1.1                          A bill for an act 
  1.2             relating to education; appropriating money for 
  1.3             education and related purposes to the higher education 
  1.4             services office, board of trustees of the Minnesota 
  1.5             state colleges and universities, board of regents of 
  1.6             the University of Minnesota, and the Mayo medical 
  1.7             foundation, with certain conditions; establishing and 
  1.8             modifying programs that promote college affordability; 
  1.9             providing for agricultural education; clarifying the 
  1.10            role of the higher education services office; making 
  1.11            technical changes related to the post-secondary 
  1.12            merger; increasing the higher education facilities 
  1.13            authority bonding authority; modifying certain 
  1.14            conditions for the Minnesota state colleges and 
  1.15            universities; prescribing uses for the permanent 
  1.16            university fund; extending the repeal of the 
  1.17            farmer-lender mediation act; permitting certain land 
  1.18            conveyances; defining a faculty appointment; 
  1.19            clarifying and changing requirements for private 
  1.20            career schools; amending Minnesota Statutes 1996, 
  1.21            sections 16A.69, subdivision 2; 125.1385, subdivision 
  1.22            2; 126.56, subdivisions 2, 4a, and 7; 135A.052, 
  1.23            subdivision 1; 136A.03; 136A.101, by adding a 
  1.24            subdivision; 136A.121, subdivisions 5 and 9a; 
  1.25            136A.125, subdivision 4; 136A.1355; 136A.136, 
  1.26            subdivision 2; 136A.16, subdivision 8, and by adding 
  1.27            subdivisions; 136A.171; 136A.173, subdivision 3; 
  1.28            136A.233, subdivisions 2, 3, and by adding a 
  1.29            subdivision; 136A.29, subdivision 9; 136F.28, 
  1.30            subdivision 2; 136F.30; 136F.32; 136F.49; 136F.52, by 
  1.31            adding a subdivision; 136F.581, subdivision 2; 
  1.32            136F.80; 137.022, subdivision 2; 141.21, subdivisions 
  1.33            3, 5, 6, and by adding subdivisions; 141.22; 141.25, 
  1.34            subdivisions 1, 2, 3, 5, 6, 7, 8, 9, 10, and 12; 
  1.35            141.26, subdivision 2; 141.271, subdivisions 1, 2, 3, 
  1.36            4, 5, 6, and 12; 141.28, subdivisions 3 and 5; 141.29, 
  1.37            subdivision 1; 141.31; 141.35; 181.06, subdivision 2; 
  1.38            216C.27, subdivision 7; and 583.22, subdivision 5; 
  1.39            Laws 1986, chapter 398, article 1, section 18, as 
  1.40            amended; Laws 1995, chapter 212, article 1, section 4, 
  1.41            subdivision 4; Laws 1996, chapter 463, section 2, 
  1.42            subdivision 6; proposing coding for new law as 
  1.43            Minnesota Statutes, chapter 41D; proposing coding for 
  1.44            new law in Minnesota Statutes, chapters 16A; 136A; 
  1.45            136F; and 141; repealing Minnesota Statutes 1996, 
  1.46            sections 126.113; 137.41; 141.25, subdivisions 9a, 9b, 
  2.1             and 11; and 141.36; Laws 1995, chapter 212, article 4, 
  2.2             section 34; Laws 1995 First Special Session, chapter 
  2.3             2, article 1, sections 35 and 36. 
  2.4   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.5                              ARTICLE 1
  2.6                            APPROPRIATIONS
  2.7   Section 1.  [HIGHER EDUCATION APPROPRIATIONS.] 
  2.8      The sums in the columns marked "APPROPRIATIONS" are 
  2.9   appropriated from the general fund, or other named fund, to the 
  2.10  agencies and for the purposes specified in this article.  The 
  2.11  listing of an amount under the figure "1998" or "1999" in this 
  2.12  article indicates that the amount is appropriated to be 
  2.13  available for the fiscal year ending June 30, 1998, or June 30, 
  2.14  1999, respectively.  "The first year" is fiscal year 1998.  "The 
  2.15  second year" is fiscal year 1999.  "The biennium" is fiscal 
  2.16  years 1998 and 1999. 
  2.17                          SUMMARY BY FUND
  2.18                            1998          1999           TOTAL
  2.19  General            $1,185,212,000 $1,195,072,000 $2,380,284,000
  2.20                   SUMMARY BY AGENCY - ALL FUNDS
  2.21                            1998          1999           TOTAL
  2.22  Higher Education Services Office
  2.23                        126,261,000    129,926,000    256,187,000
  2.24  Board of Trustees of the Minnesota
  2.25  State Colleges and Universities
  2.26                        505,778,000    523,183,000  1,028,961,000
  2.27  Board of Regents of the University of Minnesota
  2.28                        551,994,000    540,681,000  1,092,675,000
  2.29  Mayo Medical Foundation
  2.30                          1,179,000      1,282,000      2,461,000
  2.31                                             APPROPRIATIONS 
  2.32                                         Available for the Year 
  2.33                                             Ending June 30 
  2.34                                            1998         1999 
  2.35  Sec. 2.  HIGHER EDUCATION
  2.36  SERVICES OFFICE
  2.37  Subdivision 1.  Total
  2.38  Appropriation                        126,261,000    129,926,000
  2.39  The amounts that may be spent from this 
  2.40  appropriation for each purpose are 
  2.41  specified in the following subdivisions.
  3.1   Subd. 2.  State Grants
  3.2        91,996,000       100,846,000
  3.3   If the appropriation in this 
  3.4   subdivision for either year is 
  3.5   insufficient, the appropriation for the 
  3.6   other year is available for it.  
  3.7   The legislature intends that the higher 
  3.8   education services office make full 
  3.9   grant awards in each year of the 
  3.10  biennium.  
  3.11  For the biennium, the private 
  3.12  institution tuition maximum shall be 
  3.13  $7,860 in the first year and $8,055 in 
  3.14  the second year for four-year 
  3.15  institutions and $6,050 in the first 
  3.16  year and $6,200 in the second year for 
  3.17  two-year institutions. 
  3.18  This appropriation contains money to 
  3.19  set the living and miscellaneous 
  3.20  expense allowance at $4,305 in the 
  3.21  first year and $4,413 in the second 
  3.22  year. 
  3.23  This appropriation includes $250,000 
  3.24  each year for grants to nursing 
  3.25  programs to recruit persons of color 
  3.26  and to provide grants to nursing 
  3.27  students who are persons of color.  Of 
  3.28  this amount, $100,000 each year is for 
  3.29  recruitment and retention of students 
  3.30  of color in nursing programs leading to 
  3.31  licensure as a registered nurse.  Other 
  3.32  than the grants to students, all grants 
  3.33  shall be matched with at least the same 
  3.34  amount from grantee sources or nonstate 
  3.35  money.  
  3.36  $50,000 in the first year is 
  3.37  nonrecurring money for the loan 
  3.38  repayment assistance program of 
  3.39  Minnesota to reimburse graduates of 
  3.40  Minnesota law schools working as 
  3.41  lawyers in Minnesota who meet the 
  3.42  eligibility criteria for loan repayment 
  3.43  for law school debt.  The eligibility 
  3.44  criteria must include the following:  
  3.45  (1) recipient's annual household income 
  3.46  is $30,000 or less; and (2) recipient 
  3.47  is providing legal services full time 
  3.48  for economically disadvantaged persons 
  3.49  for (a) a nonprofit agency as defined 
  3.50  by section 501(c)(3), 501(c)(4), or 
  3.51  501(c)(5) of the Internal Revenue Code 
  3.52  of 1986; (b) Native American tribal 
  3.53  governments, court systems, and public 
  3.54  interest organizations; (c) public 
  3.55  defense corporations; or (d) the state 
  3.56  board of public defense.  The money may 
  3.57  be released to the program only in 
  3.58  amounts that have been matched two to 
  3.59  one with private money. 
  3.60  Subd. 3.  Interstate Tuition
  3.61  Reciprocity
  3.62       4,000,000      4,000,000
  4.1   If the appropriation in this 
  4.2   subdivision for either year is 
  4.3   insufficient, the appropriation for the 
  4.4   other year is available to meet 
  4.5   reciprocity contract obligations. 
  4.6   Subd. 4.  State Work Study
  4.7        8,819,000      8,819,000
  4.8   Subd. 5.  Minitex Library Program
  4.9        2,608,000      2,608,000
  4.10  Subd. 6.  Learning Network of Minnesota
  4.11       4,424,000      4,426,000
  4.12  $1,000,000 in each year is nonrecurring 
  4.13  money for new technology. 
  4.14  Subd. 7.  Income Contingent Loans
  4.15  The higher education services office 
  4.16  shall administer an income contingent 
  4.17  loan repayment program to assist 
  4.18  graduates of Minnesota schools in 
  4.19  medicine, dentistry, pharmacy, 
  4.20  chiropractic medicine, public health, 
  4.21  and veterinary medicine, and Minnesota 
  4.22  residents graduating from optometry and 
  4.23  osteopathy programs.  Applicant data 
  4.24  collected by the higher education 
  4.25  services office for this program may be 
  4.26  disclosed to a consumer credit 
  4.27  reporting agency under the same 
  4.28  conditions as apply to the supplemental 
  4.29  loan program under Minnesota Statutes, 
  4.30  section 136A.162.  No new applicants 
  4.31  may be accepted after June 30, 1995. 
  4.32  Subd. 8.  Statewide On-line Library
  4.33  Information System
  4.34      12,000,000          -0-   
  4.35  This appropriation is for 
  4.36  implementation of the Minnesota library 
  4.37  information network, which shall be 
  4.38  developed in cooperation with the 
  4.39  library planning task force, and shall 
  4.40  include the development of (1) an 
  4.41  integrated library system that will 
  4.42  serve the libraries of the University 
  4.43  of Minnesota, the Minnesota state 
  4.44  colleges and universities system, and 
  4.45  state government, as well as interested 
  4.46  public, school, private college, and 
  4.47  qualifying nonprofit institution 
  4.48  libraries; and (2) a common services 
  4.49  gateway creating links to the 
  4.50  integrated library system for 
  4.51  compatible school, public, and private 
  4.52  nonprofit library information systems 
  4.53  statewide.  The University of Minnesota 
  4.54  and the Minnesota state colleges and 
  4.55  universities shall provide necessary 
  4.56  staff for operation, technical support, 
  4.57  and training.  This appropriation is 
  4.58  nonrecurring. 
  5.1   Subd. 9.  Edvest 
  5.2          -0-          6,775,000 
  5.3   $6,775,000 in the second year is for 
  5.4   matching college savings. 
  5.5   Subd. 10.  Agency Administration
  5.6        2,414,000      2,452,000
  5.7   Money encumbered for youth works 
  5.8   postservice benefits shall not cancel 
  5.9   but is available until the participants 
  5.10  for whom the money was encumbered are 
  5.11  no longer eligible to draw benefits. 
  5.12  This appropriation includes money for 
  5.13  the Minnesota Minority Education 
  5.14  Partnership. 
  5.15  The higher education advisory council 
  5.16  and the student advisory council shall 
  5.17  not expire on June 30, 1997, but shall 
  5.18  continue for the biennium. 
  5.19  Subd. 11.  Balances Forward 
  5.20  An unencumbered balance in the first 
  5.21  year under a subdivision in this 
  5.22  section does not cancel but is 
  5.23  available for the second year. 
  5.24  Subd. 12.  Transfers 
  5.25  The higher education services office 
  5.26  may transfer unencumbered balances from 
  5.27  the appropriations in this section to 
  5.28  the state grant appropriation by 
  5.29  reducing the assigned family 
  5.30  responsibility and then reducing the 
  5.31  student share, the interstate tuition 
  5.32  reciprocity appropriation, the child 
  5.33  care grant appropriation, and the state 
  5.34  work study appropriation. 
  5.35  Sec. 3.  BOARD OF TRUSTEES OF THE
  5.36  MINNESOTA STATE COLLEGES AND UNIVERSITIES
  5.37  Subdivision 1.  Total
  5.38  Appropriation                       505,778,000    525,183,000
  5.39  The amounts that may be spent from this 
  5.40  appropriation for each purpose are 
  5.41  specified in the following subdivisions.
  5.42  Unless otherwise specified in this 
  5.43  section, in fiscal year 1998 each 
  5.44  college and university is to receive 
  5.45  its fiscal year 1997 total allocation 
  5.46  adjusted for enrollment changes.  In 
  5.47  addition, all instructional and 
  5.48  noninstructional appropriation 
  5.49  increases are to be distributed to the 
  5.50  colleges and universities based on the 
  5.51  proportion of each to the total system 
  5.52  full year equivalent enrollment for the 
  5.53  1996-1997 academic year.  The system 
  5.54  shall report to the legislature on the 
  5.55  board's progress in developing a new 
  5.56  allocation model by February 1, 1998. 
  6.1   Subd. 2.  Instructional Expenditures 
  6.2   This appropriation contains money for 
  6.3   educational enhancements including 
  6.4   improvements in programs, student 
  6.5   services, advising, library 
  6.6   acquisitions, and class size and 
  6.7   availability, while holding down 
  6.8   tuition increases. 
  6.9   This appropriation includes 
  6.10  nonrecurring funding to be directed to 
  6.11  those campuses that are below a 
  6.12  minimally acceptable standard in 
  6.13  instructional technology and 
  6.14  equipment.  The appropriation also 
  6.15  includes recurring funds, to be 
  6.16  distributed as provided in subdivision 
  6.17  1, for improvements in instructional 
  6.18  technology and equipment which is used 
  6.19  for the benefit of faculty and students 
  6.20  on campus. 
  6.21  This appropriation contains 
  6.22  nonrecurring money to develop and 
  6.23  implement a common student information 
  6.24  system and central data management 
  6.25  system, and to upgrade the management 
  6.26  information systems network. 
  6.27  This appropriation contains money for 
  6.28  grants to develop courses that can be 
  6.29  delivered through the Virtual 
  6.30  University.  Grant recipients shall 
  6.31  match this appropriation by an equal 
  6.32  amount of money from existing or 
  6.33  nonstate resources. 
  6.34  The board shall implement a program for 
  6.35  the preparation and certification of 
  6.36  bilingual interpreters and translators 
  6.37  skilled in English and other 
  6.38  languages.  The board shall accomplish 
  6.39  the implementation in cooperation with 
  6.40  the University of Minnesota, which 
  6.41  shall provide necessary technical 
  6.42  assistance. 
  6.43  In the process of converting to 
  6.44  semesters, the system and campuses 
  6.45  shall develop and incorporate 
  6.46  mechanisms to improve credit transfer 
  6.47  as they redesign curriculum. 
  6.48  A campus student association shall not 
  6.49  hold a referendum to determine 
  6.50  statewide affiliation before May 1, 
  6.51  1998, or before the statewide student 
  6.52  associations for the community colleges 
  6.53  and technical colleges vote to 
  6.54  consolidate, whichever is sooner. 
  6.55  Subd. 3.  Noninstructional Expenditures 
  6.56  This appropriation contains money for 
  6.57  development and implementation of the 
  6.58  Minnesota career and education planning 
  6.59  system in partnership with the 
  6.60  University of Minnesota, the department 
  6.61  of children, families, and learning, 
  6.62  and the Minnesota office of 
  7.1   technology.  System maintenance and 
  7.2   operation costs must be paid by 
  7.3   participating agencies and institutions.
  7.4   $150,000 in the first year is to 
  7.5   establish pilot programs at one 
  7.6   community college, one technical 
  7.7   college, and one consolidated community 
  7.8   technical college to expand the child 
  7.9   care offerings on campus to include 
  7.10  infant care.  To be chosen by the board 
  7.11  to receive a grant, a campus must 
  7.12  demonstrate that (1) it has an 
  7.13  exemplary child care program, (2) there 
  7.14  is demand for infant care on campus, 
  7.15  and (3) it has the physical and 
  7.16  financial capacity to sustain an infant 
  7.17  care program after the pilot grant has 
  7.18  expired.  The board shall provide an 
  7.19  evaluation of the pilot programs and 
  7.20  its recommendations on expanding infant 
  7.21  care to other campuses to the education 
  7.22  committees of the legislature as part 
  7.23  of its 2000-2001 biennial budget 
  7.24  request. 
  7.25  The percentage of debt service assessed 
  7.26  to the campus for capital projects not 
  7.27  recommended by the board may not be 
  7.28  higher than for those projects 
  7.29  recommended by the board. 
  7.30  $204,000 the first year and $99,000 the 
  7.31  second year are for debt service 
  7.32  payments. 
  7.33  $150,000 each year is for southwest 
  7.34  Asia veterans tuition relief.  
  7.35  Sec. 4.  BOARD OF REGENTS OF THE 
  7.36  UNIVERSITY OF MINNESOTA 
  7.37  Subdivision 1.  Total
  7.38  Appropriation                        551,994,000    540,681,000
  7.39  The amounts that may be spent from this 
  7.40  appropriation for each purpose are 
  7.41  specified in the following subdivisions.
  7.42  Subd. 2.  Operations and
  7.43  Maintenance                          471,905,000    476,692,000
  7.44  (a) Instructional Expenditures 
  7.45  This appropriation contains money for 
  7.46  grants to develop courses that can be 
  7.47  delivered through the Virtual 
  7.48  University.  Grant recipients shall 
  7.49  match this appropriation by an equal 
  7.50  amount of money from existing or 
  7.51  nonstate resources. 
