1.1 	A bill for an act
1.2 	relating to local government; requiring special districts to file information with 
1.3 	the state auditor; proposing coding for new law in Minnesota Statutes, chapter 6.
1.4 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.5 	Section 1. [6.756] SPECIAL DISTRICTS; INFORMATION REQUIRED TO BE 
1.6 	FILED WITH STATE AUDITOR; AUDITS.
1.7 		Subdivision 1.Definition. For the purposes of this section, "special district" means a 
1.8 	public entity with a special or limited purpose, financed by property tax revenues or other 
1.9 	public funds, that is not included in a city, county, or town financial report as a component 
1.10 	of that local government, that is created or authorized by law, and that is governed by (1) 
1.11 	persons directly elected to the governing board of the district, (2) persons appointed to the 
1.12 	governing board of the district by local elected officials, (3) local elected officials who 
1.13 	serve on the board by virtue of their elected office, or (4) a combination of these methods 
1.14 	of selection.  "Special district" includes special taxing districts listed in section 275.066.
1.15 		Subd. 2.Governance documents must be filed. Each special district must file with 
1.16 	the state auditor within 60 days of adoption any document relating to the governance of the 
1.17 	district, including articles of incorporation, bylaws, or agreements, and any amendment 
1.18 	to these documents.
1.19 		Subd. 3.Audit requirements. (a) A special district with total annual revenue 
1.20 	greater than the amount in paragraph (c) must provide for an annual audit of the district's 
1.21 	financial affairs by the state auditor or a public accountant in accordance with minimum 
1.22 	auditing procedures prescribed by the state auditor.
1.23 	(b) A special district with total annual revenue that is equal to or less than the amount 
1.24 	in paragraph (c) mu0st provide for an audit of the district's financial affairs by the state 
2.1 	auditor or a public accountant in accordance with minimum audit procedures prescribed 
2.2 	by the state auditor at least once every five years.  The audit must be for a one-year period 
2.3 	to be determined at random by the person conducting the audit.  The audited financial 
2.4 	statement must be prepared in a manner similar to the reporting requirements for cities 
2.5 	under 2,500 in population.  In any year in which a special district is not audited, the district 
2.6 	must prepare a financial statement in a format similar to the reporting requirements for 
2.7 	cities reporting on a cash basis and file that statement with the state auditor.
2.8 	(c) For the purposes of paragraphs (a) and (b), the amount in 2007 is $150,000, and 
2.9 	in 2008 and thereafter, the amount is $150,000 adjusted for inflation using the annual 
2.10 	implicit price deflator for state and local expenditures as published by the United States 
2.11 	Department of Commerce.
2.12 	(d) This subdivision does not apply to a special district subject to financial auditing 
2.13 	and reporting requirements under other law.
2.14 		Subd. 4.Presentation to governing board. Except as provided by other law, 
2.15 	financial statements and audits must be completed and presented to the district's governing 
2.16 	board within 180 days after the end of the district's fiscal year.