1.1 	A bill for an act
1.2 	relating to education finance; increasing the basic
1.3 	formula allowance; restoring funding for special
1.4 	education programs; restoring funding for LEP
1.5 	programs; restoring funding for early education
1.6 	programs; restoring funding for after-school programs;
1.7 	restoring funding for adult basic education programs;
1.8 	restoring certain levy authority; appropriating money;
1.9 	amending Minnesota Statutes 2004, sections 124D.11,
1.10 	subdivision 4; 124D.135, subdivision 1; 124D.20,
1.11 	subdivision 3; 124D.531, subdivisions 1, 2, 4;
1.12 	124D.59, subdivision 2; 125A.76, subdivisions 1, 4;
1.13 	125A.79, subdivisions 1, 6; 126C.05, subdivisions 8,
1.14 	15; 126C.10, subdivisions 2, 2a, 3; 126C.40,
1.15 	subdivision 1; 126C.43, subdivisions 2, 3; 126C.44;
1.16 	proposing coding for new law in Minnesota Statutes,
1.17 	chapter 124D.
1.18 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.19 	Section 1. Minnesota Statutes 2004, section 124D.11,
1.20 	subdivision 4, is amended to read:
1.21 		Subd. 4.Building lease aid.  When a charter school finds
1.22 	it economically advantageous to rent or lease a building or land
1.23 	for any instructional purposes and it determines that the total
1.24 	operating capital revenue under section 126C.10, subdivision 13,
1.25 	is insufficient for this purpose, it may apply to the
1.26 	commissioner for building lease aid for this purpose.  The
1.27 	commissioner must review and either approve or deny a lease aid
1.28 	application using the following criteria:
1.29 	(1) the reasonableness of the price based on current market
1.30 	values;
1.31 	(2) the extent to which the lease conforms to applicable
2.1 	state laws and rules; and
2.2 	(3) the appropriateness of the proposed lease in the
2.3 	context of the space needs and financial circumstances of the
2.4 	charter school.
2.5 	A charter school must not use the building lease aid it receives
2.6 	for custodial, maintenance service, utility, or other operating
2.7 	costs.  The amount of building lease aid per pupil unit served
2.8 	for a charter school for any year shall not exceed the lesser of
2.9 	(a) 90 percent of the approved cost or (b) the product of the
2.10 	pupil units served for the current school year times the greater
2.11 	of the charter school's building lease aid per pupil unit served
2.12 	for fiscal year 2003, excluding the adjustment under Laws 2002,
2.13 	chapter 392, article 6, section 4, or $1,200 $1,500.
2.14 	
EFFECTIVE DATE. This section is effective for revenue for
2.15 	fiscal year 2006.

2.16 	Sec. 2. Minnesota Statutes 2004, section 124D.135,
2.17 	subdivision 1, is amended to read:
2.18 		Subdivision 1.Revenue.  The revenue for early childhood
2.19 	family education programs for a school district equals $120 for
2.20 	fiscal years 2003 and 2004 and $96 $136 for fiscal year 2005 
2.21 	2006 and later, times the greater of:
2.22 	(1) 150; or
2.23 	(2) the number of people under five years of age residing
2.24 	in the district on October 1 of the previous school year.
2.25 	
EFFECTIVE DATE. This section is effective for revenue for
2.26 	fiscal year 2006.