  7.52  (b) Noninstructional Expenditures 
  7.53  This appropriation contains money for 
  7.54  the development and implementation of 
  7.55  the Minnesota career and education 
  7.56  planning system in partnership with the 
  7.57  Minnesota state colleges and 
  7.58  universities, the department of 
  7.59  children, families, and learning, and 
  8.1   the Minnesota office of technology.  
  8.2   System maintenance and operation costs 
  8.3   must be paid by participating agencies 
  8.4   and institutions. 
  8.5   $250,000 in the first year is for the 
  8.6   academic health center to provide 
  8.7   research grants of up to $20,000 to 
  8.8   faculty.  These grants shall be given 
  8.9   to provide developmental support for 
  8.10  projects that have a strong potential 
  8.11  for future funding from outside sources.
  8.12  This appropriation contains 
  8.13  nonrecurring money for administrative 
  8.14  process redesign. 
  8.15  $1,600,000 in nonrecurring funds in the 
  8.16  first year is to honor the first woman 
  8.17  elected from Minnesota to the United 
  8.18  States congress by endowing the Coya 
  8.19  Knutson chair in political science. 
  8.20  Subd. 3.  Special
  8.21  Appropriation                         80,089,000     63,989,000
  8.22  The amounts expended for each program 
  8.23  in the four categories of special 
  8.24  appropriations shall be separately 
  8.25  identified in the 1999 biennial budget 
  8.26  document. 
  8.27  (a) Agriculture and Extension Service 
  8.28      48,297,000     47,297,000
  8.29  This appropriation is for the 
  8.30  Agricultural Experiment Station and 
  8.31  Minnesota Extension Service. 
  8.32  Any salary increases granted by the 
  8.33  university to personnel paid from the 
  8.34  Minnesota Extension appropriation must 
  8.35  not result in a reduction of the county 
  8.36  portion of the salary payments. 
  8.37  During the biennium, the university 
  8.38  shall maintain an advisory council 
  8.39  system for each experiment station.  
  8.40  The advisory councils must be broadly 
  8.41  representative of range of size and 
  8.42  income distribution of farms and 
  8.43  agribusinesses and must not 
  8.44  disproportionately represent those from 
  8.45  the upper half of the size and income 
  8.46  distributions. 
  8.47  $1,000,000 in the first year is for 
  8.48  agricultural education.  Of this amount 
  8.49  $600,000 is for the Minnesota 
  8.50  agriculture leadership council 
  8.51  including $200,000 for grants.  
  8.52  $400,000 is for the university to 
  8.53  improve recruitment and collaborative 
  8.54  efforts at the college of agriculture, 
  8.55  food, and environmental science.  
  8.56  Appropriations in this paragraph are 
  8.57  nonrecurring. 
  8.58  (b) Health Sciences 
  9.1       19,682,000      4,742,000
  9.2   This appropriation is for Indigent 
  9.3   Patients (County Papers), Rural 
  9.4   Physicians Associates Program, the 
  9.5   Veterinary Diagnostic Laboratory, 
  9.6   Health Sciences Research, and dental 
  9.7   care. 
  9.8   This appropriation contains money for 
  9.9   curriculum redesign and technology, 
  9.10  technology transfer, research and 
  9.11  public service, and the biomedical 
  9.12  engineering center endowment.  
  9.13  Appropriations for these purposes are 
  9.14  nonrecurring. 
  9.15  (c) Institute of Technology  
  9.16       1,552,000      1,552,000
  9.17  This appropriation is for the 
  9.18  Geological Survey and the Talented 
  9.19  Youth Mathematics Program. 
  9.20  (d) System Specials 
  9.21      10,558,000     10,398,000
  9.22  This appropriation is for General 
  9.23  Research, Student Loans Matching Money, 
  9.24  women's athletics, Industrial Relations 
  9.25  Education, Natural Resources Research 
  9.26  Institute, Center for Urban and 
  9.27  Regional Affairs, Bell Museum of 
  9.28  Natural History, and the Humphrey 
  9.29  Exhibit.  The appropriation also 
  9.30  contains money for the Carlson school 
  9.31  initiative. 
  9.32  This appropriation includes money to 
  9.33  improve the programs and resources 
  9.34  available to women and to assist 
  9.35  campuses to comply with Title IX of the 
  9.36  Education Amendments of 1972 and 
  9.37  Minnesota Statutes, section 126.21.  Of 
  9.38  this appropriation, no less than the 
  9.39  following amounts must be allocated to 
  9.40  each campus: 
  9.41  Duluth              $551,600      $551,600   
  9.42  Morris              $ 66,100      $ 66,100   
  9.43  Crookston           $ 65,000      $ 65,000   
  9.44  By February 15 of each year, the 
  9.45  University shall report to the higher 
  9.46  education divisions of the legislature 
  9.47  on its efforts to improve opportunities 
  9.48  for female athletes consistent with 
  9.49  Title IX. 
  9.50  Sec. 5.  MAYO MEDICAL FOUNDATION 
  9.51  Subdivision 1.  Total
  9.52  Appropriation                          1,179,000      1,282,000
  9.53  The amounts that may be spent from this 
  9.54  appropriation for each purpose are 
  9.55  specified in the following subdivisions.
 10.1   Subd. 2.  Medical School
 10.2          441,000        455,000
 10.3   The state of Minnesota shall pay a 
 10.4   capitation of $11,042 in the first year 
 10.5   and $11,378 in the second year for each 
 10.6   student who is a resident of 
 10.7   Minnesota.  The appropriation may be 
 10.8   transferred between years of the 
 10.9   biennium to accommodate enrollment 
 10.10  fluctuations. 
 10.11  The legislature intends that during the 
 10.12  biennium the Mayo foundation use the 
 10.13  capitation money to increase the number 
 10.14  of doctors practicing in rural areas in 
 10.15  need of doctors.  
 10.16  Subd. 3.  Family Practice and
 10.17  Graduate Residency Program
 10.18         408,000        467,000
 10.19  The state of Minnesota provides a 
 10.20  capitation of $15,107 in the first year 
 10.21  and $15,560 in the second year year for 
 10.22  each student. 
 10.23  Subd. 4.  St. Cloud Hospital-Mayo 
 10.24  Family Practice Residency Program 
 10.25         330,000        360,000
 10.26  This appropriation is to the Mayo 
 10.27  foundation to support 12 resident 
 10.28  physicians in the St. Cloud 
 10.29  Hospital-Mayo Family Practice Residency 
 10.30  Program.  This appropriation is 
 10.31  contingent upon $950,000 in matching 
 10.32  money being made available from 
 10.33  nonstate sources.  The program shall 
 10.34  prepare doctors to practice primary 
 10.35  care medicine in rural areas of the 
 10.36  state.  It is intended that this 
 10.37  program will improve health care in 
 10.38  rural communities, provide affordable 
 10.39  access to appropriate medical care, and 
 10.40  manage the treatment of patients in a 
 10.41  more cost-effective manner. 
 10.42  Sec. 6.  POST-SECONDARY SYSTEMS 
 10.43  The legislature intends that the 
 10.44  University of Minnesota and the 
 10.45  Minnesota state colleges and 
 10.46  universities correct technical college 
 10.47  credit transfer problems.  The systems, 
 10.48  in conjunction with their campuses and 
 10.49  with faculty and student 
 10.50  representatives, shall convene faculty 
 10.51  task forces in appropriate curricular 
 10.52  areas to determine, within sound 
 10.53  academic standards, which technical 
 10.54  college courses shall transfer to 
 10.55  academic institutions and whether each 
 10.56  course is accepted for general 
 10.57  education, major field, or elective 
 10.58  credit.  The task forces shall complete 
 10.59  their work in time to implement changes 
 10.60  for the 1998-1999 academic year.  The 
 11.1   systems shall develop mechanisms for 
 11.2   assessing the success of the changes 
 11.3   after they have been implemented and 
 11.4   shall determine whether this process 
 11.5   should be used to update the entire 
 11.6   transfer curriculum, particularly in 
 11.7   light of semester conversion.  The 
 11.8   systems shall report on their progress 
 11.9   and recommendations for any further 
 11.10  action as part of the 2000-2001 
 11.11  biennial budget request. 
 11.12  The board of regents of the University 
 11.13  of Minnesota and the board of trustees 
 11.14  of the Minnesota state colleges and 
 11.15  universities shall consult throughout 
 11.16  their biennial planning process, as 
 11.17  provided in Minnesota Statutes, section 
 11.18  135A.06, in order to improve the 
 11.19  coordination and delivery of higher 
 11.20  education services.  In addition, the 
 11.21  board of trustees and the board of 
 11.22  regents shall jointly prepare and 
 11.23  submit a metropolitan higher education 
 11.24  plan to the higher education divisions 
 11.25  of the legislature by February 1, 
 11.26  1998.  The private colleges are 
 11.27  encouraged to participate in the 
 11.28  planning processes. 
 11.29  By February 15, 1998, Minnesota state 
 11.30  colleges and universities and the 
 11.31  University of Minnesota shall each 
 11.32  report to the higher education 
 11.33  divisions of the legislature their 
 11.34  recommendations on the feasibility of 
 11.35  managing their portions of state grant 
 11.36  funds and the methodology they would 
 11.37  use to distribute the funds. 
 11.38  During the biennium, a college or 
 11.39  university that establishes a lab 
 11.40  school shall report to its governing 
 11.41  board and the higher education 
 11.42  divisions of the legislature by 
 11.43  February 1, 1999, on all direct and 
 11.44  indirect expenditures related to the 
 11.45  establishment and operation of the 
 11.46  school.  The report shall include 
 11.47  documentation of all sources of funding 
 11.48  for these expenses. 
 11.49                             ARTICLE 2
 11.50                       COLLEGE AFFORDABILITY
 11.51     Section 1.  [16A.645] [GOPHER STATE BONDS.] 
 11.52     Subdivision 1.  [ESTABLISHMENT OF PROGRAM.] The 
 11.53  commissioner of finance, in consultation with the University of 
 11.54  Minnesota, the Minnesota state colleges and universities, and 
 11.55  the private college council, shall establish a college savings 
 11.56  bond program, to be known as "gopher state bonds" to encourage 
 11.57  individuals to save for higher education costs by investing in 
 11.58  state general obligation bonds.  The program consists of:  (1) 
 12.1   issuing a portion of the state general obligation bonds in zero 
 12.2   coupon form and in denominations and maturities that will be 
 12.3   attractive to individuals saving to pay for higher education 
 12.4   costs; and (2) developing a program for marketing the bonds to 
 12.5   investors who are saving to pay for higher education costs.  The 
 12.6   commissioner of finance may designate all or a portion of each 
 12.7   state general obligation bond sale as "gopher state bonds." 
 12.8      Subd. 2.  [DENOMINATIONS; MATURITIES.] The commissioner 
 12.9   shall determine the appropriate denominations and maturities for 
 12.10  gopher state bonds.  It is the intent of the legislature to make 
 12.11  bonds available in as small denominations as is feasible given 
 12.12  the costs of marketing and administering the bond issue.  
 12.13  Minimum denominations of $500 must be made available.  The 
 12.14  minimum denomination bonds need not be made available for bonds 
 12.15  of all maturities.  For purposes of this section, "denomination" 
 12.16  means the compounded maturity amount of the bond. 
 12.17     Subd. 3.  [DIRECT SALE PERMITTED.] Notwithstanding the 
 12.18  provisions of section 16A.646, subdivision 5, the commissioner 
 12.19  may sell any series of gopher state bonds directly to the public 
 12.20  or to financial institutions for prompt resale to the public 
 12.21  upon the terms and conditions and the restrictions the 
 12.22  commissioner prescribes.  The commissioner may enter into all 
 12.23  contracts deemed necessary or desirable to accomplish the sale 
 12.24  in a cost-effective manner including a private or negotiated 
 12.25  sale, but the commissioner may contract for investment banking 
 12.26  and banking services only after receiving competitive proposals 
 12.27  for the services. 
 12.28     Subd. 4.  [MARKETING PLAN.] The commissioner and the higher 
 12.29  education advisory council shall develop a plan for marketing 
 12.30  gopher state bonds. 
 12.31     The plan must include strategies to: 
 12.32     (1) inform parents and relatives about the availability of 
 12.33  the bonds; 
 12.34     (2) take orders for the bonds; 
 12.35     (3) target the sale of the bonds to Minnesota residents, 
 12.36  especially parents and relatives of children who are likely to 
 13.1   seek higher education; 
 13.2      (4) ensure that purchase of the bonds by corporations will 
 13.3   not prevent individuals and relatives of future students from 
 13.4   buying them; and 
 13.5      (5) market the bonds at the lowest cost to the state. 
 13.6      Subd. 5.  [EFFECT ON STUDENT GRANTS.] The first $25,000 of 
 13.7   gopher state bonds purchased for the benefit of a student must 
 13.8   not be considered in determining the financial need of an 
 13.9   applicant for the state grant program under section 136A.121. 
 13.10  This $25,000 is in addition to any other asset exclusion 
 13.11  authorized under chapter 136A. 
 13.12     Sec. 2.  [16A.646] [ZERO COUPON BONDS.] 
 13.13     Subdivision 1.  [AUTHORITY TO ISSUE.] When authorized by 
 13.14  law to issue state general obligation bonds, the commissioner 
 13.15  may issue all or part of the bonds as serial maturity bonds or 
 13.16  as zero coupon bonds or a combination of the two. 
 13.17     Subd. 2.  [DEFINITIONS.] For purposes of this section and 
 13.18  section 16A.645, the following terms have the meanings given 
 13.19  them. 
 13.20     (a) "Compounded maturity" means the amount of principal and 
 13.21  interest payable at maturity on zero coupon bonds. 
 13.22     (b) "Serial maturity bonds" means bonds maturing on a 
 13.23  specified day in two or more consecutive years and bearing 
 13.24  interest at a specified rate payable periodically to maturity or 
 13.25  prior redemption. 
 13.26     (c) "Zero coupon bonds" means bonds in a stated principal 
 13.27  amount, maturing on a specified date or dates, and bearing 
 13.28  interest that accrues and compounds to and is payable only at 
 13.29  maturity or upon prior redemption of the bonds. 
 13.30     Subd. 3.  [METHOD OF SALE; PRINCIPAL AMOUNT.] Except as 
 13.31  otherwise provided by this section or section 16A.645, any 
 13.32  series of bonds including zero coupon bonds must be issued and 
 13.33  sold under the provisions of section 16A.641.  The stated 
 13.34  principal amount of zero coupon bonds must be used to determine 
 13.35  the principal amount of bonds issued under the laws authorizing 
 13.36  issuance of state general obligation bonds. 
 14.1      Subd. 4.  [SINKING FUND.] The commissioner's order 
 14.2   authorizing the issuance of zero coupon bonds shall establish a 
 14.3   separate sinking fund account for the zero coupon bonds in the 
 14.4   state bond fund.  There is annually appropriated from the 
 14.5   general fund to each zero coupon bond account, beginning in the 
 14.6   year in which the zero coupon bonds are issued, an amount not 
 14.7   less than the sum of: 
 14.8      (1) the total stated principal amount of the zero coupon 
 14.9   bonds that would have matured from their date of issue to and 
 14.10  including the second July 1 following the transfer of 
 14.11  appropriated money, if the bonds matured serially in an equal 
 14.12  principal amount in each year during their term and in the same 
 14.13  month as their stated maturity date; plus 
 14.14     (2) the total amount of interest accruing on the stated 
 14.15  principal amount of the bonds and on interest previously 
 14.16  accrued, from bonds date of issue to and including the second 
 14.17  July 1 following the transfer of appropriated money; less 
 14.18     (3) the amount in the sinking fund account for the payment 
 14.19  of the compounded maturity amount of the bonds, including 
 14.20  interest earnings on amounts in the account.  This appropriation 
 14.21  is in lieu of all other appropriations made with respect to zero 
 14.22  coupon bonds.  The appropriated amounts must be transferred from 
 14.23  the general fund to the sinking fund account in the state bond 
 14.24  fund by December 1 of each year. 
 14.25     Subd. 5.  [SALE.] Except as otherwise provided in section 
 14.26  16A.645, zero coupon bonds, or a series of bonds including zero 
 14.27  coupon bonds, must be sold at public sale at a price not less 
 14.28  than 98 percent of their stated principal amount.  No state 
 14.29  trunk highway bond may be sold for a price of less than par and 
 14.30  accrued interest. 
 14.31     Sec. 3.  Minnesota Statutes 1996, section 136A.101, is 
 14.32  amended by adding a subdivision to read: 
 14.33     Subd. 5a.  [ASSIGNED FAMILY RESPONSIBILITY.] "Assigned 
 14.34  family responsibility" means the amount of a family contribution 
 14.35  to a student's cost of attendance, as determined by a federal 
 14.36  need analysis, except that up to $25,000 in savings and other 
 15.1   assets shall be subtracted from the federal calculation of net 
 15.2   worth before determining the contribution.  For dependent 
 15.3   students, the assigned family responsibility is the parental 
 15.4   contribution minus any savings adjustment; for independent 
 15.5   students, the assigned family responsibility is the student 
 15.6   contribution minus any savings adjustment. 
