1.1                          A bill for an act 
  1.2             relating to education; providing for expanded student 
  1.3             and school board options; appropriating money; 
  1.4             amending Minnesota Statutes 1994, sections 120.062, 
  1.5             subdivisions 3, 6, 7, and 11; 120.17, subdivision 4; 
  1.6             120.80, subdivision 1; 122.541, subdivision 2; 123.33, 
  1.7             subdivision 1, and by adding a subdivision; 123.35, by 
  1.8             adding subdivisions; 123.38, subdivisions 2a and 2b; 
  1.9             123.951; 124.17, subdivision 1e, and by adding 
  1.10            subdivisions; 124.18, subdivision 2; 124.273, by 
  1.11            adding a subdivision; 124A.029, subdivision 4; 
  1.12            124A.03, subdivisions 1b, 1e, 1f, and 3b; 124A.034, 
  1.13            subdivision 1; 124A.036, as amended; 124A.22, 
  1.14            subdivision 5; Minnesota Statutes 1995 Supplement, 
  1.15            sections 120.064, subdivisions 3, 4, 4a, 5, and 8; 
  1.16            120.17, subdivisions 6 and 7; 120.181; 123.3514, 
  1.17            subdivision 6; 123.9361; 124.17, subdivisions 1, 1c, 
  1.18            and 1d; 124.175; 124.225, subdivisions 1 and 7f; 
  1.19            124.248, subdivisions 1, 1a, 2, 4, and by adding 
  1.20            subdivisions; 124.273, subdivision 1c; 124A.03, 
  1.21            subdivision 2; 124A.22, subdivision 6; 124A.225, 
  1.22            subdivision 1; and 124C.74, by adding a subdivision; 
  1.23            proposing coding for new law in Minnesota Statutes, 
  1.24            chapters 120; 121; 123; 124A; and 126B; repealing 
  1.25            Minnesota Statutes 1994, sections 120.062, subdivision 
  1.26            12; 124.17, subdivision 1f; 124.225, subdivisions 3a, 
  1.27            7a, 7b, 7d, 7e, 8a, 8k, and 10; 124.226, subdivisions 
  1.28            1, 2, 3, 3a, 4, 5, 6, 7, 8, and 9; 124A.03, 
  1.29            subdivision 3b; and 124A.034, subdivision 1a. 
  1.30  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.31                                "A"
  1.32                   EXPANDING CHOICE FOR STUDENTS
  1.33                             ARTICLE 1
  1.34                          SCHOOL VOUCHERS
  1.35     Section 1.  [120.063] [SCHOOL VOUCHER PROGRAM.] 
  1.36     Subdivision 1.  [PURPOSE.] The purposes of the school 
  1.37  voucher program are to make the full array of school choices 
  2.1   accessible to parents and students from lower income households 
  2.2   and to close the learning gap often associated with students 
  2.3   from lower income households. 
  2.4      Subd. 2.  [DEFINITIONS.] In this section, the definitions 
  2.5   in this subdivision apply. 
  2.6      (a) "Parent" means a parent or other person primarily 
  2.7   responsible to pay an eligible student's tuition and educational 
  2.8   expenses. 
  2.9      (b) "Eligible student" means, except as otherwise provided 
  2.10  in this section, a person of school age who is a state resident 
  2.11  and whose household's income is not more than 185 percent of the 
  2.12  federal poverty level. 
  2.13     (c) "Eligible school" means a nonpublic school defined in 
  2.14  section 123.932, subdivision 3, that meets the conditions of, 
  2.15  and requests to be included on, the commissioner's list of 
  2.16  eligible schools for the voucher program. 
  2.17     (d) "Previously enrolled" means enrolled in a nonpublic 
  2.18  school, including a home school, in the state for any part of 
  2.19  the two school years before first using the voucher program. 
  2.20     Subd. 3.  [ELIGIBLE SCHOOLS LIST.] The commissioner must 
  2.21  maintain a current list of eligible schools and their costs and 
  2.22  make it conveniently available to parents.  The commissioner 
  2.23  must not list a school if the commissioner finds that the school 
  2.24  does not provide instruction in compliance with sections 120.101 
  2.25  and 120.102. 
  2.26     Subd. 4.  [PROGRAM PROCEDURE.] The school voucher program 
  2.27  is administered by the commissioner.  The commissioner must see 
  2.28  that vouchers are made available to parents of eligible students 
  2.29  in a convenient and timely fashion.  A parent must certify an 
  2.30  eligible student's household income eligibility and residency 
  2.31  and assign the voucher to the eligible school that they choose 
  2.32  when the school enrolls their eligible student.  The eligible 
  2.33  school must certify that the eligible student is enrolled to 
  2.34  redeem the voucher with the commissioner.  The commissioner must 
  2.35  pay the voucher amount to the eligible school for the period of 
  2.36  the eligible student's enrollment that is covered by the voucher.
