HF 351

1st Engrossment - 88th Legislature (2013 - 2014) Posted on 02/21/2013 08:55am

A bill for an act
relating to economic development; regulating the Iron Range Resources and
Rehabilitation Board; modifying board composition and approval provisions;
amending Minnesota Statutes 2012, sections 116J.424; 298.22, subdivisions 5a,
8, 10, 11, by adding a subdivision; 298.221; 298.2211, subdivision 3; 298.2213,
subdivision 4; 298.2214, subdivision 6; 298.223, subdivisions 1, 2; 298.227;
298.28, subdivision 9d; 298.292, subdivision 2; 298.294; 298.296, subdivisions
1, 2; 298.2961, subdivisions 2, 4, 5; repealing Minnesota Statutes 2012, section
298.22, subdivision 2.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2012, section 116J.424, is amended to read:

116J.424 IRON RANGE RESOURCES AND REHABILITATION BOARD
CONTRIBUTION.

The commissioner of the Iron Range Resources and Rehabilitation Board with
approval by deleted text begin at least seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin the
board new text end , shall provide an equal match for any loan or equity investment made for a facility
located in the tax relief area defined in section 273.134, paragraph (b), by the Minnesota
minerals 21st century fund created by section 116J.423. The match may be in the form
of a loan or equity investment, notwithstanding whether the fund makes a loan or equity
investment. The state shall not acquire an equity interest because of an equity investment
or loan by the board and the board at its sole discretion shall decide what interest it acquires
in a project. The commissioner of employment and economic development may require a
commitment from the board to make the match prior to disbursing money from the fund.

Sec. 2.

Minnesota Statutes 2012, section 298.22, is amended by adding a subdivision
to read:

new text begin Subd. 1a. new text end

new text begin Iron Range Resources and Rehabilitation Board. new text end

new text begin The Iron Range
Resources and Rehabilitation Board consists of the state senators and representatives
elected from state senatorial or legislative districts in which one-third or more of
the residents reside in a taconite assistance area as defined in section 273.1341. All
expenditures and projects made by the commissioner shall first be submitted to the board
for approval. The expenses of the board shall be paid by the state from funds available
under this section. Members of the board may be reimbursed for expenses in the manner
provided in sections 3.099, subdivision 1, and 3.101, and may receive per diem payments
during the interims between legislative sessions in the manner provided in section 3.099,
subdivision 1.
new text end

Sec. 3.

Minnesota Statutes 2012, section 298.22, subdivision 5a, is amended to read:

Subd. 5a.

Forest trust.

The commissioner, upon deleted text begin the affirmative vote of at least
seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin approval by the board new text end ,
may purchase forest lands in the taconite assistance area defined in under section 273.1341
with funds specifically authorized for the purchase. The acquired forest lands must be
held in trust for the benefit of the citizens of the taconite assistance area as the Iron Range
Miners' Memorial Forest. The forest trust lands shall be managed and developed for
recreation and economic development purposes. The commissioner, upon deleted text begin the affirmative
vote of at least seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin approval
by the board new text end , may sell forest lands purchased under this subdivision if the board finds that
the sale advances the purposes of the trust. Proceeds derived from the management or sale
of the lands and from the sale of timber or removal of gravel or other minerals from these
forest lands shall be deposited into an Iron Range Miners' Memorial Forest account that is
established within the state financial accounts. Funds may be expended from the account
upon approval by deleted text begin at least seven Iron Range Resources and Rehabilitation Board members
deleted text end new text begin the board new text end , to purchase, manage, administer, convey interests in, and improve the forest
lands. deleted text begin By an affirmative vote of at least seven Iron Range Resources and Rehabilitation
Board members deleted text end new text begin With approval by the board new text end , money in the Iron Range Miners' Memorial
Forest account may be transferred into the corpus of the Douglas J. Johnson economic
protection trust fund established under sections 298.291 to 298.294. The property acquired
under the authority granted by this subdivision and income derived from the property or
the operation or management of the property are exempt from taxation by the state or its
political subdivisions while held by the forest trust.

Sec. 4.

Minnesota Statutes 2012, section 298.22, subdivision 8, is amended to read:

Subd. 8.

Spending priority.