2.27 	Sec. 3. [124D.1711] WAY TO GROW/SCHOOL READINESS
2.28 	PROGRAM.
2.29 		Subdivision 1.Administration. The commissioner of
2.30 	education shall administer the way to grow/school readiness
2.31 	program, in collaboration with the commissioners of health and
2.32 	human services, to promote intellectual, social, emotional, and
2.33 	physical development and school readiness of children prebirth
2.34 	to age six by coordinating and improving access to
2.35 	community-based and neighborhood-based services that support and
2.36 	assist all parents in meeting the health and developmental needs
3.1 	of their children at the earliest possible age.
3.2 		Subd. 2.Program components. (a) A way to grow/school
3.3 	readiness program must:
3.4 	(1) collaborate and coordinate delivery of services with
3.5 	other community organizations and agencies serving children
3.6 	prebirth to age six and their families;
3.7 	(2) target services to families with children prebirth to
3.8 	age six with services increasing based on need;
3.9 	(3) build on existing services and coordinate a continuum
3.10 	of prebirth to age six essential services, including but not
3.11 	limited to prenatal health services, parent education and
3.12 	support, and preschool programs;
3.13 	(4) provide strategic outreach efforts to families using
3.14 	trained paraprofessionals such as home visitors; and 
3.15 	(5) support of neighborhood oriented and culturally
3.16 	specific social support, information, outreach, and other
3.17 	programs to promote healthy development of children and to help
3.18 	parents obtain the information, resources, and parenting skills
3.19 	needed to nurture and care for their children.
3.20 	(b) A way to grow/school readiness program may include:
3.21 	(1) a program of home visitors to contact pregnant women
3.22 	early in their pregnancies, encourage them to obtain prenatal
3.23 	care, and provide social support, information, and referrals
3.24 	regarding prenatal care and well-baby care to reduce infant
3.25 	mortality, low birth weight, and childhood injury, disease, and
3.26 	disability;
3.27 	(2) a program of home visitors to provide social support,
3.28 	information, and referrals regarding parenting skills and to
3.29 	encourage families to participate in parenting skills programs
3.30 	and other family supportive services;
3.31 	(3) support of neighborhood-based or community-based
3.32 	parent-child and family resource centers or interdisciplinary
3.33 	resource teams to offer supportive services to families with
3.34 	preschool children;
3.35 	(4) staff training, technical assistance, and incentives
3.36 	for collaboration designed to raise the quality of community
4.1 	services relating to prenatal care, child development, health,
4.2 	and school readiness;
4.3 	(5) programs to raise general public awareness about
4.4 	practices that promote healthy child development and school
4.5 	readiness;
4.6 	(6) programs to expand public and private collaboration to
4.7 	promote the development of a coordinated and culturally specific
4.8 	system of services available to all families;
4.9 	(7) support of periodic screening and evaluation services
4.10 	for preschool children to ensure adequate developmental
4.11 	progress;
4.12 	(8) support of health, educational, and other developmental
4.13 	services needed by families with preschool children;
4.14 	(9) support of family prevention and intervention programs
4.15 	needed to address risks of child abuse or neglect;
4.16 	(10) development or support of a jurisdiction-wide
4.17 	coordinating agency to develop and oversee programs to enhance
4.18 	child health, development, and school readiness with special
4.19 	emphasis on neighborhoods with a high proportion of children in
4.20 	need; and 
4.21 	(11) other programs or services to improve the health,
4.22 	development, and school readiness of children in target
4.23 	neighborhoods and communities.
4.24 		Subd. 3.Eligible grantees. An application for a grant
4.25 	may be submitted by any of the following entities:
4.26 	(1) a city, town, county, school district, or other local
4.27 	unit of government;
4.28 	(2) two or more governmental units organized under a joint
4.29 	powers agreement;
4.30 	(3) a community action agency that satisfies the
4.31 	requirements of section 119A.375, subdivision 1; or 
4.32 	(4) a nonprofit organization, or consortium of nonprofit
4.33 	organizations, that demonstrates collaborative effort with at
4.34 	least one unit of local government.
4.35 		Subd. 4.Distribution. The commissioner shall give
4.36 	priority to funding existing programs.
5.1 	To the extent possible, the commissioner shall award grants
5.2 	to applicants with experience or demonstrated ability in
5.3 	providing comprehensive, multidisciplinary, community-based
5.4 	programs with objectives similar to those listed in subdivision
5.5 	2, or in providing other human services or social services
5.6 	programs using a multidisciplinary, community-based approach.
5.7 		Subd. 5.Applications. Each grant application must
5.8 	propose a five-year program designed to accomplish the purposes
5.9 	of this section.  The application must be submitted on forms
5.10 	provided by the commissioner.  The grant application must
5.11 	include:
5.12 	(1) a description of the specific neighborhoods that will
5.13 	be served under the program and the name, address, and a
5.14 	description of each community agency or agencies with which the
5.15 	applicant intends to contract to provide services using grant
5.16 	money;
5.17 	(2) a letter of intent from each community agency
5.18 	identified in clause (1) that indicates the agency's willingness
5.19 	to participate in the program and approval of the proposed
5.20 	program structure and components;
5.21 	(3) a detailed description of the structure and components
5.22 	of the proposed program and an explanation of how each component
5.23 	will contribute to accomplishing the purposes of this section;
5.24 	(4) a description of how public and private resources,
5.25 	including schools, health care facilities, government agencies,
5.26 	neighborhood organizations, and other resources, will be
5.27 	coordinated and made accessible to families in target
5.28 	neighborhoods, including letters of intent from public and
5.29 	private agencies indicating their willingness to cooperate with
5.30 	the program;
5.31 	(5) a detailed, proposed budget that demonstrates the
5.32 	ability of the program to accomplish the purposes of this
5.33 	section using grant money and other available resources,
5.34 	including funding sources other than a grant; and 
5.35 	(6) a comprehensive evaluation plan for measuring the
5.36 	success of the program in meeting the objectives of the overall
6.1 	grant program and the individual grant project, including an
6.2 	assessment of the impact of the program in terms of at least
6.3 	three of the following criteria:
6.4 	(i) utilization rates of community services;
6.5 	(ii) availability of support systems for families;
6.6 	(iii) birth weights of newborn babies;
6.7 	(iv) child accident rates;
6.8 	(v) utilization rates of prenatal care;
6.9 	(vi) reported rates of child abuse;
6.10 	(vii) rates of health screening and evaluation; and 
6.11 	(viii) school readiness of way to grow participants
6.12 	compared to nonparticipants.
6.13 		Subd. 6.Match. Each dollar of state money must be
6.14 	matched with 50 cents of nonstate money.  Programs may match
6.15 	state money with in-kind contributions, including volunteer
6.16 	assistance.
6.17 		Subd. 7.Advisory committee. Each grantee must establish
6.18 	a program advisory board of 12 or more members to advise the
6.19 	grantee on program design, operation, and evaluation.  The board
6.20 	must include representatives of local units of government and
6.21 	representatives of the project area who reflect the geographic,
6.22 	cultural, racial, and ethnic diversity of that community.
6.23 	
EFFECTIVE DATE. This section is effective for revenue for
6.24 	fiscal year 2006.

6.25 	Sec. 4. Minnesota Statutes 2004, section 124D.20,
6.26 	subdivision 3, is amended to read:
6.27 		Subd. 3.General community education revenue.  The
6.28 	general community education revenue for a district equals $5.95
6.29 	for fiscal year years 2003 and 2004 and ,$5.23 for fiscal year
6.30 	2005,and $5.95 for fiscal year 2006 and later, times the
6.31 	greater of 1,335 or the population of the district.  The
6.32 	population of the district is determined according to section
6.33 	275.14.
6.34 	
EFFECTIVE DATE. This section is effective for revenue for
6.35 	fiscal year 2006.

