008, section 127A.47, subdivision 5, is amended to read:
164.29 		Subd. 5.Notification of resident district. A district educating a pupil who is 
164.30 	a resident of another district must notify the district of residence within 60 days of the 
164.31 	date the pupil is determined by the district to be a nonresident, but not later than August 
164.32 	1 following the end of the school year in which the pupil is educated. If the district of 
164.33 	residence does not receive a notification from the providing district pursuant to this 
165.1 	subdivision, it is not liable to that district for any tuition billing received after August 1 
165.2 	of the next school year.

165.3 	Sec. 16. Minnesota Statutes 2008, section 134.31, subdivision 4a, is amended to read:
165.4 		Subd. 4a.Services to the blind and physically handicapped people with visual 
165.5 	and physical disabilities. The Minnesota Department of Education shall provide 
165.6 	specialized services to the blind and physically handicapped people with visual and 
165.7 	physical disabilities through the Minnesota Braille and Talking Book Library for the Blind 
165.8 	and Physically Handicapped under a cooperative plan with the National Library Services 
165.9 	for the Blind and Physically Handicapped of the Library of Congress.

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

165.11 	Sec. 17. Minnesota Statutes 2008, section 134.31, is amended by adding a subdivision 
165.12 	to read:
165.13 		Subd. 7.Telephone or electronic meetings. (a) Notwithstanding section 13D.01, 
165.14 	the Advisory Committee for the Minnesota Braille and Talking Book Library may conduct 
165.15 	a meeting of its members by telephone or other electronic means so long as the following 
165.16 	conditions are met:
165.17 	(1) all members of the committee participating in the meeting, wherever their 
165.18 	physical locations, can hear one another and can hear all discussion and testimony;
165.19 	(2) members of the public present at the regular meeting location of the committee 
165.20 	can hear all discussion, testimony, and votes of the members of the committee;
165.21 	(3) at least one member of the committee is physically present at the regular meeting 
165.22 	location; and
165.23 	(4) all votes are conducted by roll call, so each member's vote on each issue can be 
165.24 	identified and recorded.
165.25 	(b) Each member of the committee participating in a meeting by telephone or other 
165.26 	electronic means is considered present at the meeting for purposes of determining quorum 
165.27 	and participating in all proceedings.
165.28 	(c) If telephone or other electronic means is used to conduct a meeting, to the extent 
165.29 	practical, the committee shall allow a person to monitor the meeting electronically from a 
165.30 	remote location. The committee may require the person making the connection to pay 
165.31 	for the documented additional costs that the committee incurs as a result of the additional 
165.32 	connection.
165.33 	(d) If telephone or other electronic means is used to conduct a regular, special, or 
165.34 	emergency meeting, the committee shall provide notice of the regular meeting location, 
166.1 	the fact that some members may participate by telephone or other electronic means, and 
166.2 	the provisions of paragraph (c). The timing and method of providing notice is governed 
166.3 	by section 13D.04.

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

166.5 	Sec. 18. Minnesota Statutes 2008, section 275.065, subdivision 3, is amended to read:
166.6 		Subd. 3.Notice of proposed property taxes. (a) The county auditor shall prepare 
166.7 	and the county treasurer shall deliver after November 10 and on or before November 24 
166.8 	each year, by first class mail to each taxpayer at the address listed on the county's current 
166.9 	year's assessment roll, a notice of proposed property taxes. Upon written request by 
166.10 	the taxpayer, the treasurer may send the notice in electronic form or by electronic mail 
166.11 	instead of on paper or by ordinary mail.
166.12 	(b) The commissioner of revenue shall prescribe the form of the notice.
166.13 	(c) The notice must inform taxpayers that it contains the amount of property taxes 
166.14 	each taxing authority proposes to collect for taxes payable the following year. In the 
166.15 	case of a town, or in the case of the state general tax, the final tax amount will be its 
166.16 	proposed tax. In the case of taxing authorities required to hold a public meeting under 
166.17 	subdivision 6, the notice must clearly state that each taxing authority, including regional 
166.18 	library districts established under section 134.201, and including the metropolitan taxing 
166.19 	districts as defined in paragraph (i), but excluding all other special taxing districts and 
166.20 	towns, will hold a public meeting to receive public testimony on the proposed budget and 
166.21 	proposed or final property tax levy, or, in case of a school district, on the current budget 
166.22 	and proposed property tax levy. The notice must clearly state for each city, county, school 
166.23 	district, regional library authority established under section 134.201, and metropolitan 
166.24 	taxing districts as defined in paragraph (i), the time and place of the taxing authority's 
166.25 	regularly scheduled meetings in which the budget and levy will be discussed and the final 
166.26 	budget and levy determined. The taxing authorities must provide the county auditor with 
166.27 	the information to be included in the notice. It must clearly state the time and place of 
166.28 	each taxing authority's meeting, provide a telephone number for the taxing authority that 
166.29 	taxpayers may call if they have questions related to the notice, and an address where 
166.30 	comments will be received by mail.
166.31 	(d) The notice must state for each parcel:
166.32 	(1) the market value of the property as determined under section 273.11, and used 
166.33 	for computing property taxes payable in the following year and for taxes payable in the 
166.34 	current year as each appears in the records of the county assessor on November 1 of the 
166.35 	current year; and, in the case of residential property, whether the property is classified as 
167.1 	homestead or nonhomestead. The notice must clearly inform taxpayers of the years to 
167.2 	which the market values apply and that the values are final values;
167.3 	(2) the items listed below, shown separately by county, city or town, and state general 
167.4 	tax, net of the residential and agricultural homestead credit under section 273.1384, voter 
167.5 	approved school levy, other local school levy, and the sum of the special taxing districts, 
167.6 	and as a total of all taxing authorities:
167.7 	(i) the actual tax for taxes payable in the current year; and
167.8 	(ii) the proposed tax amount.
167.9 	If the county levy under clause (2) includes an amount for a lake improvement 
167.10 	district as defined under sections 103B.501 to 103B.581, the amount attributable for that 
167.11 	purpose must be separately stated from the remaining county levy amount.
167.12 	In the case of a town or the state general tax, the final tax shall also be its proposed 
167.13 	tax unless the town changes its levy at a special town meeting under section 365.52. If a 
167.14 	school district has certified under section 126C.17, subdivision 9, that a referendum will 
167.15 	be held in the school district at the November general election, the county auditor must 
167.16 	note next to the school district's proposed amount that a referendum is pending and that, if 
167.17 	approved by the voters, the tax amount may be higher than shown on the notice. In the 
167.18 	case of the city of Minneapolis, the levy for Minneapolis Park and Recreation shall be 
167.19 	listed separately from the remaining amount of the city's levy. In the case of the city of 
167.20 	St. Paul, the levy for the St. Paul Library Agency must be listed separately from the 
167.21 	remaining amount of the city's levy. In the case of Ramsey County, any amount levied 
167.22 	under section 134.07 may be listed separately from the remaining amount of the county's 
167.23 	levy. In the case of a parcel where tax increment or the fiscal disparities areawide tax 
167.24 	under chapter 276A or 473F applies, the proposed tax levy on the captured value or the 
167.25 	proposed tax levy on the tax capacity subject to the areawide tax must each be stated 
167.26 	separately and not included in the sum of the special taxing districts; and
167.27 	(3) the increase or decrease between the total taxes payable in the current year and 
167.28 	the total proposed taxes, expressed as a percentage.
167.29 	For purposes of this section, the amount of the tax on homesteads qualifying under 
167.30 	the senior citizens' property tax deferral program under chapter 290B is the total amount 
167.31 	of property tax before subtraction of the deferred property tax amount.
167.32 	(e) The notice must clearly state that the proposed or final taxes do not include 
167.33 	the following:
167.34 	(1) special assessments;
167.35 	(2) levies approved by the voters after the date the proposed taxes are certified, 
167.36 	including bond referenda and school district levy referenda;
168.1 	(3) a levy limit increase approved by the voters by the first Tuesday after the first 
168.2 	Monday in November of the levy year as provided under section 275.73;
168.3 	(4) amounts necessary to pay cleanup or other costs due to a natural disaster 
168.4 	occurring after the date the proposed taxes are certified;
168.5 	(5) amounts necessary to pay tort judgments against the taxing authority that become 
168.6 	final after the date the proposed taxes are certified; and
168.7 	(6) the contamination tax imposed on properties which received market value 
168.8 	reductions for contamination.
168.9 	(f) Except as provided in subdivision 7, failure of the county auditor to prepare or 
168.10 	the county treasurer to deliver the notice as required in this section does not invalidate the 
168.11 	proposed or final tax levy or the taxes payable pursuant to the tax levy.
168.12 	(g) If the notice the taxpayer receives under this section lists the property as 
168.13 	nonhomestead, and satisfactory documentation is provided to the county assessor by the 
168.14 	applicable deadline, and the property qualifies for the homestead classification in that 
168.15 	assessment year, the assessor shall reclassify the property to homestead for taxes payable 
168.16 	in the following year.
168.17 	(h) In the case of class 4 residential property used as a residence for lease or rental 
168.18 	periods of 30 days or more, the taxpayer must either:
168.19 	(1) mail or deliver a copy of the notice of proposed property taxes to each tenant, 
168.20 	renter, or lessee; or
168.21 	(2) post a copy of the notice in a conspicuous place on the premises of the property.
168.22 	The notice must be mailed or posted by the taxpayer by November 27 or within 
168.23 	three days of receipt of the notice, whichever is later. A taxpayer may notify the county 
168.24 	treasurer of the address of the taxpayer, agent, caretaker, or manager of the premises to 
168.25 	which the notice must be mailed in order to fulfill the requirements of this paragraph.
168.26 	(i) For purposes of this subdivision, subdivisions and subdivision 5a and 6, 
168.27 	"metropolitan special taxing districts" means the following taxing districts in the 
168.28 	seven-county metropolitan area that levy a property tax for any of the specified purposes 
168.29 	listed below:
168.30 	(1) Metropolitan Council under section 473.132, 473.167, 473.249, 473.325, 
168.31 	473.446, 473.521, 473.547, or 473.834;
168.32 	(2) Metropolitan Airports Commission under section 473.667, 473.671, or 473.672; 
168.33 	and 
168.34 	(3) Metropolitan Mosquito Control Commission under section 473.711.
168.35 	For purposes of this section, any levies made by the regional rail authorities in the 
168.36 	county of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 
169.1 	398A shall be included with the appropriate county's levy and shall be discussed at that 
169.2 	county's public hearing.
169.3 	(j) The governing body of a county, city, or school district may, with the consent 
169.4 	of the county board, include supplemental information with the statement of proposed 
169.5 	property taxes about the impact of state aid increases or decreases on property tax 
169.6 	increases or decreases and on the level of services provided in the affected jurisdiction. 
169.7 	This supplemental information may include information for the following year, the current 
169.8 	year, and for as many consecutive preceding years as deemed appropriate by the governing 
169.9 	body of the county, city, or school district. It may include only information regarding:
169.10 	(1) the impact of inflation as measured by the implicit price deflator for state and 
169.11 	local government purchases;
169.12 	(2) population growth and decline;
169.13 	(3) state or federal government action; and
169.14 	(4) other financial factors that affect the level of property taxation and local services 
169.15 	that the governing body of the county, city, or school district may deem appropriate to 
169.16 	include.
169.17 	The information may be presented using tables, written narrative, and graphic 
169.18 	representations and may contain instruction toward further sources of information or 
169.19 	opportunity for comment.

169.20 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
169.21 	thereafter.

169.22 	Sec. 19. Minnesota Statutes 2008, section 275.065, subdivision 6, is amended to read:
169.23 		Subd. 6.Public hearing; Adoption of budget and levy. (a) For purposes of this 
169.24 	section, the following terms shall have the meanings given:
169.25 	(1) "Initial hearing" means the first and primary hearing held to discuss the taxing 
169.26 	authority's proposed budget and proposed property tax levy for taxes payable in the 
169.27 	following year, or, for school districts, the current budget and the proposed property tax 
169.28 	levy for taxes payable in the following year.
169.29 	(2) "Continuation hearing" means a hearing held to complete the initial hearing, if 
169.30 	the initial hearing is not completed on its scheduled date.
169.31 	(3) "Subsequent hearing" means the hearing held to adopt the taxing authority's final 
169.32 	property tax levy, and, in the case of taxing authorities other than school districts, the final 
169.33 	budget, for taxes payable in the following year.
169.34 	(b) Between November 29 and December 20, the governing bodies of a city that has a 
169.35 	population over 500, county, metropolitan special taxing districts as defined in subdivision 
170.1 	3, paragraph (i), and regional library districts shall each hold an initial public hearing 
170.2 	to discuss and seek public comment on its final budget and property tax levy for taxes 
170.3 	payable in the following year, and the governing body of the school district shall hold an 
170.4 	initial public hearing to review its current budget and proposed property tax levy for taxes 
170.5 	payable in the following year. The metropolitan special taxing districts shall be required to 
170.6 	hold only a single joint initial public hearing, the location of which will be determined by 
170.7 	the affected metropolitan agencies. A city, county, metropolitan special taxing district as 
170.8 	defined in subdivision 3, paragraph (i), regional library district established under section 
170.9 	134.201, or school district is not required to hold a public hearing under this subdivision 
170.10 	unless its proposed property tax levy for taxes payable in the following year, as certified 
170.11 	under subdivision 1, has increased over its final property tax levy for taxes payable in the 
170.12 	current year by a percentage that is greater than the percentage increase in the implicit 
170.13 	price deflator for government consumption expenditures and gross investment for state 
170.14 	and local governments prepared by the Bureau of Economic Analysts of the United States 
170.15 	Department of Commerce for the 12-month period ending March 31 of the current year.
170.16 	(c) The initial hearing must be held after 5:00 p.m. if scheduled on a day other than 
170.17 	Saturday. No initial hearing may be held on a Sunday.
170.18 	(d) At the initial hearing under this subdivision, the percentage increase in property 
170.19 	taxes proposed by the taxing authority, if any, and the specific purposes for which property 
170.20 	tax revenues are being increased must be discussed. During the discussion, the governing 
170.21 	body shall hear comments regarding a proposed increase and explain the reasons for the 
170.22 	proposed increase. The public shall be allowed to speak and to ask questions. At the public 
170.23 	hearing, the school district must also provide and discuss information on the distribution 
170.24 	of its revenues by revenue source, and the distribution of its spending by program area.
170.25 	(e) If the initial hearing is not completed on its scheduled date, the taxing authority 
170.26 	must announce, prior to adjournment of the hearing, the date, time, and place for the 
170.27 	continuation of the hearing. The continuation hearing must be held at least five business 
170.28 	days but no more than 14 business days after the initial hearing. A continuation hearing 
170.29 	may not be held later than December 20 except as provided in paragraphs (f) and (g). 
170.30 	A continuation hearing must be held after 5:00 p.m. if scheduled on a day other than 
170.31 	Saturday. No continuation hearing may be held on a Sunday.
170.32 	(f) The governing body of a county shall hold its initial hearing on the first Thursday 
170.33 	in December each year, and may hold additional initial hearings on other dates before 
170.34 	December 20 if necessary for the convenience of county residents. If the county needs a 
170.35 	continuation of its hearing, the continuation hearing shall be held on the third Tuesday 
171.1 	in December. If the third Tuesday in December falls on December 21, the county's 
171.2 	continuation hearing shall be held on Monday, December 20.
171.3 	(g) The metropolitan special taxing districts shall hold a joint initial public hearing 
171.4 	on the first Wednesday of December. A continuation hearing, if necessary, shall be held on 
171.5 	the second Wednesday of December even if that second Wednesday is after December 10.
171.6 	(h) The county auditor shall provide for the coordination of initial and continuation 
171.7 	hearing dates for all school districts and cities within the county to prevent conflicts under 
171.8 	clauses (i) and (j).
171.9 	(i) By August 10, each school board and the board of the regional library district 
171.10 	shall certify to the county auditors of the counties in which the school district or regional 
171.11 	library district is located the dates on which it elects to hold its initial hearing and any 
171.12 	continuation hearing. If a school board or regional library district does not certify these 
171.13 	dates by August 10, the auditor will assign the initial and continuation hearing dates. The 
171.14 	dates elected or assigned must not conflict with the initial and continuation hearing dates 
171.15 	of the county or the metropolitan special taxing districts.
171.16 	(j) By August 20, the county auditor shall notify the clerks of the cities within the 
171.17 	county of the dates on which school districts and regional library districts have elected to 
171.18 	hold their initial and continuation hearings. At the time a city certifies its proposed levy 
171.19 	under subdivision 1 it shall certify the dates on which it elects to hold its initial hearing and 
171.20 	any continuation hearing. Until September 15, the first and second Mondays of December 
171.21 	are reserved for the use of the cities. If a city does not certify its hearing dates by 
171.22 	September 15, the auditor shall assign the initial and continuation hearing dates. The dates 
171.23 	elected or assigned for the initial hearing must not conflict with the initial hearing dates 
171.24 	of the county, metropolitan special taxing districts, regional library districts, or school 
171.25 	districts within which the city is located. To the extent possible, the dates of the city's 
171.26 	continuation hearing should not conflict with the continuation hearing dates of the county, 
171.27 	metropolitan special taxing districts, regional library districts, or school districts within 
171.28 	which the city is located. This paragraph does not apply to cities of 500 population or less.
171.29 	(k) The county initial hearing date and the city, metropolitan special taxing district, 
171.30 	regional library district, and school district initial hearing dates must be designated on 
171.31 	the notices required under subdivision 3. The continuation hearing dates need not be 
171.32 	stated on the notices.
171.33 	(l) At a subsequent hearing, each county, school district, city over 500 population, 
171.34 	and metropolitan special taxing district may amend its proposed property tax levy 
171.35 	and must adopt a final property tax levy. Each county, city over 500 population, and 
171.36 	metropolitan special taxing district may also amend its proposed budget and must adopt a 
172.1 	final budget at the subsequent hearing. The final property tax levy must be adopted prior 
172.2 	to adopting the final budget. A school district is not required to adopt its final budget at the 
172.3 	subsequent hearing. The subsequent hearing of a taxing authority must be held on a date 
172.4 	subsequent to the date of the taxing authority's initial public hearing. If a continuation 
172.5 	hearing is held, the subsequent hearing must be held either immediately following the 
172.6 	continuation hearing or on a date subsequent to the continuation hearing. The subsequent 
172.7 	hearing may be held at a regularly scheduled board or council meeting or at a special 
172.8 	meeting scheduled for the purposes of the subsequent hearing. The subsequent hearing 
172.9 	of a taxing authority does not have to be coordinated by the county auditor to prevent a 
172.10 	conflict with an initial hearing, a continuation hearing, or a subsequent hearing of any 
172.11 	other taxing authority. All subsequent hearings must be held prior to five working days 
172.12 	after December 20 of the levy year. The date, time, and place of the subsequent hearing 
172.13 	must be announced at the initial public hearing or at the continuation hearing.
172.14 	(m) (a) The property tax levy certified under section 275.07 by a city of any 
172.15 	population, county, metropolitan special taxing district, regional library district, or school 
172.16 	district must not exceed the proposed levy determined under subdivision 1, except by an 
172.17 	amount up to the sum of the following amounts:
172.18 	(1) the amount of a school district levy whose voters approved a referendum to 
172.19 	increase taxes under section 123B.63, subdivision 3, or 126C.17, subdivision 9, after 
172.20 	the proposed levy was certified;
172.21 	(2) the amount of a city or county levy approved by the voters after the proposed 
172.22 	levy was certified;
172.23 	(3) the amount of a levy to pay principal and interest on bonds approved by the 
172.24 	voters under section 475.58 after the proposed levy was certified;
172.25 	(4) the amount of a levy to pay costs due to a natural disaster occurring after the 
172.26 	proposed levy was certified, if that amount is approved by the commissioner of revenue 
172.27 	under subdivision 6a;
172.28 	(5) the amount of a levy to pay tort judgments against a taxing authority that become 
172.29 	final after the proposed levy was certified, if the amount is approved by the commissioner 
172.30 	of revenue under subdivision 6a;
172.31 	(6) the amount of an increase in levy limits certified to the taxing authority by the 
172.32 	commissioner of education or the commissioner of revenue after the proposed levy was 
172.33 	certified; and
172.34 	(7) the amount required under section 126C.55.
172.35 	(n) (b) This subdivision does not apply to towns and special taxing districts other 
172.36 	than regional library districts and metropolitan special taxing districts.
173.1 	(o) (c) Notwithstanding the requirements of this section, the employer is required to 
173.2 	meet and negotiate over employee compensation as provided for in chapter 179A.