In making or approving any expenditures on programs
or projects, the commissioner and the board shall give the highest priority to programs
and projects that target relief to those areas of the taconite assistance area as defined in
section 273.1341, that have the largest percentages of job losses and population losses
directly attributable to the economic downturn in the taconite industry since the 1980s.
The commissioner and the board shall compare the 1980 population and employment
figures with the 2000 population and employment figures, and shall specifically consider
the job losses in 2000 and 2001 resulting from the closure of LTV Steel Mining Company,
in making or approving expenditures consistent with this subdivision, as well as the areas
of residence of persons who suffered job loss for which relief is to be targeted under this
subdivision. The commissioner may lease, for a term not exceeding 50 years and upon
the terms determined by the commissioner and approved by deleted text begin at least seven Iron Range
Resources and Rehabilitation Board members deleted text end new text begin the board new text end , surface and mineral interests
owned or acquired by the state of Minnesota acting by and through the office of the
commissioner of Iron Range resources and rehabilitation within those portions of the
taconite assistance area affected by the closure of the LTV Steel Mining Company facility
near Hoyt Lakes. The payments and royalties from these leases must be deposited into the
fund established in section 298.292. This subdivision supersedes any other conflicting
provisions of law and does not preclude the commissioner and the board from making
expenditures for programs and projects in other areas.

Sec. 5.

Minnesota Statutes 2012, section 298.22, subdivision 10, is amended to read:

Subd. 10.

Sale or privatization of functions.

The commissioner of Iron Range
resources and rehabilitation may not sell or privatize the Ironworld Discovery Center or
Giants Ridge Golf and Ski Resort without prior approval by deleted text begin at least seven Iron Range
Resources and Rehabilitation Board members deleted text end new text begin the board new text end .

Sec. 6.

Minnesota Statutes 2012, section 298.22, subdivision 11, is amended to read:

Subd. 11.

Budgeting.

The commissioner of Iron Range resources and rehabilitation
shall annually prepare a budget for operational expenditures, programs, and projects, and
submit it to the Iron Range Resources and Rehabilitation Board deleted text begin and the governor deleted text end . After
the budget is approved by deleted text begin at least seven Iron Range Resources and Rehabilitation Board
members deleted text end new text begin the board new text end and the governor, the commissioner may spend money in accordance
with the approved budget.

Sec. 7.

Minnesota Statutes 2012, section 298.221, is amended to read:

298.221 RECEIPTS FROM CONTRACTS; APPROPRIATION.

(a) Except as provided in paragraph (c), all money paid to the state of Minnesota
pursuant to the terms of any contract entered into by the state under authority of section
298.22 and any fees which may, in the discretion of the commissioner of Iron Range
resources and rehabilitation, be charged in connection with any project pursuant to that
section as amended, shall be deposited in the state treasury to the credit of the Iron Range
Resources and Rehabilitation Board account in the special revenue fund and are hereby
appropriated for the purposes of section 298.22.

(b) Notwithstanding section 16A.013, merchandise may be accepted by the
commissioner of the Iron Range Resources and Rehabilitation Board for payment of
advertising contracts if the commissioner determines that the merchandise can be used
for special event prizes or mementos at facilities operated by the board. Nothing in this
paragraph authorizes the commissioner or a member of the board to receive merchandise
for personal use.

(c) All fees charged by the commissioner in connection with public use of the
state-owned ski and golf facilities at the Giants Ridge Recreation Area and all other
revenues derived by the commissioner from the operation or lease of those facilities
and from the lease, sale, or other disposition of undeveloped lands at the Giants Ridge
Recreation Area must be deposited into an Iron Range Resources and Rehabilitation Board
account that is created within the state enterprise fund. All funds deposited in the enterprise
fund account are appropriated to the commissioner to be expended, subject to approval by deleted text begin at
least seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin the board new text end , as follows:

(1) to pay costs associated with the construction, equipping, operation, repair, or
improvement of the Giants Ridge Recreation Area facilities or lands;

(2) to pay principal, interest and associated bond issuance, reserve, and servicing
costs associated with the financing of the facilities; and

(3) to pay the costs of any other project authorized under section 298.22.

Sec. 8.

Minnesota Statutes 2012, section 298.2211, subdivision 3, is amended to read:

Subd. 3.

Project approval.

