1.1                          A bill for an act
  1.2             relating to local government; establishing a program 
  1.3             for aid payments to local units of government for 
  1.4             innovation and efficiency in the delivery of local 
  1.5             services; appropriating money; amending Minnesota 
  1.6             Statutes 1996, section 465.796, subdivision 2; 
  1.7             proposing coding for new law in Minnesota Statutes, 
  1.8             chapters 465; and 477A. 
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  Minnesota Statutes 1996, section 465.796, 
  1.11  subdivision 2, is amended to read: 
  1.12     Subd. 2.  [DUTIES OF BOARD.] The board shall: 
  1.13     (1) accept applications from local government units for 
  1.14  waivers of administrative rules and temporary, limited 
  1.15  exemptions from enforcement of procedural requirements in state 
  1.16  law as provided in section 465.797, and determine whether to 
  1.17  approve, modify, or reject the application; 
  1.18     (2) accept applications for grants to local government 
  1.19  units and related organizations proposing to design models or 
  1.20  plans for innovative service delivery and management as provided 
  1.21  in section 465.798 and determine whether to approve, modify, or 
  1.22  reject the application; 
  1.23     (3) accept applications from local government units for 
  1.24  financial assistance to enable them to plan for cooperative 
  1.25  efforts as provided in section 465.799, and determine whether to 
  1.26  approve, modify, or reject the application; 
  1.27     (4) accept applications from eligible local government 
  2.1   units for service-sharing grants as provided in section 465.801, 
  2.2   and determine whether to approve, modify, or reject the 
  2.3   application; 
  2.4      (5) accept applications from counties, cities, and towns 
  2.5   proposing to combine under sections 465.81 to 465.88, and 
  2.6   determine whether to approve or disapprove the application; 
  2.7      (6) accept applications from eligible local government 
  2.8   units for the local innovation and efficiency program as 
  2.9   provided in section 465.803, and determine whether to approve, 
  2.10  modify, or reject the application; 
  2.11     (7) make recommendations to the legislature for the 
  2.12  authorization of pilot projects for the implementation of 
  2.13  innovative service delivery activities that require statutory 
  2.14  authorization; 
  2.15     ~~(7)~~ (8) make recommendations to the legislature regarding 
  2.16  the elimination of state mandates that inhibit local government 
  2.17  efficiency, innovation, and cooperation by prescribing specific 
  2.18  processes for achieving a desired outcome; 
  2.19     ~~(8)~~ (9) investigate and review the role of unfunded state 
  2.20  mandates in intergovernmental relations and assess their impact 
  2.21  on state and local government objectives and responsibilities; 
  2.22     ~~(9)~~ (10) make recommendations to the governor and the 
  2.23  legislature regarding: 
  2.24     (i) allowing flexibility for local units of government in 
  2.25  complying with specific unfunded state mandates for which terms 
  2.26  of compliance are unnecessarily rigid or complex; 
  2.27     (ii) reconciling any two or more unfunded state mandates 
  2.28  that impose contradictory or inconsistent requirements; 
  2.29     (iii) terminating unfunded state mandates that are 
  2.30  duplicative, obsolete, or lacking in practical utility; 
  2.31     (iv) suspending, on a temporary basis, unfunded state 
  2.32  mandates that are not vital to public health and safety and that 
  2.33  compound the fiscal difficulties of local units of government, 
  2.34  including recommendations for initiating the suspensions; 
  2.35     (v) consolidating or simplifying unfunded state mandates or 
  2.36  the planning or reporting requirements of the mandates, in order 
  3.1   to reduce duplication and facilitate compliance by local units 
  3.2   of government with those mandates; and 
  3.3      (vi) establishing common state definitions or standards to 
  3.4   be used by local units of government in complying with unfunded 
  3.5   state mandates that use different definitions or standards for 
  3.6   the same terms or principles; and 
  3.7      ~~(10)~~ (11) identify relevant unfunded state mandates. 
  3.8      The duties imposed under clauses ~~(8)~~ (9) to ~~(10)~~ (11) shall 
  3.9   be performed to the extent possible given existing resources.  
  3.10  Each recommendation under clause ~~(9)~~ (10) shall, to the extent 
  3.11  practicable, identify the specific unfunded state mandates to 
  3.12  which the recommendation applies.  The commissioners or 
  3.13  directors of state agencies responsible for the promulgation or 
  3.14  enforcement of the unfunded mandates addressed in 
  3.15  clauses ~~(7)~~ (8) to ~~(10)~~ (11) shall assign staff to assist the 
  3.16  board in carrying out the board's duties under this section. 
  3.17     Sec. 2.  [465.803] [LOCAL INNOVATION AND EFFICIENCY 
  3.18  PROGRAM.] 
  3.19     (a) Two or more local government units, an association of 
  3.20  local governments, a local government unit acting in conjunction 
  3.21  with the metropolitan council, an organization, or a state 
  3.22  agency, or an organization established by two or more local 
  3.23  government units under a joint powers agreement may apply to the 
  3.24  board for local innovation and efficiency program aid.  Aid may 
  3.25  be requested for a period of one to four years.  The purpose of 
  3.26  the aid is to help reduce future state costs or local property 
  3.27  tax burdens by removing financial barriers to local innovations 
  3.28  in the delivery of local services.  The aid payments are to help 
  3.29  fund the costs of service innovation and cooperation by local 
  3.30  government units where those costs during the aid period might 
  3.31  otherwise require local property taxes in excess of the property 
  3.32  taxes currently being spent on the services affected by the 
  3.33  application.  To be eligible for aid a project must: 
  3.34     (1) involve cooperation among local governments or related 
  3.35  entities in the delivery of services, or demonstrate that 
  3.36  cooperation was evaluated and determined to be less efficient; 
  4.1   and 
  4.2      (2) be designed either to improve specific local services 
  4.3   with no increase in total costs in a geographic area where the 
  4.4   service improvements would meet an identified need that might 
  4.5   otherwise require state funds or property taxes to address 
  4.6   adequately, reduce future costs to the state, or reduce future 
  4.7   local costs that would otherwise be paid from the local property 
  4.8   tax. 