173.3 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
173.4 	thereafter.

173.5 	Sec. 20. Laws 2008, chapter 363, article 2, section 46, subdivision 1, is amended to 
173.6 	read:
173.7 		Subdivision 1.Capital account transfers. Notwithstanding any law to the contrary, 
173.8 	on June 30, of 2008, 2009, and 2010, a school district may transfer money from its 
173.9 	reserved for operating capital account to its undesignated balance in the general fund. The 
173.10 	amount transferred by any school district must not exceed $51 times the district's adjusted 
173.11 	marginal cost pupil units for the second preceding fiscal year 2007. This transfer annually 
173.12 	may occur only after the school board has adopted a written resolution stating the amount 
173.13 	of the transfer and declaring that the school district's operating capital needs are being met.

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

173.15 	Sec. 21. FUND TRANSFER; ST. ANTHONY-NEW BRIGHTON.
 173.16 	Notwithstanding Minnesota Statutes, section 123B.79 or 123B.80, on June 30, 2009, 
173.17 	Independent School District No. 282, St. Anthony-New Brighton, may permanently 
173.18 	transfer up to $400,000 from its reserved for operating capital account to its undesignated 
173.19 	general fund balance.

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

173.21 	Sec. 22. APPROPRIATIONS.
 173.22 		Subdivision 1.Department of Education. The sums indicated in this section are 
173.23 	appropriated from the general fund to the Department of Education for the fiscal years 
173.24 	designated.
173.25 		Subd. 2.School lunch. For school lunch aid according to Minnesota Statutes, 
173.26 	section 124D.111, and Code of Federal Regulations, title 7, section 210.17:

173.27		$
	12,688,000
	.....
	2010
	
173.28		$
	13,069,000
	.....
	2011
	
173.29 		Subd. 3.School breakfast. For traditional school breakfast aid under Minnesota 
173.30 	Statutes, section 124D.1158:

174.1		$
	4,978,000
	.....
	2010
	
174.2		$
	5,147,000
	.....
	2011
	
174.3 		Subd. 4.Kindergarten milk. For kindergarten milk aid under Minnesota Statutes, 
174.4 	section 124D.118:

174.5		$
	1,098,000
	.....
	2010
	
174.6		$
	1,120,000
	.....
	2011
	
174.7 		Subd. 5.Summer school food service replacement aid. For summer food service 
174.8 	replacement aid under Minnesota Statutes, section 124D.119:

174.9		$
	150,000
	.....
	2010
	
174.10		$
	150,000
	.....
	2011

174.11 	Sec. 23. DEPARTMENT OF EDUCATION; LIBRARY APPROPRIATIONS.
 174.12 		Subdivision 1.Department of Education. The sums indicated in this section are 
174.13 	appropriated from the general fund to the Department of Education for the fiscal years 
174.14 	designated.
174.15 		Subd. 2.Basic system support. For basic system support grants under Minnesota 
174.16 	Statutes, section 134.355:

174.17		$
	11,264,000
	.....
	2010
	
174.18		$
	13,570,000
	.....
	2011
	
174.19 	The 2010 appropriation includes $1,357,000 for 2009 and $9,907,000 for 2010.
174.20 	The 2011 appropriation includes $3,663,000 for 2010 and $9,907,000 for 2011.
174.21 		Subd. 3.Multicounty, multitype library systems. For grants under Minnesota 
174.22 	Statutes, sections 134.353 and 134.354, to multicounty, multitype library systems:

174.23		$
	1,079,000
	.....
	2010
	
174.24		$
	1,300,000
	.....
	2011
	
174.25 	The 2010 appropriation includes $130,000 for 2009 and $949,000 for 2010.
174.26 	The 2011 appropriation includes $351,000 for 2010 and $949,000 for 2011.
174.27 		Subd. 4.Electronic library for Minnesota. For statewide licenses to online 
174.28 	databases selected in cooperation with the Minnesota Office of Higher Education for 
174.29 	school media centers, public libraries, state government agency libraries, and public 
174.30 	or private college or university libraries:

174.31		$
	900,000
	.....
	2010
	
174.32		$
	900,000
	.....
	2011
	
175.1 	Any balance in the first year does not cancel but is available in the second year.
175.2 		Subd. 5.Regional library telecommunications aid. For regional library 
175.3 	telecommunications aid under Minnesota Statutes, section 134.355:

175.4		$
	1,909,000
	.....
	2010
	
175.5		$
	2,300,000
	.....
	2011
	
175.6 	The 2010 appropriation includes $230,000 for 2009 and $1,679,000 for 2010.
175.7 	The 2011 appropriation includes $621,000 for 2010 and $1,679,000 for 2011.

175.8 	Sec. 24.  REPEALER.
 175.9 	Minnesota Statutes 2008, section 275.065, subdivisions 5a, 6b, 6c, 8, 9, and 10, are 
175.10 	repealed.

175.11 	EFFECTIVE DATE. This section is effective for taxes payable in 2010 and 
175.12 	thereafter.

175.13 	ARTICLE 6
175.14 	SELF-SUFFICIENCY AND LIFELONG LEARNING

175.15 	Section 1. Minnesota Statutes 2008, section 299A.297, is amended to read:
175.16 	299A.297 OTHER DUTIES.
175.17 	The commissioner of public safety, in consultation with the Chemical Abuse and 
175.18 	Violence Prevention Council, shall:
175.19 	(1) provide information and assistance upon request to school preassessment teams 
175.20 	established under section 121A.26and school and community advisory teams established 
175.21 	under section 121A.27;
175.22 	(2) provide information and assistance upon request to the State Board of Pharmacy 
175.23 	with respect to the board's enforcement of chapter 152;
175.24 	(3) cooperate with and provide information and assistance upon request to the 
175.25 	Alcohol and Other Drug Abuse Section in the Department of Human Services;
175.26 	(4) coordinate the policy of the office with that of the Narcotic Enforcement Unit in 
175.27 	the Bureau of Criminal Apprehension; and
175.28 	(5) coordinate the activities of the regional drug task forces, provide assistance and 
175.29 	information to them upon request, and assist in the formation of task forces in areas of 
175.30 	the state in which no task force operates.

175.31 	Sec. 2.  REPEALER.
 176.1 	Minnesota Statutes 2008, section 121A.27, is repealed.

176.2 	ARTICLE 7
176.3 	STATE AGENCIES

176.4 	Section 1. Minnesota Statutes 2008, section 125A.62, subdivision 8, is amended to 
176.5 	read:
176.6 		Subd. 8.Grants and gifts. The board, through the chief administrators of the 
176.7 	academies, may apply for all competitive grants administered by agencies of the state and 
176.8 	other government or nongovernment sources. Application may not be made for grants over 
176.9 	which the board has discretion. Any funds received under this subdivision are appropriated 
176.10 	and dedicated for the purpose for which it is granted. The board must annually by February 
176.11 	1 report to the education policy and finance committees of the legislature the amount of 
176.12 	money it received under this subdivision and the purpose for which it was granted.

176.13 	Sec. 2. Minnesota Statutes 2008, section 127A.08, is amended by adding a subdivision 
176.14 	to read:
176.15 		Subd. 5.Grants and gifts. The commissioner may apply for and receive grants 
176.16 	and gifts administered by agencies of the state and other government or nongovernment 
176.17 	sources. Any money received is hereby appropriated and dedicated for the purpose for 
176.18 	which it is granted. The commissioner annually by February 1 must report to the education 
176.19 	policy and finance committees of the legislature the amount of money it received under 
176.20 	this subdivision and the purpose for which it was granted.

176.21 	Sec. 3. APPROPRIATIONS; DEPARTMENT OF EDUCATION.
 176.22 		Subdivision 1.Department of Education. Unless otherwise indicated, the sums 
176.23 	indicated in this section are appropriated from the general fund to the Department of 
176.24 	Education for the fiscal years designated.
176.25 		Subd. 2.Department. (a) For the Department of Education:

176.26		$
	 21,693,000
	.....
	2010
	
176.27		$
	 21,693,000
	.....
	2011
	
176.28 	Any balance in the first year does not cancel but is available in the second year.
176.29 	(b) $41,000 each year is for the Minnesota Academy of Science.
176.30 	(c) $632,000 in fiscal year 2010 and $632,000 in fiscal year 2011 are for the Board 
176.31 	of Teaching.
177.1 	(d) $171,000 in fiscal year 2010 and $171,000 in fiscal year 2011 are for the Board 
177.2 	of School Administrators.
177.3 	(e) $40,000 each year is for an early hearing loss intervention coordinator under 
177.4 	Minnesota Statutes, section 125A.63, subdivision 5. If the department expends federal 
177.5 	funds to employ a hearing loss coordinator under Minnesota Statutes, section 125.63, 
177.6 	subdivision 5, then the appropriation under this paragraph is reallocated for purposes of 
177.7 	employing a world languages coordinator.
177.8 	(f) $260,000 each year is for the Minnesota Children's Museum.
177.9 	(g) $50,000 each year is for the Duluth Children's Museum.
177.10 	(h) The expenditures of federal grants and aids as shown in the biennial budget 
177.11 	document and its supplements are approved and appropriated and shall be spent as 
177.12 	indicated, with the exception of state incentive grants, education technology state grants, 
177.13 	teacher incentive funds, and statewide data system funds as outlined in the supplemental 
177.14 	federal funds submission dated March 25, 2009.
177.15 		Subd. 3.Board of Teaching; licensure by portfolio. For the Board of Teaching 
177.16 	for licensure by portfolio:

177.17		$
	30,000
	.....
	2010
	
177.18		$
	30,000
	.....
	2011
	
177.19 	This appropriation is from the educator licensure portfolio account of the special 
177.20 	revenue fund.

177.21 	Sec. 4. APPROPRIATIONS; MINNESOTA STATE ACADEMIES.
 177.22 	The sums indicated in this section are appropriated from the general fund to the 
177.23 	Minnesota State Academies for the Deaf and the Blind for the fiscal years designated:

177.24		$
	11,912,000
	.....
	2010
	
177.25		$
	11,912,000
	.....
	2011
	
177.26 	Any balance in the first year does not cancel but is available in the second year.

177.27 	Sec. 5. APPROPRIATIONS; PERPICH CENTER FOR ARTS EDUCATION.
 177.28 	The sums in this section are appropriated from the general fund to the Perpich 
177.29 	Center for Arts Education for the fiscal years designated:

177.30		$
	7,087,000
	.....
	2010
	
177.31		$
	7,087,000
	.....
	2011
	
177.32 	Any balance in the first year does not cancel but is available in the second year.

178.1 	ARTICLE 8
178.2 	PUPIL TRANSPORTATION

178.3 	Section 1. Minnesota Statutes 2008, section 123B.92, subdivision 1, is amended to read:
178.4 		Subdivision 1.Definitions. For purposes of this section and section 125A.76, the 
178.5 	terms defined in this subdivision have the meanings given to them.
178.6 	(a) "Actual expenditure per pupil transported in the regular and excess transportation 
178.7 	categories" means the quotient obtained by dividing:
178.8 	(1) the sum of:
178.9 	(i) all expenditures for transportation in the regular category, as defined in paragraph 
178.10 	(b), clause (1), and the excess category, as defined in paragraph (b), clause (2), plus
178.11 	(ii) an amount equal to one year's depreciation on the district's school bus fleet 
178.12 	and mobile units computed on a straight line basis at the rate of 15 percent per year for 
178.13 	districts operating a program under section 124D.128 for grades 1 to 12 for all students in 
178.14 	the district and 12-1/2 percent per year for other districts of the cost of the fleet, plus
178.15 	(iii) an amount equal to one year's depreciation on the district's type three school 
178.16 	buses III vehicles, as defined in section 169.011, subdivision 71, clause (5), which must be 
178.17 	used a majority of the time for pupil transportation purposes, computed on a straight line 
178.18 	basis at the rate of 20 percent per year of the cost of the type three school buses by:
178.19 	(2) the number of pupils eligible for transportation in the regular category, as defined 
178.20 	in paragraph (b), clause (1), and the excess category, as defined in paragraph (b), clause (2).
178.21 	(b) "Transportation category" means a category of transportation service provided to 
178.22 	pupils as follows:
178.23 	(1) Regular transportation is:
178.24 	(i) transportation to and from school during the regular school year for resident 
178.25 	elementary pupils residing one mile or more from the public or nonpublic school they 
178.26 	attend, and resident secondary pupils residing two miles or more from the public 
178.27 	or nonpublic school they attend, excluding desegregation transportation and noon 
178.28 	kindergarten transportation; but with respect to transportation of pupils to and from 
178.29 	nonpublic schools, only to the extent permitted by sections 123B.84 to 123B.87;
178.30 	(ii) transportation of resident pupils to and from language immersion programs;
178.31 	(iii) transportation of a pupil who is a custodial parent and that pupil's child between 
178.32 	the pupil's home and the child care provider and between the provider and the school, if 
178.33 	the home and provider are within the attendance area of the school;
178.34 	(iv) transportation to and from or board and lodging in another district, of resident 
178.35 	pupils of a district without a secondary school; and
179.1 	(v) transportation to and from school during the regular school year required under 
179.2 	subdivision 3 for nonresident elementary pupils when the distance from the attendance 
179.3 	area border to the public school is one mile or more, and for nonresident secondary pupils 
179.4 	when the distance from the attendance area border to the public school is two miles or 
179.5 	more, excluding desegregation transportation and noon kindergarten transportation.
179.6 	For the purposes of this paragraph, a district may designate a licensed day care 
179.7 	facility, school day care facility, respite care facility, the residence of a relative, or the 
179.8 	residence of a person chosen by the pupil's parent or guardian as the home of a pupil for 
179.9 	part or all of the day, if requested by the pupil's parent or guardian, and if that facility or 
179.10 	residence is within the attendance area of the school the pupil attends.
179.11 	(2) Excess transportation is:
179.12 	(i) transportation to and from school during the regular school year for resident 
179.13 	secondary pupils residing at least one mile but less than two miles from the public or 
179.14 	nonpublic school they attend, and transportation to and from school for resident pupils 
179.15 	residing less than one mile from school who are transported because of extraordinary 
179.16 	traffic, drug, or crime hazards; and
179.17 	(ii) transportation to and from school during the regular school year required under 
179.18 	subdivision 3 for nonresident secondary pupils when the distance from the attendance area 
179.19 	border to the school is at least one mile but less than two miles from the public school 
179.20 	they attend, and for nonresident pupils when the distance from the attendance area border 
179.21 	to the school is less than one mile from the school and who are transported because of 
179.22 	extraordinary traffic, drug, or crime hazards.
179.23 	(3) Desegregation transportation is transportation within and outside of the district 
179.24 	during the regular school year of pupils to and from schools located outside their normal 
179.25 	attendance areas under a plan for desegregation mandated by the commissioner or under 
179.26 	court order.
179.27 	(4) "Transportation services for pupils with disabilities" is:
179.28 	(i) transportation of pupils with disabilities who cannot be transported on a regular 
179.29 	school bus between home or a respite care facility and school;
179.30 	(ii) necessary transportation of pupils with disabilities from home or from school to 
179.31 	other buildings, including centers such as developmental achievement centers, hospitals, 
179.32 	and treatment centers where special instruction or services required by sections 125A.03
179.33 	to 125A.24, 125A.26 to 125A.48, and 125A.65 are provided, within or outside the district 
179.34 	where services are provided;
179.35 	(iii) necessary transportation for resident pupils with disabilities required by sections 
179.36 	125A.12, and 125A.26 to 125A.48;
180.1 	(iv) board and lodging for pupils with disabilities in a district maintaining special 
180.2 	classes;
180.3 	(v) transportation from one educational facility to another within the district for 
180.4 	resident pupils enrolled on a shared-time basis in educational programs, and necessary 
180.5 	transportation required by sections 125A.18, and 125A.26 to 125A.48, for resident pupils 
180.6 	with disabilities who are provided special instruction and services on a shared-time basis 
180.7 	or if resident pupils are not transported, the costs of necessary travel between public 
180.8 	and private schools or neutral instructional sites by essential personnel employed by the 
180.9 	district's program for children with a disability;
180.10 	(vi) transportation for resident pupils with disabilities to and from board and lodging 
180.11 	facilities when the pupil is boarded and lodged for educational purposes; and
180.12 	(vii) transportation of pupils for a curricular field trip activity on a school bus 
180.13 	equipped with a power lift when the power lift is required by a student's disability or 
180.14 	section 504 plan; and
180.15 	(viii) services described in clauses (i) to (vi) (vii), when provided for pupils with 
180.16 	disabilities in conjunction with a summer instructional program that relates to the pupil's 
180.17 	individual education plan or in conjunction with a learning year program established 
180.18 	under section 124D.128.
180.19 	For purposes of computing special education initial aid under section 125A.76, 
180.20 	subdivision 2, the cost of providing transportation for children with disabilities includes 
180.21 	(A) the additional cost of transporting a homeless student from a temporary nonshelter 
180.22 	home in another district to the school of origin, or a formerly homeless student from a 
180.23 	permanent home in another district to the school of origin but only through the end of the 
180.24 	academic year; and (B) depreciation on district-owned school buses purchased after July 1, 
180.25 	2005, and used primarily for transportation of pupils with disabilities, calculated according 
180.26 	to paragraph (a), clauses (ii) and (iii). Depreciation costs included in the disabled 
180.27 	transportation category must be excluded in calculating the actual expenditure per pupil 
180.28 	transported in the regular and excess transportation categories according to paragraph (a).
180.29 	(5) "Nonpublic nonregular transportation" is:
180.30 	(i) transportation from one educational facility to another within the district for 
180.31 	resident pupils enrolled on a shared-time basis in educational programs, excluding 
180.32 	transportation for nonpublic pupils with disabilities under clause (4);
180.33 	(ii) transportation within district boundaries between a nonpublic school and a 
180.34 	public school or a neutral site for nonpublic school pupils who are provided pupil support 
180.35 	services pursuant to section 123B.44; and
181.1 	(iii) late transportation home from school or between schools within a district for 
181.2 	nonpublic school pupils involved in after-school activities.
181.3 	(c) "Mobile unit" means a vehicle or trailer designed to provide facilities for 
181.4 	educational programs and services, including diagnostic testing, guidance and counseling 
181.5 	services, and health services. A mobile unit located off nonpublic school premises is a 
181.6 	neutral site as defined in section 123B.41, subdivision 13.

181.7 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2010.

181.8 	Sec. 2. Minnesota Statutes 2008, section 123B.92, subdivision 5, is amended to read:
181.9 		Subd. 5.District reports. (a) Each district must report data to the department as 
181.10 	required by the department to account for transportation expenditures.
181.11 	(b) Salaries and fringe benefits of district employees whose primary duties are 
181.12 	other than transportation, including central office administrators and staff, building 
181.13 	administrators and staff, teachers, social workers, school nurses, and instructional aides, 
181.14 	must not be included in a district's transportation expenditures, except that a district may 
181.15 	include salaries and benefits according to paragraph (c) for (1) an employee designated 
181.16 	as the district transportation director, (2) an employee providing direct support to the 
181.17 	transportation director, or (3) an employee providing direct transportation services such as 
181.18 	a bus driver or bus aide.
181.19 	(c) Salaries and fringe benefits of the district employees listed in paragraph (b), 
181.20 	clauses (1), (2), and (3), who work part time in transportation and part time in other areas 
181.21 	must not be included in a district's transportation expenditures unless the district maintains 
181.22 	documentation of the employee's time spent on pupil transportation matters in the form 
181.23 	and manner prescribed by the department.
181.24 	(d) Pupil transportation expenditures, excluding expenditures for capital outlay, 
181.25 	leased buses, student board and lodging, crossing guards, and aides on buses, must 
181.26 	be allocated among transportation categories based on cost-per-mile, cost-per-student, 
181.27 	cost-per-hour, or cost-per-route, regardless of whether the transportation services are 
181.28 	provided on district-owned or contractor-owned school buses. Expenditures for school 
181.29 	bus driver salaries and fringe benefits may either be directly charged to the appropriate 
181.30 	transportation category or may be allocated among transportation categories based 
181.31 	on cost-per-mile, cost-per-student, cost-per-hour, or cost-per-route. Expenditures 
181.32 	by private contractors or individuals who provide transportation exclusively in one 
181.33 	transportation category must be charged directly to the appropriate transportation category. 
181.34 	Transportation services provided by contractor-owned school bus companies incorporated 
182.1 	under different names but owned by the same individual or group of individuals must be 
182.2 	treated as the same company for cost allocation purposes.
182.3 	(e) Notwithstanding paragraph (d), districts contracting for transportation services 
182.4 	are exempt from the standard cost allocation method for authorized and nonauthorized 
182.5 	transportation categories if the district: (1) bids its contracts separately for authorized 
182.6 	and nonauthorized transportation categories and for special transportation separate from 
182.7 	regular and excess transportation; (2) receives bids or quotes from more than one vendor 
182.8 	for these transportation categories; and (3) the district's cost-per-mile, cost-per-hour, or 
182.9 	cost-per-route does not vary more than ten percent among categories, excluding salaries 
182.10 	and fringe benefits of bus aides. If the costs reported by the district for contractor-owned 
182.11 	operations vary by more than ten percent among categories, the department shall require 
182.12 	the district to reallocate its transportation costs, excluding salaries and fringe benefits of 
182.13 	bus aides, among all categories.

182.14 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2010.

182.15 	Sec. 3. Minnesota Statutes 2008, section 169.011, subdivision 71, is amended to read:
182.16 		Subd. 71.School bus. (a) "School bus" means a motor vehicle used to transport 
182.17 	pupils to or from a school defined in section 120A.22, or to or from school-related 
182.18 	activities, by the school or a school district, or by someone under an agreement with the 
182.19 	school or a school district. A school bus does not include a motor vehicle transporting 
182.20 	children to or from school for which parents or guardians receive direct compensation 
182.21 	from a school district, a motor coach operating under charter carrier authority, a transit 
182.22 	bus providing services as defined in section 174.22, subdivision 7, a multifunction school 
182.23 	activity bus as defined by federal motor vehicle safety standards, or a vehicle otherwise 
182.24 	qualifying as a type III vehicle under paragraph (5) clause (6), when the vehicle is properly 
182.25 	registered and insured and being driven by an employee or agent of a school district for 
182.26 	nonscheduled or nonregular transportation. 
182.27 	(b) A school bus may be type A, type B, type C, or type D, multifunction school 
182.28 	activity bus, or type III as follows:  provided in paragraphs (c) to (h).
182.29 	(1) (c) A "type A school bus" is a van conversion or bus constructed utilizing a 
182.30 	cutaway front section vehicle with a left-side driver's door. The entrance door is behind the 
182.31 	front wheels. This definition includes two classifications: type A-I, with a gross vehicle 
182.32 	weight rating (GVWR) less than or equal to 10,000 14,500 pounds; and type A-II, with a 
182.33 	GVWR greater than 10,000 14,500 pounds and less than or equal to 21,500 pounds.
182.34 	(2) (d) A "type B school bus" is constructed utilizing a stripped chassis. The 
182.35 	entrance door is behind the front wheels. This definition includes two classifications: type 
183.1 	B-I, with a GVWR less than or equal to 10,000 pounds; and type B-II, with a GVWR 
183.2 	greater than 10,000 pounds.
183.3 	(3) (e) A "type C school bus" is constructed utilizing a chassis with a hood and front 
183.4 	fender assembly. The entrance door is behind the front wheels. A "type C school bus" also 
183.5 	includes a cutaway truck chassis or truck chassis with cab, with or without a left side door, 
183.6 	and with a GVWR greater than 21,500 pounds.
183.7 	(4) (f) A "type D school bus" is constructed utilizing a stripped chassis. The entrance 
183.8 	door is ahead of the front wheels.
183.9 	(5)(g) A "multifunction school activity bus" is a school bus that meets the definition 
183.10 	of a multifunction school activity bus in Code of Federal Regulations, title 49, section 
183.11 	571.3. A vehicle that meets the definition of a type III vehicle is not a multifunction 
183.12 	school activity bus.
183.13 	(h) A "Type III vehicles are vehicle" is restricted to passenger cars, station wagons, 
183.14 	vans, and buses having a maximum manufacturer's rated seating capacity of ten or fewer 
183.15 	people, including the driver, and a gross vehicle weight rating of 10,000 pounds or 
183.16 	less. In this subdivision, "gross vehicle weight rating" means the value specified by the 
183.17 	manufacturer as the loaded weight of a single vehicle. A "type III vehicle" must not be 
183.18 	outwardly equipped and identified as a type A, B, C, or D school bus or type A, B, C, or D 
183.19 	Head Start bus. A van or bus converted to a seating capacity of ten or fewer and placed in 
183.20 	service on or after August 1, 1999, must have been originally manufactured to comply 
183.21 	with the passenger safety standards.
183.22 	(i) In this subdivision, "gross vehicle weight rating" means the value specified by 
183.23 	the manufacturer as the loaded weight of a single vehicle.

183.24 	EFFECTIVE DATE. This section is effective July 1, 2009.

183.25 	Sec. 4. Minnesota Statutes 2008, section 169.443, subdivision 9, is amended to read:
183.26 		Subd. 9. Personal cellular phone call prohibition. (a) As used in this subdivision, 
183.27 	"school bus" has the meaning given in section 169.011, subdivision 71. In addition, the 
183.28 	term includes type III vehicles as described defined in section 169.011, subdivision 71, 
183.29 	clause (5), when driven by employees or agents of school districts. 
183.30 	(b) A school bus driver may not operate a school bus while communicating over, or 
183.31 	otherwise operating, a cellular phone for personal reasons, whether handheld or hands 
183.32 	free, when the vehicle is in motion. 

183.33 	Sec. 5. Minnesota Statutes 2008, section 169.4501, subdivision 1, is amended to read:
184.1 		Subdivision 1.National standards adopted. Except as provided in sections 
184.2 	169.4502 and 169.4503, the construction, design, equipment, and color of types A, B, C, 
184.3 	D and multifunctional school buses and multifunction school activity bus school buses 
184.4 	used for the transportation of school children shall meet the requirements of the "bus 
184.5 	chassis standards" and "bus body standards" in the 2005 edition of the "National School 
184.6 	Transportation Specifications and Procedures" adopted by the National Congress on 
184.7 	School Transportation. Except as provided in section 169.4504, the construction, design, 
184.8 	and equipment of types A, B, C, D and multifunctional school buses and multifunction
184.9 	school activity bus school buses used for the transportation of students with disabilities 
184.10 	also shall meet the requirements of the "specially equipped school bus standards" in the 
184.11 	2005 National School Transportation Specifications and Procedures. The "bus chassis 
184.12 	standards," "bus body standards," and "specially equipped school bus standards" sections 
184.13 	of the 2005 edition of the "National School Transportation Specifications and Procedures" 
184.14 	are incorporated by reference in this chapter. 

184.15 	Sec. 6. Minnesota Statutes 2008, section 169.4503, subdivision 20, is amended to read:
184.16 		Subd. 20.Seat and crash barriers. (a) All restraining barriers and passenger seats 
184.17 	shall be covered with a material that has fire retardant or fire block characteristics.
184.18 	(b) All seats must have a minimum cushion depth of 15 inches and a seat back 
184.19 	height of at least 20 inches above the seating reference point, and beginning October 21, 
184.20 	2009, must also conform to the Federal Motor Vehicle Safety Standard in Code of Federal 
184.21 	Regulations, title 49, section 571.222.

184.22 	Sec. 7. Minnesota Statutes 2008, section 169.4503, is amended by adding a subdivision 
184.23 	to read:
184.24 		Subd. 27.Tailpipe. (a) The tailpipe must not extend more than two inches beyond 
184.25 	the perimeter of the body for a side-exit pipe or beyond the bumper for a rear-exit pipe.
184.26 	(b) The tailpipe must exit either in the rear of the vehicle or to the left side of the bus 
184.27 	in front of or behind the rear drive axle. The tailpipe exit location on all type A-I or B-I 
184.28 	buses must be in accordance with the manufacturer's standards. The tailpipe must not exit 
184.29 	beneath any fuel filler location or beneath any emergency door.

184.30 	EFFECTIVE DATE. This section is effective the day following final enactment 
184.31 	retroactive to December 31, 2007.

184.32 	Sec. 8. Minnesota Statutes 2008, section 169.454, subdivision 13, is amended to read:
185.1 		Subd. 13.Exemption. When a vehicle otherwise qualifying as a type III vehicle 
185.2 	under section 169.011, subdivision 71, clause (5), whether owned and operated by a 
185.3 	school district or privately owned and operated, is used to transport school children in a 
185.4 	nonscheduled situation, it shall be exempt from the vehicle requirements of this section 
185.5 	and the licensing requirements of section 171.321, if the vehicle is properly registered 
185.6 	and insured and operated by an employee or agent of a school district with a valid driver's 
185.7 	license. 

185.8 	Sec. 9. Minnesota Statutes 2008, section 169A.03, subdivision 23, is amended to read:
185.9 		Subd. 23. School bus. "School bus" has the meaning given in section 169.011, 
185.10 	subdivision 71. In addition, the term includes type III vehicles as described defined in 
185.11 	section 169.011, subdivision 71, clause (5), when driven by employees or agents of school 
185.12 	districts. 

185.13 	Sec. 10. Minnesota Statutes 2008, section 171.01, subdivision 22, is amended to read:
185.14 		Subd. 22.Commercial motor vehicle. "Commercial motor vehicle" means a motor 
185.15 	vehicle or combination of motor vehicles used to transport passengers or property if 
185.16 	the motor vehicle:
185.17 	(1) has a gross vehicle weight of more than 26,000 pounds;
185.18 	(2) has a towed unit with a gross vehicle weight of more than 10,000 pounds and the 
185.19 	combination of vehicles has a combined gross vehicle weight of more than 26,000 pounds;
185.20 	(3) is a bus;
185.21 	(4) is of any size and is used in the transportation of hazardous materials that are 
185.22 	required to be placarded under Code of Federal Regulations, title 49, parts 100-185; or
185.23 	(5) is outwardly equipped and identified as a school bus, except for type III vehicles 
185.24 	defined in section 169.011, subdivision 71, clause (5).