6.36 	Sec. 5. [124D.2211] AFTER-SCHOOL ENRICHMENT PROGRAMS.
7.1 		Subdivision 1.Establishment. A competitive statewide
7.2 	after-school enrichment grant program that incorporates
7.3 	principles, strategies, and approaches consistent with a
7.4 	positive youth development orientation is established to provide
7.5 	implementation grants to community or nonprofit organizations,
7.6 	to political subdivisions, or to school-based programs.  The
7.7 	commissioner may use criteria for after-school enrichment
7.8 	programs under Minnesota Statutes 2002, section 124D.221, to
7.9 	evaluate grant proposals.
7.10 		Subd. 2.Priority neighborhoods. For grants in
7.11 	Minneapolis and St. Paul, the commissioner must give priority to
7.12 	neighborhoods in this subdivision.  In Minneapolis, priority
7.13 	neighborhoods are Near North, Hawthorne, Sumner-Glenwood,
7.14 	Harrison, Jordan, Powderhorn, Central, Whittier, Cleveland,
7.15 	McKinley, Waite Park, Sheridan, Holland, Lyndale, Folwell, and
7.16 	Phillips.  In St. Paul, priority neighborhoods are
7.17 	Summit-University, Thomas-Dale, North End, Payne-Phalen, Daytons
7.18 	Bluff, and the West Side.
7.19 		Subd. 3.Program outcomes. The expected outcomes of the
7.20 	after-school enrichment programs are to:
7.21 	(1) increase the number of children participating in
7.22 	adult-supervised programs in nonschool hours;
7.23 	(2) support academic achievement, including the areas of
7.24 	reading and math;
7.25 	(3) reduce the amount of juvenile crime;
7.26 	(4) increase school attendance and reduce the number of
7.27 	school suspensions;
7.28 	(5) increase the number of youth engaged in community
7.29 	service and other activities designed to support character
7.30 	improvement, strengthen families, and instill community values;
7.31 	(6) increase skills in technology, the arts, sports, and
7.32 	other activities; and 
7.33 	(7) increase and support the academic achievement and
7.34 	character development of adolescent parents.
7.35 		Subd. 4.Plan. An applicant shall develop a plan for an
7.36 	after-school enrichment program for youth.  The plan must
8.1 	include:
8.2 	(1) collaboration with and leverage of existing community
8.3 	resources that have demonstrated effectiveness;
8.4 	(2) solid grounding in an evidence-based conceptual
8.5 	framework, such as resilience or developmental assets, that
8.6 	represents a more efficacious approach to program design and
8.7 	implementation;
8.8 	(3) creative outreach to children and youth;
8.9 	(4) involvement of local governments, including park and
8.10 	recreation boards or schools, unless no government agency is
8.11 	appropriate;
8.12 	(5) community control over the design of the enrichment
8.13 	program; and 
8.14 	(6) identification of the sources of nonpublic funding.
8.15 		Subd. 5.Plan approval; grants. An applicant shall
8.16 	submit a plan developed under subdivision 4 to the commissioner
8.17 	for approval.  The commissioner shall award a grant for the
8.18 	implementation of an approved plan.
8.19 	
EFFECTIVE DATE. This section is effective for revenue for
8.20 	fiscal year 2006.

8.21 	Sec. 6. Minnesota Statutes 2004, section 124D.531,
8.22 	subdivision 1, is amended to read:
8.23 		Subdivision 1.State total adult basic education aid.
 8.24 	(a) The state total adult basic education aid for fiscal year
8.25 	2004 equals $34,388,000.  The state total adult basic education
8.26 	aid for fiscal year 2005 and later is $36,509,000. The state
8.27 	total adult basic education aid for later years equals the state
8.28 	total adult basic education aid for the preceding year times the
8.29 	lesser of:
8.30 	(1) 1.08; or 
8.31 	(2) the greater of 1.00 or the ratio of the state total
8.32 	contact hours in the first prior program year to the state total
8.33 	contact hours in the second prior program year.
8.34 	(b) Beginning in fiscal year 2002, two percent of the state
8.35 	total adult basic education aid must be set aside for adult
8.36 	basic education supplemental service grants under section
9.1 	124D.522.
9.2 	(b) (c) The state total adult basic education aid,
9.3 	excluding basic population aid, equals the difference between
9.4 	the amount computed in paragraph (a), and the state total basic
9.5 	population aid under subdivision 2.
9.6 	
EFFECTIVE DATE. This section is effective for revenue for
9.7 	fiscal year 2006.

9.8 	Sec. 7. Minnesota Statutes 2004, section 124D.531,
9.9 	subdivision 2, is amended to read:
9.10 		Subd. 2.Basic population aid.  A district is eligible
9.11 	for basic population aid if the district has a basic service
9.12 	level approved by the commissioner under section 124D.52,
9.13 	subdivision 5, or is a member of a consortium with an approved
9.14 	basic service level.  Basic population aid is equal to the
9.15 	greater of $3,844 $4,000 or $1.73 $1.80 times the population of
9.16 	the district.  District population is determined according to
9.17 	section 275.14.
9.18 	
EFFECTIVE DATE. This section is effective for revenue for
9.19 	fiscal year 2006.

