1.1 	A bill for an act
1.2 	relating to capital investments; establishing an
1.3 	electronic medical record system loan program and
1.4 	fund; authorizing the sale of state revenue bonds;
1.5 	appropriating money; proposing coding for new law in
1.6 	Minnesota Statutes, chapter 62J.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. [62J.82] ELECTRONIC MEDICAL RECORD SYSTEM LOAN
1.9 	PROGRAM.
1.10 		Subdivision 1.Establishment. The commissioner shall
1.11 	establish and implement a loan program to help physicians or
1.12 	physician group practices obtain the necessary finances to
1.13 	install an interoperable electronic medical record system.
1.14 		Subd. 2.Rules. The commissioner may adopt rules to
1.15 	administer the loan program.
1.16 		Subd. 3.Eligibility. To be eligible for a loan under
1.17 	this section, the borrower must:
1.18 	(1) have a signed contract with a vendor;
1.19 	(2) be a physician licensed in this state or a physician
1.20 	group practice located in this state;
1.21 	(3) provide evidence of financial stability;
1.22 	(4) demonstrate an ability to repay the loan;
1.23 	(5) demonstrate that the borrower has explored possible
1.24 	alliances or contractual opportunities with other provider
1.25 	groups located in the same geographical area to become part of
1.26 	the larger provider group's system; and 
2.1 	(6) meet any other requirements the commissioner imposes by
2.2 	administrative procedure or by rule.
2.3 		Subd. 4.Loans. (a) The commissioner may make a direct
2.4 	loan to a provider or provider group that is eligible under
2.5 	subdivision 3.  The total accumulative loan principal must not
2.6 	exceed $65,000 per loan.
2.7 	(b) The commissioner may prescribe forms, establish an
2.8 	application process, and, notwithstanding section 16A.1283,
2.9 	impose a reasonable nonrefundable application fee to cover the
2.10 	cost of administering the loan program.
2.11 	(c) The loan principal balance outstanding plus all
2.12 	assessed interest must be repaid no later than 15 years from the
2.13 	date of the loan.

2.14 	Sec. 2. [62J.83] ELECTRONIC MEDICAL RECORD SYSTEM LOAN
2.15 	FUND.
2.16 		Subdivision 1.Creation. The electronic medical record
2.17 	system loan fund is established as a special account in the
2.18 	state treasury.  All application fees, loan repayments, and
2.19 	other revenue received under section 62J.82 must be credited to
2.20 	the fund.
2.21 		Subd. 2.Bond proceeds account. An electronic medical
2.22 	record system revenue bond proceeds account is established in
2.23 	the electronic medical record system loan fund.  The proceeds of
2.24 	any bonds issued under section 62J.84 must be credited to the
2.25 	account.  Money in the account is appropriated to the
2.26 	commissioner to make loans under section 62J.82.
2.27 		Subd. 3.Debt service account. An electronic medical
2.28 	record system revenue bond debt service account is established
2.29 	in the electronic medical record system loan fund.  There must
2.30 	be credited to this debt service account in each fiscal year
2.31 	from the income to the electronic medical record system loan
2.32 	fund an amount sufficient to increase the balance on hand in the
2.33 	debt service account on each December 1 to an amount equal to
2.34 	the full amount of principal and interest to come due on all
2.35 	outstanding bonds issued under section 62J.84 to and including
2.36 	the second following July 1.  The assets of the account are
3.1 	pledged to and may only be used to pay principal and interest on
3.2 	bonds issued under section 62J.84.  Money in the debt service
3.3 	account is appropriated to the commissioner of finance to pay
3.4 	principal and interest on bonds issued under section 62J.84.
3.5 		Subd. 4.Appropriation. Money in the electronic medical
3.6 	record system loan fund not otherwise appropriated is
3.7 	appropriated to the commissioner of health to administer the
3.8 	loan program.