185.25 	Sec. 11. Minnesota Statutes 2008, section 171.02, subdivision 2, is amended to read:
185.26 		Subd. 2.Driver's license classifications, endorsements, exemptions. (a) Drivers' 
185.27 	licenses are classified according to the types of vehicles that may be driven by the holder 
185.28 	of each type or class of license. The commissioner may, as appropriate, subdivide the 
185.29 	classes listed in this subdivision and issue licenses classified accordingly.
185.30 	(b) Except as provided in paragraph (c), clauses (1) and (2), and subdivision 2a, no 
185.31 	class of license is valid to operate a motorcycle, school bus, tank vehicle, double-trailer 
185.32 	or triple-trailer combination, vehicle transporting hazardous materials, or bus, unless 
186.1 	so endorsed. There are four general classes of licenses as described in paragraphs (c) 
186.2 	through (f).
186.3 	(c) Class D drivers' licenses are valid for:
186.4 	(1) operating all farm trucks if the farm truck is:
186.5 	(i) controlled and operated by a farmer, including operation by an immediate family 
186.6 	member or an employee of the farmer;
186.7 	(ii) used to transport agricultural products, farm machinery, or farm supplies, 
186.8 	including hazardous materials, to or from a farm;
186.9 	(iii) not used in the operations of a common or contract motor carrier as governed by 
186.10 	Code of Federal Regulations, title 49, part 365; and
186.11 	(iv) used within 150 miles of the farm;
186.12 	(2) notwithstanding paragraph (b), operating an authorized emergency vehicle, as 
186.13 	defined in section 169.011, subdivision 3, whether or not in excess of 26,000 pounds 
186.14 	gross vehicle weight;
186.15 	(3) operating a recreational vehicle as defined in section 168.002, subdivision 27, 
186.16 	that is operated for personal use;
186.17 	(4) operating all single-unit vehicles except vehicles with a gross vehicle weight of 
186.18 	more than 26,000 pounds, vehicles designed to carry more than 15 passengers including 
186.19 	the driver, and vehicles that carry hazardous materials;
186.20 	(5) notwithstanding paragraph (d), operating a type A school bus or a multifunctional
186.21 	multifunction school activity bus without a school bus endorsement if:
186.22 	(i) the bus has a gross vehicle weight of 10,000 pounds or less;
186.23 	(ii) the bus is designed to transport 15 or fewer passengers, including the driver; and
186.24 	(iii) the requirements of subdivision 2a are satisfied, as determined by the 
186.25 	commissioner;
186.26 	(6) operating any vehicle or combination of vehicles when operated by a licensed 
186.27 	peace officer while on duty; and
186.28 	(7) towing vehicles if:
186.29 	(i) the towed vehicles have a gross vehicle weight of 10,000 pounds or less; or
186.30 	(ii) the towed vehicles have a gross vehicle weight of more than 10,000 pounds and 
186.31 	the combination of vehicles has a gross vehicle weight of 26,000 pounds or less.
186.32 	(d) Class C drivers' licenses are valid for:
186.33 	(1) operating class D motor vehicles;
186.34 	(2) with a hazardous materials endorsement, operating class D vehicles to transport 
186.35 	hazardous materials;
186.36 	(3) with a passenger endorsement, operating buses; and
187.1 	(4) with a passenger endorsement and school bus endorsement, operating school 
187.2 	buses.
187.3 	(e) Class B drivers' licenses are valid for:
187.4 	(1) operating all class C motor vehicles, class D motor vehicles, and all other 
187.5 	single-unit motor vehicles including, with a passenger endorsement, buses; and
187.6 	(2) towing only vehicles with a gross vehicle weight of 10,000 pounds or less.
187.7 	(f) Class A drivers' licenses are valid for operating any vehicle or combination of 
187.8 	vehicles.

187.9 	Sec. 12. Minnesota Statutes 2008, section 171.02, subdivision 2a, is amended to read:
187.10 		Subd. 2a.Exception for certain school bus drivers. Notwithstanding subdivision 
187.11 	2, paragraph (c) (b), the holder of a class D driver's license, without a school bus 
187.12 	endorsement, may operate a type A school bus described in subdivision 2, paragraph (b),
187.13 	or a multifunction school activity bus under the following conditions:
187.14 	(a) The operator is an employee of the entity that owns, leases, or contracts for the 
187.15 	school bus and is not solely hired to provide transportation services under this subdivision.
187.16 	(b) The operator drives the school bus only from points of origin to points of 
187.17 	destination, not including home-to-school trips to pick up or drop off students.
187.18 	(c) The operator is prohibited from using the eight-light system. Violation of this 
187.19 	paragraph is a misdemeanor.
187.20 	(d) The operator's employer has adopted and implemented a policy that provides for 
187.21 	annual training and certification of the operator in:
187.22 	(1) safe operation of the type of school bus the operator will be driving;
187.23 	(2) understanding student behavior, including issues relating to students with 
187.24 	disabilities;
187.25 	(3) encouraging orderly conduct of students on the bus and handling incidents of 
187.26 	misconduct appropriately;
187.27 	(4) knowing and understanding relevant laws, rules of the road, and local school 
187.28 	bus safety policies;
187.29 	(5) handling emergency situations; and
187.30 	(6) safe loading and unloading of students.
187.31 	(e) A background check or background investigation of the operator has been 
187.32 	conducted that meets the requirements under section 122A.18, subdivision 8, or 123B.03
187.33 	for teachers; section 144.057 or chapter 245C for day care employees; or section 171.321, 
187.34 	subdivision 3, for all other persons operating a type A school bus under this subdivision.
188.1 	(f) Operators shall submit to a physical examination as required by section 171.321, 
188.2 	subdivision 2.
188.3 	(g) The operator's driver's license is verified annually by the entity that owns, leases, 
188.4 	or contracts for the school bus.
188.5 	(h) A person who sustains a conviction, as defined under section 609.02, of violating 
188.6 	section 169A.25, 169A.26, 169A.27, 169A.31, 169A.51, or 169A.52, or a similar statute 
188.7 	or ordinance of another state is precluded from operating a school bus for five years 
188.8 	from the date of conviction.
188.9 	(i) A person who has ever been convicted of a disqualifying offense as defined in 
188.10 	section 171.3215, subdivision 1, paragraph (c), may not operate a school bus under this 
188.11 	subdivision.
188.12 	(j) A person who sustains a conviction, as defined under section 609.02, of a fourth 
188.13 	moving offense in violation of chapter 169 is precluded from operating a school bus for 
188.14 	one year from the date of the last conviction.
188.15 	(k) Students riding the school bus must have training required under section 
188.16 	123B.90, subdivision 2.
188.17 	(l) An operator must be trained in the proper use of child safety restraints as set 
188.18 	forth in the National Highway Traffic Safety Administration's "Guideline for the Safe 
188.19 	Transportation of Pre-school Age Children in School Buses," if child safety restraints are 
188.20 	used by the passengers.
188.21 	(m) Annual certification of the requirements listed in this subdivision must be 
188.22 	maintained under separate file at the business location for each operator licensed under 
188.23 	this subdivision and subdivision 2, paragraph (b), clause (5). The business manager, 
188.24 	school board, governing body of a nonpublic school, or any other entity that owns, 
188.25 	leases, or contracts for the school bus operating under this subdivision is responsible 
188.26 	for maintaining these files for inspection.
188.27 	(n) The school bus must bear a current certificate of inspection issued under section 
188.28 	169.451.
188.29 	(o) If the word "School" appears on the front and rear of the bus, the word "School"
188.30 	must be covered by a sign that reads "Activities" when the bus is being operated under 
188.31 	authority of this subdivision.
188.32 	(p) The type A-I school bus or multifunction school activity bus is designed to 
188.33 	transport 15 or fewer passengers, including the driver.
188.34 	(q) The school bus has a gross vehicle weight rating of 14,500 pounds or less.

188.35 	EFFECTIVE DATE. This section is effective July 1, 2010.

189.1 	Sec. 13. Minnesota Statutes 2008, section 171.02, subdivision 2b, is amended to read:
189.2 		Subd. 2b.Exception for type III vehicle drivers. (a) Notwithstanding subdivision 
189.3 	2, paragraph (c), the holder of a class A, B, C, or D driver's license, without a school bus 
189.4 	endorsement, may operate a type III vehicle described in section 169.011, subdivision 71, 
189.5 	clause (5), under the conditions in paragraphs (b) through (n) (o).
189.6 	(b) The operator is an employee of the entity that owns, leases, or contracts for 
189.7 	the school bus.
189.8 	(c) The operator's employer has adopted and implemented a policy that provides for 
189.9 	annual training and certification of the operator in:
189.10 	(1) safe operation of a type III vehicle;
189.11 	(2) understanding student behavior, including issues relating to students with 
189.12 	disabilities;
189.13 	(3) encouraging orderly conduct of students on the bus and handling incidents of 
189.14 	misconduct appropriately;
189.15 	(4) knowing and understanding relevant laws, rules of the road, and local school 
189.16 	bus safety policies;
189.17 	(5) handling emergency situations;
189.18 	(6) proper use of seat belts and child safety restraints;
189.19 	(7) performance of pretrip vehicle inspections; and
189.20 	(8) safe loading and unloading of students, including, but not limited to:
189.21 	(i) utilizing a safe location for loading and unloading students at the curb, on the 
189.22 	nontraffic side of the roadway, or at off-street loading areas, driveways, yards, and other 
189.23 	areas to enable the student to avoid hazardous conditions;
189.24 	(ii) refraining from loading and unloading students in a vehicular traffic lane, on the 
189.25 	shoulder, in a designated turn lane, or a lane adjacent to a designated turn lane;
189.26 	(iii) avoiding a loading or unloading location that would require a pupil to cross a 
189.27 	road, or ensuring that the driver or an aide personally escort the pupil across the road if 
189.28 	it is not reasonably feasible to avoid such a location; and
189.29 	(iv) placing the type III vehicle in "park" during loading and unloading; and
189.30 	(9) compliance with paragraph (k), concerning reporting certain convictions to the 
189.31 	employer within ten days of the date of conviction.
189.32 	(d) A background check or background investigation of the operator has been 
189.33 	conducted that meets the requirements under section 122A.18, subdivision 8, or 123B.03 
189.34 	for school district employees; section 144.057 or chapter 245C for day care employees; 
189.35 	or section 171.321, subdivision 3, for all other persons operating a type A or type III 
189.36 	vehicle under this subdivision.
190.1 	(e) Operators shall submit to a physical examination as required by section 171.321, 
190.2 	subdivision 2.
190.3 	(f) The operator's employer has adopted and implemented a policy that provides for 
190.4 	mandatoryrequires preemployment drug and alcohol testing of applicants for operator 
190.5 	positions and. Current operators, in accordance must comply  with the employer's policy 
190.6 	under  section 181.951, subdivisions 2, 4, and 5.
190.7 	(g) The operator's driver's license is verified annually by the entity that owns, leases, 
190.8 	or contracts for the school bus.
190.9 	(h) A person who sustains a conviction, as defined under section 609.02, of violating 
190.10 	section 169A.25, 169A.26, 169A.27, or 169A.31, or whose driver's license is revoked 
190.11 	under sections 169A.50 to 169A.53 of the implied consent law, or who is convicted of 
190.12 	violating or has theirwhose driver's license is revoked under a similar statute or ordinance 
190.13 	of another state, is precluded from operating a type III vehicle for five years from the 
190.14 	date of conviction.
190.15 	(i) A person who has ever been convicted of a disqualifying offense as defined in 
190.16 	section 171.3215, subdivision 1, paragraph (c), may not operate a type III vehicle under 
190.17 	this subdivision.
190.18 	(j) A person who sustains a conviction, as defined under section 609.02, of a moving 
190.19 	offense in violation of chapter 169 within three years of the first of three other moving 
190.20 	offenses is precluded from operating a type III vehicle for one year from the date of 
190.21 	the last conviction.
190.22 	(k) An operator who sustains a conviction as described in paragraph (h), (i), or (j) 
190.23 	while employed by the entity that owns, leases, or contracts for the school bus, shall report 
190.24 	the conviction to the employer within ten days of the date of the conviction.
190.25 	(l) Students riding the type III vehicle must have training required under section 
190.26 	123B.90, subdivision 2.
190.27 	(m) Documentation of meeting the requirements listed in this subdivision must be 
190.28 	maintained under separate file at the business location for each type III vehicle operator. 
190.29 	The business manager, school board, governing body of a nonpublic school, or any 
190.30 	other entity that owns, leases, or contracts for the type III vehicle operating under this 
190.31 	subdivision is responsible for maintaining these files for inspection.
190.32 	(n) The type III vehicle must bear a current certificate of inspection issued under 
190.33 	section 169.451.
190.34 	(o) An operator employed by a school or school district, whose normal duties do not 
190.35 	include operating a type III vehicle, who holds a class D driver's license without a school 
190.36 	bus endorsement, may operate a type III vehicle and is exempt from paragraphs (d), (e), 
191.1 	(f), (g), and (k) An employee of a school or of a school district, who is not employed for 
191.2 	the sole purpose of operating a type III vehicle, is exempt from paragraphs (e) and (f).

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

191.4 	Sec. 14. Minnesota Statutes 2008, section 171.321, subdivision 1, is amended to read:
191.5 		Subdivision 1.Endorsement. No person shall drive a school bus when transporting 
191.6 	school children to or from school or upon a school-related trip or activity without having a 
191.7 	valid class A, class B, or class C driver's license with a school bus endorsement except 
191.8 	that a person possessing a valid driver's license but not a school bus endorsement may 
191.9 	drive a type III vehicle or a school bus, subject to the requirements of section 171.02, 
191.10 	subdivisions 2, 2a, and 2b.

191.11 	Sec. 15. Minnesota Statutes 2008, section 171.321, subdivision 4, is amended to read:
191.12 		Subd. 4.Training. (a) No person shall drive a class A, B, C, or D school bus when 
191.13 	transporting school children to or from school or upon a school-related trip or activity 
191.14 	without having demonstrated sufficient skills and knowledge to transport students in 
191.15 	a safe and legal manner.
191.16 	(b) A bus driver must have training or experience that allows the driver to meet at 
191.17 	least the following competencies:
191.18 	(1) safely operate the type of school bus the driver will be driving;
191.19 	(2) understand student behavior, including issues relating to students with 
191.20 	disabilities;
191.21 	(3) encourage orderly conduct of students on the bus and handle incidents of 
191.22 	misconduct appropriately;
191.23 	(4) know and understand relevant laws, rules of the road, and local school bus 
191.24 	safety policies;
191.25 	(5) handle emergency situations; and
191.26 	(6) safely load and unload students.
191.27 	(c) The commissioner of public safety shall develop a comprehensive model 
191.28 	school bus driver training program and model assessments for school bus driver training 
191.29 	competencies, which are not subject to chapter 14. A school district, nonpublic school, or 
191.30 	private contractor may use alternative assessments for bus driver training competencies 
191.31 	with the approval of the commissioner of public safety. A driver may receive at least eight 
191.32 	hours of school bus in-service training any year, as an alternative to being assessed for bus 
191.33 	driver competencies after the initial year of being assessed for bus driver competencies. 
192.1 	The employer shall keep the assessment or a record of the in-service training for the 
192.2 	current period available for inspection by representatives of the commissioner.
192.3 	(d) A school district, nonpublic school, or private contractor shall provide in-service 
192.4 	training annually to each school bus driver.

192.5 	Sec. 16. Minnesota Statutes 2008, section 171.321, subdivision 5, is amended to read:
192.6 		Subd. 5.Annual evaluation and license verification. (a) A school district, 
192.7 	nonpublic school, or private contractor shall provide in-service training annually to each 
192.8 	school bus driver. For purposes of this section, "annually" means at least once every 
192.9 	380 days from the initial or previous evaluation and at least once every 380 days from 
192.10 	the initial or previous license verification.
192.11 	(b) A school district, nonpublic school, or private contractor shall annually verify 
192.12 	with the National Driver Register or with the Department of Public Safety the validity of 
192.13 	the driver's license of each employee who regularly transports students for the district in: 
192.14 	(1) a type A school bus, a type B school bus, a type C school bus, or type D school bus,; (2) 
192.15 	a multifunction school activity bus; or regularly transports students for the district in(3) a 
192.16 	type III vehicle with the National Driver Register or with the Department of Public Safety.