  3.1      Sec. 2.  [120.0631] [VOUCHER AMOUNTS.] 
  3.2      Subdivision 1.  [COMPUTATION; ACTUAL VOUCHER AMOUNT.] (a) 
  3.3   The voucher amount for a school year for a parent is computed 
  3.4   under this section.  
  3.5      (b) The applicable voucher amount computed under this 
  3.6   section must be multiplied by the applicable pupil unit 
  3.7   weighting described in section 124.17, subdivision 1, paragraph 
  3.8   (e), (f), or (g), to determine the parent's actual voucher 
  3.9   amount. 
  3.10     Subd. 2.  [BASIS AMOUNT.] The basis amount in computing the 
  3.11  voucher amount is "the state average general education revenue 
  3.12  per pupil unit, calculated without compensatory revenue," that 
  3.13  is referred to in section 124.248, subdivision 1, reduced by the 
  3.14  state average transportation revenue components. 
  3.15     Subd. 3.  [MAXIMUM VOUCHER AMOUNT.] The maximum voucher 
  3.16  amount is 50 percent of the basis amount.  Each year by March 
  3.17  15, the commissioner shall increase the maximum voucher amount, 
  3.18  as much as possible, so as to reach the maximum of 90 percent of 
  3.19  the basis amount as quickly as possible so long as estimated 
  3.20  fiscal neutrality is preserved. 
  3.21     Subd. 4.  [MINIMUM VOUCHER AMOUNT.] The minimum voucher 
  3.22  amount is ten percent of the basis amount.  The minimum voucher 
  3.23  amount is the lowest voucher amount that may be paid for a full 
  3.24  school year. 
  3.25     Subd. 5.  [THE HOME SCHOOL VOUCHER AMOUNT.] The home school 
  3.26  voucher amount is 25 percent of the basis amount and is the 
  3.27  maximum voucher amount for an eligible home-schooled student. 
  3.28     Subd. 6.  [THE GRADUATED VOUCHER AMOUNT.] The graduated 
  3.29  voucher amount is an amount adjusted yearly by the commissioner, 
  3.30  upward to the extent possible so long as estimated fiscal 
  3.31  neutrality is preserved, from an initial amount not less than 
  3.32  the minimum voucher amount.  The graduated voucher amount is for 
  3.33  a student previously enrolled at a nonpublic school or a home 
  3.34  school.  The graduated voucher amount must be set by the 
  3.35  commissioner by March 15 each year, for the next school year. 
  3.36     Subd. 7.  [VOUCHER LIMITS.] A parent's actual voucher 
  4.1   amount cannot be more than the amount charged in tuition and 
  4.2   instructional fees to the student, or in the case of a 
  4.3   </u>
  4.4   home-schooled student, the amount actually spent on the student 
  4.5   for educational purposes. 
  4.6      Subd. 8.  [PRORATION.] A parent's actual voucher amount 
  4.7   must be prorated for a student with less than a full year's 
  4.8   enrollment under the program. 
  4.9      Subd. 9.  [TUITION DIFFERENTIAL.] (a) Except as provided in 
  4.10  paragraph (b), an eligible school must not charge tuition and 
  4.11  instructional fees for an eligible student enrolled in the 
  4.12  school, in an amount that is more than 90 percent of the basis 
  4.13  amount, unless fully covered by scholarships or other nonparent 
  4.14  or nonguardian funds. 
  4.15     (b) A school may charge, in tuition and instructional fees, 
  4.16  for a student whose actual voucher amount is less than 90 
  4.17  percent of the basis amount, the difference between the two.  
  4.18  Some or all of the difference may be paid from scholarship or 
  4.19  other funds. 
  4.20     Subd. 10.  [TUITION AND FEE RATE.] An eligible school must 
  4.21  not charge higher tuition and instructional fees to an eligible 
  4.22  student than the school charges noneligible students. 
  4.23     Subd. 11.  [FORMS AND DEADLINES.] The commissioner shall 
  4.24  develop and disseminate the forms necessary to implement this 
  4.25  section.  The commissioner shall also set deadlines necessary to 
  4.26  implement this section.  In doing so, the commissioner need not 
  4.27  comply with the administrative procedures act except that the 
  4.28  forms and deadlines must be published in the State Register and 
  4.29  approved as to form by the revisor of statutes. 