All projects authorized by this section shall be
submitted by the commissioner to the Iron Range Resources and Rehabilitation Board for
approval by deleted text begin at least seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin the
board new text end . Prior to the commencement of a project involving the exercise by the commissioner
of any authority of sections 469.174 to 469.179, the governing body of each municipality
in which any part of the project is located and the county board of any county containing
portions of the project not located in an incorporated area shall by majority vote approve
or disapprove the project. Any project approved by deleted text begin at least seven Iron Range Resources
and Rehabilitation Board members deleted text end new text begin the board new text end and the applicable governing bodies, if
any, together with detailed information concerning the project, its costs, the sources of
its funding, and the amount of any bonded indebtedness to be incurred in connection
with the project, shall be transmitted to the governor, who shall approve, disapprove, or
return the proposal for additional consideration within 30 days of receipt. No project
authorized under this section shall be undertaken, and no obligations shall be issued and
no tax increments shall be expended for a project authorized under this section until the
project has been approved by the governor.

Sec. 9.

Minnesota Statutes 2012, section 298.2213, subdivision 4, is amended to read:

Subd. 4.

Project approval.

The board and commissioner shall by August 1 each
year prepare a list of projects to be funded from the money appropriated in this section
with necessary supporting information including descriptions of the projects, plans, and
cost estimates. A project must not be approved by the board unless it finds that:

(1) the project will materially assist, directly or indirectly, the creation of additional
long-term employment opportunities;

(2) the prospective benefits of the expenditure exceed the anticipated costs; and

(3) in the case of assistance to private enterprise, the project will serve a sound
business purpose.

Each project must be approved by deleted text begin at least seven Iron Range Resources and
Rehabilitation Board members deleted text end new text begin the board new text end and the commissioner of Iron Range resources
and rehabilitation. The list of projects must be submitted to the governor, who shall, by
November 15 of each year, approve, disapprove, or return for further consideration, each
project. The money for a project may be spent only upon approval of the project by the
governor. The board may submit supplemental projects for approval at any time.

Sec. 10.

Minnesota Statutes 2012, section 298.2214, subdivision 6, is amended to read:

Subd. 6.

Per diem.

Members of the committee may be reimbursed for expenses deleted text begin in
the manner provided in section 298.22, subdivision 2 deleted text end new text begin by the state from funds available
under section 298.22 new text end .

Sec. 11.

Minnesota Statutes 2012, section 298.223, subdivision 1, is amended to read:

Subdivision 1.

Creation; purposes.

A fund called the taconite environmental
protection fund is created for the purpose of reclaiming, restoring and enhancing those
areas of northeast Minnesota located within the taconite assistance area defined in section
273.1341, that are adversely affected by the environmentally damaging operations
involved in mining taconite and iron ore and producing iron ore concentrate and for the
purpose of promoting the economic development of northeast Minnesota. The taconite
environmental protection fund shall be used for the following purposes:

(1) to initiate investigations into matters the Iron Range Resources and Rehabilitation
Board determines are in need of study and which will determine the environmental
problems requiring remedial action;

(2) reclamation, restoration, or reforestation of mine lands not otherwise provided
for by state law;

(3) local economic development projects but only if those projects are approved
by deleted text begin at least seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin the board new text end ,
and public works, including construction of sewer and water systems located within the
taconite assistance area defined in section 273.1341;

(4) monitoring of mineral industry related health problems among mining employees;

(5) local public works projects under section 298.227, paragraph (c); and

(6) local public works projects as provided under this clause. The following amounts
shall be distributed in 2009 based upon the taxable tonnage of production in 2008:

(i) .4651 cent per ton to the city of Aurora for street repair and renovation;

(ii) .4264 cent per ton to the city of Biwabik for street and utility infrastructure
improvements to the south side industrial site;

(iii) .6460 cent per ton to the city of Buhl for street repair;

(iv) 1.0336 cents per ton to the city of Hoyt Lakes for public utility improvements;

(v) 1.1628 cents per ton to the city of Eveleth for water and sewer infrastructure
upgrades;

(vi) 1.0336 cents per ton to the city of Gilbert for water and sewer infrastructure
upgrades;

(vii) .7752 cent per ton to the city of Mountain Iron for water and sewer infrastructure;

(viii) 1.2920 cents per ton to the city of Virginia for utility upgrades and accessibility
modifications for the miners' memorial;

(ix) .6460 cent per ton to the town of White for Highway 135 road upgrades;

(x) 1.9380 cents per ton to the city of Hibbing for public infrastructure projects;

(xi) 1.1628 cents per ton to the city of Chisholm for water and sewer repair;

(xii) .6460 cent per ton to the town of Balkan for community center repairs;

(xiii) .9044 cent per ton to the city of Babbitt for city garage construction;