192.17 	EFFECTIVE DATE. This section is effective July 1, 2010.

192.18 	ARTICLE 9
192.19 	SCHOOL FINANCE SYSTEM CHANGES

192.20 	Section 1. Minnesota Statutes 2008, section 123B.53, subdivision 5, is amended to read:
192.21 		Subd. 5.Equalized debt service levy. (a) The equalized debt service levy of a 
192.22 	district equals the sum of the first tier equalized debt service levy and the second tier 
192.23 	equalized debt service levy.
192.24 	(b) A district's first tier equalized debt service levy equals the district's first tier debt 
192.25 	service equalization revenue times the lesser of one or the ratio of:
192.26 	(1) the quotient derived by dividing the adjusted net tax capacity of the district for 
192.27 	the year before the year the levy is certified by the adjusted pupil units in the district for 
192.28 	the school year ending in the year prior to the year the levy is certified; to
192.29 	(2) $3,200 100 percent of the statewide adjusted net tax capacity equalizing factor.
192.30 	(c) A district's second tier equalized debt service levy equals the district's second tier 
192.31 	debt service equalization revenue times the lesser of one or the ratio of:
193.1 	(1) the quotient derived by dividing the adjusted net tax capacity of the district for 
193.2 	the year before the year the levy is certified by the adjusted pupil units in the district for 
193.3 	the school year ending in the year prior to the year the levy is certified; to
193.4 	(2) $8,000 200 percent of the statewide adjusted net tax capacity equalizing factor.

193.5 	EFFECTIVE DATE. This section is effective for taxes payable in 2013 and later.

193.6 	Sec. 2. [123B.555] SCHOOL BOND AGRICULTURAL CREDIT.
193.7 		Subdivision 1.Eligibility. All class 2a, 2b, and 2c property under section 273.13, 
193.8 	subdivision 23, except for property consisting of the house, garage, and immediately 
193.9 	surrounding one acre of land of an agricultural homestead, is eligible to receive the credit 
193.10 	under this section.
193.11 		Subd. 2.Credit amount. For each qualifying property, the school bond agricultural 
193.12 	credit is equal to 66 percent of the property's eligible net tax capacity multiplied by the 
193.13 	school debt tax rate determined under section 275.08, subdivision 1b.
193.14 		Subd. 3.Credit reimbursements. The county auditor shall determine the tax 
193.15 	reductions allowed under this section within the county for each taxes payable year and 
193.16 	shall certify that amount to the commissioner of revenue as a part of the abstracts of tax 
193.17 	lists submitted under section 275.29. Any prior year adjustments shall also be certified on 
193.18 	the abstracts of tax lists. The commissioner shall review the certifications for accuracy, 
193.19 	and may make such changes as are deemed necessary, or return the certification to the 
193.20 	county auditor for correction. The credit under this section must be used to reduce the 
193.21 	school district net tax capacity-based property tax as provided in section 273.1393.
193.22 		Subd. 4.Payment. The commissioner of revenue shall certify the total of the tax 
193.23 	reductions granted under this section for each taxes payable year within each school 
193.24 	district to the commissioner of education, who shall pay the reimbursement amounts to 
193.25 	each school district as provided in section 273.1392.

193.26 	EFFECTIVE DATE. This section is effective for taxes payable in 2013 and later.

193.27 	Sec. 3. Minnesota Statutes 2008, section 124D.4531, is amended to read:
193.28 	124D.4531 CAREER AND TECHNICAL LEVY AID.
193.29 		Subdivision 1.Career and technical levy aid. (a) A district with a career and 
193.30 	technical program approved under this section for the fiscal year in which the levy is 
193.31 	certified may levy an amount is eligible for aid equal to the lesser of:
193.32 	(1) $80 $240 times the district's average daily membership in grades 10 through 12 
193.33 	for the fiscal year in which the levy is certified; or
194.1 	(2) 25 percent of approved expenditures in the previous fiscal year in which the 
194.2 	levy is certified for the following:
194.3 	(i) salaries paid to essential, licensed personnel providing direct instructional 
194.4 	services to students in that fiscal year for services rendered in the district's approved 
194.5 	career and technical education programs;
194.6 	(ii) contracted services provided by a public or private agency other than a Minnesota 
194.7 	school district or cooperative center under subdivision 7;
194.8 	(iii) necessary travel between instructional sites by licensed career and technical 
194.9 	education personnel;
194.10 	(iv) necessary travel by licensed career and technical education personnel for 
194.11 	vocational student organization activities held within the state for instructional purposes;
194.12 	(v) curriculum development activities that are part of a five-year plan for 
194.13 	improvement based on program assessment;
194.14 	(vi) necessary travel by licensed career and technical education personnel for 
194.15 	noncollegiate credit-bearing professional development; and
194.16 	(vii) specialized vocational instructional supplies.
194.17 	(b) Up to ten percent of a district's career and technical levy aid may be spent on 
194.18 	equipment purchases. Districts using the career and technical levy aid for equipment 
194.19 	purchases must report to the department on the improved learning opportunities for 
194.20 	students that result from the investment in equipment.
194.21 	(c) The district must recognize the full amount of this levy as revenue for the fiscal 
194.22 	year in which it is certified.
194.23 		Subd. 2.Allocation from cooperative centers and intermediate districts. For 
194.24 	purposes of this section, a cooperative center or an intermediate district must allocate its 
194.25 	approved expenditures for career and technical education programs among participating 
194.26 	districts.
194.27 		Subd. 3.Levy Aid guarantee. Notwithstanding subdivision 1, the career and 
194.28 	technical education levyaid for a district is not less than the lesser of:
194.29 	(1) the district's career and technical education levy authorityrevenue for the 
194.30 	previous fiscal year; or
194.31 	(2) 100 percent of the approved expenditures for career and technical programs 
194.32 	included in subdivision 1, paragraph (b), for the prior fiscal year in which the levy is 
194.33 	certified.
194.34 		Subd. 4.District reports. Each district or cooperative center must report data to the 
194.35 	department for all career and technical education programs as required by the department 
194.36 	to implement the career and technical levy formula.

195.1 	EFFECTIVE DATE. This section is effective for aid payments for fiscal year 
195.2 	2014 and thereafter.

195.3 	Sec. 4. Minnesota Statutes 2008, section 124D.59, subdivision 2, is amended to read:
195.4 		Subd. 2.Pupil of limited English proficiency. (a) "Pupil of limited English 
195.5 	proficiency" means a pupil in kindergarten through grade 12 who meets the following 
195.6 	requirements:
195.7 	(1) the pupil, as declared by a parent or guardian first learned a language other than 
195.8 	English, comes from a home where the language usually spoken is other than English, or 
195.9 	usually speaks a language other than English; and
195.10 	(2) the pupil is determined by developmentally appropriate measures, which might 
195.11 	include observations, teacher judgment, parent recommendations, or developmentally 
195.12 	appropriate assessment instruments, to lack the necessary English skills to participate 
195.13 	fully in classes taught in English.
195.14 	(b) Notwithstanding paragraph (a), a pupil in grades 4 through 12 who was enrolled 
195.15 	in a Minnesota public school on the dates during the previous school year when a 
195.16 	commissioner provided assessment that measures the pupil's emerging academic English 
195.17 	was administered, shall not be counted as a pupil of limited English proficiency in 
195.18 	calculating limited English proficiency pupil units under section 126C.05, subdivision 
195.19 	17, and shall not generate state limited English proficiency aid under section 124D.65, 
195.20 	subdivision 5, unless the pupil scored below the state cutoff score on an assessment 
195.21 	measuring emerging academic English provided by the commissioner during the previous 
195.22 	school year.  
195.23 	(c) Notwithstanding paragraphs (a) and (b), a pupil in kindergarten through grade 12 
195.24 	shall not be counted as a pupil of limited English proficiency in calculating limited English 
195.25 	proficiency pupil units under section 126C.05, subdivision 17, and shall not generate state 
195.26 	limited English proficiency aid under section 124D.65, subdivision 5, if:
195.27 	(1) the pupil is not enrolled during the current fiscal year in an educational program 
195.28 	for pupils of limited English proficiency in accordance with sections 124D.58 to 124D.64; 
195.29 	or.
195.30 	(2) the pupil has generated five or more years of average daily membership in 
195.31 	Minnesota public schools since July 1, 1996.

195.32 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
195.33 	and later.

195.34 	Sec. 5. Minnesota Statutes 2008, section 124D.65, subdivision 5, is amended to read:
196.1 		Subd. 5.School district LEP revenue. (a) A district's limited English proficiency 
196.2 	programs revenue equals the product of: (1) $700 in fiscal year 2004 and later times .2;
196.3 	(2)  the basic formula allowance for that year; and (3) the greater of 20 or the adjusted 
196.4 	marginal cost average daily membership of eligible pupils of limited English proficiency 
196.5 	enrolled in the district during the current fiscal year.
196.6 	(b) A pupil ceases to generate state limited English proficiency aid in the school 
196.7 	year following the school year in which the pupil attains the state cutoff score on a 
196.8 	commissioner-provided assessment that measures the pupil's emerging academic English.

196.9 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
196.10 	and later.

196.11 	Sec. 6. Minnesota Statutes 2008, section 125A.76, subdivision 5, is amended to read:
196.12 		Subd. 5.School district special education aid. A school district's special education 
196.13 	aid for fiscal year 2008 and later equals the state total special education aid times the ratio 
196.14 	of the district'sits initial special education aid to the state total initial special education aid.

196.15 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
196.16 	and later.

196.17 	Sec. 7. Minnesota Statutes 2008, section 125A.79, subdivision 7, is amended to read:
196.18 		Subd. 7.District special education excess cost aid. A district's special education 
196.19 	excess cost aid for fiscal year 2002 and later equals the state total special education excess 
196.20 	cost aid times the ratio of the district's its initial excess cost aid to the state total initial 
196.21 	excess cost aid.

196.22 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
196.23 	and later.

196.24 	Sec. 8. Minnesota Statutes 2008, section 126C.01, is amended by adding a subdivision 
196.25 	to read:
196.26 		Subd. 2a.Adjusted net tax capacity equalizing factor. The adjusted net tax 
196.27 	capacity equalizing factor equals the quotient derived by dividing the total adjusted net tax 
196.28 	capacity of all school districts in the state for the year before the year the levy is certified 
196.29 	by the total number of adjusted pupil units in the state for the current school year.

196.30 	EFFECTIVE DATE. This section is effective for taxes payable in 2013 and later.

197.1 	Sec. 9. Minnesota Statutes 2008, section 126C.01, is amended by adding a subdivision 
197.2 	to read:
197.3 		Subd. 3a.Referendum market value equalizing factor. The referendum market 
197.4 	value equalizing factor equals the quotient derived by dividing the total referendum 
197.5 	market value of all school districts in the state for the year before the year the levy is 
197.6 	certified by the total number of resident pupil units in the state for the current school year.

197.7 	EFFECTIVE DATE. This section is effective for taxes payable in 2013.

197.8 	Sec. 10. Minnesota Statutes 2008, section 126C.01, is amended by adding a 
197.9 	subdivision to read:
197.10 		Subd. 5a.Location equity index. (a) A school district's location equity index 
197.11 	equals each district's composite wage level divided by the statewide average wage for the 
197.12 	same period. The composite wage level for a school district equals the sum of 50 percent 
197.13 	of the district's county wage level and 50 percent of the district's economic development 
197.14 	region composite wage level. The composite wage level is computed by using the most 
197.15 	recent three-year weighted wage data.
197.16 	(b) A school district's location equity index must not be less than .9 or greater than 
197.17 	1.05.
197.18 	(c) The commissioner of education annually must recalculate the indexes in this 
197.19 	section. For purposes of this subdivision, the commissioner must locate a school district 
197.20 	with boundaries that cross county borders in the county that generates the highest location 
197.21 	equity index for that district.

197.22 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
197.23 	and later.

197.24 	Sec. 11. Minnesota Statutes 2008, section 126C.05, subdivision 1, is amended to read:
197.25 		Subdivision 1.Pupil unit. Pupil units for each Minnesota resident pupil under the 
197.26 	age of 21 or who meets the requirements of section 120A.20, subdivision 1, paragraph (c), 
197.27 	in average daily membership enrolled in the district of residence, in another district under 
197.28 	sections 123A.05 to 123A.08, 124D.03, 124D.08, or 124D.68; in a charter school under 
197.29 	section 124D.10; or for whom the resident district pays tuition under section 123A.18, 
197.30 	123A.22, 123A.30, 123A.32, 123A.44, 123A.488, 123B.88, subdivision 4, 124D.04, 
197.31 	124D.05, 125A.03 to 125A.24, 125A.51, or 125A.65, shall be counted according to this 
197.32 	subdivision. 
198.1 	(a) A prekindergarten pupil with a disability who is enrolled in a program approved 
198.2 	by the commissioner and has an individual education plan is counted as the ratio of the 
198.3 	number of hours of assessment and education service to 825 times 1.25 with a minimum 
198.4 	average daily membership of 0.28, but not more than 1.25 pupil units. 
198.5 	(b) A prekindergarten pupil who is assessed but determined not to be disabled is 
198.6 	counted as the ratio of the number of hours of assessment service to 825 times 1.25. 
198.7 	(c) A kindergarten pupil with a disability who is enrolled in a program approved 
198.8 	by the commissioner is counted as the ratio of the number of hours of assessment and 
198.9 	education services required in the fiscal year by the pupil's individual education program 
198.10 	plan to 875, but not more than one.
198.11 	(d) A kindergarten pupil who is not included in paragraph (c) is counted as .612 1.0
198.12 	pupil units.
198.13 	(e) A pupil who is in any of grades 1 to 3 is counted as 1.115 1.0 pupil units for 
198.14 	fiscal year 2000 and thereafter. 
198.15 	(f) A pupil who is any of grades 4 to 6 is counted as 1.06 1.0 pupil units for fiscal 
198.16 	year 1995 and thereafter. 
198.17 	(g) A pupil who is in any of grades 7 to 12 is counted as 1.3 1.0 pupil units.
198.18 	(h) A pupil who is in the postsecondary enrollment options program is counted as 
198.19 	1.3 1.0 pupil units.

198.20 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
198.21 	and later.

198.22 	Sec. 12. Minnesota Statutes 2008, section 126C.05, subdivision 3, is amended to read:
198.23 		Subd. 3.Compensation revenue pupil units. Compensation revenue pupil units 
198.24 	for fiscal year 1998 and thereafter must be computed according to this subdivision.
198.25 	(a) The compensation revenue concentration percentage for each building in a
198.26 	district equals the product of 100 times the ratio of:
198.27 	(1) the sum of the number of pupils enrolled in the building district eligible to receive 
198.28 	free lunch plus one-half of the pupils eligible to receive reduced pricedor reduced-price 
198.29 	lunch on October 1 of the previous fiscal year; to
198.30 	(2) the number of pupils enrolled in the building district on October 1 of the 
198.31 	previous fiscal year.
198.32 	(b) The compensation revenue pupil weighting factor for a building equals the 
198.33 	lesser of one or the quotient obtained by dividing the building's compensation revenue 
198.34 	concentration percentage by 80.0.
198.35 	(c) The compensation revenue pupil units for a building district equals the product of:
199.1 	(1) the sum of the number of pupils enrolled in the building district eligible to receive 
199.2 	free lunch and one-half of the pupils eligible to receive reduced pricedor reduced-price 
199.3 	lunch on October 1 of the previous fiscal year; times
199.4 	(2) the compensation revenue pupil weighting factor for the building; times
199.5 	(3) .60 district.
199.6 	(d) Notwithstanding paragraphs (a) to (c), for charter schools and contracted 
199.7 	alternative programs in the first year of operation, compensation revenue pupil units shall 
199.8 	be computed using data for the current fiscal year. If the charter school or contracted 
199.9 	alternative program begins operation after October 1, compensatory revenue pupil units 
199.10 	shall be computed based on pupils enrolled on an alternate date determined by the 
199.11 	commissioner, and the compensation revenue pupil units shall be prorated based on the 
199.12 	ratio of the number of days of student instruction to 170 days.
199.13 	(e) The percentages in this subdivision must be based on the count of individual 
199.14 	pupils and not on a building average or minimum.

199.15 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
199.16 	and later.

199.17 	Sec. 13. Minnesota Statutes 2008, section 126C.05, subdivision 5, is amended to read:
199.18 		Subd. 5.Adjusted pupil units. (a) Adjusted pupil units for a district or charter 
199.19 	school means the sum of:
199.20 	(1) the number of pupil units served, according to subdivision 7, plus
199.21 	(2) pupil units according to subdivision 1 for whom the district or charter school 
199.22 	pays tuition under section 123A.18, 123A.22, 123A.30, 123A.32, 123A.44, 123A.488, 
199.23 	123B.88, subdivision 4, 124D.04, 124D.05, 125A.03 to 125A.24, 125A.51, or 125A.65, 
199.24 	minus 
199.25 	(3) pupil units according to subdivision 1 for whom the district or charter school 
199.26 	receives tuition under section 123A.18, 123A.22, 123A.30, 123A.32, 123A.44, 123A.488, 
199.27 	123B.88, subdivision 4, 124D.04, 124D.05, 125A.03 to 125A.24, 125A.51, or 125A.65. 
199.28 	(b) Adjusted marginal cost pupil units means the greater of:
199.29 	(1) the sum of .77 times the pupil units defined in paragraph (a) for the current school 
199.30 	year and .23 times the pupil units defined in paragraph (a) for the previous school year; or
199.31 	(2) the number of adjusted pupil units defined in paragraph (a) for the current school 
199.32 	year.