 15.7      Sec. 4.  Minnesota Statutes 1996, section 136A.121, 
 15.8   subdivision 5, is amended to read: 
 15.9      Subd. 5.  [GRANT STIPENDS.] The grant stipend shall be 
 15.10  based on a sharing of responsibility for covering the recognized 
 15.11  cost of attendance by the applicant, the applicant's family, and 
 15.12  the government.  The amount of a financial stipend must not 
 15.13  exceed a grant applicant's recognized cost of attendance, as 
 15.14  defined in subdivision 6, after deducting the following:  
 15.15     (1) the assigned student responsibility of at least 50 
 15.16  percent of the cost of attending the institution of the 
 15.17  applicant's choosing; 
 15.18     (2) the assigned family responsibility, as determined by 
 15.19  the federal need analysis, which for (i) dependent students, is 
 15.20  the parental contribution as calculated by the federal need 
 15.21  analysis, and for (ii) independent students, is the student 
 15.22  contribution as determined by the federal need analysis; and as 
 15.23  defined in section 136A.101; and 
 15.24     (3) the amount of a federal Pell grant award for which the 
 15.25  grant applicant is eligible. 
 15.26     The minimum financial stipend is $300 per academic year. 
 15.27     Sec. 5.  Minnesota Statutes 1996, section 136A.121, 
 15.28  subdivision 9a, is amended to read: 
 15.29     Subd. 9a.  [FULL-YEAR GRANTS.] Students may receive state 
 15.30  grants for four consecutive quarters or three consecutive 
 15.31  semesters during the course of a single fiscal year.  In 
 15.32  calculating a state grant for the fourth quarter or third 
 15.33  semester, the office must use the same calculation as it would 
 15.34  for any other term, except that the calculation must subtract 
 15.35  any Pell grant for which a student would be eligible even if the 
 15.36  student has exhausted the Pell grant for that fiscal year. 
 16.1      Sec. 6.  Minnesota Statutes 1996, section 136A.125, 
 16.2   subdivision 4, is amended to read: 
 16.3      Subd. 4.  [AMOUNT AND LENGTH OF GRANTS.] The amount of a 
 16.4   child care grant must be based on: 
 16.5      (1) the income of the applicant and the applicant's spouse, 
 16.6   if any; 
 16.7      (2) the number in the applicant's family, as defined by the 
 16.8   office; and 
 16.9      (3) the number of eligible children in the applicant's 
 16.10  family.  
 16.11     The maximum award to the applicant shall be $1,700 $2,000 
 16.12  for each eligible child per academic year.  The office shall 
 16.13  prepare a chart to show the amount of a grant that will be 
 16.14  awarded per child based on the factors in this subdivision.  The 
 16.15  chart shall include a range of income and family size. 
 16.16     Sec. 7.  Minnesota Statutes 1996, section 136A.1355, is 
 16.17  amended to read: 
 16.18     136A.1355 [RURAL PHYSICIANS.] 
 16.19     Subdivision 1.  [CREATION OF ACCOUNT.] A rural physician 
 16.20  education account is established in the health care access 
 16.21  fund.  The higher education services office commissioner shall 
 16.22  use money from the account to establish a loan forgiveness 
 16.23  program for medical students residents agreeing to practice in 
 16.24  designated rural areas, as defined by the commissioner.  
 16.25     Subd. 2.  [ELIGIBILITY.] To be eligible to participate in 
 16.26  the program, a prospective physician must submit a letter of 
 16.27  interest to the higher education services office commissioner.  
 16.28  A student or resident who is accepted must sign a contract to 
 16.29  agree to serve at least three of the first five years following 
 16.30  residency in a designated rural area. 
 16.31     Subd. 3.  [LOAN FORGIVENESS.] For each fiscal years 
 16.32  beginning on and year after July 1, 1995, the higher education 
 16.33  services office commissioner may accept up to four applicants 
 16.34  who are fourth year medical students, three 12 applicants who 
 16.35  are medical residents, including four applicants who are 
 16.36  pediatric residents, and four six applicants who are family 
 17.1   practice residents, and one applicant who is an two applicants 
 17.2   who are internal medicine resident residents, per fiscal year 
 17.3   for participation in the loan forgiveness program.  If 
 17.4   the higher education services office commissioner does not 
 17.5   receive enough applicants per fiscal year to fill the number of 
 17.6   residents in the specific areas of practice, the resident 
 17.7   applicants may be from any area of practice.  The eight 12 
 17.8   resident applicants may be in any year of training; however, 
 17.9   priority must be given to the following categories of residents 
 17.10  in descending order:  third year residents, second year 
 17.11  residents, and first year residents.  Applicants are responsible 
 17.12  for securing their own loans.  Applicants chosen to participate 
 17.13  in the loan forgiveness program may designate for each year of 
 17.14  medical school, up to a maximum of four years, an agreed amount, 
 17.15  not to exceed $10,000, as a qualified loan.  For each year that 
 17.16  a participant serves as a physician in a designated rural area, 
 17.17  up to a maximum of four years, the higher education services 
 17.18  office commissioner shall annually pay an amount equal to one 
 17.19  year of qualified loans.  Participants who move their practice 
 17.20  from one designated rural area to another remain eligible for 
 17.21  loan repayment.  In addition, if in any year that a resident 
 17.22  participating in the loan forgiveness program serves at least 
 17.23  four weeks during a year of residency substituting for a rural 
 17.24  physician to temporarily relieve the rural physician of rural 
 17.25  practice commitments to enable the rural physician to take a 
 17.26  vacation, engage in activities outside the practice area, or 
 17.27  otherwise be relieved of rural practice commitments, the 
 17.28  participating resident may designate up to an additional $2,000, 
 17.29  above the $10,000 yearly maximum, for each year of residency 
 17.30  during which the resident substitutes for a rural physician for 
 17.31  four or more weeks. 
 17.32     Subd. 4.  [PENALTY FOR NONFULFILLMENT.] If a participant 
 17.33  does not fulfill the required three-year minimum commitment of 
 17.34  service in a designated rural area, the higher education 
 17.35  services office commissioner shall collect from the participant 
 17.36  the amount paid by the commissioner under the loan forgiveness 
 18.1   program.  The higher education services office commissioner 
 18.2   shall deposit the money collected in the rural physician 
 18.3   education account established in subdivision 1.  The 
 18.4   commissioner shall allow waivers of all or part of the money 
 18.5   owed the commissioner if emergency circumstances prevented 
 18.6   fulfillment of the three-year service commitment.  
 18.7      Subd. 5.  [LOAN FORGIVENESS; UNDERSERVED URBAN 
 18.8   COMMUNITIES.] For each fiscal years year beginning on and after 
 18.9   July 1, 1995, the higher education services office commissioner 
 18.10  may accept up to four applicants who are either fourth year 
 18.11  medical students, or residents in family practice, pediatrics, 
 18.12  or internal medicine per fiscal year for participation in the 
 18.13  urban primary care physician loan forgiveness program.  The 
 18.14  resident applicants may be in any year of residency training; 
 18.15  however, priority will be given to the following categories of 
 18.16  residents in descending order:  third year residents, second 
 18.17  year residents, and first year residents.  If the higher 
 18.18  education services office commissioner does not receive enough 
 18.19  qualified applicants per fiscal year to fill the number of slots 
 18.20  for urban underserved communities, the slots may be allocated to 
 18.21  students or residents who have applied for the rural physician 
 18.22  loan forgiveness program in subdivision 1.  Applicants are 
 18.23  responsible for securing their own loans.  For purposes of this 
 18.24  provision, "qualifying educational loans" are government and 
 18.25  commercial loans for actual costs paid for tuition, reasonable 
 18.26  education expenses, and reasonable living expenses related to 
 18.27  the graduate or undergraduate education of a health care 
 18.28  professional.  Applicants chosen to participate in the loan 
 18.29  forgiveness program may designate for each year of medical 
 18.30  school, up to a maximum of four years, an agreed amount, not to 
 18.31  exceed $10,000, as a qualified loan.  For each year that a 
 18.32  participant serves as a physician in a designated underserved 
 18.33  urban area, up to a maximum of four years, the higher education 
 18.34  services office commissioner shall annually pay an amount equal 
 18.35  to one year of qualified loans.  Participants who move their 
 18.36  practice from one designated underserved urban community to 
 19.1   another remain eligible for loan repayment. 
 19.2      Sec. 8.  Minnesota Statutes 1996, section 136A.136, 
 19.3   subdivision 2, is amended to read: 
 19.4      Subd. 2.  [RESPONSIBILITY OF METROPOLITAN HEALTHCARE 
 19.5   FOUNDATION'S PROJECT LINC.] The metropolitan healthcare 
 19.6   foundation's project LINC shall administer the grant program and 
 19.7   award grants to eligible health care facility employees.  To be 
 19.8   eligible to receive a grant, a person must be: 
 19.9      (1) an employee of a health care facility located in 
 19.10  Minnesota, whom the facility has recommended to the metropolitan 
 19.11  healthcare foundation's project LINC for consideration; 
 19.12     (2) working part time, up to 32 fewer hours than their 
 19.13  regular schedule per pay period, for the health care 
 19.14  facility organization, while maintaining full salary and their 
 19.15  original benefits and a salary greater than the number of hours 
 19.16  worked; 
 19.17     (3) enrolled full time in a Minnesota school or college of 
 19.18  nursing to complete a baccalaureate or master's degree in 
 19.19  nursing; and 
 19.20     (4) a resident of the state of Minnesota. 
 19.21     The grant must be awarded for one academic year but is 
 19.22  renewable for a maximum of six semesters or nine quarters of 
 19.23  full-time study, or their equivalent.  The grant must be used 
 19.24  for tuition, fees, and books.  Priority in awarding grants shall 
 19.25  be given to persons with the greatest financial need.  The 
 19.26  health care facility may require its employee to commit to a 
 19.27  reasonable postprogram completion of employment at the health 
 19.28  care facility as a condition for the financial support the 
 19.29  facility provides. 
 19.30     Sec. 9.  Minnesota Statutes 1996, section 136A.233, 
 19.31  subdivision 2, is amended to read: 
 19.32     Subd. 2.  [DEFINITIONS.] For purposes of sections 136A.231 
 19.33  to 136A.233, the words defined in this subdivision have the 
 19.34  meanings ascribed to them. 
 19.35     (a) "Eligible student" means a Minnesota resident enrolled 
 19.36  or intending to enroll at least half time in a degree, diploma, 
 20.1   or certificate program in a Minnesota post-secondary institution.
 20.2      (b) "Minnesota resident" means a student who meets the 
 20.3   conditions in section 136A.101, subdivision 8. 
 20.4      (c) "Financial need" means the need for financial 
 20.5   assistance in order to attend a post-secondary institution as 
 20.6   determined by a post-secondary institution according to 
 20.7   guidelines established by the higher education services office. 
 20.8      (d) "Eligible employer" means any eligible post-secondary 
 20.9   institution and, any nonprofit, nonsectarian agency or state 
 20.10  institution located in the state of Minnesota, including state 
 20.11  hospitals, and also includes a handicapped person or a person 
 20.12  over 65 who employs a student to provide personal services in or 
 20.13  about the person's residence of the handicapped person or the 
 20.14  person over 65, or a private, for-profit employer employing a 
 20.15  student as an intern in a position directly related to the 
 20.16  student's field of study that will enhance the student's 
 20.17  knowledge and skills in that field.  Internships must be under 
 20.18  the supervision of a faculty member or other academic employee 
 20.19  at the institution. 
 20.20     (e) "Eligible post-secondary institution" means any 
 20.21  post-secondary institution eligible for participation in the 
 20.22  Minnesota state grant program as specified in section 136A.101, 
 20.23  subdivision 4. 
 20.24     (f) "Independent student" has the meaning given it in the 
 20.25  Higher Education Act of 1965, United States Code, title 20, 
 20.26  section 1070a-6, and applicable regulations. 
 20.27     (g) "Half-time" for undergraduates has the meaning given in 
 20.28  section 136A.101, subdivision 7b, and for graduate students is 
 20.29  defined by the institution. 
 20.30     Sec. 10.  Minnesota Statutes 1996, section 136A.233, 
 20.31  subdivision 3, is amended to read: 
 20.32     Subd. 3.  [PAYMENTS.] Work-study payments shall be made to 
 20.33  eligible students by post-secondary institutions as provided in 
 20.34  this subdivision. 
 20.35     (a) Students shall be selected for participation in the 
 20.36  program by the post-secondary institution on the basis of 
 21.1   student financial need. 
 21.2      (b) In selecting students for participation, priority must 
 21.3   be given to students enrolled for at least 12 credits. 
 21.4      (c) Students will be paid for hours actually worked and the 
 21.5   maximum hourly rate of pay shall not exceed the maximum hourly 
 21.6   rate of pay permitted under the federal college work-study 
 21.7   program. 
 21.8      (d) Minimum pay rates will be determined by an applicable 
 21.9   federal or state law. 
 21.10     (e) The office shall annually establish a minimum 
 21.11  percentage rate of student compensation to be paid by an 
 21.12  eligible employer. 
 21.13     (f) Each post-secondary institution receiving money for 
 21.14  state work-study grants shall make a reasonable effort to place 
 21.15  work-study students in employment with eligible employers 
 21.16  outside the institution.  However, a public employer other than 
 21.17  the institution may not terminate, lay off, or reduce the 
 21.18  working hours of a permanent employee for the purpose of hiring 
 21.19  a work-study student, or replace a permanent employee who is on 
 21.20  layoff from the same or substantially the same job by hiring a 
 21.21  work-study student. 
 21.22     (g) The percent of the institution's work-study allocation 
 21.23  provided to graduate students shall not exceed the percent of 
 21.24  graduate student enrollment at the participating institution. 
 21.25     (h) No more than 20 percent of an institution's allocation 
 21.26  may be used for student internships with private, for-profit 
 21.27  employers. 
 21.28     Sec. 11.  Minnesota Statutes 1996, section 136A.233, is 
 21.29  amended by adding a subdivision to read: 
 21.30     Subd. 4.  [COOPERATION WITH LOCAL SCHOOLS.] Each campus 
 21.31  using the state work study program is encouraged to cooperate 
 21.32  with its local public elementary and secondary schools to place 
 21.33  college work study students in activities in the schools, such 
 21.34  as tutoring.  Students must be placed in meaningful activities 
 21.35  that directly assist students in kindergarten through grade 12 
 21.36  in meeting graduation standards including the profiles of 
 22.1   learning.  College students shall work under direct supervision; 
 22.2   therefore, school hiring authorities are not required to request 
 22.3   criminal background checks on these students under section 
 22.4   120.1045. 
 22.5      Sec. 12.  [136A.90] [EDVEST PROGRAM ESTABLISHED.] 
 22.6      An Edvest savings program is established.  In establishing 
 22.7   this program, the legislature seeks to encourage individuals to 
 22.8   save for post-secondary education by: 
 22.9      (1) providing a qualified state tuition program under 
 22.10  federal tax law; 
 22.11     (2) providing matching grants for contributions to the 
 22.12  program; and 
 22.13     (3) encouraging individuals, foundations, and businesses to 
 22.14  provide additional grants to participating students. 
 22.15     Sec. 13.  [136A.91] [DEFINITIONS.] 
 22.16     Subdivision 1.  [GENERAL.] For purposes of sections 136A.90 
 22.17  to 136A.94, the following terms have the meanings given. 
 22.18     Subd. 2.  [BENEFICIARY.] "Beneficiary" means the designated 
 22.19  beneficiary for the account, as defined in section 529(e)(1) of 
 22.20  the Internal Revenue Code. 
 22.21     Subd. 3.  [BOARD.] "Board" means the state board of 
 22.22  investment. 
 22.23     Subd. 4.  [EXECUTIVE DIRECTOR.] "Executive director" means 
 22.24  the executive director of the state board of investment. 
 22.25     Subd. 5.  [INTERNAL REVENUE CODE.] "Internal Revenue Code" 
 22.26  means the Internal Revenue Code of 1986, as amended. 
 22.27     Subd. 6.  [OFFICE.] "Office" means the higher education 
 22.28  services office. 
 22.29     Subd. 7.  [PROGRAM OR EDVEST.] "Program" or "Edvest" refers 
 22.30  to the program established under section 136A.90. 
 22.31     Sec. 14.  [136A.92] [HIGHER EDUCATION SERVICES OFFICE'S 
 22.32  RESPONSIBILITIES.] 
 22.33     Subdivision 1.  [ESTABLISH TERMS.] (a) The office shall 
 22.34  establish the rules, terms, and conditions for the program, 
 22.35  subject to the requirements of sections 136A.90 to 136A.94. 
 22.36     (b) The office shall prescribe the application forms, 
 23.1   procedures, and other requirements that apply to the program. 
 23.2      Subd. 2.  [ACCOUNTS TYPE PROGRAM.] The office must 
 23.3   establish the program and the program must be operated as an 
 23.4   accounts type program that permits individuals to save for 
 23.5   qualified higher education costs incurred at any institution, 
 23.6   regardless of whether it is private or public or whether it is 
 23.7   located within or outside of this state.  A separate account 
 23.8   must be maintained for each beneficiary for whom contributions 
 23.9   are made. 
 23.10     Subd. 3.  [CONSULTATION WITH STATE BOARD OF INVESTMENT.] In 
 23.11  designing and establishing the program's requirements and in 
 23.12  negotiating or entering contracts with third parties under 
 23.13  subdivision 8, the office shall consult with the executive 
 23.14  director. 