9.20 	Sec. 8. Minnesota Statutes 2004, section 124D.531,
9.21 	subdivision 4, is amended to read:
9.22 		Subd. 4.Adult basic education program aid limit.  (a)
9.23 	Notwithstanding subdivisions 2 and 3, the total adult basic
9.24 	education aid for a program per prior year contact hour must not
9.25 	exceed $21 per prior year contact hour computed under
9.26 	subdivision 3, clause (2).
9.27 	(b) For fiscal year 2004, the aid for a program under
9.28 	subdivision 3, clause (2), adjusted for changes in program
9.29 	membership, must not exceed the aid for that program under
9.30 	subdivision 3, clause (2), for fiscal year 2003 by more than the
9.31 	greater of eight percent or $10,000.
9.32 	(c) For fiscal year 2005, the aid for a program under
9.33 	subdivision 3, clause (2), adjusted for changes in program
9.34 	membership, must not exceed the sum of the aid for that program
9.35 	under subdivision 3, clause (2), and Laws 2003, First Special
9.36 	Session chapter 9, article 9, section 8, paragraph (a), for the
10.1 	preceding fiscal year by more than the greater of eight percent
10.2 	or $10,000.
10.3 	(d) For fiscal year 2006 and later, the aid for a program
10.4 	under subdivision 3, clause (2), adjusted for changes in program
10.5 	membership, must not exceed the aid for that program under
10.6 	subdivision 3, clause (2), for the first preceding fiscal year
10.7 	by more than the greater of eight 17 percent or $10,000 $20,000.
10.8 	(e) Adult basic education aid is payable to a program for
10.9 	unreimbursed costs.
10.10 	
EFFECTIVE DATE. This section is effective for revenue for
10.11 	fiscal year 2006.

10.12 	Sec. 9. Minnesota Statutes 2004, section 124D.59,
10.13 	subdivision 2, is amended to read:
10.14 		Subd. 2.Pupil of limited english proficiency.  (a)
10.15 	"Pupil of limited English proficiency" means a pupil in
10.16 	kindergarten through grade 12 who meets the following
10.17 	requirements:
10.18 	(1) the pupil, as declared by a parent or guardian first
10.19 	learned a language other than English, comes from a home where
10.20 	the language usually spoken is other than English, or usually
10.21 	speaks a language other than English; and
10.22 	(2) the pupil is determined by developmentally appropriate
10.23 	measures, which might include observations, teacher judgment,
10.24 	parent recommendations, or developmentally appropriate
10.25 	assessment instruments, to lack the necessary English skills to
10.26 	participate fully in classes taught in English.
10.27 	(b) Notwithstanding paragraph (a), a pupil in grades 4
10.28 	through 12 who was enrolled in a Minnesota public school on the
10.29 	dates during the previous school year when a commissioner
10.30 	provided assessment that measures the pupil's emerging academic
10.31 	English was administered, shall not be counted as a pupil of
10.32 	limited English proficiency in calculating limited English
10.33 	proficiency pupil units under section 126C.05, subdivision 17,
10.34 	and shall not generate state limited English proficiency aid
10.35 	under section 124D.65, subdivision 5, unless the pupil scored
10.36 	below the state cutoff score on an assessment measuring emerging
11.1 	academic English provided by the commissioner during the
11.2 	previous school year.
11.3 	(c) Notwithstanding paragraphs (a) and (b), a pupil in
11.4 	kindergarten through grade 12 shall not be counted as a pupil of
11.5 	limited English proficiency in calculating limited English
11.6 	proficiency pupil units under section 126C.05, subdivision 17,
11.7 	and shall not generate state limited English proficiency aid
11.8 	under section 124D.65, subdivision 5, if:
11.9 	(1) the pupil is not enrolled during the current fiscal
11.10 	year in an educational program for pupils of limited English
11.11 	proficiency in accordance with sections 124D.58 to 124D.64; or 
11.12 	(2) the pupil has generated five or more years of average
11.13 	daily membership in Minnesota public schools since July 1, 1996.
11.14 	
EFFECTIVE DATE. This section is effective July 1, 2005,
11.15 	for revenue for fiscal year 2006.

11.16 	Sec. 10. Minnesota Statutes 2004, section 125A.76,
11.17 	subdivision 1, is amended to read:
11.18 		Subdivision 1.Definitions.  For the purposes of this
11.19 	section, the definitions in this subdivision apply.
11.20 	(a) "Base year" for fiscal year 1998 and later fiscal years
11.21 	means the second fiscal year preceding the fiscal year for which
11.22 	aid will be paid.
11.23 	(b) "Basic revenue" has the meaning given it in section
11.24 	126C.10, subdivision 2.  For the purposes of computing basic
11.25 	revenue pursuant to this section, each child with a disability
11.26 	shall be counted as prescribed in section 126C.05, subdivision 1.
11.27 	(c) "Essential personnel" means teachers, cultural
11.28 	liaisons, related services, and support services staff providing
11.29 	direct services to students.  Essential personnel may also
11.30 	include special education paraprofessionals or clericals
11.31 	providing support to teachers and students by preparing
11.32 	paperwork and making arrangements related to special education
11.33 	compliance requirements, including parent meetings and
11.34 	individual education plans.
11.35 	(d) "Average daily membership" has the meaning given it in
11.36 	section 126C.05.
12.1 	(e) "Program growth factor" means 1.046 for fiscal year
12.2 	2003, and 1.0 for fiscal year years 2004 and 2005, and 1.046 for
12.3 	fiscal year 2007 and later.
12.4 	
EFFECTIVE DATE. This section is effective for revenue for
12.5 	fiscal year 2006.