199.33 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
199.34 	and later.

200.1 	Sec. 14. Minnesota Statutes 2008, section 126C.05, subdivision 6, is amended to read:
200.2 		Subd. 6.Resident pupil units. (a) Resident pupil units for a district means the 
200.3 	number of pupil units according to subdivision 1 residing in the district.
200.4 	(b) Resident marginal cost pupil units means the greater of:
200.5 	(1) the sum of .77 times the pupil units defined in paragraph (a) for the current year 
200.6 	and .23 times the pupil units defined in paragraph (a) for the previous school year; or
200.7 	(2) the number of resident pupil units defined in paragraph (a) for the current school 
200.8 	year.

200.9 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
200.10 	and later.

200.11 	Sec. 15. Minnesota Statutes 2008, section 126C.05, subdivision 8, is amended to read:
200.12 		Subd. 8.Average daily membership. (a) Membership for pupils in grades 
200.13 	kindergarten through 12 and for prekindergarten pupils with disabilities shall mean the 
200.14 	number of pupils on the current roll of the school, counted from the date of entry until 
200.15 	withdrawal. The date of withdrawal shall mean the day the pupil permanently leaves 
200.16 	the school or the date it is officially known that the pupil has left or has been legally 
200.17 	excused. However, a pupil, regardless of age, who has been absent from school for 15 
200.18 	consecutive school days during the regular school year or for five consecutive school days 
200.19 	during summer school or intersession classes of flexible school year programs without 
200.20 	receiving instruction in the home or hospital shall be dropped from the roll and classified 
200.21 	as withdrawn. Nothing in this section shall be construed as waiving the compulsory 
200.22 	attendance provisions cited in section 120A.22. Average daily membership equals the 
200.23 	sum for all pupils of the number of days of the school year each pupil is enrolled in the 
200.24 	district's schools divided by the number of days the schools are in session. Days of 
200.25 	summer school or intersession classes of flexible school year programs are only included 
200.26 	in the computation of membership for pupils with a disability not appropriately served 
200.27 	primarily in the regular classroom. A student must not be counted as more than 1.2 pupils 
200.28 	in average daily membership under this section. When the initial total average daily 
200.29 	membership exceeds 1.2 for a pupil enrolled in more than one school district during the 
200.30 	fiscal year, each district's average daily membership must be reduced proportionately. 
200.31 	(b) A student must not be counted as more than one pupil in average daily 
200.32 	membership except for purposes of section 126C.10, subdivision 2a. 
200.33 	(c) For purposes of section 126C.10, subdivision 2a, only, a pupil's average daily 
200.34 	membership is counted as 1.0 once a kindergarten or elementary pupil has received 960 
201.1 	hours of instruction during the school year and as 1.0 once a secondary student has 
201.2 	received 1,050 hours of instruction during the school year.

201.3 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
201.4 	and later.

201.5 	Sec. 16. Minnesota Statutes 2008, section 126C.05, subdivision 16, is amended to read:
201.6 		Subd. 16.Free and reduced-price lunches. The commissioner shall determine the 
201.7 	number of children eligible to receive either a free or reduced-price lunch on October 1 
201.8 	each year. Children enrolled in a building on October 1 and determined to be eligible to 
201.9 	receive free or reduced-price lunch by December 15 of that school year shall be counted 
201.10 	as eligible on October 1 for purposes of subdivision 3. The commissioner may use 
201.11 	federal definitions for these purposes and may adjust these definitions as appropriate. 
201.12 	The commissioner may adopt reporting guidelines to assure accuracy of data counts and 
201.13 	eligibility. Districts shall use any guidelines adopted by the commissioner.

201.14 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
201.15 	and later.

201.16 	Sec. 17. Minnesota Statutes 2008, section 126C.05, subdivision 17, is amended to read:
201.17 		Subd. 17.LEP pupil units. (a) Limited English proficiency pupil units for fiscal 
201.18 	year 2004 and thereafter shall be determined according to this subdivision.
201.19 	(b) The limited English proficiency concentration percentage for a district equals the 
201.20 	product of 100 times the ratio of:
201.21 	(1) means the number of eligible pupils of limited English proficiency in average 
201.22 	daily membership enrolled in the district during the current fiscal year; to.
201.23 	(2) the number of pupils in average daily membership enrolled in the district.
201.24 	(c) The limited English proficiency pupil units for each eligible pupil of limited 
201.25 	English proficiency in average daily membership equals the lesser of one or the quotient 
201.26 	obtained by dividing the limited English proficiency concentration percentage for the 
201.27 	pupil's district of enrollment by 11.5.
201.28 	(d) (b) Limited English proficiency pupil units shall be counted by the district of 
201.29 	enrollment.
201.30 	(e) (c) Notwithstanding paragraph (d) (b), for the purposes of this subdivision, 
201.31 	pupils enrolled in a cooperative or intermediate school district shall be counted by the 
201.32 	district of residence.
202.1 	(f) (d) For the purposes of this subdivision, the terms defined in section 124D.59
202.2 	have the same meaning. 

202.3 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
202.4 	and later.

202.5 	Sec. 18. [126C.09] EDUCATION FUNDING FRAMEWORK.
202.6 		Subdivision 1.Basic formula framework; general classroom funding. The 
202.7 	general classroom funding for each school district equals the sum of the district's general 
202.8 	education basic revenue, extended time revenue, compensatory revenue, LEP revenue, 
202.9 	referendum replacement revenue, and special education revenue.
202.10 		Subd. 2.District instructional services. A school district's instructional services 
202.11 	revenue equals the sum of its operating sparsity revenue, location equity revenue, and 
202.12 	declining enrollment revenue.
202.13 		Subd. 3.District support services. A school district's support services revenue 
202.14 	equals the sum of its operating capital revenue, alternative facilities revenue, integration 
202.15 	revenue, and transportation revenue.

202.16 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
202.17 	and later.

202.18 	Sec. 19. Minnesota Statutes 2008, section 126C.10, subdivision 1, is amended to read:
202.19 		Subdivision 1.General education revenue. (a) For fiscal year 2006 and later
202.20 	through 2013, the general education revenue for each district equals the sum of the 
202.21 	district's basic revenue, extended time revenue, gifted and talented revenue, basic skills 
202.22 	revenue, training and experience revenue, secondary sparsity revenue, elementary sparsity 
202.23 	revenue, transportation sparsity revenue, total operating capital revenue, equity revenue, 
202.24 	alternative teacher compensation revenue, and transition revenue.
202.25 	(b) For fiscal years 2014 and later, a school district's general education revenue 
202.26 	equals the sum of its basic revenue, extended time revenue, declining enrollment revenue, 
202.27 	basic skills revenue, location equity revenue, referendum replacement revenue, secondary 
202.28 	sparsity revenue, elementary sparsity revenue, transportation revenue, and total operating 
202.29 	capital revenue.

202.30 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
202.31 	and later.

202.32 	Sec. 20. Minnesota Statutes 2008, section 126C.10, subdivision 2, is amended to read:
203.1 		Subd. 2.Basic revenue. (a) The basic revenue for each district equals the formula 
203.2 	allowance times the adjusted marginal cost pupil units for the school year. 
203.3 	(b) The formula allowance for fiscal year 2007 is $4,974. The formula allowance for 
203.4 	fiscal year 2008 is $5,074 and the formula allowance for fiscal year 2009 and subsequent 
203.5 	years is $5,124.
203.6 	(c) The formula allowance for fiscal year 2014 is $7,500. The formula allowance 
203.7 	for fiscal year 2015 and later equals the formula allowance for the previous year times 
203.8 	the sum of 1.0 and the greater of zero or the ratio of implicit price deflator, as defined in 
203.9 	section 275.70, subdivision 2, for the most recent year to the implicit price deflator for 
203.10 	the previous year.

203.11 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
203.12 	and later.

203.13 	Sec. 21. Minnesota Statutes 2008, section 126C.10, subdivision 2a, is amended to read:
203.14 		Subd. 2a.Extended time revenue. (a) A school district's extended time revenue 
203.15 	is equal to the product of $4,601 the formula allowance for that year and the sum of 
203.16 	the adjusted marginal cost pupil units of the district for each pupil in average daily 
203.17 	membership in excess of 1.0 and less than 1.2 according to section 126C.05, subdivision 8. 
203.18 	(b) A school district's extended time revenue may be used for extended day 
203.19 	programs, extended week programs, summer school, and other programming authorized 
203.20 	under the learning year program.

203.21 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
203.22 	and later.

203.23 	Sec. 22. Minnesota Statutes 2008, section 126C.10, is amended by adding a 
203.24 	subdivision to read:
203.25 		Subd. 2c.Declining enrollment revenue. A school district's declining enrollment 
203.26 	revenue equals the greater of zero or the product of: (1) the basic formula allowance for 
203.27 	that year; and (2) the difference between the mean average adjusted pupil units for the 
203.28 	three preceding years and the adjusted pupil units for the current year.

203.29 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
203.30 	and later.

203.31 	Sec. 23. Minnesota Statutes 2008, section 126C.10, is amended by adding a 
203.32 	subdivision to read:
204.1 		Subd. 2d.Location equity revenue. A school district's location equity revenue 
204.2 	equals the product of:
204.3 	(1) .50;
204.4 	(2) the basic formula allowance for that year;
204.5 	(3) the district's adjusted pupil units for that year; and
204.6 	(4) the district's location equity index minus .9.

204.7 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
204.8 	and later.

204.9 	Sec. 24. Minnesota Statutes 2008, section 126C.10, is amended by adding a 
204.10 	subdivision to read:
204.11 		Subd. 2e.Referendum replacement revenue. A school district's referendum 
204.12 	replacement revenue equals $500 times the district's adjusted pupil units for that year.

204.13 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
204.14 	and later.

204.15 	Sec. 25. Minnesota Statutes 2008, section 126C.10, subdivision 3, is amended to read:
204.16 		Subd. 3.Compensatory education revenue. (a) The compensatory education 
204.17 	revenue for each building in the district equals  the greater of: (1) $2,500 times the district's 
204.18 	enrollment of students eligible for free or reduced-price meals under section 126C.05, 
204.19 	subdivision 3, paragraph (a), clause (1); or (2) 40 percent of the formula allowance minus 
204.20 	$415 times the compensation revenue pupil units computed according to section 126C.05, 
204.21 	subdivision 3. Revenue shall be paid to the district and must be allocated according to 
204.22 	section 126C.15, subdivision 2. 
204.23 	(b) When the district contracting with an alternative program under section 124D.69
204.24 	changes prior to the start of a school year, the compensatory revenue generated by pupils 
204.25 	attending the program shall be paid to the district contracting with the alternative program 
204.26 	for the current school year, and shall not be paid to the district contracting with the 
204.27 	alternative program for the prior school year. 
204.28 	(c) When the fiscal agent district for an area learning center changes prior to the start 
204.29 	of a school year, the compensatory revenue shall be paid to the fiscal agent district for the 
204.30 	current school year, and shall not be paid to the fiscal agent district for the prior school year.

204.31 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
204.32 	and later.

205.1 	Sec. 26. Minnesota Statutes 2008, section 126C.10, subdivision 4, is amended to read:
205.2 		Subd. 4.Basic skills revenue. A school district's basic skills revenue equals the 
205.3 	sum of:
205.4 	(1) compensatory revenue under subdivision 3; plus
205.5 	(2) limited English proficiency revenue under section 124D.65, subdivision 5; plus.
205.6 	(3) $250 times the limited English proficiency pupil units under section 126C.05, 
205.7 	subdivision 17.

205.8 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
205.9 	and later.

205.10 	Sec. 27. Minnesota Statutes 2008, section 126C.10, subdivision 6, is amended to read:
205.11 		Subd. 6.Definitions. The definitions in this subdivision apply only to subdivisions 
205.12 	7 and 8.
205.13 	(a) "High school" means a public secondary school, except a charter school under 
205.14 	section 124D.10, that has pupils enrolled in at least the 10th, 11th, and 12th grades. If 
205.15 	there is no high school in the district and the school is at least 19 15 miles from the next 
205.16 	nearest school, the commissioner must designate one school in the district as a high school 
205.17 	for the purposes of this section.
205.18 	(b) "Secondary average daily membership" means, for a district that has only one 
205.19 	high school, the average daily membership of pupils served in grades 7 through 12. For a 
205.20 	district that has more than one high school, "secondary average daily membership" for 
205.21 	each high school means the product of the average daily membership of pupils served in 
205.22 	grades 7 through 12 in the high school, times the ratio of six to the number of grades 
205.23 	in the high school.
205.24 	(c) "Attendance area" means the total surface area of the district, in square miles, 
205.25 	divided by the number of high schools in the district. For a district that does not operate 
205.26 	a high school and is less than 19 15 miles from the nearest operating high school, the 
205.27 	attendance area equals zero.
205.28 	(d) "Isolation index" for a high school means the square root of 55 percent of the 
205.29 	attendance area plus the distance in miles, according to the usually traveled routes, 
205.30 	between the high school and the nearest high school. For a district in which there is located 
205.31 	land defined in section 84A.01, 84A.20, or 84A.31, the distance in miles is the sum of: 
205.32 	(1) the square root of one-half of the attendance area; and
205.33 	(2) the distance from the border of the district to the nearest high school.
205.34 	(e) "Qualifying high school" means a high school that has an isolation index greater 
205.35 	than 23 and that has secondary average daily membership of less than 400.
206.1 	(f) "Qualifying elementary school" means a public elementary school, except a 
206.2 	charter school under section 124D.10, that is located 19 15 miles or more from the nearest 
206.3 	elementary school or from the nearest elementary school within the district and, in either 
206.4 	case, has an elementary average daily membership of an average of 20 or fewer per grade.
206.5 	(g) "Elementary average daily membership" means, for a district that has only 
206.6 	one elementary school, the average daily membership of pupils served in kindergarten 
206.7 	through grade 6. For a district that has more than one elementary school, "average daily 
206.8 	membership" for each school means the average daily membership of pupils served in 
206.9 	kindergarten through grade 6 multiplied by the ratio of seven to the number of grades 
206.10 	in the elementary school.

206.11 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
206.12 	and later.

206.13 	Sec. 28. Minnesota Statutes 2008, section 126C.10, subdivision 13, is amended to read:
206.14 		Subd. 13.Total operating capital and technology revenue. (a) Total operating 
206.15 	capital revenue for a district equals: (1) $50 times the adjusted pupil units for the school 
206.16 	year for technology purposes; (2) for any district not participating in the alternative 
206.17 	facilities program under section 123B.59, $600 times the adjusted pupil units for deferred 
206.18 	maintenance and health and safety purposes under sections 123B.57 and 123B.59; (3) the 
206.19 	amount determined under paragraph (b) or (c), plus $73; and (4) $100 times the adjusted 
206.20 	marginal cost pupil units for the school year. The revenue must be placed in a reserved 
206.21 	account in the general fund and may only be used according to subdivision 14.
206.22 	(b) Capital revenue for a district equals $100 times the district's maintenance cost 
206.23 	index times its adjusted marginal cost pupil units for the school year.
206.24 	(c) The revenue for a district that operates a program under section 124D.128, is 
206.25 	increased by an amount equal to $30 times the number of marginal cost adjusted pupil 
206.26 	units served at the site where the program is implemented.

206.27 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
206.28 	and later.

