1.1                          A bill for an act 
  1.2             relating to state government; providing that no 
  1.3             private money may be given to the state for the 
  1.4             purpose of influencing policy. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [PRIVATE INFLUENCE.] 
  1.7      (a) As used in this section, the following terms have the 
  1.8   meanings given to them in this paragraph: 
  1.9      "Private entity" means an individual or entity other than 
  1.10  an entity owned, operated, or managed by or on behalf of the 
  1.11  state or a political subdivision with a public interest agenda. 
  1.12     "Privately funded initiative" means a program, project, or 
  1.13  initiative of a state agency, including a pilot project, which 
  1.14  is funded or will be funded, in whole or in part, by a private 
  1.15  entity. 
  1.16     "State agency" means a state agency described in Minnesota 
  1.17  Statutes, section 15.012. 
  1.18     (b) The legislature finds that some state agencies have 
  1.19  abused their delegated power to administer statutorily 
  1.20  authorized programs by tailoring those programs to the 
  1.21  specifications of private entities, particularly nonprofit 
  1.22  foundations with public interest agendas, in connection with the 
  1.23  receipt of funding from those private organizations.  This 
  1.24  disturbing practice has occurred without adequate legislative 
  1.25  oversight.  When the legislature delegates vast amounts of power 
  2.1   to unelected officials in the executive branch, it is imperative 
  2.2   that the legislature take steps to assure that appointed 
  2.3   officials exercise their discretion and expertise in a way that 
  2.4   best reflects legislative intent and to ensure that this 
  2.5   delegated authority has not been compromised by the desirability 
  2.6   of obtaining money from private organizations with their own 
  2.7   notion of the common good. 
  2.8      (c) Except where specifically authorized by statute, no 
  2.9   state agency may accept funds from any private entity if the 
  2.10  state or state agency would be required to modify or adopt any 
  2.11  program, project, or initiative, including any pilot project, as 
  2.12  a condition for the receipt of funds from the private entity.  
  2.13  The execution of a contract or other agreement between a private 
  2.14  entity and a state agency in connection with a privately funded 
  2.15  initiative shall create a rebuttable presumption that the state 
  2.16  agency has agreed to modify or adopt a program, project, or 
  2.17  initiative as a condition for the receipt of funds from the 
  2.18  private entity if the contract or agreement requires a state 
  2.19  agency to operate a program, initiative, or project, including a 
  2.20  pilot project, in accordance with prescribed terms or conditions.
  2.21     (d) Notwithstanding a state agency's determination that its 
  2.22  acceptance of funds from a private entity is not conditioned 
  2.23  upon the modification or adoption of any program, initiative, or 
  2.24  project of the state or a state agency, the state agency may not 
  2.25  accept funds from the private entity or enter into any binding 
  2.26  contract or agreement with the private entity which is related 
  2.27  to the acceptance of funds until at least 15 days after the 
  2.28  state auditor issues a report on the impact of the privately 
  2.29  funded initiative.  The state agency shall provide the state 
  2.30  auditor with a copy of the proposed contract or agreement, any 
  2.31  project narrative, information on the proposed funding 
  2.32  arrangement, and any other relevant information in the 
  2.33  possession of the state agency.  The state agency and the 
  2.34  private entity shall comply with any of the state auditor's 
  2.35  requests for additional information related to the foregoing.  
  2.36  The state auditor shall issue the report within 45 days of its 
  3.1   receipt of the information described in this paragraph. 
  3.2      (e) The state auditor shall provide a copy of the 
  3.3   information received from the state agency, pursuant to 
  3.4   paragraph (d), to the chairs of the house of representatives and 
  3.5   senate committees on appropriations and finance within five days 
  3.6   after the auditor's receipt of such information.  The auditor 
  3.7   shall prepare a description of the privately funded initiative, 
  3.8   which must include the identity of any private entity proposing 
  3.9   to fund the program, narrative, or project; the amount of any 
  3.10  proposed funding; and an invitation for public comment.  The 
  3.11  auditor shall submit the description for publication in the 
  3.12  State Register within ten days after the auditor receives the 
  3.13  information described in paragraph (d). 
  3.14     (f) The report shall include the state auditor's nonbinding 
  3.15  determination as to whether the privately funded initiative: 
  3.16     (1) is permissible under paragraph (c); 
  3.17     (2) is in the public interest; this clause must include a 
  3.18  determination as to whether the initiative is consistent with 
  3.19  the statutory authority of the state agency and with the 
  3.20  intention of the legislature in the enactment of the statutory 
  3.21  law upon which the initiative is based; 
  3.22     (3) would have a significant economic or fiscal impact upon 
  3.23  the state or its political subdivisions; and 
  3.24     (4) would represent a policy decision of such a substantial 
  3.25  nature that it requires legislative review. 
  3.26     (g) If the report concerns a pilot project, the report 
  3.27  shall also analyze the potential impact of the project as a 
  3.28  statewide program in accordance with the criteria under 
  3.29  paragraph (f). 
  3.30     (h) The state auditor shall provide for the transmittal of 
  3.31  a copy of the report to the state agency, the attorney general, 
  3.32  the appropriate committees of the legislature, and to any member 
  3.33  of the public who requests a copy of the report. 
  3.34     (i) The state auditor and any appropriate committee of the 
  3.35  house of representatives or senate may conduct public hearings 
  3.36  on any privately funded initiative. 
  4.1      (j) If any contract or agreement specified in paragraph (d) 
  4.2   requires the approval of the attorney general as to legality, 
  4.3   the state agency shall notify the attorney general that it is 
  4.4   transmitting the contract or agreement to the state auditor 
  4.5   pursuant to paragraph (d).  The attorney general shall await the 
  4.6   report of the state auditor before making a determination 
  4.7   regarding the legality of the contract or agreement. 
  4.8      (k) No state agency may accept funds from a private entity 
  4.9   for the purpose of paying all or part of the compensation of an 
  4.10  officer or employee of the agency unless the identity of the 
  4.11  state agency, the officers and employees receiving compensation, 
  4.12  the private entity making the payment, and the amount and 
  4.13  purpose of the privately funded subsidy are published in the 
  4.14  State Register and are transmitted to the chairs of the house of 
  4.15  representatives and senate appropriations and finance committees 
  4.16  at least 30 days before the arrangement takes effect. 
  4.17     (l) No state agency may enter into any contract or 
  4.18  agreement with any nonprofit foundation or other private entity 
  4.19  which entitles the foundation or entity to receive data 
  4.20  collected in connection with its participation in or funding of 
  4.21  a state program, project, or initiative, unless the attorney 
  4.22  general certifies that the contract or agreement contains 
  4.23  sufficient safeguards to protect confidential data and privacy 
  4.24  rights of individuals affected by the program, project, or 
  4.25  initiative. 
  4.26     (m) Nothing in this section applies to funds received by 
  4.27  the state as a fee or other payment for a license, permit, 
  4.28  service, product, tax, fine, or penalty, or received for the 
  4.29  purchase, lease, or use of real or personal property or similar 
  4.30  matters. 
  4.31     Sec. 2.  [EFFECTIVE DATE.] 
  4.32     Section 1 is effective August 1, 1998.