12.6 	Sec. 11. Minnesota Statutes 2004, section 125A.76,
12.7 	subdivision 4, is amended to read:
12.8 		Subd. 4.State total special education aid.  The state
12.9 	total special education aid for fiscal year 2004 equals
12.10 	$530,642,000.  The state total special education aid for fiscal
12.11 	year 2005 equals $529,164,000. The state total special
12.12 	education aid for fiscal year 2006 equals $578,967,000.The
12.13 	state total special education aid for later fiscal years equals:
12.14 	(1) the state total special education aid for the preceding
12.15 	fiscal year; times
12.16 	(2) the program growth factor; times
12.17 	(3) the ratio of the state total average daily membership 
12.18 	unduplicated count of students with an individual education plan 
12.19 	for the current fiscal year to the state total average daily
12.20 	membership unduplicated count of students with an individual
12.21 	education plan for the preceding fiscal year.
12.22 	
EFFECTIVE DATE. This section is effective for revenue for
12.23 	fiscal year 2006.

12.24 	Sec. 12. Minnesota Statutes 2004, section 125A.79,
12.25 	subdivision 1, is amended to read:
12.26 		Subdivision 1.Definitions.  For the purposes of this
12.27 	section, the definitions in this subdivision apply.
12.28 	(a) "Unreimbursed special education cost" means the sum of
12.29 	the following:
12.30 	(1) expenditures for teachers' salaries, contracted
12.31 	services, supplies, equipment, and transportation services
12.32 	eligible for revenue under section 125A.76; plus
12.33 	(2) expenditures for tuition bills received under sections
12.34 	125A.03 to 125A.24 and 125A.65 for services eligible for revenue
12.35 	under section 125A.76, subdivision 2; minus
12.36 	(3) revenue for teachers' salaries, contracted services,
13.1 	supplies, and equipment under section 125A.76; minus
13.2 	(4) tuition receipts under sections 125A.03 to 125A.24 and
13.3 	125A.65 for services eligible for revenue under section 125A.76,
13.4 	subdivision 2.
13.5 	(b) "General revenue" means for fiscal year 1996, the sum
13.6 	of the general education revenue according to section 126C.10,
13.7 	subdivision 1, as adjusted according to section 127A.47,
13.8 	subdivision 7, plus the total referendum revenue according to
13.9 	section 126C.17, subdivision 4.  For fiscal years 1997 and
13.10 	later, "general revenue" means the sum of the general education
13.11 	revenue according to section 126C.10, subdivision 1, as adjusted
13.12 	according to section 127A.47, subdivisions 7 and 8, plus the
13.13 	total referendum revenue minus transportation sparsity revenue
13.14 	minus total operating capital revenue.
13.15 	(c) "Average daily membership" has the meaning given it in
13.16 	section 126C.05.
13.17 	(d) "Program growth factor" means 1.02 for fiscal year
13.18 	2003, and ;1.0 for fiscal year years 2004, 2005, and 2006;and
13.19 	1.02 for fiscal year 2007 and later.
13.20 	
EFFECTIVE DATE. This section is effective for revenue for
13.21 	fiscal year 2006.

13.22 	Sec. 13. Minnesota Statutes 2004, section 125A.79,
13.23 	subdivision 6, is amended to read:
13.24 		Subd. 6.State total special education excess cost aid.
 13.25 	The state total special education excess cost aid for fiscal
13.26 	year 2004 equals $92,067,000.  The state total special education
13.27 	aid for fiscal year 2005 equals $91,811,000. The state total
13.28 	special education aid for fiscal year 2006 equals $95,520,000.
13.29 	The state total special education excess cost aid for fiscal
13.30 	year 2006 and later fiscal years equals:
13.31 	(1) the state total special education excess cost aid for
13.32 	the preceding fiscal year; times
13.33 	(2) the program growth factor; times
13.34 	(3) the ratio of the state total average daily membership
13.35 	for the current fiscal year to the state total average daily
13.36 	membership for the preceding fiscal year.
14.1 	
EFFECTIVE DATE. This section is effective for revenue for
14.2 	fiscal year 2006.

14.3 	Sec. 14. Minnesota Statutes 2004, section 126C.05,
14.4 	subdivision 8, is amended to read:
14.5 		Subd. 8.Average daily membership.  (a) Membership for
14.6 	pupils in grades kindergarten through 12 and for prekindergarten
14.7 	pupils with disabilities shall mean the number of pupils on the
14.8 	current roll of the school, counted from the date of entry until
14.9 	withdrawal.  The date of withdrawal shall mean the day the pupil
14.10 	permanently leaves the school or the date it is officially known
14.11 	that the pupil has left or has been legally excused.  However, a
14.12 	pupil, regardless of age, who has been absent from school for 15
14.13 	consecutive school days during the regular school year or for
14.14 	five consecutive school days during summer school or
14.15 	intersession classes of flexible school year programs without
14.16 	receiving instruction in the home or hospital shall be dropped
14.17 	from the roll and classified as withdrawn.  Nothing in this
14.18 	section shall be construed as waiving the compulsory attendance
14.19 	provisions cited in section 120A.22.  Average daily membership
14.20 	equals the sum for all pupils of the number of days of the
14.21 	school year each pupil is enrolled in the district's schools
14.22 	divided by the number of days the schools are in session.  Days
14.23 	of summer school or intersession classes of flexible school year
14.24 	programs are only included in the computation of membership for
14.25 	pupils with a disability not appropriately served primarily in
14.26 	the regular classroom.  A student must not be counted as more
14.27 	than 1.2 1.5 pupils in average daily membership under this
14.28 	section.  When the initial total average daily membership
14.29 	exceeds 1.2 1.5 for a pupil enrolled in more than one school
14.30 	district during the fiscal year, each district's average daily
14.31 	membership must be reduced proportionately.
14.32 	(b) A student must not be counted as more than one pupil in
14.33 	average daily membership except for purposes of section 126C.10,
14.34 	subdivision 2a.
14.35 	
EFFECTIVE DATE. This section is effective for revenue for
14.36 	fiscal year 2006.