3.9 	Sec. 3. [62J.84] ELECTRONIC MEDICAL RECORD SYSTEM REVENUE
3.10 	BONDS.
3.11 		Subdivision 1.Bonding authority. Upon request of the
3.12 	commissioner of health, the commissioner of finance may sell and
3.13 	issue state revenue bonds to make loans under section 62J.82, to
3.14 	establish a reserve fund or funds, and to pay the cost of
3.15 	issuance of the bonds.
3.16 		Subd. 2.Amount. The principal amount of the bonds
3.17 	issued for the purposes specified in subdivision 1 must not
3.18 	exceed $5,000,000.
3.19 		Subd. 3.Procedure. The commissioner of finance may sell
3.20 	and issue the bonds on the terms and conditions the commissioner
3.21 	determines to be in the best interests of the state.  The bonds
3.22 	may be sold at public or private sale.  The commissioner of
3.23 	finance may enter any agreements or pledges the commissioner
3.24 	determines necessary or useful to sell the bonds that are not
3.25 	inconsistent with sections 62J.82 to 62J.84.  Sections 16A.672
3.26 	to 16A.675 apply to the bonds.
3.27 		Subd. 4.Revenue sources. The bonds are payable only
3.28 	from the following sources:
3.29 	(1) loan repayments credited to the electronic medical
3.30 	record system loan fund;
3.31 	(2) the principal and any investment earnings on the assets
3.32 	of the debt service account; and 
3.33 	(3) other revenues pledged to the payment of the bonds.
3.34 		Subd. 5.Refunding bonds. The commissioner of finance
3.35 	may issue bonds to refund outstanding bonds issued under
3.36 	subdivision 1, including the payment of any redemption premiums
4.1 	on the bonds and any interest accrued or to accrue to the first
4.2 	redemption date after delivery of the refunding bonds.  The
4.3 	proceeds of the refunding bonds may, in the discretion of the
4.4 	commissioner of finance, be applied to the purchases or payment
4.5 	at maturity of the bonds to be refunded, or the redemption of
4.6 	the outstanding bonds on the first redemption date after
4.7 	delivery of the refunding bonds and may, until so used, be
4.8 	placed in escrow to be applied to the purchase, retirement, or
4.9 	redemption.  Refunding bonds issued under this subdivision must
4.10 	be issued and secured in the manner provided by the commissioner
4.11 	of finance.
4.12 		Subd. 6.Not a general or moral obligation. Bonds issued
4.13 	under this section are not public debt, and the full faith,
4.14 	credit, and taxing powers of the state are not pledged for their
4.15 	payment.  The bonds may not be paid directly in whole or in part
4.16 	from a tax of statewide application on any class of property,
4.17 	income, transaction, or privilege.  Payment of the bonds is
4.18 	limited to the revenues explicitly authorized to be pledged
4.19 	under this section.  The state neither makes nor has a moral
4.20 	obligation to pay the bonds if the pledged revenues and other
4.21 	legal security for them are insufficient.
4.22 		Subd. 7.Trustee. The commissioner of finance may
4.23 	contract with and appoint a trustee for bondholders.  The
4.24 	trustee has the powers and authority vested in it by the
4.25 	commissioner of finance under the bond and trust indentures.
4.26 		Subd. 8.Pledges. Any pledge made by the commissioner of
4.27 	finance is valid and binding from the time the pledge is made.
4.28 	The money or property pledged and later received by the
4.29 	commissioner of finance is immediately subject to the lien of
4.30 	the pledge without any physical delivery of the property or
4.31 	money or further act, and the lien of any pledge is valid and
4.32 	binding as against all parties having claims of any kind in
4.33 	tort, contract, or otherwise against the commissioner of
4.34 	finance, whether or not those parties have notice of the lien or
4.35 	pledge.  Neither the order nor any other instrument by which a
4.36 	pledge is created need be recorded.
5.1 		Subd. 9.Bonds; purchase and cancellation. The
5.2 	commissioner of finance, subject to agreements with bondholders
5.3 	that may then exist, may, out of any money available for the
5.4 	purpose, purchase bonds of the commissioner at a price not
5.5 	exceeding:
5.6 	(1) if the bonds are then redeemable, the redemption price
5.7 	then applicable plus accrued interest to the next interest
5.8 	payment date thereon; or 
5.9 	(2) if the bonds are not redeemable, the redemption price
5.10 	applicable on the first date after the purchase upon which the
5.11 	bonds become subject to redemption plus accrued interest to that
5.12 	date.
5.13 		Subd. 10.State pledge against impairment of contracts.
 5.14 	The state pledges and agrees with the holders of any bonds that
5.15 	the state will not limit or alter the rights vested in the
5.16 	commissioner of finance to fulfill the terms of any agreements
5.17 	made with the bondholders, or in any way impair the rights and
5.18 	remedies of the holders until the bonds, together with interest
5.19 	on them, with interest on any unpaid installments of interest,
5.20 	and all costs and expenses in connection with any action or
5.21 	proceeding by or on behalf of the bondholders, are fully met and
5.22 	discharged.  The commissioner of finance may include this pledge
5.23 	and agreement of the state in any agreement with the holders of
5.24 	bonds issued under this section.

5.25 	Sec. 4. APPROPRIATION.
 5.26 	$....... is appropriated from the general fund to the
5.27 	commissioner of finance for transfer to the electronic medical
5.28 	record system loan fund to capitalize the fund.  The
5.29 	appropriation is available until expended.