(xiv) .5168 cent per ton to the city of Cook for public infrastructure projects;

(xv) .5168 cent per ton to the city of Ely for reconstruction of 2nd Avenue West;

(xvi) .6460 cent per ton to the city of Tower for water infrastructure upgrades;

(xvii) .1292 cent per ton to the city of Orr for water infrastructure upgrades;

(xviii) .1292 cent per ton to the city of Silver Bay for emergency cleanup;

(xvix) .3230 cent per ton to Lake County for trail construction;

(xx) .1292 cent per ton to Cook County for construction of tennis courts in Grand
Marais;

(xxi) .3101 cent per ton to the city of Two Harbors for water infrastructure
improvements;

(xxii) .1938 cent per ton for land acquisition for phase one of Cook Airport project;

(xxiii) 1.0336 cents per ton to the city of Coleraine for water and sewer
improvements along Gayley Avenue;

(xxiv) .3876 cent per ton to the city of Marble for construction of a city
administration facility;

(xxv) .1292 cent per ton to the city of Calumet for repairs at city hall and the
community center;

(xxvi) .6460 cent per ton to the city of Nashwauk for electrical infrastructure
upgrades;

(xxvii) 1.0336 cents per ton to the city of Keewatin for water and sewer upgrades
along Depot Street;

(xxviii) .2584 cent per ton to the city of Aitkin for water, sewer, street, and gutter
improvements;

(xxix) 1.1628 cents per ton to the city of Grand Rapids for water and sewer
infrastructure upgrades at Pokegema Golf Course and Park Place;

(xxx) .1809 cent per ton to the city of Grand Rapids for water and sewer upgrades
for 1st Avenue from River Road to 3rd Street SE; and

(xxxi) .9044 cent per ton to the city of Cohasset for upgrades to the railroad crossing
at Highway 2 and County Road 62.

Sec. 12.

Minnesota Statutes 2012, section 298.223, subdivision 2, is amended to read:

Subd. 2.

Administration.

(a) The taconite area environmental protection fund shall
be administered by the commissioner of the Iron Range Resources and Rehabilitation
Board. The commissioner shall by September 1 of each year submit to the board a list
of projects to be funded from the taconite area environmental protection fund, with such
supporting information including description of the projects, plans, and cost estimates as
may be necessary.

(b) Each year no less than one-half of the amounts deposited into the taconite
environmental protection fund must be used for public works projects, including
construction of sewer and water systems, as specified under subdivision 1, clause (3). The
Iron Range Resources and Rehabilitation Board deleted text begin with approval by at least seven Iron
Range Resources and Rehabilitation Board members, deleted text end may waive the requirements of
this paragraph.

(c) Upon approval by deleted text begin at least seven Iron Range Resources and Rehabilitation Board
members deleted text end new text begin the board new text end , the list of projects approved under this subdivision shall be submitted to
the governor by November 1 of each year. By December 1 of each year, the governor shall
approve or disapprove, or return for further consideration, each project. Funds for a project
may be expended only upon approval of the project by deleted text begin at least seven Iron Range Resources
and Rehabilitation Board members, deleted text end new text begin the board new text end and the governor. The commissioner may
submit supplemental projects to the board and governor for approval at any time.

Sec. 13.

Minnesota Statutes 2012, section 298.227, is amended to read:

298.227 TACONITE ECONOMIC DEVELOPMENT FUND.

(a) An amount equal to that distributed pursuant to each taconite producer's taxable
production and qualifying sales under section 298.28, subdivision 9a, shall be held by
the Iron Range Resources and Rehabilitation Board in a separate taconite economic
development fund for each taconite and direct reduced ore producer. Money from the
fund for each producer shall be released by the commissioner after review by a joint
committee consisting of an equal number of representatives of the salaried employees and
the nonsalaried production and maintenance employees of that producer. The District 11
director of the United States Steelworkers of America, on advice of each local employee
president, shall select the employee members. In nonorganized operations, the employee
committee shall be elected by the nonsalaried production and maintenance employees.
The review must be completed no later than six months after the producer presents a
proposal for expenditure of the funds to the committee. The funds held pursuant to this
section may be released only for workforce development and associated public facility
improvement, or for acquisition of plant and stationary mining equipment and facilities
for the producer or for research and development in Minnesota on new mining, or
taconite, iron, or steel production technology, but only if the producer provides a matching
expenditure to be used for the same purpose of at least 50 percent of the distribution
based on 14.7 cents per ton beginning with distributions in 2002. Effective for proposals
for expenditures of money from the fund beginning May 26, 2007, the commissioner
may not release the funds before the next scheduled meeting of the board. If a proposed
expenditure is not approved by deleted text begin at least seven Iron Range Resources and Rehabilitation
Board members deleted text end new text begin the board new text end , the funds must be deposited in the Taconite Environmental
Protection Fund under sections 298.222 to 298.225. If a producer uses money which has
been released from the fund prior to May 26, 2007 to procure haulage trucks, mobile
equipment, or mining shovels, and the producer removes the piece of equipment from the
taconite tax relief area defined in section 273.134 within ten years from the date of receipt
of the money from the fund, a portion of the money granted from the fund must be repaid
to the taconite economic development fund. The portion of the money to be repaid is 100
percent of the grant if the equipment is removed from the taconite tax relief area within 12
months after receipt of the money from the fund, declining by ten percent for each of the
subsequent nine years during which the equipment remains within the taconite tax relief
area. If a taconite production facility is sold after operations at the facility had ceased, any
money remaining in the fund for the former producer may be released to the purchaser of
the facility on the terms otherwise applicable to the former producer under this section. If
a producer fails to provide matching funds for a proposed expenditure within six months
after the commissioner approves release of the funds, the funds are available for release to
another producer in proportion to the distribution provided and under the conditions of
this section. Any portion of the fund which is not released by the commissioner within
one year of its deposit in the fund shall be divided between the taconite environmental
protection fund created in section 298.223 and the Douglas J. Johnson economic protection
trust fund created in section 298.292 for placement in their respective special accounts.
Two-thirds of the unreleased funds shall be distributed to the taconite environmental
protection fund and one-third to the Douglas J. Johnson economic protection trust fund.

(b)(i) Notwithstanding the requirements of paragraph (a), setting the amount of
distributions and the review process, an amount equal to ten cents per taxable ton of
production in 2007, for distribution in 2008 only, that would otherwise be distributed
under paragraph (a), may be used for a loan or grant for the cost of providing for a
value-added wood product facility located in the taconite tax relief area and in a county
that contains a city of the first class. This amount must be deducted from the distribution
under paragraph (a) for which a matching expenditure by the producer is not required. The
granting of the loan or grant is subject to approval by deleted text begin at least seven Iron Range Resources
and Rehabilitation Board members deleted text end new text begin the board new text end . If the money is provided as a loan, interest
must be payable on the loan at the rate prescribed in section 298.2213, subdivision 3. (ii)
Repayments of the loan and interest, if any, must be deposited in the taconite environment
protection fund under sections 298.222 to 298.225. If a loan or grant is not made under
this paragraph by July 1, 2012, the amount that had been made available for the loan under
this paragraph must be transferred to the taconite environment protection fund under
sections 298.222 to 298.225. (iii) Money distributed in 2008 to the fund established
under this section that exceeds ten cents per ton is available to qualifying producers under
paragraph (a) on a pro rata basis.

(c) Repayment or transfer of money to the taconite environmental protection fund
under paragraph (b), item (ii), must be allocated by the Iron Range Resources and
Rehabilitation Board for public works projects in house legislative districts in the same
proportion as taxable tonnage of production in 2007 in each house legislative district, for
distribution in 2008, bears to total taxable tonnage of production in 2007, for distribution
in 2008. Notwithstanding any other law to the contrary, expenditures under this paragraph
do not require approval by the governor. For purposes of this paragraph, "house legislative
districts" means the legislative districts in existence on May 15, 2009.

Sec. 14.

Minnesota Statutes 2012, section 298.28, subdivision 9d, is amended to read:

Subd. 9d.

Iron Range higher education account.

Five cents per taxable ton must
be allocated to the Iron Range Resources and Rehabilitation Board to be deposited in
an Iron Range higher education account that is hereby created, to be used for higher
education programs conducted at educational institutions in the taconite assistance area
defined in section 273.1341. The Iron Range Higher Education committee under section
298.2214, and the Iron Range Resources and Rehabilitation Board deleted text begin by an affirmative vote
of at least seven Iron Range Resources and Rehabilitation Board members, deleted text end must approve
all expenditures from the account.

Sec. 15.

Minnesota Statutes 2012, section 298.292, subdivision 2, is amended to read:

Subd. 2.

Use of money.