 23.15     Subd. 4.  [PROGRAM TO COMPLY WITH FEDERAL LAW.] The office 
 23.16  shall take steps to ensure that the program meets the 
 23.17  requirements for a qualified state tuition program under section 
 23.18  529 of the Internal Revenue Code.  The office may request a 
 23.19  private letter ruling or rulings from the Internal Revenue 
 23.20  Service or take any other steps to ensure that the program 
 23.21  qualifies under section 529 of the Internal Revenue Code or 
 23.22  other relevant provisions of federal law.  
 23.23     Subd. 5.  [MINIMUM PENALTY.] In establishing the terms of 
 23.24  the program, the office must provide that refunds of amounts in 
 23.25  an account are subject to a minimum penalty, as required by 
 23.26  section 529(b)(3) of the Internal Revenue Code.  If the refunds 
 23.27  or payments are not used for qualified higher education expenses 
 23.28  of the designated beneficiary, this penalty must equal, at 
 23.29  least, the proportionate amount of any matching grants deposited 
 23.30  in the account under section 136A.94 and the investment return 
 23.31  on the grants, plus an additional penalty that meets the 
 23.32  requirement of federal law. 
 23.33     Subd. 6.  [THREE-YEAR PERIOD FOR WITHDRAWAL OF GRANTS.] A 
 23.34  matching grant deposited in the account under section 136A.94 
 23.35  may not be withdrawn within three years of the establishment of 
 23.36  the account of the beneficiary.  In calculating the three-year 
 24.1   period, the period held in another account is included, if the 
 24.2   account includes a rollover from another account under section 
 24.3   529(c)(3)(C) of the Internal Revenue Code. 
 24.4      Subd. 7.  [MARKETING.] The office shall make parents and 
 24.5   other interested individuals aware of the availability and 
 24.6   advantages of the program as a way to save for higher education 
 24.7   costs.  The cost of these promotional efforts must be paid 
 24.8   entirely from state general fund appropriations and may not be 
 24.9   funded with fees imposed on participants. 
 24.10     Subd. 8.  [ADMINISTRATION.] The office shall administer the 
 24.11  program, including accepting and processing applications, 
 24.12  maintaining account records, making payments, making matching 
 24.13  grants under section 136A.94, and undertaking any other 
 24.14  necessary tasks to administer the program.  The office may 
 24.15  contract with one or more third parties to carry out some or all 
 24.16  of these administrative duties, including promotion and 
 24.17  marketing of the program.  The office and the board may jointly 
 24.18  contract with third-party providers, if the office and board 
 24.19  determine that it is desirable to contract with the same entity 
 24.20  or entities for administration and investment management. 
 24.21     Subd. 9.  [EFFECT ON STUDENT GRANTS.] The first $25,000 of 
 24.22  the amount in an account under the program must not be 
 24.23  considered in determining the financial aid of an applicant for 
 24.24  the state grant program under section 136A.121. 
 24.25     Subd. 10.  [AUTHORITY TO IMPOSE FEES.] The office may 
 24.26  impose fees on participants in the program to recover the costs 
 24.27  of administration.  The office must use its best efforts to keep 
 24.28  these fees as low as possible, consistent with efficient 
 24.29  administration, so that the returns on savings invested in the 
 24.30  program will be as high as possible.  
 24.31     Sec. 15.  [136A.93] [INVESTMENT OF ACCOUNTS.] 
 24.32     Subdivision 1.  [STATE BOARD TO INVEST.] The state board of 
 24.33  investment shall invest the money deposited in accounts in the 
 24.34  program. 
 24.35     Subd. 2.  [PERMITTED INVESTMENTS.] The board may invest the 
 24.36  accounts in any permitted investment under section 11A.24.  The 
 25.1   legislature intends that each account be invested in a mix of 
 25.2   investments that is appropriate to the number of years remaining 
 25.3   before the funds will be withdrawn, if this is feasible given 
 25.4   the costs and any other relevant factors. 
 25.5      Subd. 3.  [CONTRACTING AUTHORITY.] The board may contract 
 25.6   with one or more third parties for investment management, 
 25.7   recordkeeping, or other services in connection with investing 
 25.8   the accounts.  The board and office may jointly contract with 
 25.9   third-party providers, if the office and board determine that it 
 25.10  is desirable to contract with the same entity or entities for 
 25.11  administration and investment management. 
 25.12     Subd. 4.  [FEES.] The board may impose fees on participants 
 25.13  in the program to recover the cost of investment management and 
 25.14  related tasks for the program.  The board must use its best 
 25.15  efforts to keep these fees as low as possible, consistent with 
 25.16  high quality investment management, so that the returns on 
 25.17  savings invested in the program will be as high as possible. 
 25.18     Sec. 16.  [136A.94] [MATCHING GRANTS.] 
 25.19     Subdivision 1.  [MATCHING GRANT QUALIFICATION.] By March 1 
 25.20  of each year, a state matching grant must be added to each 
 25.21  account established under the program if the following 
 25.22  conditions are met: 
 25.23     (1) the contributor applies, in writing in a form 
 25.24  prescribed by the office, for a matching grant; 
 25.25     (2) a minimum contribution of $200 was made during the 
 25.26  preceding calendar year; and 
 25.27     (3) the contributor did not make, and agrees not to make, a 
 25.28  contribution during the year to any higher education trust under 
 25.29  chapter 290. 
 25.30     Subd. 2.  [AMOUNT OF MATCHING GRANT.] The amount of the 
 25.31  matching grant for a beneficiary equals 15 percent of the sum of 
 25.32  the contributions made to the beneficiary's account during the 
 25.33  calendar year, not to exceed $300. 
 25.34     Subd. 3.  [BUDGET LIMIT.] If the amount of matching grants 
 25.35  determined under subdivision 2 exceed the amount of the 
 25.36  appropriation for the fiscal year, the office shall 
 26.1   proportionately reduce each grant so that the total equals the 
 26.2   available appropriation. 
 26.3      Subd. 4.  [PRIVATE CONTRIBUTIONS.] (a) The office may 
 26.4   solicit and accept contributions from private corporations, 
 26.5   other businesses, foundations, or individuals to provide: 
 26.6      (1) matching grants under this section in addition to those 
 26.7   funded with direct appropriations; or 
 26.8      (2) grants to students who withdraw money from accounts 
 26.9   established under the program. 
 26.10     (b) Amounts contributed may only be used for those purposes.
 26.11  Amounts contributed are appropriated to the office to make 
 26.12  grants. 
 26.13     (c) Contributors may designate a specific field of study, 
 26.14  geographic area, or other criteria that govern use of the grants 
 26.15  funded with their contributions, but may not discriminate on the 
 26.16  basis of race, ethnicity, or gender.  The office may refuse 
 26.17  contributions that are subject, in its judgment, to unacceptable 
 26.18  conditions on their use. 
 26.19     Sec. 17.  Minnesota Statutes 1996, section 181.06, 
 26.20  subdivision 2, is amended to read: 
 26.21     Subd. 2.  [PAYROLL DEDUCTIONS.] A written contract may be 
 26.22  entered into between an employer and an employee wherein the 
 26.23  employee authorizes the employer to make payroll deductions for 
 26.24  the purpose of paying union dues, premiums of any life 
 26.25  insurance, hospitalization and surgical insurance, group 
 26.26  accident and health insurance, group term life insurance, group 
 26.27  annuities or contributions to credit unions or a community chest 
 26.28  fund, a local arts council, a local science council or a local 
 26.29  arts and science council, or Minnesota benefit association, a 
 26.30  federally or state registered political action committee, or 
 26.31  participation in any employee stock purchase plan or savings 
 26.32  plan for periods longer than 60 days, including gopher state 
 26.33  bonds established under section 16A.645. 
 26.34     Sec. 18.  [REVISOR'S INSTRUCTION.] 
 26.35     The revisor of statutes shall renumber Minnesota Statutes, 
 26.36  section 136A.1355, in an appropriate place in Minnesota 
 27.1   Statutes, chapter 144. 
 27.2      Sec. 19.  [EFFECTIVE DATE.] 
 27.3      Section 5 is effective the day following final enactment.  
 27.4   Section 16 is effective January 1, 1998. 
 27.5                              ARTICLE 3
 27.6                           OTHER PROVISIONS
 27.7      Section 1.  Minnesota Statutes 1996, section 16A.69, 
 27.8   subdivision 2, is amended to read: 
 27.9      Subd. 2.  [TRANSFER BETWEEN ACCOUNTS.] Upon the awarding of 
 27.10  final contracts for the completion of a project for construction 
 27.11  or other permanent improvement, or upon the abandonment of the 
 27.12  project, the agency to whom the appropriation was made may 
 27.13  transfer the unencumbered balance in the project account to 
 27.14  another project enumerated in the same section of that 
 27.15  appropriation act.  The transfer must be made only to cover bids 
 27.16  for the other project that were higher than was estimated when 
 27.17  the appropriation for the other project was made and not to 
 27.18  cover an expansion of the other project.  The money transferred 
 27.19  under this section is appropriated for the purposes for which 
 27.20  transferred.  For transfers for technical colleges by the state 
 27.21  board of technical of trustees of the Minnesota state colleges 
 27.22  and universities, the total cost of both projects and the 
 27.23  required local share for both projects are adjusted 
 27.24  accordingly.  The agency proposing a transfer shall report to 
 27.25  the chair of the senate finance committee and the chair of the 
 27.26  house of representatives ways and means committee before the 
 27.27  transfer is made under this subdivision. 
 27.28     Sec. 2.  [41D.01] [MINNESOTA AGRICULTURE EDUCATION 
 27.29  LEADERSHIP COUNCIL.] 
 27.30     Subdivision 1.  [ESTABLISHMENT; MEMBERSHIP.] The Minnesota 
 27.31  agriculture education leadership council is established.  The 
 27.32  council is composed of 17 members as follows: 
 27.33     (1) the chair of the senate committee on agriculture and 
 27.34  rural development or the chair's designee; 
 27.35     (2) the chair of the house committee on agriculture or the 
 27.36  chair's designee; 
 28.1      (3) the ranking minority caucus member of the senate 
 28.2   committee on agriculture and rural development or the member's 
 28.3   designee; 
 28.4      (4) the ranking minority caucus member of the house 
 28.5   agriculture committee or the member's designee; 
 28.6      (5) a member of the senate children, families, and learning 
 28.7   committee designated by the chair of the committee; 
 28.8      (6) a member of the house education committee designated by 
 28.9   the chair of the committee; 
 28.10     (7) the chair of the University of Minnesota agricultural 
 28.11  education program; 
 28.12     (8) the supervisor of secondary agricultural education for 
 28.13  the department of children, families, and learning; 
 28.14     (9) the director of management education for the board of 
 28.15  trustees of the Minnesota state colleges and universities; 
 28.16     (10) the president and the president-elect of the Minnesota 
 28.17  vocational agriculture instructors association; 
 28.18     (11) a representative of the Future Farmers of America 
 28.19  Foundation designated by the leadership of the organization; 
 28.20     (12) the commissioner of agriculture or the commissioner's 
 28.21  designee; 
 28.22     (13) a representative of agriculture education appointed by 
 28.23  the chair of the senate committee on agriculture and rural 
 28.24  development; 
 28.25     (14) a representative of agricultural business appointed by 
 28.26  the ranking minority caucus member of the senate committee on 
 28.27  agriculture and rural development; 
 28.28     (15) a representative of agriculture education appointed by 
 28.29  the chair of the house committee on agriculture; and 
 28.30     (16) a representative of agricultural business appointed by 
 28.31  the ranking minority caucus member of the house committee on 
 28.32  agriculture. 
 28.33     Subd. 2.  [POWERS AND DUTIES.] Specific powers and duties 
 28.34  of the council are to: 
 28.35     (1) develop recommendations to the legislature and the 
 28.36  governor and provide review for agriculture education programs 
 29.1   in Minnesota; 
 29.2      (2) establish a grant program to foster and encourage the 
 29.3   development of secondary and post-secondary agriculture 
 29.4   education programs; 
 29.5      (3) coordinate and articulate Minnesota's agriculture 
 29.6   education policy across all programs and institutions; 
 29.7      (4) identify the critical needs for agriculture educators; 
 29.8      (5) serve as a link between the agribusiness sector and the 
 29.9   agriculture education system to communicate mutual concerns, 
 29.10  needs, and projections; 
 29.11     (6) establish and maintain an increased awareness of 
 29.12  agriculture education and its continued need to all citizens of 
 29.13  Minnesota; 
 29.14     (7) operate the Minnesota center for agriculture education 
 29.15  created in section 41D.03; 
 29.16     (8) gain broad public support for agriculture education in 
 29.17  Minnesota; and 
 29.18     (9) report annually on its activities to the senate 
 29.19  agriculture and rural development committee and the house 
 29.20  agriculture committee. 
 29.21     Subd. 3.  [COUNCIL OFFICERS; TERMS AND COMPENSATION OF 
 29.22  APPOINTEES; STAFF.] (a) The chair of the senate agriculture and 
 29.23  rural development committee and the chair of the house 
 29.24  agriculture committee are the cochairs of the council. 
 29.25     (b) The council's membership terms, compensation, filling 
 29.26  of vacancies, and removal of members are as provided in section 
 29.27  15.0575. 
 29.28     (c) The council may employ an executive director and any 
 29.29  other staff to carry out its functions. 
 29.30     Subd. 4.  [EXPIRATION.] This section expires on June 30, 
 29.31  2002. 
 29.32     Sec. 3.  [41D.02] [AGRICULTURE EDUCATION GRANT PROGRAM.] 
 29.33     Subdivision 1.  [ESTABLISHMENT.] The Minnesota agriculture 
 29.34  education leadership council shall establish a program to 
 29.35  provide grants under subdivisions 2 and 3 to educational 
 29.36  institutions and other appropriate entities for secondary and 
 30.1   post-secondary agriculture education programs. 
 30.2      Subd. 2.  [SECONDARY AGRICULTURAL EDUCATION.] The council 
 30.3   may provide grants for: 
 30.4      (1) planning and establishment costs for secondary 
 30.5   agriculture education programs; 
 30.6      (2) new instructional and communication technologies; and 
 30.7      (3) curriculum updates. 
 30.8      Subd. 3.  [POST-SECONDARY EDUCATION.] The council may 
 30.9   provide grants for: 
 30.10     (1) new instructional and communication technologies; and 
 30.11     (2) special project funding, including programming, 
 30.12  in-service training, and support staff. 
 30.13     Sec. 4.  [41D.03] [MINNESOTA CENTER FOR AGRICULTURE 
 30.14  EDUCATION.] 
 30.15     Subdivision 1.  [GOVERNANCE.] The Minnesota center for 
 30.16  agriculture education is governed by the Minnesota agriculture 
 30.17  education leadership council. 
 30.18     Subd. 2.  [POWERS AND DUTIES OF COUNCIL.] (a) The council 
 30.19  has the powers necessary for the care, management, and control 
 30.20  of the Minnesota center for agriculture education and all its 
 30.21  real and personal property.  The powers shall include, but are 
 30.22  not limited to, those listed in this subdivision. 
 30.23     (b) The council may employ necessary employees, and 
 30.24  contract for other services to ensure the efficient operation of 
 30.25  the center for agriculture education. 
 30.26     (c) The council may receive and award grants.  The council 
 30.27  may establish a charitable foundation and accept, in trust or 
 30.28  otherwise, any gift, grant, bequest, or devise for educational 
 30.29  purposes and hold, manage, invest, and dispose of them and the 
 30.30  proceeds and income of them according to the terms and 
 30.31  conditions of the gift, grant, bequest, or devise and its 
 30.32  acceptance.  The council shall adopt internal procedures to 
 30.33  administer and monitor aids and grants. 
 30.34     (d) The council may establish or coordinate evening, 
 30.35  continuing education, and summer programs for teachers and 
 30.36  pupils. 
 31.1      (e) The council may determine the location for the 
 31.2   Minnesota center for agriculture education and any additional 
 31.3   facilities related to the center, including the authority to 
 31.4   lease a temporary facility. 
 31.5      (f) The council may enter into contracts with other public 
 31.6   and private agencies and institutions for building maintenance 
 31.7   services if it determines that these services could be provided 
 31.8   more efficiently and less expensively by a contractor than by 
 31.9   the council itself.  The council may also enter into contracts 
 31.10  with public or private agencies and institutions, school 
 31.11  districts or combinations of school districts, or educational 
 31.12  cooperative service units to provide supplemental educational 
 31.13  instruction and services. 
 31.14     Subd. 3.  [CENTER ACCOUNT.] There is established in the 
 31.15  state treasury a center for agriculture education account in the 
 31.16  special revenue fund.  All money collected by the council, 
 31.17  including rental income, shall be deposited in the account.  
 31.18  Money in the account, including interest earned, is appropriated 
 31.19  to the council for the operation of its services and programs. 
 31.20     Subd. 4.  [EMPLOYEES.] (a) The council shall employ persons 
 31.21  who shall serve in the unclassified service. 
 31.22     (b) The employees hired under this subdivision and any 
 31.23  other necessary employees hired by the council shall be state 
 31.24  employees in the executive branch. 