  4.30     Subd. 12.  [EVALUATIONS.] The commissioner shall cooperate 
  4.31  with Minnesota Assessment of Educational Progress, Inc., to 
  4.32  evaluate the effectiveness of the voucher program.  Minnesota 
  4.33  Assessment of Educational Progress, Inc., shall report to the 
  4.34  legislature and governor by December 15 of each even-numbered 
  4.35  year. 
  4.36     Subd. 13.  [ADDITIONAL CONDITIONS.] (a) An individual or 
  4.37  school is not required to participate in the voucher program. 
  5.1      (b) An eligible school must agree to meet the admission 
  5.2   requirements of section 120.064, subdivision 9, except that it 
  5.3   must agree to admit students with vouchers on the same basis and 
  5.4   subject to the same admission standards as other students.  If 
  5.5   the requirements of section 120.064, subdivision 9, conflict 
  5.6   with the school's admission standards, the school's standards 
  5.7   prevail. 
  5.8      (c) An eligible school must agree to disclose the aggregate 
  5.9   results of assessments to the same extent that public schools 
  5.10  are required to disclose assessment results. 
  5.11     (d) An eligible school must agree to allow its students to 
  5.12  participate in assessments involving the state's graduation 
  5.13  standards as the standards are enacted, to the same extent 
  5.14  public schools are required to participate. 
  5.15     (e) An eligible school must agree that it will make 
  5.16  available at least five percent of its new student admissions 
  5.17  each year to eligible students. 
  5.18     (f) An eligible school must, at a parent's request, arrange 
  5.19  for special education for eligible students defined in section 
  5.20  120.03 on a shared time basis, as provided in sections 124A.02, 
  5.21  subdivisions 20 to 22, and 124A.034. 
  5.22     (g) This subdivision does not apply to home schools. 
  5.23     Subd. 14.  [NONPUBLIC AIDS; TAX DEDUCTIONS.] A parent of an 
  5.24  eligible student and an eligible student who applies for a 
  5.25  voucher under this section are not eligible for distribution of 
  5.26  education aids at no charge under sections 123.931 to 123.937, 
  5.27  nor is the parent eligible for a subtraction under section 
  5.28  290.01, subdivision 19b, clause (3), to the extent that costs 
  5.29  otherwise eligible for subtraction are offset by a voucher or 
  5.30  state reimbursement.  
  5.31     Sec. 3.  [120.0632] [NONPUBLIC SCHOOL STUDENT ACCESS TO 
  5.32  PUBLIC SCHOOLS.] 
  5.33     A school district shall not deny timely and reasonable 
  5.34  requests by a nonpublic school student for enrollment in 
  5.35  classes, extracurricular activities, or cocurricular activities 
  5.36  not available in the student's nonpublic school.  A nonpublic 
  6.1   school student must complete an application for enrollment by 
  6.2   ..... of the year preceding the class or activity the student 
  6.3   wants to enroll in, or by a later date set by the school 
  6.4   district.  For the purposes of this section, "nonpublic school 
  6.5   student" means a student who receives educational instruction 
  6.6   outside a public school classroom, including, but not limited 
  6.7   to, an eligible voucher school student and home school student. 
  6.8      Sec. 4.  Minnesota Statutes 1995 Supplement, section 
  6.9   123.9361, is amended to read: 
  6.10     123.9361 [ADMINISTRATIVE COSTS.] 
  6.11     (a) Each year, a school district or intermediary service 
  6.12  area may claim and receive from the department of children, 
  6.13  families, and learning an additional sum for the administration 
  6.14  of sections 123.933 and 123.935, equal to five percent of the 
  6.15  district's or area's allocation for that year pursuant to those 
  6.16  sections.  
  6.17     (b) Beginning with the 1996-1997 school year, a school 
  6.18  district with resident eligible students enrolled in an eligible 
  6.19  home school under this article who were not previously enrolled 
  6.20  in a home school shall receive $150 per student, per school 
  6.21  year, for its required home school administration. 
  6.22     Sec. 5.  [APPROPRIATION.] 
  6.23     The amount necessary to implement this article is included 
  6.24  in the annual appropriation for fiscal year 1997, for general 
  6.25  education aid under section 124A.032. 
  6.26                             ARTICLE 2
  6.27                TRANSPORTATION TO NONPUBLIC SCHOOLS 
  6.28     Section 1.  [123.791] [TRANSPORTATION OPTIONS TO NONPUBLIC 
  6.29  SCHOOLS.] 
  6.30     Subdivision 1.  [ENTITLEMENT; COMPUTATION.] (a) If, in any 
  6.31  school year, a student is entitled, under section 123.76, to 
  6.32  school transportation to and from a nonpublic school actually 
  6.33  attended, the state shall provide for the transportation 
  6.34  according to either paragraph (b) or (c).  