Money in the Douglas J. Johnson economic protection trust
fund may be used for the following purposes:

(1) to provide loans, loan guarantees, interest buy-downs and other forms of
participation with private sources of financing, but a loan to a private enterprise shall be
for a principal amount not to exceed one-half of the cost of the project for which financing
is sought, and the rate of interest on a loan to a private enterprise shall be no less than the
lesser of eight percent or an interest rate three percentage points less than a full faith
and credit obligation of the United States government of comparable maturity, at the
time that the loan is approved;

(2) to fund reserve accounts established to secure the payment when due of the
principal of and interest on bonds issued pursuant to section 298.2211;

(3) to pay in periodic payments or in a lump-sum payment any or all of the interest
on bonds issued pursuant to chapter 474 for the purpose of constructing, converting,
or retrofitting heating facilities in connection with district heating systems or systems
utilizing alternative energy sources;

(4) to invest in a venture capital fund or enterprise that will provide capital to other
entities that are engaging in, or that will engage in, projects or programs that have the
purposes set forth in subdivision 1. No investments may be made in a venture capital fund
or enterprise unless at least two other unrelated investors make investments of at least
$500,000 in the venture capital fund or enterprise, and the investment by the Douglas
J. Johnson economic protection trust fund may not exceed the amount of the largest
investment by an unrelated investor in the venture capital fund or enterprise. For purposes
of this subdivision, an "unrelated investor" is a person or entity that is not related to
the entity in which the investment is made or to any individual who owns more than 40
percent of the value of the entity, in any of the following relationships: spouse, parent,
child, sibling, employee, or owner of an interest in the entity that exceeds ten percent of
the value of all interests in it. For purposes of determining the limitations under this
clause, the amount of investments made by an investor other than the Douglas J. Johnson
economic protection trust fund is the sum of all investments made in the venture capital
fund or enterprise during the period beginning one year before the date of the investment
by the Douglas J. Johnson economic protection trust fund; and

(5) to purchase forest land in the taconite assistance area defined in section 273.1341
to be held and managed as a public trust for the benefit of the area for the purposes
authorized in section 298.22, subdivision 5a. Property purchased under this section may
be sold by the commissioner upon approval by deleted text begin at least seven Iron Range Resources and
Rehabilitation Board members deleted text end new text begin the board new text end . The net proceeds must be deposited in the trust
fund for the purposes and uses of this section.

Money from the trust fund shall be expended only in or for the benefit of the taconite
assistance area defined in section 273.1341.

Sec. 16.

Minnesota Statutes 2012, section 298.294, is amended to read:

298.294 INVESTMENT OF FUND.

(a) The trust fund established by section 298.292 shall be invested pursuant to law
by the State Board of Investment and the net interest, dividends, and other earnings arising
from the investments shall be transferred, except as provided in paragraph (b), on the first
day of each month to the trust and shall be included and become part of the trust fund.
The amounts transferred, including the interest, dividends, and other earnings earned
prior to July 13, 1982, together with the additional amount of $10,000,000 for fiscal year
1983, which is appropriated April 21, 1983, are appropriated from the trust fund to the
commissioner of Iron Range resources and rehabilitation for deposit in a separate account
for expenditure for the purposes set forth in section 298.292. Amounts appropriated
pursuant to this section shall not cancel but shall remain available unless expended.

(b) For fiscal years 2010 and 2011 only, $1,500,000 of the net interest, dividends,
and other earnings under paragraph (a) shall be transferred to a special account. Funds
in the special account are available for loans or grants to businesses, with priority given
to businesses with 25 or fewer employees. Funds may be used for wage subsidies for
up to 52 weeks of up to $5 per hour or other activities, including, but not limited to,
short-term operating expenses and purchase of equipment and materials by businesses
under financial duress, that will create additional jobs in the taconite assistance area under
section 273.1341. Expenditures from the special account must be approved by deleted text begin at least
seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin the board new text end .

(c) To qualify for a grant or loan, a business must be currently operating and have
been operating for one year immediately prior to its application for a loan or grant, and its
corporate headquarters must be located in the taconite assistance area.

Sec. 17.

Minnesota Statutes 2012, section 298.296, subdivision 1, is amended to read:

Subdivision 1.

Project approval.