15.1 	Sec. 15. Minnesota Statutes 2004, section 126C.05,
15.2 	subdivision 15, is amended to read:
15.3 		Subd. 15.Learning year pupil units.  (a) When a pupil is
15.4 	enrolled in a learning year program under section 124D.128, an
15.5 	area learning center under sections 123A.05 and 123A.06, an
15.6 	alternative program approved by the commissioner, or a contract
15.7 	alternative program under section 124D.68, subdivision 3,
15.8 	paragraph (d), or subdivision 3a, for more than 1,020 hours in a
15.9 	school year for a secondary student, more than 935 hours in a
15.10 	school year for an elementary student, or more than 425 hours in
15.11 	a school year for a kindergarten student without a disability,
15.12 	that pupil may be counted as more than one pupil in average
15.13 	daily membership for purposes of section 126C.10, subdivision
15.14 	2a.  The amount in excess of one pupil must be determined by the
15.15 	ratio of the number of hours of instruction provided to that
15.16 	pupil in excess of:  (i) the greater of 1,020 hours or the
15.17 	number of hours required for a full-time secondary pupil in the
15.18 	district to 1,020 for a secondary pupil; (ii) the greater of 935
15.19 	hours or the number of hours required for a full-time elementary
15.20 	pupil in the district to 935 for an elementary pupil in grades 1
15.21 	through 6; and (iii) the greater of 425 hours or the number of
15.22 	hours required for a full-time kindergarten student without a
15.23 	disability in the district to 425 for a kindergarten student
15.24 	without a disability.  Hours that occur after the close of the
15.25 	instructional year in June shall be attributable to the
15.26 	following fiscal year.  A kindergarten student must not be
15.27 	counted as more than 1.2 1.5 pupils in average daily membership
15.28 	under this subdivision.  A student in grades 1 through 12 must
15.29 	not be counted as more than 1.2 1.5 pupils in average daily
15.30 	membership under this subdivision.
15.31 	(b)(i) To receive general education revenue for a pupil in
15.32 	an alternative program that has an independent study component,
15.33 	a district must meet the requirements in this paragraph.  The
15.34 	district must develop, for the pupil, a continual learning plan
15.35 	consistent with section 124D.128, subdivision 3.  Each school
15.36 	district that has a state-approved public alternative program
16.1 	must reserve revenue in an amount equal to at least 90 percent
16.2 	of the district average general education revenue per pupil unit
16.3 	less compensatory revenue per pupil unit times the number of
16.4 	pupil units generated by students attending a state-approved
16.5 	public alternative program.  The amount of reserved revenue
16.6 	available under this subdivision may only be spent for program
16.7 	costs associated with the state-approved public alternative
16.8 	program.  Compensatory revenue must be allocated according to
16.9 	section 126C.15, subdivision 2.
16.10 	(ii) General education revenue for a pupil in an approved
16.11 	alternative program without an independent study component must
16.12 	be prorated for a pupil participating for less than a full year,
16.13 	or its equivalent.  The district must develop a continual
16.14 	learning plan for the pupil, consistent with section 124D.128,
16.15 	subdivision 3.  Each school district that has a state-approved
16.16 	public alternative program must reserve revenue in an amount
16.17 	equal to at least 90 percent of the district average general
16.18 	education revenue per pupil unit less compensatory revenue per
16.19 	pupil unit times the number of pupil units generated by students
16.20 	attending a state-approved public alternative program.  The
16.21 	amount of reserved revenue available under this subdivision may
16.22 	only be spent for program costs associated with the
16.23 	state-approved public alternative program.  Compensatory revenue
16.24 	must be allocated according to section 126C.15, subdivision 2.
16.25 	(iii) General education revenue for a pupil in an approved
16.26 	alternative program that has an independent study component must
16.27 	be paid for each hour of teacher contact time and each hour of
16.28 	independent study time completed toward a credit or graduation
16.29 	standards necessary for graduation.  Average daily membership
16.30 	for a pupil shall equal the number of hours of teacher contact
16.31 	time and independent study time divided by 1,020.
16.32 	(iv) For an alternative program having an independent study
16.33 	component, the commissioner shall require a description of the
16.34 	courses in the program, the kinds of independent study involved,
16.35 	the expected learning outcomes of the courses, and the means of
16.36 	measuring student performance against the expected outcomes.
17.1 	
EFFECTIVE DATE. This section is effective for revenue for
17.2 	fiscal year 2006.

17.3 	Sec. 16. Minnesota Statutes 2004, section 126C.10,
17.4 	subdivision 2, is amended to read:
17.5 		Subd. 2.Basic revenue.  The basic revenue for each
17.6 	district equals the formula allowance times the adjusted
17.7 	marginal cost pupil units for the school year. The formula
17.8 	allowance for fiscal year 2001 is $3,964.  The formula allowance
17.9 	for fiscal year 2002 is $4,068.The formula allowance for
17.10 	fiscal year years 2003 and subsequent years through 2005 is
17.11 	$4,601. The formula allowance for fiscal year 2006 and
17.12 	subsequent fiscal years is $4,851.
17.13 	
EFFECTIVE DATE. This section is effective for revenue for
17.14 	fiscal year 2006.