  6.35     (b) The student's parent may request that the student be 
  6.36  provided with the transportation without charge according to 
  7.1   section 123.78. 
  7.2      (c)(1) The student's parent may provide for the 
  7.3   transportation at the student's parent's expense subject to 
  7.4   reimbursement under clause (2).  The transportation may be by 
  7.5   any means including, but not limited to, fee or other 
  7.6   arrangements with the nonpublic school; a school district 
  7.7   including, but not limited to, the student's school district of 
  7.8   residence; a school district transportation contractor; mass 
  7.9   transit; a private vehicle; or by a combination of these means.  
  7.10     (2) A student's parent who incurs expenses for the 
  7.11  student's transportation under clause (1) and who applies for 
  7.12  reimbursement for the expenses from the commissioner must be 
  7.13  reimbursed by the commissioner for the expenses up to the lesser 
  7.14  of (i) the amount used, for the district of the student's 
  7.15  residence, as the multiplier described in section 124.225, 
  7.16  subdivision 16, paragraph (b), clause (1); or (ii) 15 cents per 
  7.17  mile that the student is transported by the most direct route to 
  7.18  and from the student's residence and the nonpublic school 
  7.19  actually attended.  
  7.20     (d) A student's parent who requests transportation under 
  7.21  paragraph (b) for all or part of the student's transportation 
  7.22  under this section cannot receive any reimbursement under 
  7.23  paragraph (c) for that student. 
  7.24     Subd. 2.  [STUDENT'S PARENT.] In this section, a student's 
  7.25  parent means the person primarily responsible for the student's 
  7.26  transportation expenses, if any, described in subdivision 1, 
  7.27  paragraph (a). 
  7.28     Subd. 3.  [ONE REIMBURSEMENT PER STUDENT; ONE APPLICATION 
  7.29  PER PARENT.] (a) The commissioner may require reimbursement to 
  7.30  the first and to only one application per student under 
  7.31  subdivision 1, paragraph (c). 
  7.32     (b) A parent claiming reimbursement under this section for 
  7.33  more than one student shall state the total transportation 
  7.34  expenses under subdivision 1, paragraph (c), separately for each 
  7.35  student, but the commissioner may require the requests for all 
  7.36  the parent's students to be combined in one application. 
  8.1                              ARTICLE 3
  8.2                     EXPANDED CHARTER SCHOOL LAW
  8.3      Section 1.  Minnesota Statutes 1995 Supplement, section 
  8.4   120.064, subdivision 3, is amended to read: 
  8.5      Subd. 3.  [SPONSOR.] A school board, community college, 
  8.6   state university, technical college, the state board of 
  8.7   education, or the University of Minnesota may sponsor one or 
  8.8   more charter schools. 
  8.9      No more than a total of 40 charter schools may be 
  8.10  authorized not more than three of which may be sponsored by 
  8.11  public post-secondary institutions.  The state board of 
  8.12  education shall advise potential sponsors when the maximum 
  8.13  number of charter schools has been authorized. 
  8.14     Sec. 2.  Minnesota Statutes 1995 Supplement, section 
  8.15  120.064, subdivision 4, is amended to read: 
  8.16     Subd. 4.  [FORMATION OF SCHOOL.] (a) A sponsor may 
  8.17  authorize one or more licensed teachers under section 125.05, 
  8.18  subdivision 1, or a person, governmental body, or nonprofit 
  8.19  organization that contracts for its instructional programs with 
  8.20  an organization owned by teachers, to operate a charter school 
  8.21  subject to, for a sponsor other than the state board, approval 
  8.22  by the state board of education.  If a school board elects not 
  8.23  to sponsor a charter school, the applicant may appeal the school 
  8.24  board's decision to the state board of education if two members 
  8.25  of the school board voted to sponsor the school.  If the state 
  8.26  board authorizes the school, the state board shall sponsor the 
  8.27  school according to this section.  The school shall be organized 
  8.28  and operated as a cooperative under chapter 308A or nonprofit 
  8.29  corporation under chapter 317A.  
  8.30     (b) Before the operators may form and operate as a school, 
  8.31  the a sponsor, other than the state board, must file an 
  8.32  affidavit with the state board of education stating its intent 
  8.33  to authorize a charter school.  The affidavit must state the 
  8.34  terms and conditions under which the sponsor would authorize a 
  8.35  charter school.  The state board must approve or disapprove the 
  8.36  sponsor's proposed authorization within 60 days of receipt of 
  9.1   the affidavit.  Failure to obtain state board approval precludes 
  9.2   a sponsor from authorizing the charter school that was the 
  9.3   subject of the affidavit.  