The board and commissioner shall by August 1 of
each year prepare a list of projects to be funded from the Douglas J. Johnson economic
protection trust with necessary supporting information including description of the
projects, plans, and cost estimates. These projects shall be consistent with the priorities
established in section 298.292 and shall not be approved by the board unless it finds that:

(a) the project will materially assist, directly or indirectly, the creation of additional
long-term employment opportunities;

(b) the prospective benefits of the expenditure exceed the anticipated costs; and

(c) in the case of assistance to private enterprise, the project will serve a sound
business purpose.

Each project must be approved by deleted text begin at least eight Iron Range Resources and
Rehabilitation Board deleted text end new text begin over one-half of all of the new text end members new text begin of the board new text end and the
commissioner of Iron Range resources and rehabilitation. The list of projects shall
be submitted to the governor, who shall, by November 15 of each year, approve or
disapprove, or return for further consideration, each project. The money for a project may
be expended only upon approval of the project by the governor. The board may submit
supplemental projects for approval at any time.

Sec. 18.

Minnesota Statutes 2012, section 298.296, subdivision 2, is amended to read:

Subd. 2.

Expenditure of funds.

(a) Before January 1, 2028, funds may be expended
on projects and for administration of the trust fund only from the net interest, earnings,
and dividends arising from the investment of the trust at any time, including net interest,
earnings, and dividends that have arisen prior to July 13, 1982, plus $10,000,000 made
available for use in fiscal year 1983, except that any amount required to be paid out of the
trust fund to provide the property tax relief specified in Laws 1977, chapter 423, article
X, section 4, and to make school bond payments and payments to recipients of taconite
production tax proceeds pursuant to section 298.225, may be taken from the corpus of
the trust.

(b) Additionally, upon recommendation by the board, up to $13,000,000 from the
corpus of the trust may be made available for use as provided in subdivision 4, and up to
$10,000,000 from the corpus of the trust may be made available for use as provided in
section 298.2961.

(c) Additionally, an amount equal to 20 percent of the value of the corpus of the trust
on May 18, 2002, not including the funds authorized in paragraph (b), plus the amounts
made available under section 298.28, subdivision 4, and Laws 2002, chapter 377, article
8, section 17, may be expended on projects. Funds may be expended for projects under
this paragraph only if the project:

(1) is for the purposes established under section 298.292, subdivision 1, clause
(1) or (2); and

(2) is approved by new text begin at least two-thirds of all of the members of new text end the board deleted text begin upon an
affirmative vote of at least ten of its members deleted text end .

No money made available under this paragraph or paragraph (d) can be used for
administrative or operating expenses of the Iron Range Resources and Rehabilitation Board
or expenses relating to any facilities owned or operated by the board on May 18, 2002.

(d) Upon recommendation by a unanimous vote of all members of the board,
amounts in addition to those authorized under paragraphs (a), (b), and (c) may be
expended on projects described in section 298.292, subdivision 1.

(e) Annual administrative costs, not including detailed engineering expenses for the
projects, shall not exceed five percent of the net interest, dividends, and earnings arising
from the trust in the preceding fiscal year.

(f) Principal and interest received in repayment of loans made pursuant to this
section, and earnings on other investments made under section 298.292, subdivision 2,
clause (4), shall be deposited in the state treasury and credited to the trust. These receipts
are appropriated to the board for the purposes of sections 298.291 to 298.298.

(g) Additionally, notwithstanding section 298.293, upon the deleted text begin affirmative vote of at
least seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin approval of the
board new text end , money from the corpus of the trust may be expanded to purchase forest lands
within the taconite assistance area as provided in sections 298.22, subdivision 5a, and
298.292, subdivision 2, clause (5).

Sec. 19.

Minnesota Statutes 2012, section 298.2961, subdivision 2, is amended to read:

Subd. 2.

Projects; approval.

(a) Projects funded must be for:

(1) environmentally unique reclamation projects; or

(2) pit or plant repairs, expansions, or modernizations other than for a value added
iron products plant.

(b) To be proposed by the board, a project must be approved by deleted text begin at least eight Iron
Range Resources and Rehabilitation Board members deleted text end new text begin the board new text end . The money for a project
may be spent only upon approval of the project by the governor. The board may submit
supplemental projects for approval at any time.

(c) The board may require that it receive an equity percentage in any project to
which it contributes under this section.

Sec. 20.

Minnesota Statutes 2012, section 298.2961, subdivision 4, is amended to read:

Subd. 4.

Grant and loan fund.