 31.25     Subd. 5.  [POLICIES.] The council may adopt administrative 
 31.26  policies about the operation of the center. 
 31.27     Subd. 6.  [PUBLIC POST-SECONDARY INSTITUTIONS; PROVIDING 
 31.28  SPACE.] Public post-secondary institutions shall provide space 
 31.29  for the Minnesota center for agriculture education at a 
 31.30  reasonable cost to the center to the extent that space is 
 31.31  available at the public post-secondary institutions. 
 31.32     Subd. 7.  [PURCHASING INSTRUCTIONAL ITEMS.] Technical 
 31.33  educational equipment may be procured for programs of the 
 31.34  Minnesota center for agriculture education by the council either 
 31.35  by brand designation or in accordance with standards and 
 31.36  specifications the council may adopt, notwithstanding chapter 
 32.1   16B. 
 32.2      Sec. 5.  [41D.04] [RESOURCE, MAGNET, AND OUTREACH 
 32.3   PROGRAMS.] 
 32.4      Subdivision 1.  [RESOURCE AND OUTREACH.] The center shall 
 32.5   offer resource and outreach programs and services statewide 
 32.6   aimed at the enhancement of agriculture education opportunities 
 32.7   for pupils in elementary and secondary school. 
 32.8      Subd. 2.  [CENTER RESPONSIBILITIES.] The center shall: 
 32.9      (1) provide information and technical services to 
 32.10  agriculture teachers, professional agriculture organizations, 
 32.11  school districts, and the department of children, families, and 
 32.12  learning; 
 32.13     (2) gather and conduct research in agriculture education; 
 32.14     (3) design and promote agriculture education opportunities 
 32.15  for all Minnesota pupils in elementary and secondary schools; 
 32.16  and 
 32.17     (4) serve as liaison for the department of children, 
 32.18  families, and learning to national organizations for agriculture 
 32.19  education. 
 32.20     Sec. 6.  Minnesota Statutes 1996, section 125.1385, 
 32.21  subdivision 2, is amended to read: 
 32.22     Subd. 2.  [COMPENSATION.] State money for faculty exchange 
 32.23  programs is to compensate for expenses that are unavoidable and 
 32.24  beyond the normal living expenses exchange participants would 
 32.25  incur if they were not involved in this exchange.  The state 
 32.26  university board of trustees of the Minnesota state colleges and 
 32.27  universities, the board of regents, or of the University of 
 32.28  Minnesota, and their respective campuses, in conjunction with 
 32.29  the participating school districts, must control costs for all 
 32.30  participants as much as possible, through means such as 
 32.31  arranging housing exchanges, providing campus housing, and 
 32.32  providing university, state, or school district cars for 
 32.33  transportation.  The boards and campuses may seek other sources 
 32.34  of funding to supplement these appropriations, if necessary. 
 32.35     Sec. 7.  Minnesota Statutes 1996, section 126.56, 
 32.36  subdivision 2, is amended to read: 
 33.1      Subd. 2.  [ELIGIBLE STUDENT.] To be eligible for a 
 33.2   scholarship, a student shall: 
 33.3      (1) be a United States citizen or permanent resident of the 
 33.4   United States; 
 33.5      (2) be a resident of Minnesota; 
 33.6      (3) attend an eligible program; 
 33.7      (4) have completed at least one year of secondary school 
 33.8   but not have graduated from high school; 
 33.9      (5) have earned at least a B average or its equivalent 
 33.10  during the semester or quarter prior to application, or have 
 33.11  earned at least a B average or its equivalent during the 
 33.12  semester or quarter prior to application in the academic subject 
 33.13  area applicable to the summer program the student wishes to 
 33.14  attend; and 
 33.15     (6) demonstrate need for financial assistance; and 
 33.16     (7) be 19 years of age or younger. 
 33.17     Sec. 8.  Minnesota Statutes 1996, section 126.56, 
 33.18  subdivision 4a, is amended to read: 
 33.19     Subd. 4a.  [ELIGIBLE PROGRAMS.] A scholarship may be used 
 33.20  only for an eligible program.  To be eligible, a program must: 
 33.21     (1) provide, as its primary purpose, academic instruction 
 33.22  for student enrichment in curricular areas including, but not 
 33.23  limited to, communications, humanities, social studies, social 
 33.24  science, science, mathematics, art, or foreign languages; 
 33.25     (2) not be offered for credit to post-secondary students; 
 33.26     (3) not provide remedial instruction; 
 33.27     (4) meet any other program requirements established by the 
 33.28  state board of education and the higher education services 
 33.29  office; and 
 33.30     (5) be approved by the commissioner higher education 
 33.31  services office.  
 33.32     Sec. 9.  Minnesota Statutes 1996, section 126.56, 
 33.33  subdivision 7, is amended to read: 
 33.34     Subd. 7.  [ADMINISTRATION.] The higher education services 
 33.35  office and commissioner shall determine the time and manner for 
 33.36  scholarship applications, awards, and program approval. 
 34.1      Sec. 10.  Minnesota Statutes 1996, section 135A.052, 
 34.2   subdivision 1, is amended to read: 
 34.3      Subdivision 1.  [STATEMENT OF MISSIONS.] The legislature 
 34.4   recognizes each type of public post-secondary system institution 
 34.5   to have a distinctive mission within the overall provision of 
 34.6   public higher education in the state and a responsibility to 
 34.7   cooperate with the each other systems.  These missions are as 
 34.8   follows: 
 34.9      (1) the technical college system colleges shall offer 
 34.10  vocational training and education to prepare students for 
 34.11  skilled occupations that do not require a baccalaureate degree; 
 34.12     (2) the community college system colleges shall offer lower 
 34.13  division instruction in academic programs, occupational programs 
 34.14  in which all credits earned will be accepted for transfer to a 
 34.15  baccalaureate degree in the same field of study, and remedial 
 34.16  studies, for students transferring to baccalaureate institutions 
 34.17  and for those seeking associate degrees; 
 34.18     (3) consolidated community technical colleges shall offer 
 34.19  the same types of instruction, programs, certificates, diplomas, 
 34.20  and degrees as the technical colleges and community colleges 
 34.21  offer; 
 34.22     (4) the state university system universities shall offer 
 34.23  undergraduate and graduate instruction through the master's 
 34.24  degree, including specialist certificates, in the liberal arts 
 34.25  and sciences and professional education; and 
 34.26     (4) (5) the University of Minnesota shall offer 
 34.27  undergraduate, graduate, and professional instruction through 
 34.28  the doctoral degree, and shall be the primary state supported 
 34.29  academic agency for research and extension services. 
 34.30     It is part of the mission of each system that within the 
 34.31  system's resources the system's governing board and chancellor 
 34.32  or president shall endeavor to: 
 34.33     (a) prevent the waste or unnecessary spending of public 
 34.34  money; 
 34.35     (b) use innovative fiscal and human resource practices to 
 34.36  manage the state's resources and operate the system as 
 35.1   efficiently as possible; 
 35.2      (c) coordinate the system's activities wherever appropriate 
 35.3   with the activities of other systems and governmental agencies; 
 35.4      (d) use technology where appropriate to increase system 
 35.5   productivity, improve customer service, increase public access 
 35.6   to information about the system, and increase public 
 35.7   participation in the business of the system; 
 35.8      (e) utilize constructive and cooperative labor-management 
 35.9   practices to the extent otherwise required by chapters 43A and 
 35.10  179A; and 
 35.11     (f) recommend to the legislature appropriate changes in law 
 35.12  necessary to carry out the mission of the system. 
 35.13     Sec. 11.  Minnesota Statutes 1996, section 136A.03, is 
 35.14  amended to read: 
 35.15     136A.03 [EXECUTIVE OFFICERS; EMPLOYEES.] 
 35.16     The director of the higher education services office shall 
 35.17  possess the powers and perform the duties as prescribed by the 
 35.18  higher education services council and shall serve in the 
 35.19  unclassified service of the state civil service.  The director, 
 35.20  or the director's designated representative, on behalf of the 
 35.21  office is authorized to sign contracts and execute all 
 35.22  instruments necessary or appropriate to carry out the purposes 
 35.23  of sections 136A.01 to 136A.178 for the office.  The salary of 
 35.24  the director shall be established by the higher education 
 35.25  services council according to section 15A.081, subdivision 1.  
 35.26  The director shall be a person qualified by training or 
 35.27  experience in the field of higher education or in financial aid 
 35.28  administration.  The director may appoint other professional 
 35.29  employees who shall serve in the unclassified service of the 
 35.30  state civil service.  All other employees shall be in the 
 35.31  classified civil service.  
 35.32     An officer or professional employee in the unclassified 
 35.33  service as provided in this section is a person who has studied 
 35.34  higher education or a related field at the graduate level or has 
 35.35  similar experience and who is qualified for a career in 
 35.36  financial aid and other aspects of higher education and for 
 36.1   activities in keeping with the planning and administrative 
 36.2   responsibilities of the office and who is appointed to assume 
 36.3   responsibility for administration of educational programs or 
 36.4   research in matters of higher education. 
 36.5      Sec. 12.  Minnesota Statutes 1996, section 136A.16, 
 36.6   subdivision 8, is amended to read: 
 36.7      Subd. 8.  Money made available to the office that is not 
 36.8   immediately needed for the purposes of sections 136A.15 to 
 36.9   136A.1702 may be invested by the office.  The money must be 
 36.10  invested in bonds, certificates of indebtedness, and other fixed 
 36.11  income securities, except preferred stocks, which are legal 
 36.12  investments for the permanent school fund.  The money may also 
 36.13  be invested in prime quality commercial paper that is eligible 
 36.14  for investment in the state employees retirement fund.  All 
 36.15  interest and profits from such investments inure to the benefit 
 36.16  of the office or may be pledged for security of bonds issued by 
 36.17  the office or its predecessor, the Minnesota higher education 
 36.18  coordinating board. 
 36.19     Sec. 13.  Minnesota Statutes 1996, section 136A.16, is 
 36.20  amended by adding a subdivision to read: 
 36.21     Subd. 14.  The office may sell at public or private sale, 
 36.22  at the price or prices determined by the office, any note or 
 36.23  other instrument or obligation evidencing or securing a loan 
 36.24  made by the office or its predecessor, the Minnesota higher 
 36.25  education coordinating board. 
 36.26     Sec. 14.  Minnesota Statutes 1996, section 136A.16, is 
 36.27  amended by adding a subdivision to read: 
 36.28     Subd. 15.  The office may obtain municipal bond insurance, 
 36.29  letters of credit, surety obligations, or similar agreements 
 36.30  from financial institutions. 
 36.31     Sec. 15.  Minnesota Statutes 1996, section 136A.171, is 
 36.32  amended to read: 
 36.33     136A.171 [REVENUE BONDS; ISSUANCE; PROCEEDS.] 
 36.34     The higher education services office may issue revenue 
 36.35  bonds to obtain funds for loans made in accordance with the 
 36.36  provisions of this chapter.  The aggregate amount of revenue 
 37.1   bonds, issued directly by the office, outstanding at any one 
 37.2   time, not including refunded bonds or otherwise defeased or 
 37.3   discharged bonds, shall not exceed $550,000,000.  Proceeds from 
 37.4   the issuance of bonds may be held and invested by the office 
 37.5   pending disbursement in the form of loans.  All interest and 
 37.6   profits from the investments shall inure to the benefit of the 
 37.7   office and shall be available to the board office for the same 
 37.8   purposes as the proceeds from the sale of revenue bonds 
 37.9   including, but not limited to, costs incurred in administering 
 37.10  loans under this chapter and loan reserve funds. 
 37.11     Sec. 16.  Minnesota Statutes 1996, section 136A.173, 
 37.12  subdivision 3, is amended to read: 
 37.13     Subd. 3.  The revenue bonds may be issued as serial bonds 
 37.14  or as term bonds, or the office, in its discretion, may issue 
 37.15  bonds of both types.  The revenue bonds shall be authorized by 
 37.16  resolution of the members director of the office and shall bear 
 37.17  such date or dates, mature at such time or times, not exceeding 
 37.18  50 years from their respective dates, bear interest at such rate 
 37.19  or rates, payable at such time or times, be in denominations, be 
 37.20  in such form, either coupon or registered, carry such 
 37.21  registration privileges, be executed in such manner, be payable 
 37.22  in lawful money of the United States of America at such place or 
 37.23  places, and be subject to such terms of redemption, as such 
 37.24  resolution or resolutions may provide.  The revenue bonds or 
 37.25  notes may be sold at public or private sale for such price or 
 37.26  prices as the office shall determine.  Pending preparation of 
 37.27  the definitive bonds, the office may issue interim receipts or 
 37.28  certificates which shall be exchanged for such definite bonds. 
 37.29     Sec. 17.  Minnesota Statutes 1996, section 136A.29, 
 37.30  subdivision 9, is amended to read: 
 37.31     Subd. 9.  The authority is authorized and empowered to 
 37.32  issue revenue bonds whose aggregate principal amount at any time 
 37.33  shall not exceed $350,000,000 $500,000,000 and to issue notes, 
 37.34  bond anticipation notes, and revenue refunding bonds of the 
 37.35  authority under the provisions of sections 136A.25 to 136A.42, 
 37.36  to provide funds for acquiring, constructing, reconstructing, 
 38.1   enlarging, remodeling, renovating, improving, furnishing, or 
 38.2   equipping one or more projects or parts thereof. 
 38.3      Sec. 18.  Minnesota Statutes 1996, section 136F.28, 
 38.4   subdivision 2, is amended to read: 
 38.5      Subd. 2.  [DEFINITIONS.] For the purpose of this 
 38.6   section, the following terms have the meaning given to them: 
 38.7      (a) "Southwest Asia veteran" means a person who:  
 38.8      (1) served in the active military service in any branch of 
 38.9   the armed forces of the United States any time between August 1, 
 38.10  1990, and February 27, 1992; 
 38.11     (2) became eligible for the Southwest Asia Service Medal as 
 38.12  a result of the service; 
 38.13     (3) was a Minnesota resident at the time of induction into 
 38.14  the armed forces and for the one year immediately preceding 
 38.15  induction; and 
 38.16     (4) has been separated or discharged from active military 
 38.17  service under conditions other than dishonorable.  
 38.18     (b) "Technical college" means a technical college or 
 38.19  consolidated community technical college under the governance of 
 38.20  the Minnesota state colleges and universities. 
 38.21     Sec. 19.  Minnesota Statutes 1996, section 136F.30, is 
 38.22  amended to read: 
 38.23     136F.30 [COURSES AND PROGRAMS.] 
 38.24     The board shall review and approve or disapprove campus 
 38.25  proposals for adding, deleting, or substantially changing 
 38.26  programs of study, including graduate and undergraduate academic 
 38.27  programs, training in professional, semiprofessional, and 
 38.28  technical fields, and adult education.  The board shall avoid 
 38.29  duplicate program offerings.  The board may initiate activities 
 38.30  to close programs.  If a decision is made to eliminate a 
 38.31  program, a college or university shall notify students and 
 38.32  assist them in completing the program or in transferring to a 
 38.33  similar program at another campus.  The board shall place a high 
 38.34  priority on ensuring the transferability of credit. 
 38.35     Sec. 20.  Minnesota Statutes 1996, section 136F.32, is 
 38.36  amended to read: 
 39.1      136F.32 [DEGREES; DIPLOMAS; CERTIFICATES.] 
 39.2      Subdivision 1.  [APPROVAL.] The board may approve awarding 
 39.3   of appropriate certificates, diplomas, or degrees to persons who 
 39.4   complete a prescribed curriculum. 
 39.5      Subd. 2.  [TECHNICAL AND CONSOLIDATED TECHNICAL 
 39.6   COLLEGES.] A technical college or consolidated technical 
 39.7   community college shall offer students the option of pursuing 
 39.8   diplomas and certificates in each technical education program, 
 39.9   unless the board determines that this is not practicable for 
 39.10  certain programs.  All credits earned for the diploma or 
 39.11  certificate shall be applicable toward any available degree in 
 39.12  the same program. 
 39.13     Sec. 21.  Minnesota Statutes 1996, section 136F.49, is 
 39.14  amended to read: 
 39.15     136F.49 [LICENSURE.] 
 39.16     The board may shall adopt policies for licensure of 
 39.17  teaching personnel in technical colleges and for vocational 
 39.18  technical instructors teaching outside the Minnesota state 
 39.19  colleges and universities system.  The board may establish a 
 39.20  processing fee for the issuance, renewal, or extension of a 
 39.21  license. 
 39.22     Sec. 22.  Minnesota Statutes 1996, section 136F.52, is 
 39.23  amended by adding a subdivision to read: 
 39.24     Subd. 1a.  [PROGRAM ADVISORY COMMITTEES.] Technical and 
 39.25  consolidated colleges may have advisory committees for each 
 39.26  technical program.  The advisory committee shall be comprised of 
 39.27  representatives of relevant businesses, community members, 
 39.28  faculty, and students.  The advisory committees shall review and 
 39.29  make recommendations to the college and the board on proposals 
 39.30  to reduce, substantially change, or eliminate programs. 