  9.4      (c) The operators authorized to organize and operate a 
  9.5   school shall hold an election for members of the school's board 
  9.6   of directors in a timely manner after the school is operating.  
  9.7   Any staff members who are employed at the school, including 
  9.8   teachers providing instruction under a contract with a 
  9.9   cooperative, and all parents of children enrolled in the school 
  9.10  may participate in the election.  Licensed teachers employed at 
  9.11  the school, including teachers providing instruction under a 
  9.12  contract with a cooperative, must be a majority of the members 
  9.13  of the board of directors.  When a person, governmental body, or 
  9.14  nonprofit organization that contracts for its instructional 
  9.15  programs with an organization owned by teachers operates the 
  9.16  school, teachers are not required to be a majority of the 
  9.17  members of the board of directors.  A provisional board may 
  9.18  operate before the election of the school's board of directors.  
  9.19  Board of director meetings must comply with section 471.705. 
  9.20     (d) The granting or renewal of a charter by a sponsoring 
  9.21  entity shall not be conditioned upon the bargaining unit status 
  9.22  of the employees of the school. 
  9.23     Sec. 3.  Minnesota Statutes 1995 Supplement, section 
  9.24  120.064, subdivision 5, is amended to read: 
  9.25     Subd. 5.  [CONTRACT.] The sponsor's authorization for a 
  9.26  charter school shall be in the form of a written contract signed 
  9.27  by the sponsor and the board of directors of the charter 
  9.28  school.  The contract for a charter school shall be in writing 
  9.29  and contain at least the following: 
  9.30     (1) a description of a program that carries out one or more 
  9.31  of the purposes in subdivision 1; 
  9.32     (2) specific outcomes pupils are to achieve under 
  9.33  subdivision 10; 
  9.34     (3) admission policies and procedures; 
  9.35     (4) management and administration of the school; 
  9.36     (5) requirements and procedures for program and financial 
 10.1   audits; 
 10.2      (6) how the school will comply with subdivisions 8, 13, 15, 
 10.3   and 21; 
 10.4      (7) assumption of liability by the charter school; 
 10.5      (8) types and amounts of insurance coverage to be obtained 
 10.6   by the charter school; and 
 10.7      (9) the term of the contract, which may be up to shall be 
 10.8   three years. 
 10.9      Sec. 4.  Minnesota Statutes 1995 Supplement, section 
 10.10  120.064, subdivision 8, is amended to read: 
 10.11     Subd. 8.  [REQUIREMENTS.] (a) A charter school shall meet 
 10.12  all applicable state and local health and safety requirements. 
 10.13     (b) The A school must sponsored by a school district may be 
 10.14  located in the sponsoring any district, unless another the 
 10.15  school board agrees to locate a charter school sponsored by 
 10.16  another district in its boundaries of the district of the 
 10.17  proposed location disapproves and has not adopted a resolution 
 10.18  under section 120.062, subdivision 2.  If such a school board 
 10.19  denies a request to locate within its boundaries a charter 
 10.20  school sponsored by another district, the sponsoring district 
 10.21  may appeal to the state board of education.  If the state board 
 10.22  authorizes the school, the state board shall sponsor the 
 10.23  school.  A school sponsored by a post-secondary institution may 
 10.24  be located at any place the institution considers convenient. 
 10.25     (c) A charter school must be nonsectarian in its programs, 
 10.26  admission policies, employment practices, and all other 
 10.27  operations.  A sponsor may not authorize a charter school or 
 10.28  program that is affiliated with a nonpublic sectarian school or 
 10.29  a religious institution. 
 10.30     (d) Charter schools shall not be used as a method of 
 10.31  providing education or generating revenue for students who are 
 10.32  being home schooled. 
 10.33     (e) The primary focus of a charter school must be to 
 10.34  provide a comprehensive program of instruction for at least one 
 10.35  grade or age group from five through 18 years of age.  
 10.36  Instruction may be provided to people younger than five years 
 11.1   and older than 18 years of age. 
 11.2      (f) A charter school may not charge tuition. 
 11.3      (g) A charter school is subject to and shall comply with 
 11.4   chapter 363 and section 126.21. 
 11.5      (h) A charter school is subject to and shall comply with 
 11.6   the pupil fair dismissal act, sections 127.26 to 127.39, and the 
 11.7   Minnesota public school fee law, sections 120.71 to 120.76. 
 11.8      (i) A charter school is subject to the same financial 
 11.9   audits, audit procedures, and audit requirements as a school 
 11.10  district.  The audit must be consistent with the requirements of 
 11.11  sections 121.904 to 121.917, except to the extent deviations are 
 11.12  necessary because of the program at the school.  The department 
 11.13  of children, families, and learning, state auditor, or 
 11.14  legislative auditor may conduct financial, program, or 
 11.15  compliance audits. 