17.15 	Sec. 17. Minnesota Statutes 2004, section 126C.10,
17.16 	subdivision 2a, is amended to read:
17.17 		Subd. 2a.Extended time revenue.  (a) A school district's
17.18 	extended time revenue is equal to the product of $4,601 and the
17.19 	sum of the adjusted marginal cost pupil units of the district
17.20 	for each pupil in average daily membership in excess of 1.0 and
17.21 	less than 1.2 1.5 according to section 126C.05, subdivision 8.
17.22 	(b) A school district's extended time revenue may be used
17.23 	for extended day programs, extended week programs, summer
17.24 	school, and other programming authorized under the learning year
17.25 	program.
17.26 	
EFFECTIVE DATE. This section is effective for revenue for
17.27 	fiscal year 2006.

17.28 	Sec. 18. Minnesota Statutes 2004, section 126C.10,
17.29 	subdivision 3, is amended to read:
17.30 		Subd. 3.Compensatory education revenue.  (a) The
17.31 	compensatory education revenue for each building in the district
17.32 	equals the formula allowance minus $415 times the compensation
17.33 	revenue pupil units computed according to section 126C.05,
17.34 	subdivision 3.  Revenue shall be paid to the district and must
17.35 	be allocated according to section 126C.15, subdivision 2.
17.36 	(b) When the district contracting with an alternative
18.1 	program under section 124D.69 changes prior to the start of a
18.2 	school year, the compensatory revenue generated by pupils
18.3 	attending the program shall be paid to the district contracting
18.4 	with the alternative program for the current school year, and
18.5 	shall not be paid to the district contracting with the
18.6 	alternative program for the prior school year.
18.7 	(c) When the fiscal agent district for an area learning
18.8 	center changes prior to the start of a school year, the
18.9 	compensatory revenue shall be paid to the fiscal agent district
18.10 	for the current school year, and shall not be paid to the fiscal
18.11 	agent district for the prior school year.
18.12 	
EFFECTIVE DATE. This section is effective for revenue for
18.13 	fiscal year 2006.

18.14 	Sec. 19. Minnesota Statutes 2004, section 126C.40,
18.15 	subdivision 1, is amended to read:
18.16 		Subdivision 1.To lease building or land.  (a) When an
18.17 	independent or a special school district or a group of
18.18 	independent or special school districts finds it economically
18.19 	advantageous to rent or lease a building or land for any
18.20 	instructional purposes or for school storage or furniture
18.21 	repair, and it determines that the operating capital revenue
18.22 	authorized under section 126C.10, subdivision 13, is
18.23 	insufficient for this purpose, it may apply to the commissioner
18.24 	for permission to make an additional capital expenditure levy
18.25 	for this purpose.  An application for permission to levy under
18.26 	this subdivision must contain financial justification for the
18.27 	proposed levy, the terms and conditions of the proposed lease,
18.28 	and a description of the space to be leased and its proposed use.
18.29 	(b) The criteria for approval of applications to levy under
18.30 	this subdivision must include:  the reasonableness of the price,
18.31 	the appropriateness of the space to the proposed activity, the
18.32 	feasibility of transporting pupils to the leased building or
18.33 	land, conformity of the lease to the laws and rules of the state
18.34 	of Minnesota, and the appropriateness of the proposed lease to
18.35 	the space needs and the financial condition of the district.
18.36 	The commissioner must not authorize a levy under this
19.1 	subdivision in an amount greater than 90 percent of the cost to
19.2 	the district of renting or leasing a building or land for
19.3 	approved purposes.  The proceeds of this levy must not be used
19.4 	for custodial or other maintenance services.  A district may not
19.5 	levy under this subdivision for the purpose of leasing or
19.6 	renting a district-owned building or site to itself.
19.7 	(c) For agreements finalized after July 1, 1997, a district
19.8 	may not levy under this subdivision for the purpose of leasing:
19.9 	(1) a newly constructed building used primarily for regular
19.10 	kindergarten, elementary, or secondary instruction; or (2) a
19.11 	newly constructed building addition or additions used primarily
19.12 	for regular kindergarten, elementary, or secondary instruction
19.13 	that contains more than 20 percent of the square footage of the
19.14 	previously existing building.
19.15 	(d) Notwithstanding paragraph (b), a district may levy
19.16 	under this subdivision for the purpose of leasing or renting a
19.17 	district-owned building or site to itself only if the amount is
19.18 	needed by the district to make payments required by a lease
19.19 	purchase agreement, installment purchase agreement, or other
19.20 	deferred payments agreement authorized by law, and the levy
19.21 	meets the requirements of paragraph (c).  A levy authorized for
19.22 	a district by the commissioner under this paragraph may be in
19.23 	the amount needed by the district to make payments required by a
19.24 	lease purchase agreement, installment purchase agreement, or
19.25 	other deferred payments agreement authorized by law, provided
19.26 	that any agreement include a provision giving the school
19.27 	districts the right to terminate the agreement annually without
19.28 	penalty.
19.29 	(e) The total levy under this subdivision for a district
19.30 	for any year must not exceed $90 $100 times the resident pupil
19.31 	units for the fiscal year to which the levy is attributable.
19.32 	(f) For agreements for which a review and comment have been
19.33 	submitted to the Department of Education after April 1, 1998,
19.34 	the term "instructional purpose" as used in this subdivision
19.35 	excludes expenditures on stadiums.
19.36 	(g) The commissioner of education may authorize a school
20.1 	district to exceed the limit in paragraph (e) if the school
20.2 	district petitions the commissioner for approval.  The
20.3 	commissioner shall grant approval to a school district to exceed
20.4 	the limit in paragraph (e) for not more than five years if the
20.5 	district meets the following criteria:
20.6 	(1) the school district has been experiencing pupil
20.7 	enrollment growth in the preceding five years;
20.8 	(2) the purpose of the increased levy is in the long-term
20.9 	public interest;
20.10 	(3) the purpose of the increased levy promotes colocation
20.11 	of government services; and
20.12 	(4) the purpose of the increased levy is in the long-term
20.13 	interest of the district by avoiding over construction of school
20.14 	facilities.
20.15 	(h) A school district that is a member of an intermediate
20.16 	school district may include in its authority under this section
20.17 	90 percent of the costs associated with leases of administrative
20.18 	and classroom space for intermediate school district programs.
20.19 	This authority must not exceed $22.50 $25 times the adjusted
20.20 	marginal cost pupil units of the member districts.  This
20.21 	authority is in addition to any other authority authorized under
20.22 	this section.
20.23 	(i) In addition to the allowable capital levies in
20.24 	paragraph (a), a district that is a member of the "Technology
20.25 	and Information Education Systems" data processing joint board,
20.26 	that finds it economically advantageous to enter into a lease
20.27 	purchase agreement for a building for a group of school
20.28 	districts or special school districts for staff development
20.29 	purposes, may levy for its portion of lease costs attributed to
20.30 	the district within the total levy limit in paragraph (e).
20.31 	
EFFECTIVE DATE. This section is effective for taxes
20.32 	payable in 2006.