206.29 	Sec. 29. Minnesota Statutes 2008, section 126C.10, subdivision 14, is amended to read:
206.30 		Subd. 14.Uses of total operating capital revenue. Technology revenue may only 
206.31 	be used for purposes in clauses (18), (19), (21), (23), and (24). Total operating capital 
206.32 	revenue may be used only for the following purposes:
206.33 	(1) to acquire land for school purposes;
207.1 	(2) to acquire or construct buildings for school purposes;
207.2 	(3) to rent or lease buildings, including the costs of building repair or improvement 
207.3 	that are part of a lease agreement;
207.4 	(4) to improve and repair school sites and buildings, and equip or reequip school 
207.5 	buildings with permanent attached fixtures, including library media centers;
207.6 	(5) for a surplus school building that is used substantially for a public nonschool 
207.7 	purpose;
207.8 	(6) to eliminate barriers or increase access to school buildings by individuals with a 
207.9 	disability;
207.10 	(7) to bring school buildings into compliance with the State Fire Code adopted 
207.11 	according to chapter 299F;
207.12 	(8) to remove asbestos from school buildings, encapsulate asbestos, or make 
207.13 	asbestos-related repairs;
207.14 	(9) to clean up and dispose of polychlorinated biphenyls found in school buildings;
207.15 	(10) to clean up, remove, dispose of, and make repairs related to storing heating fuel 
207.16 	or transportation fuels such as alcohol, gasoline, fuel oil, and special fuel, as defined 
207.17 	in section 296A.01; 
207.18 	(11) for energy audits for school buildings and to modify buildings if the audit 
207.19 	indicates the cost of the modification can be recovered within ten years;
207.20 	(12) to improve buildings that are leased according to section 123B.51, subdivision 4; 
207.21 	(13) to pay special assessments levied against school property but not to pay 
207.22 	assessments for service charges;
207.23 	(14) to pay principal and interest on state loans for energy conservation according to 
207.24 	section 216C.37 or loans made under the Douglas J. Johnson Economic Protection Trust 
207.25 	Fund Act according to sections 298.292 to 298.298; 
207.26 	(15) to purchase or lease interactive telecommunications equipment;
207.27 	(16) by board resolution, to transfer money into the debt redemption fund to: (i) 
207.28 	pay the amounts needed to meet, when due, principal and interest payments on certain 
207.29 	obligations issued according to chapter 475; or (ii) pay principal and interest on debt 
207.30 	service loans or capital loans according to section 126C.70; 
207.31 	(17) to pay operating capital-related assessments of any entity formed under a 
207.32 	cooperative agreement between two or more districts;
207.33 	(18) to purchase or lease computers and related materials, copying machines, 
207.34 	telecommunications equipment, and other noninstructional equipment;
207.35 	(19) to purchase or lease assistive technology or equipment for instructional 
207.36 	programs;
208.1 	(20) to purchase textbooks;
208.2 	(21) to purchase new and replacement library media resources or technology;
208.3 	(22) to purchase vehicles;
208.4 	(23) to purchase or lease telecommunications equipment, computers, and related 
208.5 	equipment for integrated information management systems for:
208.6 	(i) managing and reporting learner outcome information for all students under a 
208.7 	results-oriented graduation rule;
208.8 	(ii) managing student assessment, services, and achievement information required 
208.9 	for students with individual education plans; and
208.10 	(iii) other classroom information management needs; and
208.11 	(24) to pay personnel costs directly related to the acquisition, operation, and 
208.12 	maintenance of telecommunications systems, computers, related equipment, and network 
208.13 	and applications software.

208.14 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014.

208.15 	Sec. 30. Minnesota Statutes 2008, section 126C.10, subdivision 18, is amended to read:
208.16 		Subd. 18.Transportation sparsity revenue allowance. (a) A district's 
208.17 	transportation sparsity allowance equals the greater of zero or the result of the following 
208.18 	computation:
208.19 	(i) Multiply the formula allowance according to subdivision 2, by .1469.
208.20 	(ii) Multiply the result in clause (i) by the district's sparsity index raised to the 
208.21 	26/100 power.
208.22 	(iii) Multiply the result in clause (ii) by the district's density index raised to the 
208.23 	13/100 power.
208.24 	(iv) Multiply the formula allowance according to subdivision 2, by .0485.
208.25 	(v) Subtract the result in clause (iv) from the result in clause (iii).
208.26 	(b) Transportation sparsity revenue is equal to the transportation sparsity allowance 
208.27 	times the adjusted marginal cost pupil units.

208.28 	EFFECTIVE DATE. This section is effective for fiscal year 2014 and later.

208.29 	Sec. 31. Minnesota Statutes 2008, section 126C.10, is amended by adding a 
208.30 	subdivision to read:
208.31 		Subd. 18a.Transportation revenue. (a) A school district's transportation revenue 
208.32 	equals the sum of its transportation sparsity revenue, hazardous transportation revenue, 
208.33 	and bus purchase revenue.
209.1 	(b) A school district's transportation sparsity revenue equals its transportation 
209.2 	sparsity allowance times its adjusted pupil units for that year.
209.3 	(c) A school district's hazardous transportation aid equals the amount necessary to 
209.4 	provide transportation services to students facing hazardous transportation conditions. A 
209.5 	district's hazardous transportation aid must not exceed 20 percent of the district's total 
209.6 	regular to and from school transportation costs for that year. For any year, a school 
209.7 	district may receive aid under this paragraph only after the school board has considered 
209.8 	the comprehensive plan for hazardous transportation submitted by the district's pupil 
209.9 	transportation safety committee at a regularly scheduled meeting of the school board.  The 
209.10 	comprehensive plan may not be adopted until after the board has allowed the public 
209.11 	reasonable time to testify on the plan.
209.12 	(d) A school district's bus purchase revenue equals five percent of the district's 
209.13 	spending on transportation services for the previous fiscal year.

209.14 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
209.15 	and later.

209.16 	Sec. 32. [126C.115] INNOVATION REVENUE.
209.17 	(a) A school district must use its innovation revenue to implement evidence-based 
209.18 	innovation premised on research-based curriculum and instruction and other education 
209.19 	programs and practices, including best teaching practices, that are known to improve 
209.20 	academic performance for diverse groups of students. If a school district demonstrates 
209.21 	low growth and needs to improve students' current achievement and educational growth, 
209.22 	as measured by a growth-based value-added system under section 120B.35, the school 
209.23 	district must submit a plan to the commissioner, developed in consultation with interested 
209.24 	parents, that describes how the district proposes to use its innovation revenue to 
209.25 	supplement state reading requirements under section 120B.12, subdivision 1, and state 
209.26 	math and science requirements under section 120B.023, subdivision 2, paragraphs (b) and 
209.27 	(d), and improve student outcomes. The plan must:
209.28 	(1) identify specific education goals, consistent with this section, and the indicators 
209.29 	to demonstrate progress toward achieving those goals, which may include a value-added 
209.30 	assessment model under sections 120B.35 and 120B.362;
209.31 	(2) supplement current district initiatives that may transform district programs, 
209.32 	practices, and processes sufficient to significantly improve student outcomes, which 
209.33 	may include, among other initiatives, an organizational assessment and performance 
209.34 	improvement process under section 120B.3625; and
210.1 	(3) demonstrate how innovation revenue helps narrow and eliminate differences in 
210.2 	student academic achievement in reading, math, and science based on student measures of 
210.3 	mobility, attendance, race and ethnicity, gender, English language learner status, eligibility 
210.4 	for free or reduced price lunch, and special education, among other outcomes.
210.5 	(b) After transmitting its plan to the commissioner, a district must spend its 
210.6 	innovation revenue effectively and efficiently, consistent with its plan. A school district 
210.7 	that submits an innovation revenue plan under paragraph (a) must report annually by June 
210.8 	30 to the commissioner and post on the district's official Web site reliable and accessible 
210.9 	information and supporting longitudinal data showing the amount of progress the district 
210.10 	made in the immediately preceding school year and previous school years in realizing its 
210.11 	innovation revenue goals. The commissioner must analyze the data from the annual 
210.12 	district reports and post the analysis on the department's official Web site.

210.13 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
210.14 	and later.

210.15 	Sec. 33. Minnesota Statutes 2008, section 126C.13, subdivision 4, is amended to read:
210.16 		Subd. 4.General education aid. For fiscal years 2007 and later, A district's general 
210.17 	education aid is the sum of the following amounts equals its:
210.18 	(1) general education revenue, excluding equity revenue, total operating capital 
210.19 	revenue, alternative teacher compensation revenue, and transition revenue;
210.20 	(2) operating capital aid under section 126C.10, subdivision 13b;
210.21 	(3) equity aid under section 126C.10, subdivision 30;
210.22 	(4) alternative teacher compensation aid under section 126C.10, subdivision 36;
210.23 	(5) transition aid under section 126C.10, subdivision 33 for that year;
210.24 	(6) (2) shared time aid under section 126C.01, subdivision 7;
210.25 	(7) (3) referendum aid under section 126C.17, subdivisions 7 and 7a; and
210.26 	(8) (4) online learning aid according to section 124D.096.

210.27 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
210.28 	and later.

210.29 	Sec. 34. Minnesota Statutes 2008, section 126C.13, subdivision 5, is amended to read:
210.30 		Subd. 5.Uses of revenue. Except as provided in sections 126C.10, subdivision 
210.31 	14; 126C.12; and 126C.15, (a) General education revenue may be used during the 
210.32 	regular school year and the summer for general and special school purposes and for 
210.33 	prekindergarten programs except as limited by paragraph (b).  
211.1 	(b) General education revenue set-asides include:
211.2 	(1) 1.0 percent of basic revenue must be used only for gifted and talented activities 
211.3 	consistent with section 120B.15;
211.4 	(2) 5.0 percent of basic revenue must be used only to implement a district's 
211.5 	innovative revenue program activities under section 126C.115;
211.6 	(3) basic skills revenue must be used according to section 126C.15; and
211.7 	(4) operating capital revenue must be spent according to section 126C.10, 
211.8 	subdivision 14.

211.9 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
211.10 	and later.

211.11 	Sec. 35. Minnesota Statutes 2008, section 126C.17, subdivision 1, is amended to read:
211.12 		Subdivision 1.Referendum allowance. (a) For fiscal year 2003 and later, a district's 
211.13 	initial referendum revenue allowance equals the sum of the allowance under section 
211.14 	126C.16, subdivision 2, plus any additional allowance per resident marginal cost pupil 
211.15 	unit authorized under subdivision 9 before May 1, 2001, for fiscal year 2002 and later, 
211.16 	plus the referendum conversion allowance approved under subdivision 13, minus $415. 
211.17 	For districts with more than one referendum authority, the reduction must be computed 
211.18 	separately for each authority. The reduction must be applied first to the referendum 
211.19 	conversion allowance and next to the authority with the earliest expiration date. A 
211.20 	district's initial referendum revenue allowance may not be less than zero. 
211.21 	(b) For fiscal year 2003, a district's referendum revenue allowance equals the initial 
211.22 	referendum allowance plus any additional allowance per resident marginal cost pupil unit 
211.23 	authorized under subdivision 9 between April 30, 2001, and December 30, 2001, for 
211.24 	fiscal year 2003 and later.
211.25 	(c) For fiscal year 2004 and later, A district's referendum revenue allowance equals 
211.26 	the sum of:
211.27 	(1) the product of (i) the ratio of the resident marginal cost pupil units the district 
211.28 	would have counted for fiscal year 2004 under Minnesota Statutes 2002, section 126C.05, 
211.29 	to the district's resident marginal cost pupil units for fiscal year 2004, times (ii) the greater 
211.30 	of zero or the district's initial referendum allowance plus any additional allowance per 
211.31 	resident marginal cost pupil unit authorized under subdivision 9 between April 30, 2001, 
211.32 	and May 30, 2003, for fiscal year 2003 and later 2014 less $500, plus 
211.33 	(2) any additional allowance per resident marginal cost pupil unit authorized under 
211.34 	subdivision 9 after May 30, 2003 2012, for fiscal year 2005 2014 and later.

212.1 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
212.2 	and later.

212.3 	Sec. 36. Minnesota Statutes 2008, section 126C.17, subdivision 5, is amended to read:
212.4 		Subd. 5.Referendum equalization revenue. (a) For fiscal year 2003 and later,
212.5 	A district's referendum equalization revenue equals the sum of the first tier referendum 
212.6 	equalization revenue and the second tier referendum equalization revenue.
212.7 	(b) A district's first tier referendum equalization revenue equals the district's first 
212.8 	tier referendum equalization allowance times the district's resident marginal cost pupil 
212.9 	units for that year.
212.10 	(c) For fiscal year 2006, a district's first tier referendum equalization allowance 
212.11 	equals the lesser of the district's referendum allowance under subdivision 1 or $500. For 
212.12 	fiscal year 2007, a district's first tier referendum equalization allowance equals the lesser 
212.13 	of the district's referendum allowance under subdivision 1 or $600.
212.14 	For fiscal year 2008 and later, (b)  A district's first tier referendum equalization 
212.15 	allowance equals the lesser of the district's referendum allowance under subdivision 1 
212.16 	or $700.
212.17 	(d) (c) A district's second tier referendum equalization revenue equals the district's 
212.18 	second tier referendum equalization allowance times the district's resident marginal cost 
212.19 	pupil units for that year.
212.20 	(e) For fiscal year 2006, a district's second tier referendum equalization allowance 
212.21 	equals the lesser of the district's referendum allowance under subdivision 1 or 18.6 percent 
212.22 	of the formula allowance, minus the district's first tier referendum equalization allowance. 
212.23 	For fiscal year 2007 and later, (d) A district's second tier referendum equalization 
212.24 	allowance equals the lesser of the district's referendum allowance under subdivision 1 or 
212.25 	26 percent of the formula allowance, minus the district's first tier referendum equalization 
212.26 	allowance.
212.27 	(f)  (e) Notwithstanding paragraph (e) (d), the second tier referendum allowance for a 
212.28 	district qualifying for secondary sparsity revenue under section 126C.10, subdivision 7, or 
212.29 	elementary sparsity revenue under section 126C.10, subdivision 8, equals the district's 
212.30 	referendum allowance under subdivision 1 minus the district's first tier referendum 
212.31 	equalization allowance.

212.32 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014.

212.33 	Sec. 37. Minnesota Statutes 2008, section 126C.17, subdivision 6, is amended to read:
213.1 		Subd. 6.Referendum equalization levy. (a) For fiscal year 2003 and later,
213.2 	A district's referendum equalization levy equals the sum of the first tier referendum 
213.3 	equalization levy and the second tier referendum equalization levy.
213.4 	(b) A district's first tier referendum equalization levy equals the district's first tier 
213.5 	referendum equalization revenue times the lesser of one or the ratio of the district's 
213.6 	referendum market value per resident marginal cost pupil unit to $476,000 100 percent of 
213.7 	the statewide referendum market value equalizing factor.
213.8 	(c) A district's second tier referendum equalization levy equals the district's second 
213.9 	tier referendum equalization revenue times the lesser of one or the ratio of the district's 
213.10 	referendum market value per resident marginal cost pupil unit to $270,000 60 percent of 
213.11 	the statewide referendum market value equalizing factor.

213.12 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014.

213.13 	Sec. 38. Minnesota Statutes 2008, section 126C.20, is amended to read:
213.14 	126C.20 ANNUAL GENERAL EDUCATION AID APPROPRIATION.
213.15 	There is annually appropriated from the general fund to the department the amount
213.16 	amounts necessary for: (1) general education aid; (2) special education aid; (3) debt 
213.17 	service aid; and (4) the school bond agricultural credit. This amount These amounts must 
213.18 	be reduced by the amount of any money specifically appropriated for the same purpose 
213.19 	in any year from any state fund.

213.20 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
213.21 	and later.

213.22 	Sec. 39. Minnesota Statutes 2008, section 126C.40, subdivision 1, is amended to read:
213.23 		Subdivision 1.To lease building or land. (a) When an independent or a special 
213.24 	school district or a group of independent or special school districts finds it economically 
213.25 	advantageous to rent or lease a building or land for any instructional purposes or 
213.26 	administrative purpose, or for school storage or furniture repair, and it determines that 
213.27 	the operating capital revenue authorized under section 126C.10, subdivision 13, is 
213.28 	insufficient for this purpose, it may apply to the commissioner for permission to make 
213.29 	an additional capital expenditure levy for this purpose. An application for permission to 
213.30 	levy under this subdivision must contain financial justification for the proposed levy, the 
213.31 	terms and conditions of the proposed lease, and a description of the space to be leased 
213.32 	and its proposed use.
214.1 	(b) The criteria for approval of applications to levy under this subdivision must 
214.2 	include: the reasonableness of the price, the appropriateness of the space to the proposed 
214.3 	activity, the feasibility of transporting pupils to the leased building or land, conformity 
214.4 	of the lease to the laws and rules of the state of Minnesota, and the appropriateness of 
214.5 	the proposed lease to the space needs and the financial condition of the district. The 
214.6 	commissioner must not authorize a levy under this subdivision in an amount greater than 
214.7 	the cost to the district of renting or leasing a building or land for approved purposes. 
214.8 	The proceeds of this levy must not be used for custodial or other maintenance services. 
214.9 	A district may not levy under this subdivision for the purpose of leasing or renting a 
214.10 	district-owned building or site to itself.
214.11 	(c) For agreements finalized after July 1, 1997, a district may not levy under this 
214.12 	subdivision for the purpose of leasing: (1) a newly constructed building used primarily 
214.13 	for regular kindergarten, elementary, or secondary instruction; or (2) a newly constructed 
214.14 	building addition or additions used primarily for regular kindergarten, elementary, or 
214.15 	secondary instruction that contains more than 20 percent of the square footage of the 
214.16 	previously existing building.
214.17 	(d) Notwithstanding paragraph (b), a district may levy under this subdivision for the 
214.18 	purpose of leasing or renting a district-owned building or site to itself only if the amount 
214.19 	is needed by the district to make payments required by a lease purchase agreement, 
214.20 	installment purchase agreement, or other deferred payments agreement authorized by law, 
214.21 	and the levy meets the requirements of paragraph (c). A levy authorized for a district by 
214.22 	the commissioner under this paragraph may be in the amount needed by the district to 
214.23 	make payments required by a lease purchase agreement, installment purchase agreement, 
214.24 	or other deferred payments agreement authorized by law, provided that any agreement 
214.25 	include a provision giving the school districts the right to terminate the agreement 
214.26 	annually without penalty.
214.27 	(e) The total levy under this subdivision for a district for any year must not exceed 
214.28 	$150 times the resident pupil units for the fiscal year to which the levy is attributable.
214.29 	(f) For agreements for which a review and comment have been submitted to the 
214.30 	Department of Education after April 1, 1998, the term "instructional purpose" as used in 
214.31 	this subdivision excludes expenditures on stadiums.
214.32 	(g) The commissioner of education may authorize a school district to exceed the 
214.33 	limit in paragraph (e) if the school district petitions the commissioner for approval. The 
214.34 	commissioner shall grant approval to a school district to exceed the limit in paragraph (e) 
214.35 	for not more than five years if the district meets the following criteria:
215.1 	(1) the school district has been experiencing pupil enrollment growth in the 
215.2 	preceding five years;
215.3 	(2) the purpose of the increased levy is in the long-term public interest;
215.4 	(3) the purpose of the increased levy promotes colocation of government services; 
215.5 	and
215.6 	(4) the purpose of the increased levy is in the long-term interest of the district by 
215.7 	avoiding over construction of school facilities.
215.8 	(h) A school district that is a member of an intermediate school district may include 
215.9 	in its authority under this section the costs associated with leases of administrative and 
215.10 	classroom space for intermediate school district programs. This authority must not 
215.11 	exceed $43 $50 times the adjusted marginal cost pupil units of the member districts. This 
215.12 	authority is in addition to any other authority authorized under this section.
215.13 	(i) In addition to the allowable capital levies in paragraph (a), a district that is a 
215.14 	member of the "Technology and Information Education Systems" data processing joint 
215.15 	board, that finds it economically advantageous to enter into a lease purchase agreement for 
215.16 	a building for a group of school districts or special school districts for staff development 
215.17 	purposes, may levy for its portion of lease costs attributed to the district within the total 
215.18 	levy limit in paragraph (e).