 11.16     (j) A charter school is a school district for the purposes 
 11.17  of tort liability under chapter 466. 
 11.18     Sec. 5.  Minnesota Statutes 1995 Supplement, section 
 11.19  124.248, subdivision 1, is amended to read: 
 11.20     Subdivision 1.  [GENERAL EDUCATION AND REFERENDUM 
 11.21  REVENUE.] (a) General education revenue and referendum revenue 
 11.22  shall be paid to a charter school as though it were a school 
 11.23  district.  
 11.24     (b) The general education revenue for each pupil unit is 
 11.25  the state average general education revenue per pupil unit minus 
 11.26  $170, calculated without compensatory revenue, transportation 
 11.27  sparsity revenue, and the transportation portion of the 
 11.28  transition revenue adjustment, plus compensatory revenue as 
 11.29  though the school were a school district. 
 11.30     (c) The referendum revenue for each pupil unit is the 
 11.31  lesser of the referendum revenue per pupil unit in the resident 
 11.32  district or the referendum revenue per pupil unit in the 
 11.33  district in which the charter school is located. 
 11.34     Sec. 6.  Minnesota Statutes 1995 Supplement, section 
 11.35  124.248, subdivision 1a, is amended to read: 
 11.36     Subd. 1a.  [TRANSPORTATION REVENUE.] Transportation revenue 
 12.1   shall be paid to a charter school that provides transportation 
 12.2   services according to section 120.064, subdivision 15, as though 
 12.3   it were a school district according to this subdivision.  
 12.4   Transportation aid shall equal transportation revenue.  
 12.5      (a) For the first two years that In addition to the revenue 
 12.6   under subdivision 1, a charter school is providing 
 12.7   transportation services, the regular transportation allowance 
 12.8   for the charter school shall be equal to the regular 
 12.9   transportation allowance for the school district in which the 
 12.10  charter school is located.  For the third year of transportation 
 12.11  services and later fiscal years, the predicted base cost for the 
 12.12  charter school shall be equal to the predicted base cost for the 
 12.13  school district in which the charter school is located shall 
 12.14  receive general education aid for each pupil unit equal to the 
 12.15  sum of $170, plus the transportation sparsity allowance for the 
 12.16  school district in which the charter school is located, plus the 
 12.17  transportation transition allowance for the school district in 
 12.18  which the charter school is located.  
 12.19     (b) For the first two years that a charter school is 
 12.20  providing transportation services, the nonregular special 
 12.21  programs transportation revenue equals the charter school's 
 12.22  actual cost in the current school year for nonregular 
 12.23  transportation services, minus the amount of regular 
 12.24  transportation revenue attributable to FTE's in the handicapped 
 12.25  category in the current school year for children with 
 12.26  disabilities under section 124.223, subdivisions 4, 5, 7, and 
 12.27  8.  For the third year of transportation services and later 
 12.28  fiscal years, the nonregular special programs transportation 
 12.29  revenue shall be computed according to section 124.225, 
 12.30  subdivision 7d, paragraph (b) 14.  
 12.31     Sec. 7.  Minnesota Statutes 1995 Supplement, section 
 12.32  124.248, is amended by adding a subdivision to read: 
 12.33     Subd. 1b.  [SCHOOL DISTRICT COOPERATION REVENUE.] (a) 
 12.34  School district cooperation aid shall be paid to a charter 
 12.35  school according to section 124.2727 as though it were a school 
 12.36  district.  School district cooperation aid shall equal school 
 13.1   district cooperation revenue. 
 13.2      (b) A charter school must place its district cooperation 
 13.3   revenue in a reserved account and may only use the revenue to 
 13.4   purchase goods and services from entities formed for cooperative 
 13.5   purposes or to otherwise provide educational services in a 
 13.6   cooperative manner.  Notwithstanding section 124.2727, 
 13.7   subdivision 6d, a charter school is not required to spend at 
 13.8   least $9 per pupil unit of its district cooperation revenue on 
 13.9   secondary vocational programs. 
 13.10     Sec. 8.  Minnesota Statutes 1995 Supplement, section 
 13.11  124.248, subdivision 2, is amended to read: 
 13.12     Subd. 2.  [CAPITAL EXPENDITURE EQUIPMENT REVENUE.] Capital 
 13.13  expenditure equipment aid shall be paid to a charter school 
 13.14  according to section 124.245, subdivision 6, as though it were a 
 13.15  school district. 
 13.16     Capital expenditure equipment aid shall equal capital 
 13.17  expenditure equipment revenue.  Notwithstanding section 124.244, 
 13.18  subdivision 4 124A.22, subdivision 11, a charter school may 
 13.19  use the total operating capital revenue for any purpose related 
 13.20  to the school. 