  4.9      (b) The application to the board must include an 
  4.10  implementation plan for the period of the aid request, a budget 
  4.11  showing the use of the aid requested, and proposed financial and 
  4.12  other outcomes and performance measures to be used for 
  4.13  evaluating the innovation during and after the aid period.  To 
  4.14  be eligible for aid the application must show that without the 
  4.15  aid, the proposed innovation would require a commitment of local 
  4.16  property tax dollars in excess of the amount currently being 
  4.17  spent on the service affected by the application.  A copy of the 
  4.18  application must be provided to the exclusive representatives 
  4.19  certified under section 179A.12 to represent employees who 
  4.20  provide the service or program affected by the application. 
  4.21     (c) By December 31 of each year, the board shall recommend 
  4.22  aid payments to the commissioner of revenue under this section 
  4.23  on the basis of the applicant's score under the scoring system 
  4.24  in section 465.802, plus additional points awarded under the 
  4.25  following criteria: 
  4.26     (1) up to an additional 25 points to reflect the extent to 
  4.27  which the application anticipates future cost savings to the 
  4.28  state or future reductions in demand for property taxes; 
  4.29     (2) an additional 15 points if the application would 
  4.30  restructure service delivery and involves services provided by a 
  4.31  county and at least one other taxing jurisdiction located at 
  4.32  least partially within the county; 
  4.33     (3) up to an additional ten points to reflect the extent to 
  4.34  which the application anticipates service improvements with no 
  4.35  increase in total costs to meet identified needs that might 
  4.36  otherwise require state funds or property taxes to address 
  5.1   adequately; and 
  5.2      (4) up to an additional ten points based on recommendations 
  5.3   from the association of Minnesota counties, the league of 
  5.4   Minnesota cities, the Minnesota school boards association, and 
  5.5   the Minnesota association of townships.  The board shall develop 
  5.6   a process for obtaining these recommendations. 
  5.7      The board may not reduce the score for an application 
  5.8   solely because it is similar to innovations undertaken 
  5.9   successfully or proposed by other local government units. 
  5.10     (d) The board may recommend aid payments under this section 
  5.11  over a period of up to four years.  All aid payments recommended 
  5.12  by the board in a fiscal year must be paid from the current 
  5.13  fiscal year or a previous fiscal year's appropriation, 
  5.14  regardless of when the aid is actually paid to the local 
  5.15  government unit or related entity.  The board may bill the 
  5.16  commissioner of revenue for the cost of administering the 
  5.17  program established under this section, not to exceed $75,000 in 
  5.18  any fiscal year. 
  5.19     (e) For each calendar year for which aid is provided, the 
  5.20  recipients must provide the board with a report that summarizes 
  5.21  the steps taken to implement the proposal and an assessment of 
  5.22  the service improvements or cost savings achieved, or both.  If 
  5.23  the board finds that a recipient has failed to implement a 
  5.24  proposal according to the terms of the application, it may 
  5.25  recommend to the commissioner of revenue that the recipient 
  5.26  repay all or a portion of the aid. 
  5.27     (f) The board shall prepare a report by February 1 of each 
  5.28  year that summarizes the local innovation and efficiency aid 
  5.29  payments awarded under this section during the previous calendar 
  5.30  year, the resulting local service innovations or cooperative 
  5.31  efforts, and the related service improvements and cost savings 
  5.32  achieved.  The report shall be sent to the chair of the local 
  5.33  government and metropolitan affairs committee of the house of 
  5.34  representatives and the chair of the metropolitan and local 
  5.35  government committee of the senate. 
  5.36     Sec. 3.  [477A.0145] [LOCAL INNOVATION AND EFFICIENCY AID 
  6.1   PAYMENTS.] 
  6.2      The commissioner of revenue shall make additional aid 
  6.3   payments to local governments beginning in calendar year 1998 
  6.4   based on the recommendations of the board of government 
  6.5   innovation and cooperation provided under section 465.803.  The 
  6.6   aid payments shall be made on the dates provided under section 
  6.7   477A.015.  The commissioner shall deduct the amount billed by 
  6.8   the board of government innovation and cooperation for 
  6.9   administering the local innovation and efficiency program from 
  6.10  the aid payments to be made to the local governments. 
  6.11     Sec. 4.  [APPROPRIATION.] 
  6.12     $25,000,000 for fiscal year 1998 and $25,000,000 for fiscal 
  6.13  year 1999 are appropriated from the general fund to the 
  6.14  commissioner of revenue for the local innovation and efficiency 
  6.15  program aid payments and shall include expenses for 
  6.16  administration as provided in Minnesota Statutes, sections 
  6.17  465.803 and 477A.0145.  The appropriation shall remain available 
  6.18  until expended.