 39.31     Sec. 23.  Minnesota Statutes 1996, section 136F.581, 
 39.32  subdivision 2, is amended to read: 
 39.33     Subd. 2.  [POLICIES AND PROCEDURES.] The board shall 
 39.34  develop policies, and each college and university shall develop 
 39.35  procedures, for purchases and contracts that are consistent with 
 39.36  subdivision 1.  The policies and procedures shall be developed 
 40.1   through the system and campus labor management committees and 
 40.2   shall include provisions requiring the system and campuses to 
 40.3   determine that they cannot use available staff before 
 40.4   contracting with additional outside consultants or services.  In 
 40.5   addition, each college and university, in consultation with the 
 40.6   system office, shall develop procedures for those purchases and 
 40.7   contracts that can be accomplished by a college and university 
 40.8   without board approval.  The board policies must allow each 
 40.9   college and university the local authority to enter into 
 40.10  contracts for construction projects of up to $250,000 and to 
 40.11  make other purchases of up to $50,000, without receiving board 
 40.12  approval.  The board may allow a college or university local 
 40.13  authority to make purchases over $50,000 without receiving board 
 40.14  approval. 
 40.15     Sec. 24.  Minnesota Statutes 1996, section 136F.80, is 
 40.16  amended to read: 
 40.17     136F.80 [GRANTS; GIFTS; BEQUESTS; DEVISES; ENDOWMENTS.] 
 40.18     Subdivision 1.  [RECEIPT AND ACCEPTANCE.] The board may 
 40.19  apply for, receive, and accept on behalf of the state and for 
 40.20  the benefit of any state college or university any grant, gift, 
 40.21  bequest, devise, or endowment that any person, firm, 
 40.22  corporation, foundation, association, or government agency may 
 40.23  make to the board for the purposes of the state colleges and 
 40.24  universities.  The board may use any money given to it or to any 
 40.25  of the state colleges and universities consistent with the terms 
 40.26  and conditions under which the money was received and for the 
 40.27  purposes stated.  All moneys received are appropriated to the 
 40.28  board for use in the colleges and universities.  These moneys 
 40.29  shall not be taken into account in determining appropriations or 
 40.30  allocations and are not subject to the provisions of chapter 
 40.31  16A.  All taxes and special assessments constituting a lien on 
 40.32  any real property received and accepted by the board under this 
 40.33  section shall be paid in full before title is transferred to the 
 40.34  state.  
 40.35     Subd. 2.  [DEPOSIT OF MONEY.] The board shall provide by 
 40.36  policy, in accordance with provisions of chapter 118 118A, for 
 41.1   the deposit of all money received or referred to under this 
 41.2   section.  Whenever the board shall by resolution determine that 
 41.3   there are moneys in the state college or university funds not 
 41.4   currently needed, the board may by resolution authorize and 
 41.5   direct the president of the college or university to invest a 
 41.6   specified amount in securities as are duly authorized as legal 
 41.7   investments for savings banks and trust companies.  Securities 
 41.8   so purchased shall be deposited and held for the board by any 
 41.9   bank or trust company authorized to do a banking business in 
 41.10  this state.  Notwithstanding the provisions of chapter 118 118A, 
 41.11  the state board of investment may invest assets of the board, 
 41.12  colleges, and universities when requested by the board, college, 
 41.13  or university. 
 41.14     Sec. 25.  [136F.81] [TRANSFER OF GIFTS.] 
 41.15     A college or university that receives a gift or bequest 
 41.16  that is intended for purposes performed by the institution's 
 41.17  foundation may transfer the money to its foundation. 
 41.18     Sec. 26.  Minnesota Statutes 1996, section 137.022, 
 41.19  subdivision 2, is amended to read: 
 41.20     Subd. 2.  [INCOME.] The All income from the permanent 
 41.21  university fund is appropriated annually to the board of 
 41.22  regents.  Authority over this income is vested solely in the 
 41.23  board but must be used by the board directly to enhance the 
 41.24  mission of the university.  This appropriation of income must 
 41.25  not be used to reduce other appropriations made to the board of 
 41.26  regents.  The determination of this income shall be based on the 
 41.27  procedures detailed in section 11A.16, subdivision 5, or 11A.12, 
 41.28  subdivision 2. 
 41.29     Sec. 27.  Minnesota Statutes 1996, section 216C.27, 
 41.30  subdivision 7, is amended to read: 
 41.31     Subd. 7.  [BUILDING EVALUATORS.] The commissioner shall 
 41.32  certify evaluators in each county of the state who are qualified 
 41.33  to determine the compliance of a residence with applicable 
 41.34  energy efficiency standards.  The commissioner shall, by rule 
 41.35  pursuant to chapter 14, adopt standards for the certification 
 41.36  and performance of evaluators and set a fee for the 
 42.1   certification of evaluators which is sufficient to cover the 
 42.2   ongoing costs of the program once it is established.  The 
 42.3   commissioner shall encourage the certification of existing 
 42.4   groups of trained municipal personnel and qualified individuals 
 42.5   from community-based organizations and public service 
 42.6   organizations.  Each certified evaluator shall, on request of 
 42.7   the owner, inspect any residence and report the degree to which 
 42.8   it complies with applicable energy efficiency standards 
 42.9   established pursuant to subdivision 1.  The inspections shall be 
 42.10  made within 30 days of the request.  The commissioner shall 
 42.11  enter into an agreement with the department of children, 
 42.12  families, and learning board of trustees of the Minnesota state 
 42.13  colleges and universities for the provision of evaluator 
 42.14  training through at institutions that offer the technical 
 42.15  colleges training.  The commissioner may contract with 
 42.16  the technical colleges board to reduce the training costs to the 
 42.17  students.  The commissioner may eliminate the examination fee 
 42.18  for persons seeking upgraded certificates.  The commissioner may 
 42.19  also establish requirements for continuing education, periodic 
 42.20  recertification, and revocation of certification for evaluators. 
 42.21     Sec. 28.  Minnesota Statutes 1996, section 583.22, 
 42.22  subdivision 5, is amended to read: 
 42.23     Subd. 5.  [DIRECTOR.] "Director" means the director of the 
 42.24  agricultural extension service conflict and change center at the 
 42.25  University of Minnesota's Humphrey Institute or the director's 
 42.26  designee. 
 42.27     Sec. 29.  Laws 1986, chapter 398, article 1, section 18, as 
 42.28  amended by Laws 1987, chapter 292, section 37; Laws 1989, 
 42.29  chapter 350, article 16, section 8; Laws 1990, chapter 525, 
 42.30  section 1; Laws 1991, chapter 208, section 2; Laws 1993, First 
 42.31  Special Session chapter 2, article 6, section 2; and Laws 1995, 
 42.32  chapter 212, article 2, section 11, is amended to read: 
 42.33     Sec. 18.  [REPEALER.] 
 42.34     Sections 1 to 17 and Minnesota Statutes, section 336.9-501, 
 42.35  subsections (6) and (7), and sections 583.284, 583.285, 583.286, 
 42.36  and 583.305, are repealed on July 1, 1997 1998. 
 43.1      Sec. 30.  Laws 1995, chapter 212, article 1, section 4, 
 43.2   subdivision 4, is amended to read: 
 43.3   Subd. 4.  Specials Transfer 
 43.4   The appropriation in subdivision 3, 
 43.5   paragraph (b), for Medical Research, 
 43.6   Special Hospitals Service and 
 43.7   Educational Offset, and the Institute 
 43.8   for Human Genetics; and in paragraph 
 43.9   (c) for the Underground Space Center, 
 43.10  Microelectronics and Information 
 43.11  Science Center, and the Center for 
 43.12  Advanced Manufacturing, Design, and 
 43.13  Control; and in paragraph (d) for the 
 43.14  Fellowships for Minority and 
 43.15  Disadvantaged Students, Intercollegiate 
 43.16  Athletics, Sea Grant College Program, 
 43.17  Biological Process Technology 
 43.18  Institute, and the Supercomputer 
 43.19  Institute shall be merged with the 
 43.20  operation and maintenance funding in 
 43.21  subdivision 2, effective June 30, 1997. 
 43.22     Sec. 31.  Laws 1996, chapter 463, section 2, subdivision 6, 
 43.23  is amended to read: 
 43.24  Subd. 6.  Anoka Ramsey Community College 
 43.25  (a) Addition and Remodeling                          10,430,000
 43.26  Design, construct, furnish, and equip 
 43.27  an addition and remodel existing space 
 43.28  to provide classrooms, a learning 
 43.29  resource center, computer labs, a 
 43.30  developmental learning center, science 
 43.31  labs, nursing and student services 
 43.32  facilities, offices, and a campus 
 43.33  center, and food service.  The college 
 43.34  may use up to $900,000 from auxiliary 
 43.35  enterprise funds for this project. 
 43.36  (b) Design and construct a replacement
 43.37  energy plant and service elevator                     4,510,000
 43.38     Sec. 32.  [BOARD AUTHORITY TO PURCHASE, SELL, TRANSFER, 
 43.39  LEASE, AND CONVEY CERTAIN LAND AND IMPROVEMENTS.] 
 43.40     Subdivision 1.  [AUTHORITY.] The board of trustees may 
 43.41  purchase, sell, transfer, lease, and convey land and 
 43.42  improvements described in this section, and may retain all 
 43.43  proceeds from the sale or lease of real estate under Minnesota 
 43.44  Statutes, section 136F.71.  The provisions of Minnesota 
 43.45  Statutes, sections 94.09 to 94.16 and 103F.535, do not apply to 
 43.46  real estate transactions authorized by this section. 
 43.47     Subd. 2.  [ST. CLOUD.] The board of trustees may purchase 
 43.48  fee title from the Central Minnesota Council of Boy Scouts, 
 43.49  Inc., of approximately 1.4 acres of land that includes an office 
 44.1   building and that is contiguous to St. Cloud Technical College 
 44.2   for college operations. 
 44.3      Subd. 3.  [INVER HILLS, NORMANDALE LAND TRANSFERS.] (a) The 
 44.4   board of trustees may transfer fee title to approximately eight 
 44.5   acres of state-owned real estate operated by Inver Hills 
 44.6   Community College to the city of Inver Grove Heights.  The 
 44.7   purpose of the transfer is to provide land for the construction 
 44.8   of a community library at no cost to the state, the board, or 
 44.9   Inver Hills Community College.  The transfer is contingent on 
 44.10  the board of trustees acquiring fee title to approximately eight 
 44.11  acres of real estate owned by the city of Inver Grove Heights, 
 44.12  adjacent to Inver Hills Community College, for college 
 44.13  operations. 
 44.14     (b) The board of trustees may transfer fee title to 
 44.15  approximately 12 acres of state-owned real estate that comprises 
 44.16  Normandale Community College's athletic fields to the city of 
 44.17  Bloomington.  The transfer is contingent on the board acquiring 
 44.18  fee title to approximately 12 acres of real estate owned by the 
 44.19  city of Bloomington, which is in the vicinity of Normandale 
 44.20  Community College, for college operations.  The transfer must 
 44.21  include provisions to allow the college continued use of the 
 44.22  fields. 
 44.23     Subd. 4.  [WINONA, JACKSON, MAHTOMEDI PROPERTY SALE.] (a) 
 44.24  The board of trustees may sell the state's interest in an 
 44.25  aviation hanger and related land operated by the Winona campus 
 44.26  of Winona-Red Wing Technical College for no less than the 
 44.27  assessed value of the property.  The sale may be by public 
 44.28  auction, sealed bid, listing with a real estate broker licensed 
 44.29  under Minnesota Statutes, chapter 82, or other means selected by 
 44.30  the board of trustees. 
 44.31     (b) The board of trustees may sell a former armory building 
 44.32  operated by the Jackson campus of Minnesota West Community and 
 44.33  Technical College for no less than the assessed value of the 
 44.34  property.  The sale may be by public auction, sealed bid, 
 44.35  listing with a real estate broker licensed under Minnesota 
 44.36  Statutes, chapter 82, or other means selected by the board of 
 45.1   trustees. 
 45.2      (c) The board of trustees may sell for $1 approximately 
 45.3   four acres of state-owned real estate operated by Century 
 45.4   Community and Technical College to the city of Mahtomedi for 
 45.5   construction of an ice arena.  
 45.6      Subd. 5.  [MINNEAPOLIS TRANSFER.] Notwithstanding the 
 45.7   provisions of Minnesota Statutes, chapter 94, or any other state 
 45.8   law, if the board of trustees of the Minnesota state college and 
 45.9   universities system or the school board of special school 
 45.10  district No. 1, Minneapolis, ceases to use its portion of the 
 45.11  real property along second avenue north adjacent to Bassett's 
 45.12  creek in Minneapolis known as the transportation center for a 
 45.13  purpose related to normal, authorized board functions or 
 45.14  activities, or if the board of trustees or the school board 
 45.15  wishes to permanently abandon, sell, or lease or otherwise 
 45.16  transfer the control of a material part of, its portion of the 
 45.17  real property, the board of trustees must offer to convey its 
 45.18  portion of the property to the school board for $1 or the school 
 45.19  board must offer to convey its portion of the property to the 
 45.20  board of trustees for $1.  The board of trustees and the school 
 45.21  board are each authorized to convey their portion of the 
 45.22  property upon timely acceptance of such offer.  An offer 
 45.23  extended shall become void if not accepted in writing within 60 
 45.24  days of issuance. 
 45.25     Sec. 33.  [DISTINGUISHED SERVICE PROFESSOR.] 
 45.26     Notwithstanding any law to the contrary, an appointment 
 45.27  made by the state university board to the position of 
 45.28  distinguished service professor in effect on June 30, 1995, and 
 45.29  the terms and conditions of the appointment, remain in effect 
 45.30  until terminated by the distinguished service professor 
 45.31  appointee or the appointee is terminated for cause.  For the 
 45.32  purposes of this section, distinguished service professor has 
 45.33  the same meaning as distinguished senior fellow. 
 45.34     Sec. 34.  [INSTRUCTION TO REVISOR.] 
 45.35     The revisor of statutes shall change the phrases "state 
 45.36  board of technical colleges," "state board for vocational 
 46.1   technical education," "state board for community colleges," and 
 46.2   "state university board," or similar, to "board of trustees of 
 46.3   the Minnesota state colleges and universities" in Minnesota 
 46.4   Statutes, sections 3.754; 16A.662, subdivision 5; 352.01, 
 46.5   subdivision 2b; and 354.66, subdivision 1a. 
 46.6      Sec. 35.  [REPEALER.] 
 46.7      Minnesota Statutes 1996, sections 126.113; and 137.41; Laws 
 46.8   1995, chapter 212, article 4, section 34; and Laws 1995, First 
 46.9   Special Session chapter 2, article 1, sections 35 and 36, are 
 46.10  repealed. 
 46.11                             ARTICLE 4
 46.12                       PRIVATE CAREER SCHOOLS
 46.13     Section 1.  Minnesota Statutes 1996, section 141.21, 
 46.14  subdivision 3, is amended to read: 
 46.15     Subd. 3.  [SOLICITOR.] "Solicitor" means a person who for a 
 46.16  salary or for commission, acts as an agent, independent 
 46.17  contractor, salesperson, or counselor in procuring or attempting 
 46.18  to procure recruiting students or enrollees for a course of 
 46.19  instruction by solicitation in program using any form made 
 46.20  method, at any place except on the actual business premises of 
 46.21  the school and except for rendering, other than only providing 
 46.22  public information service at the invitation or permission of a 
 46.23  school or educational organization.  
 46.24     Sec. 2.  Minnesota Statutes 1996, section 141.21, 
 46.25  subdivision 5, is amended to read: 
 46.26     Subd. 5.  [SCHOOL.] "School" means any person, within or 
 46.27  without outside the state, that who maintains, advertises, 
 46.28  solicits, or conducts any course of instruction program for 
 46.29  profit or for a tuition charge at any level other than 
 46.30  baccalaureate or graduate programs, and which is not 
 46.31  specifically exempted by the provisions of sections 141.21 to 
 46.32  141.36 141.35.  
 46.33     Sec. 3.  Minnesota Statutes 1996, section 141.21, 
 46.34  subdivision 6, is amended to read: 
 46.35     Subd. 6.  [COURSE OF INSTRUCTION.] "Course of instruction" 
 46.36  means any classroom, correspondence, or extension course of 
 47.1   instruction; any subunit of a program; or any combination 
 47.2   thereof.  
 47.3      Sec. 4.  Minnesota Statutes 1996, section 141.21, is 
 47.4   amended by adding a subdivision to read: 
 47.5      Subd. 8.  [PROGRAM.] "Program" means any course or grouping 
 47.6   of courses that is advertised or listed in a school's catalog, 
 47.7   brochures, or other publications, or for which the school grants 
 47.8   a formal recognition. 
 47.9      Sec. 5.  Minnesota Statutes 1996, section 141.21, is 
 47.10  amended by adding a subdivision to read: 
 47.11     Subd. 9.  [DISTANCE EDUCATION SCHOOL.] "Distance education 
 47.12  school" means a school that establishes, keeps, or maintains a 
 47.13  facility or location where a program is offered through 
 47.14  correspondence, telecommunication, or electronic media. 
 47.15     Sec. 6.  Minnesota Statutes 1996, section 141.22, is 
 47.16  amended to read: 
 47.17     141.22 [CITATION.] 
 47.18     Sections 141.21 to 141.36 141.35 may be cited as the 
 47.19  Private business, trade and correspondence Career School Act. 
 47.20     Sec. 7.  Minnesota Statutes 1996, section 141.25, 
 47.21  subdivision 1, is amended to read: 
 47.22     Subdivision 1.  [REQUIRED.] No school shall maintain, 
 47.23  advertise, solicit for, or conduct any course of instruction 
 47.24  program in Minnesota without first obtaining a license from the 
 47.25  office.  