 13.21     Sec. 9.  Minnesota Statutes 1995 Supplement, section 
 13.22  124.248, is amended by adding a subdivision to read: 
 13.23     Subd. 2a.  [BUILDING LEASE AID.] When a charter school 
 13.24  finds it economically advantageous to rent or lease a building 
 13.25  or land for any instructional purposes and it determines that 
 13.26  the total operating capital revenue under section 124A.22, 
 13.27  subdivision 10, is insufficient for this purpose, it may apply 
 13.28  to the commissioner for building lease aid for this purpose.  
 13.29  Criteria for aid approval and revenue uses shall be as defined 
 13.30  for the building lease levy in section 124.91, subdivision 1.  
 13.31  The amount of building lease aid per pupil unit for a charter 
 13.32  school for any year shall not exceed the state average debt 
 13.33  redemption revenue per pupil unit for the second preceding year. 
 13.34     Sec. 10.  Minnesota Statutes 1995 Supplement, section 
 13.35  124.248, subdivision 4, is amended to read: 
 13.36     Subd. 4.  [OTHER AID, GRANTS, REVENUE.] (a) A charter 
 14.1   school is eligible to receive other aids, grants, and revenue 
 14.2   according to chapters 120 to 129, as though it were a school 
 14.3   district except that, notwithstanding section 124.195, 
 14.4   subdivision 3, the payments shall be of an equal amount on each 
 14.5   of the 23 payment dates unless a charter school is in its first 
 14.6   year of operation in which case it shall receive on its first 
 14.7   payment date 15 percent of its cumulative amount guaranteed for 
 14.8   the year and 22 payments of an equal amount thereafter the sum 
 14.9   of which shall be 85 percent of the cumulative amount 
 14.10  guaranteed.  However, it may not receive aid, a grant, or 
 14.11  revenue if a levy is required to obtain the money, except as 
 14.12  otherwise provided in this section.  Federal aid received by the 
 14.13  state must be paid to the school, if it qualifies for the aid as 
 14.14  though it were a school district. 
 14.15     (b) Any revenue received from any source, other than 
 14.16  revenue that is specifically allowed for operational, 
 14.17  maintenance, capital facilities revenue under paragraph (c), and 
 14.18  capital expenditure equipment costs under this section, may be 
 14.19  used only for the planning and operational start-up costs of a 
 14.20  charter school.  Any unexpended revenue from any source under 
 14.21  this paragraph must be returned to that revenue source or 
 14.22  conveyed to the sponsoring school district, at the discretion of 
 14.23  the revenue source. 
 14.24     (c) A charter school may receive money from any source for 
 14.25  capital facilities needs.  Any unexpended capital facilities 
 14.26  revenue must be reserved and shall be expended only for future 
 14.27  capital facilities purposes. 
 14.28                             ARTICLE 4 
 14.29               EXPANDED INTERDISTRICT OPEN ENROLLMENT  
 14.30     Section 1.  Minnesota Statutes 1994, section 120.062, 
 14.31  subdivision 3, is amended to read: 
 14.32     Subd. 3.  [CLOSED DISTRICTS.] A school board may, by 
 14.33  resolution, determine that limit the enrollment of nonresident 
 14.34  pupils may not attend any of in its schools or programs 
 14.35  according to this section to a number not less than the greater 
 14.36  of: 
 15.1      (1) one percent of the total enrollment at each grade level 
 15.2   in the district; or 
 15.3      (2) the number of district residents at that grade level 
 15.4   enrolled in a nonresident district according to this section.  
 15.5      Sec. 2.  Minnesota Statutes 1994, section 120.062, 
 15.6   subdivision 6, is amended to read: 
 15.7      Subd. 6.  [NONRESIDENT DISTRICT PROCEDURES.] A district 
 15.8   that does not exclude nonresident pupils, according to 
 15.9   subdivision 3, shall notify the parent or guardian in writing by 
 15.10  February 15 whether the application has been accepted or 
 15.11  rejected.  If an application is rejected, the district must 
 15.12  state in the notification the reason for rejection.  The parent 
 15.13  or guardian shall notify the nonresident district by March 1 
 15.14  whether the pupil intends to enroll in the nonresident 
 15.15  district.  Notice of intent to enroll in the nonresident 
 15.16  district obligates the pupil to attend the nonresident district 
 15.17  during the following school year, unless the school boards of 
 15.18  the resident and the nonresident districts agree in writing to 
 15.19  allow the pupil to transfer back to the resident district, or 
 15.20  the pupil's parents or guardians change residence to another 
 15.21  district.  If a parent or guardian does not notify the 
 15.22  nonresident district, the pupil may not enroll in that 
 15.23  nonresident district during the following school year, unless 
 15.24  the school boards of the resident and nonresident district agree 
 15.25  otherwise.  The nonresident district shall notify the resident 
 15.26  district by March 15 of the pupil's intent to enroll in the 
 15.27  nonresident district.  The same procedures apply to a pupil who 
 15.28  applies to transfer from one participating nonresident district 
 15.29  to another participating nonresident district. 