20.33 	Sec. 20. Minnesota Statutes 2004, section 126C.43,
20.34 	subdivision 2, is amended to read:
20.35 		Subd. 2.Payment to unemployment insurance program trust
20.36 	fund by state and political subdivisions.  A district may
21.1 	levy 90 percent of the amount exceeding $10 times the district's
21.2 	adjusted marginal cost pupil units for the fiscal year ending in
21.3 	the year before the year the levy is certified necessary (i) to
21.4 	pay the district's obligations under section 268.052,
21.5 	subdivision 1, and (ii) to pay for job placement services
21.6 	offered to employees who may become eligible for benefits
21.7 	pursuant to section 268.085 for the fiscal year the levy is
21.8 	certified.
21.9 	
EFFECTIVE DATE. This section is effective for taxes
21.10 	payable in 2006.

21.11 	Sec. 21. Minnesota Statutes 2004, section 126C.43,
21.12 	subdivision 3, is amended to read:
21.13 		Subd. 3.Tax levy for judgment.  A district may levy 90
21.14 	percent of the amount exceeding $10 times the district's
21.15 	adjusted marginal cost pupil units for the fiscal year ending in
21.16 	the year before the year the levy is certified necessary to pay
21.17 	judgments against the district under section 123B.25 that became
21.18 	final after the date the district certified its proposed levy in
21.19 	the previous year.  With the approval of the commissioner, a
21.20 	district may spread this levy over a period not to exceed three
21.21 	years.  Upon approval through the adoption of a resolution by
21.22 	each of an intermediate district's member school district
21.23 	boards, a member school district may include its proportionate
21.24 	share of the costs of a judgment against an intermediate school
21.25 	district that became final under section 123B.25 after the date
21.26 	that the earliest member school district certified its proposed
21.27 	levy in the previous year.  With the approval of the
21.28 	commissioner, an intermediate school district member school
21.29 	district may spread this levy over a period not to exceed three
21.30 	years.
21.31 	
EFFECTIVE DATE. This section is effective for taxes
21.32 	payable in 2006.

21.33 	Sec. 22. Minnesota Statutes 2004, section 126C.44, is
21.34 	amended to read:
21.35 	126C.44 SAFE SCHOOLS LEVY.
21.36 	Each district may make a levy on all taxable property
22.1 	located within the district for the purposes specified in this
22.2 	section.  The maximum amount which may be levied for all costs
22.3 	under this section shall be equal to $27 $30 multiplied by the
22.4 	district's adjusted marginal cost pupil units for the school
22.5 	year.  The proceeds of the levy must be used for directly
22.6 	funding the following purposes or for reimbursing the cities and
22.7 	counties who contract with the district for the following
22.8 	purposes:  (1) to pay the costs incurred for the salaries,
22.9 	benefits, and transportation costs of peace officers and
22.10 	sheriffs for liaison in services in the district's schools; (2)
22.11 	to pay the costs for a drug abuse prevention program as defined
22.12 	in section 609.101, subdivision 3, paragraph (e), in the
22.13 	elementary schools; (3) to pay the costs for a gang resistance
22.14 	education training curriculum in the district's schools; (4) to
22.15 	pay the costs for security in the district's schools and on
22.16 	school property; or (5) to pay the costs for other crime
22.17 	prevention, drug abuse, student and staff safety, and violence
22.18 	prevention measures taken by the school district.  The district
22.19 	must initially attempt to contract for services to be provided
22.20 	by peace officers or sheriffs with the police department of each
22.21 	city or the sheriff's department of the county within the
22.22 	district containing the school receiving the services.  If a
22.23 	local police department or a county sheriff's department does
22.24 	not wish to provide the necessary services, the district may
22.25 	contract for these services with any other police or sheriff's
22.26 	department located entirely or partially within the school
22.27 	district's boundaries.  The levy authorized under this section
22.28 	is not included in determining the school district's levy
22.29 	limitations.

22.30 	EFFECTIVE DATE. This section is effective for taxes
22.31 	payable in 2006.