 47.26     Sec. 8.  Minnesota Statutes 1996, section 141.25, 
 47.27  subdivision 2, is amended to read: 
 47.28     Subd. 2.  [CONTRACT UNENFORCEABLE.] Any contract entered 
 47.29  into with any person for a course of instruction program after 
 47.30  November 15, 1969, by or on behalf of any person operating any 
 47.31  school to which a license has not been issued pursuant to under 
 47.32  sections 141.21 to 141.36 141.35, shall be unenforceable in any 
 47.33  action brought thereon.  
 47.34     Sec. 9.  Minnesota Statutes 1996, section 141.25, 
 47.35  subdivision 3, is amended to read: 
 47.36     Subd. 3.  [APPLICATION.] Application for a license shall be 
 48.1   on forms prepared and furnished by the office, and shall contain 
 48.2   the following and such other information as the office may 
 48.3   require: 
 48.4      (a) (1) the title or name of the school, together with 
 48.5   ownership and controlling officers, members, managing employees, 
 48.6   and director; 
 48.7      (b) (2) the specific fields of instruction programs which 
 48.8   will be offered and the specific purposes of such the 
 48.9   instruction; 
 48.10     (c) (3) the place or places where such the instruction will 
 48.11  be given; 
 48.12     (d) (4) a listing of the equipment available for 
 48.13  instruction in each course of instruction program; 
 48.14     (e) (5) the maximum enrollment to be accommodated with 
 48.15  equipment available in each specified course of instruction 
 48.16  program; 
 48.17     (f) (6) the qualifications of instructors and supervisors 
 48.18  in each specified course of instruction program; 
 48.19     (g) (7) a current balance sheet, income statement, and 
 48.20  adequate supporting documentation, prepared and certified by an 
 48.21  independent public accountant or CPA; 
 48.22     (h) (8) copies of all media advertising and promotional 
 48.23  literature and brochures currently used or reasonably expected 
 48.24  to be used by such the school; 
 48.25     (i) (9) copies of all Minnesota enrollment agreement forms 
 48.26  and contract forms and all enrollment agreement forms and 
 48.27  contract forms used in Minnesota; and 
 48.28     (10) gross income earned in the preceding year from student 
 48.29  tuition, fees, and other required institutional charges, unless 
 48.30  the school files with the office a surety bond equal to at least 
 48.31  $50,000 as described in subdivision 5.  
 48.32     Sec. 10.  Minnesota Statutes 1996, section 141.25, 
 48.33  subdivision 5, is amended to read: 
 48.34     Subd. 5.  [BOND.] (a) No license shall be issued to any 
 48.35  school which maintains, conducts, solicits for, or advertises 
 48.36  within the state of Minnesota any course of instruction program, 
 49.1   unless the applicant files with the office a continuous 
 49.2   corporate surety bond in the sum of $10,000 written by a company 
 49.3   authorized to do business in Minnesota conditioned upon the 
 49.4   faithful performance of all contracts and agreements with 
 49.5   students made by the applicant.  Such 
 49.6      (b) The amount of the surety bond shall be ten percent of 
 49.7   the preceding year's gross income from student tuition, fees, 
 49.8   and other required institutional charges, but in no event less 
 49.9   than $10,000 nor greater than $50,000, except that a school may 
 49.10  deposit a greater amount at its own discretion.  A school in 
 49.11  each annual application for licensure must compute the amount of 
 49.12  the surety bond and verify that the amount of the surety bond 
 49.13  complies with this subdivision, unless the school maintains a 
 49.14  surety bond equal to at least $50,000.  A school that operates 
 49.15  at two or more locations may combine gross income from student 
 49.16  tuition, fees, and other required institutional charges for all 
 49.17  locations for the purpose of determining the annual surety bond 
 49.18  requirement.  The gross tuition and fees used to determine the 
 49.19  amount of the surety bond required for a school having a license 
 49.20  for the sole purpose of recruiting students in Minnesota shall 
 49.21  be only that paid to the school by the students recruited from 
 49.22  Minnesota. 
 49.23     (c) The bond shall run to the state of Minnesota and to any 
 49.24  person who may have a cause of action against the applicant 
 49.25  arising at any time after the bond is filed and before it is 
 49.26  canceled for breach of any contract or agreement made by the 
 49.27  applicant with any student.  The aggregate liability of the 
 49.28  surety for all breaches of the conditions of the bond shall not 
 49.29  exceed the principal sum of $10,000 deposited by the school 
 49.30  under paragraph (b).  The surety of any such bond may cancel it 
 49.31  upon giving 60 days notice in writing to the office and shall be 
 49.32  relieved of liability for any breach of condition occurring 
 49.33  after the effective date of cancellation. 
 49.34     (d) In lieu of bond, the applicant may deposit with the 
 49.35  state treasurer the a sum of $10,000 equal to the amount of the 
 49.36  required surety bond in cash, or securities such as may be 
 50.1   legally purchased by savings banks or for trust funds in an 
 50.2   aggregate market value of $10,000 equal to the amount of the 
 50.3   required surety bond. 
 50.4      (e) Failure of a school to post and maintain the required 
 50.5   surety bond or deposit under paragraph (d) may result in denial, 
 50.6   suspension, or revocation of the school's license.  
 50.7      Sec. 11.  Minnesota Statutes 1996, section 141.25, 
 50.8   subdivision 6, is amended to read: 
 50.9      Subd. 6.  [RESIDENT AGENT.] Schools domiciled located 
 50.10  outside the state of Minnesota which that offer, advertise, 
 50.11  solicit for, or conduct any course of instruction program within 
 50.12  the state of Minnesota shall first file with the secretary of 
 50.13  state a sworn statement designating a resident agent authorized 
 50.14  to receive service of process.  Such The statement shall 
 50.15  designate the secretary of state as resident agent for service 
 50.16  of process in the absence of an agent otherwise so designated.  
 50.17  In the event a school fails to file such the statement, the 
 50.18  secretary of state is hereby designated as the resident agent 
 50.19  authorized to receive service of process.  Such The 
 50.20  authorization shall be irrevocable as to causes of action 
 50.21  arising out of transactions occurring prior to the filing of 
 50.22  written notice of withdrawal from the state of Minnesota filed 
 50.23  with the secretary of state.  
 50.24     Sec. 12.  Minnesota Statutes 1996, section 141.25, 
 50.25  subdivision 7, is amended to read: 
 50.26     Subd. 7.  [MINIMUM STANDARDS.] No license shall be issued 
 50.27  unless the office first determines: 
 50.28     (a) (1) that the applicant has a sound financial condition 
 50.29  with sufficient resources available to meet the school's 
 50.30  financial obligations; to refund all tuition and other charges, 
 50.31  within a reasonable period of time, in the event of dissolution 
 50.32  of the school or in the event of any justifiable claims for 
 50.33  refund against the school by the student body; to provide 
 50.34  adequate service to its students and prospective students; and 
 50.35  for the proper use and support of the school to be maintained; 
 50.36     (b) (2) that the applicant has satisfactory training 
 51.1   facilities with sufficient tools and equipment and the necessary 
 51.2   number of work stations to train prepare adequately the students 
 51.3   currently enrolled, and those proposed to be enrolled; 
 51.4      (c) (3) that the applicant employs a sufficient number of 
 51.5   qualified instructors trained by experience and education 
 51.6   teaching personnel to give provide the training educational 
 51.7   programs contemplated; 
 51.8      (d) (4) that the school has an organizational framework 
 51.9   with administrative and instructional personnel to provide the 
 51.10  programs and services it intends to offer; 
 51.11     (5) that the premises and conditions under which the 
 51.12  students work and study are sanitary, healthful, and safe, 
 51.13  according to modern standards; 
 51.14     (e) (6) that each occupational course or program of 
 51.15  instruction or study shall be of such the quality and content as 
 51.16  to provide education and training preparation which will 
 51.17  adequately prepare enrolled students for entry level positions 
 51.18  in the occupation for which trained prepared; 
 51.19     (f) (7) that the living quarters which are owned, 
 51.20  maintained, or approved by the applicant for students are 
 51.21  sanitary and safe; 
 51.22     (g) (8) that the contract or enrollment agreement used by 
 51.23  the school complies with the following provisions: in section 
 51.24  141.265; 
 51.25     (1) the name and address of the school must be clearly 
 51.26  stated; 
 51.27     (2) inclusion of a clear and conspicuous disclosure that 
 51.28  such agreement becomes a legally binding instrument upon written 
 51.29  acceptance of the student by the school unless canceled pursuant 
 51.30  to section 141.271; 
 51.31     (3) must contain the school's cancellation and refund 
 51.32  policy which shall be clearly and conspicuously entitled, 
 51.33  "Buyer's Right to Cancel"; 
 51.34     (4) the total cost of the course including tuition and all 
 51.35  other charges shall be clearly stated; 
 51.36     (5) the name and description of the course, including the 
 52.1   number of hours or credits of classroom instruction and/or home 
 52.2   study lessons shall be included; 
 52.3      (6) no contract or agreement shall (9) that contracts and 
 52.4   agreements do not contain a wage assignment provision and/or or 
 52.5   a confession of judgment clause; and 
 52.6      (7) each contract or enrollment agreement shall contain a 
 52.7   clear and conspicuous explanation of the form and means of 
 52.8   notice the student should use in the event the student elects to 
 52.9   cancel the contract or sale, the effective date of cancellation, 
 52.10  and the name and address of the seller to which the notice 
 52.11  should be sent or delivered; and 
 52.12     (h) (10) that there has been no adjudication of fraud or 
 52.13  misrepresentation in any criminal, civil, or administrative 
 52.14  proceeding in any jurisdiction against the school or its owner, 
 52.15  officers, agents, or sponsoring organization.  
 52.16     Sec. 13.  Minnesota Statutes 1996, section 141.25, 
 52.17  subdivision 8, is amended to read: 
 52.18     Subd. 8.  [FEES AND TERMS OF LICENSE.] (a) Applications for 
 52.19  initial license under sections 141.21 to 141.36 141.35 shall be 
 52.20  accompanied by a nonrefundable application fee established by 
 52.21  the office that is sufficient to recover, but not exceed, its 
 52.22  administrative costs. 
 52.23     (b) All licenses shall expire one year from the date issued 
 52.24  by the office.  Each renewal application shall be accompanied by 
 52.25  a nonrefundable renewal fee established by the office that is 
 52.26  sufficient to recover, but does not exceed, its administrative 
 52.27  costs.  
 52.28     (c) Application for renewal of license shall be made at 
 52.29  least 30 days before the expiration of the school's current 
 52.30  license.  Each renewal form shall be supplied by the office.  It 
 52.31  shall not be necessary for an applicant to supply all 
 52.32  information required in the initial application at the time of 
 52.33  renewal unless requested by the office.  
 52.34     Sec. 14.  Minnesota Statutes 1996, section 141.25, 
 52.35  subdivision 9, is amended to read: 
 52.36     Subd. 9.  [CATALOG OR BROCHURE.] Before a license is issued 
 53.1   to a school, other than one which offers exclusively a 
 53.2   correspondence course of instruction, the school shall furnish 
 53.3   to the office a catalog or brochure containing the following: 
 53.4      (1) identifying data, such as volume number and date of 
 53.5   publication; 
 53.6      (2) name and address of the school and its governing body 
 53.7   and officials; 
 53.8      (3) a calendar of the school showing legal holidays, 
 53.9   beginning and ending dates of each course quarter, term, or 
 53.10  semester, and other important dates; 
 53.11     (4) school policy and regulations on enrollment including 
 53.12  dates and specific entrance requirements for each course 
 53.13  program; 
 53.14     (5) school policy and regulations about leave, absences, 
 53.15  class cuts, make-up work, tardiness, and interruptions for 
 53.16  unsatisfactory attendance; 
 53.17     (6) school policy and regulations about standards of 
 53.18  progress for the student including the grading system of the 
 53.19  school, the minimum grades considered satisfactory, conditions 
 53.20  for interruption for unsatisfactory grades or progress, a 
 53.21  description of any probationary period allowed by the school, 
 53.22  and conditions of reentrance for those dismissed for 
 53.23  unsatisfactory progress; 
 53.24     (7) school policy and regulations about student conduct and 
 53.25  conditions for dismissal for unsatisfactory conduct; 
 53.26     (8) detailed schedule of fees, charges for tuition, books, 
 53.27  supplies, tools, student activities, laboratory fees, service 
 53.28  charges, rentals, deposits, and all other charges; 
 53.29     (9) policy and regulations, including an explanation of 
 53.30  section 141.271, about refunding tuition, fees, and other 
 53.31  charges if the student does not enter the course program, 
 53.32  withdraws from the program, or the program is discontinued; 
 53.33     (10) a description of the available facilities and 
 53.34  equipment; 
 53.35     (11) a course outline for each course offered showing 
 53.36  course objectives, subjects or units in the course, type of work 
 54.1   or skill to be learned, and approximate time, hours, or credits 
 54.2   to be spent on each subject or unit; and 
 54.3      (12) policy and regulations about granting credit for 
 54.4   previous education and training preparation; 
 54.5      (13) a procedure for investigating and resolving student 
 54.6   complaints; and 
 54.7      (14) the name and address of the Minnesota higher education 
 54.8   services office. 
 54.9      A school exclusively offering a correspondence program is 
 54.10  exempt from clauses (3) and (5). 
 54.11     Sec. 15.  Minnesota Statutes 1996, section 141.25, 
 54.12  subdivision 10, is amended to read: 
 54.13     Subd. 10.  [PLACEMENT RECORDS.] (a) Before a license is 
 54.14  issued to a school that offers, advertises or implies a 
 54.15  placement service, the school shall file with the office for the 
 54.16  past year and thereafter at reasonable intervals determined by 
 54.17  the office, a certified copy of the school's placement record, 
 54.18  containing a list of graduates, a description of their job, name 
 54.19  of their employer, and other information as the office may 
 54.20  prescribe.  
 54.21     (b) Each school that offers a placement service shall 
 54.22  furnish to each prospective student, prior to enrollment, 
 54.23  written information concerning the percentage of the previous 
 54.24  year's graduates who were placed in the occupation for which 
 54.25  trained prepared or in related employment. 
 54.26     Sec. 16.  Minnesota Statutes 1996, section 141.25, 
 54.27  subdivision 12, is amended to read: 
 54.28     Subd. 12.  [PERMANENT RECORDS.] Before a license is issued 
 54.29  to a school, Each school licensed under this chapter and located 
 54.30  in Minnesota shall maintain a permanent records record for all 
 54.31  students enrolled at any time each student for 50 years from the 
 54.32  last date of the student's attendance.  Each school licensed 
 54.33  under this chapter and offering a correspondence course of 
 54.34  instruction program to a student located in Minnesota shall 
 54.35  maintain a permanent records record for each Minnesota 
 54.36  students enrolled at any time student for 50 years from the last 
 55.1   date of the student's attendance.  Records include school 
 55.2   transcripts, documents, and files containing student data about 
 55.3   academic credits earned, courses completed, grades awarded, 
 55.4   degrees awarded, and periods of attendance.  To preserve 
 55.5   permanent records, a school shall submit a plan that meets the 
 55.6   following requirements: 
 55.7      (a) (1) at least one copy of the records must be held in a 
 55.8   secure depository; 
 55.9      (b) (2) an appropriate official must be designated to 
 55.10  provide a student with copies of records or a transcript upon 
 55.11  request; 
 55.12     (c) (3) an alternative method of complying with paragraphs 
 55.13  (a) and (b) clauses (1) and (2) must be established if the 
 55.14  school ceases to exist; and 
 55.15     (d) (4) a continuous surety bond must be filed with the 
 55.16  office in an amount not to exceed $20,000 if the school has no 
 55.17  binding agreement for preserving student records or a trust must 
 55.18  be arranged if the school ceases to exist. 
 55.19     Sec. 17.  [141.251] [LICENSE RENEWAL.] 
 55.20     Subdivision 1.  [CONDITIONS.] The office shall establish by 
 55.21  rule different conditions for renewal of licenses based on the 
 55.22  record of the school.  The conditions shall permit renewals 
 55.23  based on relaxed standards of scrutiny for schools that have 
 55.24  demonstrated the quality of their programs and their operations 
 55.25  through longevity and performance.  The office shall specify 
 55.26  minimum longevity standards and performance indicators that must 
 55.27  be met before a school may be permitted to operate under these 
 55.28  standards. 
 55.29     Subd. 2.  [APPLICATION.] Application for renewal of 
 55.30  licenses must be made at least 30 days before expiration of the 
 55.31  current license on a form supplied by the office.  Each renewal 
 55.32  application shall be accompanied by a nonrefundable fee 
 55.33  established by the office that is sufficient to recover, but 
 55.34  does not exceed, its administrative costs. 
 55.35     Sec. 18.  Minnesota Statutes 1996, section 141.26, 
 55.36  subdivision 2, is amended to read: 
 56.1      Subd. 2.  [APPLICATION FOR PERMIT.] (a) The application for 
 56.2   the permit shall state the full name, address, previous 
 56.3   employment, and such other information concerning the solicitor 
 56.4   applicant as the office may require.  