215.19 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014 
215.20 	and later.

215.21 	Sec. 40. Minnesota Statutes 2008, section 127A.51, is amended to read:
215.22 	127A.51 STATEWIDE AVERAGE REVENUE.
215.23 	By October 1 of each year the commissioner must estimate the statewide average 
215.24 	adjusted general revenue per adjusted marginal cost pupil unit and the disparity in adjusted 
215.25 	general revenue among pupils and districts by computing the ratio of the 95th percentile 
215.26 	to the fifth percentile of adjusted general revenue. The commissioner must provide that 
215.27 	information to all districts.
215.28 	If the disparity in adjusted general revenue as measured by the ratio of the 95th 
215.29 	percentile to the fifth percentile increases in any year, the commissioner shall recommend 
215.30 	to the legislature options for change in the general education formula that will limit the 
215.31 	disparity in adjusted general revenue to no more than the disparity for the previous 
215.32 	school year. The commissioner must submit the recommended options to the education 
215.33 	committees of the legislature by January 15.
215.34 	For purposes of this section and section 126C.10, adjusted general revenue means:  
216.1 	(1) for fiscal year 2002, the sum of basic revenue under section 126C.10, subdivision 
216.2 	2; supplemental revenue under section 126C.10, subdivisions 9 and 12; transition revenue 
216.3 	under section 126C.10, subdivision 20; referendum revenue under section 126C.17; and 
216.4 	equity revenue under section 126C.10, subdivisions 24a and 24b; and
216.5 	(2) for fiscal year 2003 and later through 2013, the sum of basic revenue under 
216.6 	section 126C.10, subdivision 2; referendum revenue under section 126C.17; and equity 
216.7 	revenue under section 126C.10, subdivisions 24a and 24b.; and
216.8 	(3) for fiscal year 2014 and later, the sum of basic revenue under section 126C.10, 
216.9 	subdivision 2, and referendum revenue under section 126C.17.

216.10 	EFFECTIVE DATE. This section is effective for fiscal year 2014 and later.

216.11 	Sec. 41. PHASE-IN.
 216.12 		Subdivision 1.Baseline revenue. A school district's baseline revenue equals the 
216.13 	revenue amounts for the aid appropriations calculated under Minnesota Statutes, section 
216.14 	126C.20, calculated using the current year's data and the revenue formulas in place in 
216.15 	Minnesota Statutes 2008.
216.16 		Subd. 2.New revenue. A school district's new revenue equals the revenue amounts 
216.17 	for the aid appropriations calculated under Minnesota Statutes, section 126C.20, calculated 
216.18 	using the current year's data and the revenue formulas in place under this act.
216.19 		Subd. 3.Phase-in schedule. A school district's revenue amounts for the revenue 
216.20 	formulas listed in subdivisions 1 and 2 equals the district's baseline revenue plus the 
216.21 	percent of the difference specified in subdivision 6 multiplied by the number of years 
216.22 	of the phase in specified in subdivision 7.
216.23 		Subd. 4.Aid. A school district's aid entitlement for the formulas listed under 
216.24 	this act equals the district's baseline aid plus the phase-in percentage times the new aid 
216.25 	amounts calculated under this act.
216.26 		Subd. 5.Levy. A school district levy for the formulas listed in this act equals the 
216.27 	levy for the same formulas calculated under Minnesota Statutes 2008, and the phase-in 
216.28 	percentage times the new revenue amounts for the levy calculated under this act.
216.29 		Subd. 6.Percentage. The phase-in percentage equals 25 percent.
216.30 		Subd. 7.Years of phase-in. The new revenue under this section is phased in over 
216.31 	four years.

216.32 	EFFECTIVE DATE. This section is effective July 1, 2013.

216.33 	Sec. 42. REVISOR'S INSTRUCTION.
 217.1 	In the year 2014 and subsequent editions of Minnesota Statutes, the revisor of statutes 
217.2 	shall change all references to "adjusted marginal cost pupil units" to "adjusted pupil units" 
217.3 	and all references to "resident marginal cost pupil units" to "resident pupil units."

217.4 	EFFECTIVE DATE. This section is effective July 1, 2013.

217.5 	Sec. 43.  REPEALER.
 217.6 	Minnesota Statutes 2008, sections 123B.54; 123B.57, subdivisions 3, 4, and 5; 
217.7 	123B.591; 125A.76, subdivision 4; 125A.79, subdivision 6; 126C.10, subdivisions 2b, 
217.8 	13a, 13b, 24, 25, 26, 27, 28, 29, 30, 31, 31a, 31b, 32, 33, 34, 35, and 36; 126C.12; 
217.9 	126C.126; and 127A.50, are repealed.

217.10 	EFFECTIVE DATE. This section is effective for revenue for fiscal year 2014.

217.11 	ARTICLE 10
217.12 	FORECAST ADJUSTMENTS

217.13 	Section 1. Laws 2007, chapter 146, article 1, section 24, subdivision 2, as amended by 
217.14 	Laws 2008, chapter 363, article 3, section 1, is amended to read:
217.15 		Subd. 2. General education aid. For general education aid under Minnesota 
217.16 	Statutes, section 126C.13, subdivision 4:

217.17		$ 
	5,600,647,000
	..... 
	2008 
	
217.18
217.19		$ 
	5,649,098,000
5,644,263,000
	..... 
	2009 
	
217.20 	The 2008 appropriation includes $536,251,000 for 2007 and $5,064,396,000 for 
217.21 	2008.
217.22 	The 2009 appropriation includes $543,752,000 $533,760,000 for 2008 and 
217.23 	$5,105,346,000 $5,110,503,000 for 2009.

217.24 	Sec. 2. Laws 2007, chapter 146, article 1, section 24, subdivision 6, as amended by 
217.25 	Laws 2008, chapter 363, article 3, section 5, is amended to read:
217.26 		Subd. 6. Consolidation transition. For districts consolidating under Minnesota 
217.27 	Statutes, section 123A.485:

217.28		$ 
	240,000
	..... 
	2008 
	
217.29		$ 
	339,00021,000
	..... 
	2009 
	
217.30 	The 2008 appropriation includes $43,000 for 2007 and $197,000 for 2008.
217.31 	The 2009 appropriation includes $21,000 for 2008 and $318,000 $0 for 2009.

218.1 	Sec. 3. Laws 2007, chapter 146, article 1, section 24, subdivision 8, as amended by 
218.2 	Laws 2008, chapter 363, article 3, section 7, is amended to read:
218.3 		Subd. 8. Nonpublic pupil transportation. For nonpublic pupil transportation aid 
218.4 	under Minnesota Statutes, section 123B.92, subdivision 9:

218.5		$ 
	20,755,000
	..... 
	2008 
	
218.6
218.7		$ 
	21,007,000
20,739,000
	..... 
	2009 
	
218.8 	The 2008 appropriation includes $2,124,000 for 2007 and $18,631,000 for 2008.
218.9 	The 2009 appropriation includes $2,070,000 $2,037,000 for 2008 and $18,937,000
218.10 	$18,702,000 for 2009.

218.11 	Sec. 4. Laws 2007, chapter 146, article 2, section 46, subdivision 6, as amended by 
218.12 	Laws 2008, chapter 363, article 3, section 11, is amended to read:
218.13 		Subd. 6. Interdistrict desegregation or integration transportation grants. For 
218.14 	interdistrict desegregation or integration transportation grants under Minnesota Statutes, 
218.15 	section 124D.87: 

218.16		$ 
	9,901,000
	..... 
	2008 
	
218.17
218.18		$ 
	11,881,000
11,947,000
	..... 
	2009 

218.19 	Sec. 5. Laws 2007, chapter 146, article 3, section 24, subdivision 4, as amended by 
218.20 	Laws 2008, chapter 363, article 3, section 14, is amended to read:
218.21 		Subd. 4. Travel for home-based services. For aid for teacher travel for home-based 
218.22 	services under Minnesota Statutes, section 125A.75, subdivision 1: 

218.23		$ 
	207,000
	..... 
	2008 
	
218.24		$ 
	227,000237,000
	..... 
	2009 
	
218.25 	The 2008 appropriation includes $22,000 for 2007 and $185,000 for 2008. 
218.26 	The 2009 appropriation includes $20,000 $21,000 for 2008 and $207,000 $216,000
218.27 	for 2009. 

218.28 	Sec. 6. Laws 2007, chapter 146, article 4, section 16, subdivision 2, as amended by 
218.29 	Laws 2008, chapter 363, article 3, section 15, is amended to read:
218.30 		Subd. 2. Health and safety revenue. For health and safety aid according to 
218.31 	Minnesota Statutes, section 123B.57, subdivision 5: 

218.32		$ 
	254,000
	..... 
	2008 
	
218.33		$ 
	103,000119,000
	..... 
	2009 
	
219.1 	The 2008 appropriation includes $20,000 for 2007 and $234,000 for 2008. 
219.2 	The 2009 appropriation includes $26,000 $23,000 for 2008 and $77,000 $96,000
219.3 	for 2009. 

219.4 	Sec. 7. Laws 2007, chapter 146, article 4, section 16, subdivision 6, as amended by 
219.5 	Laws 2008, chapter 363, article 3, section 17, is amended to read:
219.6 		Subd. 6. Deferred maintenance aid. For deferred maintenance aid, according to 
219.7 	Minnesota Statutes, section 123B.591, subdivision 4: 

219.8		$ 
	3,232,000
	..... 
	2008 
	
219.9219.10
		$ 
	2,627,000
2,720,000
	..... 
	2009 
	
219.11 	The 2008 appropriation includes $0 for 2007 and $3,232,000 for 2008. 
219.12 	The 2009 appropriation includes $359,000 $371,000 for 2008 and $2,268,000
219.13 	$2,349,000 for 2009. 

219.14 	Sec. 8. Laws 2007, chapter 146, article 5, section 13, subdivision 2, as amended by 
219.15 	Laws 2008, chapter 363, article 3, section 19, is amended to read:
219.16 		Subd. 2. School lunch. For school lunch aid according to Minnesota Statutes, 
219.17 	section 124D.111, and Code of Federal Regulations, title 7, section 210.17: 

219.18		$ 
	12,094,000
	..... 
	2008 
	
219.19
219.20		$ 
	12,394,000
12,298,000
	..... 
	2009 

219.21 	Sec. 9. Laws 2007, chapter 146, article 5, section 13, subdivision 3, as amended by 
219.22 	Laws 2008, chapter 363, article 2, section 40, is amended to read:
219.23 		Subd. 3. Traditional school breakfast; kindergarten milk. For traditional school 
219.24 	breakfast aid and kindergarten milk under Minnesota Statutes, sections 124D.1158 and 
219.25 	124D.118: 

219.26		$ 
	5,583,000
	..... 
	2008 
	
219.27		$ 
	6,396,000
	..... 
	2009 
	
219.28 	The 2009 appropriation includes $4,825,000 for traditional school breakfast and 
219.29 	$1,076,000 for kindergarten milk.

219.30 	Sec. 10. Laws 2007, chapter 146, article 9, section 17, subdivision 2, as amended by 
219.31 	Laws 2008, chapter 363, article 3, section 21, is amended to read:
219.32 		Subd. 2. Early childhood family education aid. For early childhood family 
219.33 	education aid under Minnesota Statutes, section 124D.135: 

220.1		$ 
	21,092,000
	..... 
	2008 
	
220.2
220.3		$ 
	29,324,000
29,326,000
	..... 
	2009 
	
220.4 	The 2008 appropriation includes $1,796,000 for 2007 and $19,296,000 for 2008. 
220.5 	The 2009 appropriation includes $2,144,000 for 2008 and $27,180,000 $27,182,000
220.6 	for 2009. 

220.7 	Sec. 11. Laws 2007, chapter 146, article 9, section 17, subdivision 13, as amended by 
220.8 	Laws 2008, chapter 363, article 3, section 25, is amended to read:
220.9 		Subd. 13. Adult basic education aid. For adult basic education aid under 
220.10 	Minnesota Statutes, section 124D.531: 

220.11		$ 
	40,344,000
	..... 
	2008 
	
220.12
220.13		$ 
	41,712,000
41,749,000
	..... 
	2009 
	
220.14 	The 2008 appropriation includes $3,759,000 for 2007 and $36,585,000 for 2008. 
220.15 	The 2009 appropriation includes $4,065,000 for 2008 and $37,647,000 $37,684,000
220.16 	for 2009.

220.17 	ARTICLE 11
220.18 	TECHNICAL CORRECTIONS

220.19 	Section 1. Minnesota Statutes 2008, section 126C.10, subdivision 24, is amended to 
220.20 	read:
220.21 		Subd. 24.Equity revenue. (a) A school district qualifies for equity revenue if:
220.22 	(1) the school district's adjusted marginal cost pupil unit amount of basic revenue, 
220.23 	supplemental revenue, transition revenue, and referendum revenue is less than the value of 
220.24 	the school district at or immediately above the 95th percentile of school districts in its 
220.25 	equity region for those revenue categories; and
220.26 	(2) the school district's administrative offices are not located in a city of the first 
220.27 	class on July 1, 1999.
220.28 	(b) Equity revenue for a qualifying district that receives referendum revenue under 
220.29 	section 126C.17, subdivision 4, equals the product of (1) the district's adjusted marginal 
220.30 	cost pupil units for that year; times (2) the sum of (i) $13, plus (ii) $75, times the school 
220.31 	district's equity index computed under subdivision 27.
220.32 	(c) Equity revenue for a qualifying district that does not receive referendum revenue 
220.33 	under section 126C.17, subdivision 4, equals the product of the district's adjusted marginal 
220.34 	cost pupil units for that year times $13.
221.1 	(d) A school district's equity revenue is increased by the greater of zero or an amount 
221.2 	equal to the district's resident marginal cost pupil units times the difference between ten 
221.3 	percent of the statewide average amount of referendum revenue per resident marginal cost 
221.4 	pupil unit for that year and the district's referendum revenue per resident marginal cost 
221.5 	pupil unit. A school district's revenue under this paragraph must not exceed $100,000 for 
221.6 	that year.
221.7 	(e) A school district's equity revenue for a school district located in the metro equity 
221.8 	region equals the amount computed in paragraphs (b), (c), and (d) multiplied by 1.25.
221.9 	(f) For fiscal year 2007 and later, notwithstanding paragraph (a), clause (2), a school 
221.10 	district that has per pupil referendum revenue below the 95th percentile qualifies for 
221.11 	additional equity revenue equal to $46 times its adjusted marginal cost pupil units.
221.12 	(g) A district that does not qualify for revenue under paragraph (f) qualifies for 
221.13 	equity revenue equal to $46 times its adjusted marginal cost pupil units.