(a) A fund is established to receive distributions
under section 298.28, subdivision 9b, and to make grants or loans as provided in this
subdivision. Any grant or loan made under this subdivision must be approved by deleted text begin at least
seven Iron Range Resources and Rehabilitation Board members deleted text end new text begin the board new text end , established
under section 298.22.

(b) Distributions received in calendar year 2005 are allocated to the city of Virginia
for improvements and repairs to the city's steam heating system.

(c) Distributions received in calendar year 2006 are allocated to a project of the
public utilities commissions of the cities of Hibbing and Virginia to convert their electrical
generating plants to the use of biomass products, such as wood.

(d) Distributions received in calendar year 2007 must be paid to the city of Tower to
be used for the East Two Rivers project in or near the city of Tower.

(e) For distributions received in 2008, the first $2,000,000 of the 2008 distribution
must be paid to St. Louis County for deposit in its county road and bridge fund to be
used for relocation of St. Louis County Road 715, commonly referred to as Pike River
Road. The remainder of the 2008 distribution must be paid to St. Louis County for a
grant to the city of Virginia for connecting sewer and water lines to the St. Louis County
maintenance garage on Highway 135, further extending the lines to interconnect with the
city of Gilbert's sewer and water lines. All distributions received in 2009 and subsequent
years are allocated for projects under section 298.223, subdivision 1.

Sec. 21.

Minnesota Statutes 2012, section 298.2961, subdivision 5, is amended to read:

Subd. 5.

Public works and local economic development fund.

For distributions in
2007 only, a special fund is established to receive 38.4 cents per ton that otherwise would
be allocated under section 298.28, subdivision 6. The following amounts are allocated to
St. Louis County acting as the fiscal agent for the recipients for the specific purposes:

(1) 13.4 cents per ton for the Central Iron Range Sanitary Sewer District for
construction of a combined wastewater facility and notwithstanding section 298.28,
subdivision 11, paragraph (a), or any other law, interest accrued on this money while held
by St. Louis County shall also be distributed to the recipient;

(2) six cents per ton to the city of Eveleth to redesign and design and construct
improvements to renovate its water treatment facility;

(3) one cent per ton for the East Range Joint Powers Board to acquire land for and to
design a central wastewater collection and treatment system;

(4) 0.5 cents per ton to the city of Hoyt Lakes to repair Leeds Road;

(5) 0.7 cents per ton to the city of Virginia to extend Eighth Street South;

(6) 0.7 cents per ton to the city of Mountain Iron to repair Hoover Road;

(7) 0.9 cents per ton to the city of Gilbert for alley repairs between Michigan and
Indiana Avenues and for repayment of a loan to the Minnesota Department of Employment
and Economic Development;

(8) 0.4 cents per ton to the city of Keewatin for a new city well;

(9) 0.3 cents per ton to the city of Grand Rapids for planning for a fire and hazardous
materials center;

(10) 0.9 cents per ton to Aitkin County Growth for an economic development
project for peat harvesting;

(11) 0.4 cents per ton to the city of Nashwauk to develop a comprehensive city plan;

(12) 0.4 cents per ton to the city of Taconite for development of a city comprehensive
plan;

(13) 0.3 cents per ton to the city of Marble for water and sewer infrastructure;

(14) 0.8 cents per ton to Aitkin County for improvements to the Long Lake
Environmental Learning Center;

(15) 0.3 cents per ton to the city of Coleraine for the Coleraine Technology Center;

(16) 0.5 cents per ton to the Economic Development Authority of the city of Grand
Rapids for planning for the North Central Research and Technology Laboratory;

(17) 0.6 cents per ton to the city of Bovey for sewer and water extension;

(18) 0.3 cents per ton to the city of Calumet for infrastructure improvements; and

(19) ten cents per ton to the commissioner of Iron Range Resources and
Rehabilitation for deposit in a Highway 1 Corridor Account established by the
commissioner, to be distributed by the commissioner to any of the cities of Babbitt, Cook,
Ely, or Tower, for economic development projects approved by deleted text begin at least seven Iron Range
Resources and Rehabilitation Board members deleted text end new text begin the board new text end ; notwithstanding section 298.28,
subdivision 11, paragraph (a), or any other law, interest accrued on this money while held
by St. Louis County or the commissioner shall also be distributed to the recipient.

Sec. 22. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2012, section 298.22, subdivision 2, new text end new text begin is repealed.
new text end

Sec. 23. new text begin EFFECTIVE DATE.
new text end

new text begin This act is effective the day following final enactment.
new text end