 56.5      (b) The application shall have attached to it a certified 
 56.6   affidavit signed by a school official and the solicitor 
 56.7   attesting to the fact that the applicant has been furnished a 
 56.8   copy, has read and has knowledge of the provisions of this 
 56.9   chapter and Minnesota Rules, parts 3530.6500 to 3530.7800.  
 56.10     Sec. 19.  [141.265] [INFORMATION TO STUDENTS.] 
 56.11     Subdivision 1.  [CATALOG.] A school or its agent shall 
 56.12  deliver the catalog or brochure required in section 141.25, 
 56.13  subdivision 9, to each prospective student in a time or manner 
 56.14  that provides the prospective student ample opportunity to read 
 56.15  the catalog or brochure before signing any contract or 
 56.16  enrollment agreement or before being accepted by a school that 
 56.17  does not use a written contract or enrollment agreement. 
 56.18     Subd. 2.  [CONTRACT INFORMATION.] A contract or enrollment 
 56.19  agreement used by a school must include at least the following: 
 56.20     (1) the name and address of the school, clearly stated; 
 56.21     (2) a clear and conspicuous disclosure that the agreement 
 56.22  becomes a legally binding instrument upon written acceptance of 
 56.23  the student by the school unless canceled under section 141.271; 
 56.24     (3) the school's cancellation and refund policy which shall 
 56.25  be clearly and conspicuously entitled "Buyer's Right to Cancel"; 
 56.26     (4) the total cost of the program including tuition and all 
 56.27  other charges shall be clearly stated; 
 56.28     (5) the name and description of the program, including the 
 56.29  number of hours or credits of classroom instruction, 
 56.30  correspondence lessons, or both that shall be included; and 
 56.31     (6) a clear and conspicuous explanation of the form and 
 56.32  means of notice the student should use in the event the student 
 56.33  elects to cancel the contract or sale, the effective date of 
 56.34  cancellation, and the name and address of the seller to which 
 56.35  the notice should be sent or delivered. 
 56.36     Subd. 3.  [CONTRACT COPIES.] Immediately upon signing of 
 57.1   the enrollment agreement or the contract by the prospective 
 57.2   student, the school or agent shall furnish to the prospective 
 57.3   student an exact duplicate copy of the enrollment agreement or 
 57.4   contract.  
 57.5      Sec. 20.  Minnesota Statutes 1996, section 141.271, 
 57.6   subdivision 1, is amended to read: 
 57.7      Subdivision 1.  [NOTICE OF ACCEPTANCE OR REJECTION; RIGHT 
 57.8   TO REFUND STUDENT.] For the purposes of this section, "student" 
 57.9   means the party to the contract, whether the party is the 
 57.10  student, the student's parent or guardian, or other person on 
 57.11  behalf of the student. 
 57.12     Subd. 1a.  [NOTICE; RIGHT TO REFUND.] Every school shall 
 57.13  notify each student, in writing, of acceptance or rejection.  In 
 57.14  the event that the student is rejected by the school, all 
 57.15  tuition, fees and other charges shall be refunded.  
 57.16     Sec. 21.  Minnesota Statutes 1996, section 141.271, 
 57.17  subdivision 2, is amended to read: 
 57.18     Subd. 2.  [SCHOOLS USING WRITTEN CONTRACTS.] (a) 
 57.19  Notwithstanding anything to the contrary, every school which 
 57.20  that utilizes uses a written contract or enrollment agreement 
 57.21  shall refund all tuition, fees and other charges paid by a 
 57.22  student, if the student gives written notice of cancellation 
 57.23  within five business days after the day on which the contract 
 57.24  was executed regardless of whether the course of instruction 
 57.25  program has started.  
 57.26     (b) With respect to those schools utilizing a written 
 57.27  contract or enrollment agreement, When a student has been 
 57.28  accepted by the school and has entered into a contractual 
 57.29  agreement with the school and gives written notice of 
 57.30  cancellation following the fifth business day after the date of 
 57.31  execution of contract, but before the start of the course of 
 57.32  instruction program in the case of resident schools, or before 
 57.33  the first lesson has been serviced by the school in the case of 
 57.34  correspondence (home study) schools, all tuition, fees and other 
 57.35  charges, except 15 percent of the total cost of the course 
 57.36  program but not to exceed $50, shall be refunded to the student. 
 58.1      Sec. 22.  Minnesota Statutes 1996, section 141.271, 
 58.2   subdivision 3, is amended to read: 
 58.3      Subd. 3.  [SCHOOLS NOT USING WRITTEN CONTRACTS.] (a) 
 58.4   Notwithstanding anything to the contrary, every school which 
 58.5   does not utilize use a written contract or enrollment agreement 
 58.6   shall refund all tuition, fees and other charges paid by a 
 58.7   student if the student gives written notice of cancellation 
 58.8   within five business days after the day on which the student is 
 58.9   accepted by the school regardless of whether the course of 
 58.10  instruction program has started. 
 58.11     (b) With respect to those schools not utilizing a written 
 58.12  contract or enrollment agreement, When a student has been 
 58.13  accepted by the school and gives written notice of cancellation 
 58.14  following the fifth business day after the day of acceptance by 
 58.15  the school, but before the start of the course of 
 58.16  instruction program, in the case of resident schools, or before 
 58.17  the first lesson has been serviced by the school, in the case of 
 58.18  correspondence (home study) schools, all tuition, fees and other 
 58.19  charges, except 15 percent of the total cost of the course 
 58.20  program but not to exceed $50, shall be refunded to the student. 
 58.21     Sec. 23.  Minnesota Statutes 1996, section 141.271, 
 58.22  subdivision 4, is amended to read: 
 58.23     Subd. 4.  [RESIDENT SCHOOLS.] With respect to all schools 
 58.24  offering a resident course of instruction, When a student has 
 58.25  been accepted by the a school offering a resident program and 
 58.26  gives written notice of cancellation after the start of the 
 58.27  period of instruction for which the student has been charged, 
 58.28  but before completion of 75 percent of the period of instruction 
 58.29  for which the student has been charged, the amount charged for 
 58.30  tuition, fees, and all other charges for the completed portion 
 58.31  of the period of instruction for which the student has been 
 58.32  charged shall not exceed the pro rata be prorated as a portion 
 58.33  of the total charges for tuition, fees, and all other charges 
 58.34  that the length of the completed portion of the period of 
 58.35  instruction for which the student has been charged bears to its 
 58.36  total length, plus.  An additional 25 percent of the total cost 
 59.1   of the period of instruction for which the student has been 
 59.2   charged may be added, but not to exceed $100.  After completion 
 59.3   of 75 percent of the period of instruction for which the student 
 59.4   has been charged, no refunds are required.  
 59.5      Sec. 24.  Minnesota Statutes 1996, section 141.271, 
 59.6   subdivision 5, is amended to read: 
 59.7      Subd. 5.  [CORRESPONDENCE HOME STUDY SCHOOLS.] With respect 
 59.8   to all schools offering a correspondence (home study) course of 
 59.9   instruction, When a student has been accepted by the a 
 59.10  correspondence school and gives written notice of cancellation 
 59.11  after the first lesson has been completed by the student and 
 59.12  serviced by the school, but before completion of 75 percent of 
 59.13  the course of instruction program, the amount charged for 
 59.14  tuition, fees and all other charges for the completed lessons 
 59.15  shall not exceed the pro rata be prorated as a portion of the 
 59.16  total charges for tuition, fees and all other charges that the 
 59.17  number of lessons completed by the student bears to the total 
 59.18  number of lessons offered, plus.  An additional 25 percent of 
 59.19  the total cost of the course program may be added but not to 
 59.20  exceed $75.  After completion of 75 percent of the course of 
 59.21  instruction program, no refunds are required.  
 59.22     Sec. 25.  Minnesota Statutes 1996, section 141.271, 
 59.23  subdivision 6, is amended to read: 
 59.24     Subd. 6.  [COMBINATION CORRESPONDENCE-RESIDENT SCHOOLS.] 
 59.25  With respect to all schools offering a combination 
 59.26  correspondence (home study)-resident course of instruction, When 
 59.27  a student has been accepted by the a school that offers a 
 59.28  combination correspondence-residence program and gives written 
 59.29  notice of cancellation after the start of the course of 
 59.30  instruction program or after the first lesson has been completed 
 59.31  by the student and serviced by the school, whichever phase comes 
 59.32  first, the school shall refund all tuition, fees and other 
 59.33  charges as provided for in subdivision 4 if cancellation occurs 
 59.34  during the resident portion, and as provided for in subdivision 
 59.35  5 if cancellation occurs during the correspondence portion; 
 59.36  provided that,.  If the cancellation occurs before the student 
 60.1   has commenced one of the phases, the price of that phase shall 
 60.2   not be considered in making the proration and the student shall 
 60.3   be entitled to a full refund of the price thereof charges.  
 60.4   Conversely, if the student has completed a phase of the course 
 60.5   program before cancellation, the price thereof charges may be 
 60.6   retained by the school provided that the total tuition, fees and 
 60.7   other charges for each phase have been stated separately in the 
 60.8   school's catalog and contract or enrollment agreement.  
 60.9      Sec. 26.  Minnesota Statutes 1996, section 141.271, 
 60.10  subdivision 12, is amended to read: 
 60.11     Subd. 12.  [INSTRUMENT NOT TO BE NEGOTIATED.] No school 
 60.12  shall negotiate any promissory instrument received as payment of 
 60.13  tuition or other charge prior to completion of 50 percent of the 
 60.14  course of instruction program.  Prior to such that time, such 
 60.15  instruments may be transferred by assignment to purchasers who 
 60.16  shall be subject to all defenses available against the school 
 60.17  named as payee.  
 60.18     Sec. 27.  Minnesota Statutes 1996, section 141.28, 
 60.19  subdivision 3, is amended to read: 
 60.20     Subd. 3.  [FALSE STATEMENTS.] No school, agent, or 
 60.21  solicitor shall make, or cause to be made, any statement or 
 60.22  representation, oral, written or visual, in connection with the 
 60.23  offering or publicizing of a course program, if such the school, 
 60.24  agent, or solicitor knows or reasonably should have known the 
 60.25  statement or representation to be false, fraudulent, deceptive, 
 60.26  substantially inaccurate, or misleading.  
 60.27     Sec. 28.  Minnesota Statutes 1996, section 141.28, 
 60.28  subdivision 5, is amended to read: 
 60.29     Subd. 5.  [IMPROBABLE COURSE PROGRAM COMPLETION OR 
 60.30  EMPLOYMENT.] No school, agent, or solicitor shall enroll a 
 60.31  prospective student when it is obvious that the prospective 
 60.32  student is unlikely to successfully complete a course of 
 60.33  instruction program or is unlikely to qualify for employment in 
 60.34  the vocation or field for which the training preparation is 
 60.35  designed unless this fact is affirmatively disclosed to the 
 60.36  prospective student.  If a prospective student expresses a 
 61.1   desire to enroll after such disclosure, a disclaimer may be 
 61.2   obtained by the school.  Such The disclaimer shall be signed by 
 61.3   the student and shall state substantially as follows:  "I am 
 61.4   fully aware that it is unlikely I will be able to successfully 
 61.5   complete the course of instruction program" and/or "I am fully 
 61.6   aware of the improbability or impossibility that I will qualify 
 61.7   for employment in the vocation or field for which the course 
 61.8   program was designed."  
 61.9      Sec. 29.  Minnesota Statutes 1996, section 141.29, 
 61.10  subdivision 1, is amended to read: 
 61.11     Subdivision 1.  [GROUNDS.] The office may, after notice and 
 61.12  upon providing an opportunity for a hearing, pursuant to under 
 61.13  chapter 14 if requested by the parties adversely affected, 
 61.14  refuse to issue, refuse to renew, revoke, or suspend any license 
 61.15  or solicitor's permit for any one or any combination of the 
 61.16  following grounds: 
 61.17     (a) (1) violation of any provisions of sections 141.21 to 
 61.18  141.36 141.35 or any rule promulgated adopted by the office; 
 61.19     (b) (2) furnishing to the office false, misleading, or 
 61.20  incomplete information; 
 61.21     (c) (3) presenting to prospective students information 
 61.22  relating to the school which is false, fraudulent, deceptive, 
 61.23  substantially inaccurate, or misleading; 
 61.24     (d) (4) refusal to allow reasonable inspection or supply 
 61.25  reasonable information after written request therefor by the 
 61.26  office; 
 61.27     (e) (5) the existence of any circumstance which would be 
 61.28  grounds for the refusal of an initial or renewal license under 
 61.29  section 141.25.  
 61.30     Sec. 30.  Minnesota Statutes 1996, section 141.31, is 
 61.31  amended to read: 
 61.32     141.31 [INJUNCTION.] 
 61.33     Upon application of the attorney general the district 
 61.34  courts shall have jurisdiction to enjoin any violation of 
 61.35  sections 141.21 to 141.36 141.35.  
 61.36     Sec. 31.  Minnesota Statutes 1996, section 141.35, is 
 62.1   amended to read: 
 62.2      141.35 [EXEMPTIONS.] 
 62.3      None of the provisions of Sections 141.21 to 141.36 141.35 
 62.4   shall not apply to the following: 
 62.5      (a) (1) colleges authorized by the laws of Minnesota or of 
 62.6   any other state or foreign country to grant degrees public 
 62.7   post-secondary institutions; 
 62.8      (2) private post-secondary institutions registered under 
 62.9   sections 136A.61 to 136A.71 that are nonprofit or are approved 
 62.10  to offer exclusively baccalaureate or postbaccalaureate 
 62.11  programs; 
 62.12     (b) (3) schools of nursing accredited by the state board of 
 62.13  nursing or an equivalent public board of another state or 
 62.14  foreign country; 
 62.15     (c) public schools as defined in section 120.05; 
 62.16     (d) (4) private schools complying with the requirements of 
 62.17  section 120.101, subdivision 2 4; 
 62.18     (e) private and parochial nonprofit schools exempt from 
 62.19  taxation under the constitution of Minnesota; 
 62.20     (f) (5) courses taught to students in a valid 
 62.21  apprenticeship program taught by or required by a trade union; 
 62.22     (g) (6) schools exclusively engaged in training physically 
 62.23  or mentally handicapped persons for the state of Minnesota; 
 62.24     (h) (7) schools now or hereafter licensed by boards 
 62.25  authorized under Minnesota law to issue such licenses; 
 62.26     (i) (8) schools and educational programs, or training 
 62.27  programs, conducted by persons, firms, corporations, or 
 62.28  associations, for the training of their own employees, for which 
 62.29  no fee is charged the employee; 
 62.30     (j) (9) schools engaged exclusively in the teaching of 
 62.31  purely avocational, recreational, or remedial subjects as 
 62.32  determined by the office.  Private schools teaching a method or 
 62.33  procedure to increase the speed with which a student reads are 
 62.34  not within this exemption; 
 62.35     (k) (10) driver training schools and instructors as defined 
 62.36  in section 171.33, subdivisions 1 and 2; 
 63.1      (l) (11) classes, courses, or programs conducted by a bona 
 63.2   fide trade, professional, or fraternal organization, solely for 
 63.3   that organization's membership; 
 63.4      (m) courses of instruction (12) programs in the fine arts 
 63.5   provided by organizations exempt from taxation pursuant to under 
 63.6   section 290.05 and registered with the attorney general pursuant 
 63.7   to under chapter 309.  "Fine arts" means activities resulting in 
 63.8   artistic creation or artistic performance of works of the 
 63.9   imagination which are engaged in for the primary purpose of 
 63.10  creative expression rather than commercial sale or employment. 
 63.11  In making this determination the office may seek the advice and 
 63.12  recommendation of the Minnesota board of the arts; 
 63.13     (n) (13) classes, courses, or programs intended to fulfill 
 63.14  the continuing education requirements for licensure or 
 63.15  certification in a profession, which classes, courses, or 
 63.16  programs that have been approved by a legislatively or 
 63.17  judicially established board or agency responsible for 
 63.18  regulating the practice of the profession, and which that are 
 63.19  offered primarily to a person who currently practices people 
 63.20  practicing the profession; 
 63.21     (o) (14) classes, courses, or programs intended to prepare 
 63.22  students to sit for undergraduate, graduate, postgraduate, or 
 63.23  occupational licensing and occupational entrance examinations; 
 63.24     (p) (15) classes, courses, or programs of a seminar nature 
 63.25  providing 16 or fewer clock hours of instruction that are not 
 63.26  part of the curriculum for an occupation or are not intended to 
 63.27  prepare a person for entry level employment; 
 63.28     (q) (16) classes, courses, or programs of a seminar nature 
 63.29  providing instruction in personal development, modeling, or 
 63.30  acting; and 
 63.31     (r) (17) training or instructional programs, in which one 
 63.32  instructor teaches an individual student, that are not part of 
 63.33  the curriculum for an occupation or are not intended to prepare 
 63.34  a person for entry level employment; and 
 63.35     (18) schools with no physical presence in Minnesota engaged 
 63.36  exclusively in offering distance education courses or programs 
 64.1   that are located in and regulated by other states or 
 64.2   jurisdictions.  
 64.3      Sec. 32.  [REPEALER.] 
 64.4      Minnesota Statutes 1996, sections 141.25, subdivisions 9a, 
 64.5   9b, and 11; and 141.36, are repealed.