 15.30     Sec. 3.  Minnesota Statutes 1994, section 120.062, 
 15.31  subdivision 7, is amended to read: 
 15.32     Subd. 7.  [BASIS FOR DECISIONS.] The school board must 
 15.33  adopt, by resolution, specific standards for acceptance and 
 15.34  rejection of applications.  Standards may include the capacity 
 15.35  of a program, class, grade level, or school building.  The 
 15.36  school board may not reject applications for enrollment in a 
 16.1   particular grade level if the nonresident enrollment at that 
 16.2   grade level does not exceed the limit set by the board under 
 16.3   subdivision 3.  Standards may not include previous academic 
 16.4   achievement, athletic or other extracurricular ability, 
 16.5   disabling conditions, proficiency in the English language, or 
 16.6   previous disciplinary proceedings, or the student's district of 
 16.7   residence.  
 16.8      Sec. 4.  Minnesota Statutes 1994, section 120.062, 
 16.9   subdivision 11, is amended to read: 
 16.10     Subd. 11.  [INFORMATION.] A district that does not exclude 
 16.11  nonresident pupils according to subdivision 3 shall make 
 16.12  information about the district, schools, programs, policies, and 
 16.13  procedures available to all interested people.  
 16.14     Sec. 5.  Minnesota Statutes 1994, section 120.17, 
 16.15  subdivision 4, is amended to read: 
 16.16     Subd. 4.  [SPECIAL INSTRUCTIONS FOR NONRESIDENT CHILDREN.] 
 16.17  When a school district provides instruction and services outside 
 16.18  the district of residence, board and lodging, and any tuition to 
 16.19  be paid, shall be paid by the district of residence.  The 
 16.20  tuition rate to be charged for any child with a disability shall 
 16.21  be the actual cost of providing special instruction and services 
 16.22  to the child including a proportionate amount for capital outlay 
 16.23  and debt service but not including any amount for 
 16.24  transportation, minus the amount of special aid for children 
 16.25  with a disability general education revenue, special education 
 16.26  revenue, and other revenue received on behalf of that child.  If 
 16.27  the boards involved do not agree upon the tuition rate, either 
 16.28  board may apply to the commissioner to fix the rate.  The 
 16.29  commissioner shall then set a date for a hearing, giving each 
 16.30  board at least ten days' notice, and after the hearing the 
 16.31  commissioner shall make an order fixing the tuition rate, which 
 16.32  shall be binding on both school districts. 
 16.33     When a district provides instruction and services in a day 
 16.34  program outside the district of residence, the district of 
 16.35  residence shall be responsible for providing transportation.  
 16.36  When a district provides instruction and services requiring 
 17.1   board and lodging or placement in a residential program outside 
 17.2   the district of residence, the nonresident district in which the 
 17.3   child is placed shall be responsible for providing 
 17.4   transportation.  Transportation costs shall be paid by the 
 17.5   district responsible for providing transportation and the state 
 17.6   shall pay transportation aid to that district.  
 17.7      For the purposes of this section, any school district may 
 17.8   enter into an agreement, upon terms and conditions which are 
 17.9   mutually agreed upon, to provide special instruction and 
 17.10  services for children with a disability.  In that event, one of 
 17.11  the participating units may employ and contract with necessary 
 17.12  qualified personnel to offer services in the several districts.  
 17.13  Each participating unit shall reimburse the employing unit a 
 17.14  proportionate amount of the actual cost of providing the special 
 17.15  instruction and services, less the amount of state special 
 17.16  education aid, which shall be claimed in full by the employing 
 17.17  district. 
 17.18     Sec. 6.  Minnesota Statutes 1995 Supplement, section 
 17.19  120.17, subdivision 6, is amended to read: 
 17.20     Subd. 6.  [PLACEMENT IN ANOTHER DISTRICT; RESPONSIBILITY.] 
 17.21  The responsibility for special instruction and services for a 
 17.22  child with a disability temporarily placed in another district 
 17.23  for care and treatment shall be determined in the following 
 17.24  manner: 
 17.25     (a) The school district of residence of a child shall be 
 17.26  the district in which the child's parent resides, if living, or 
 17.27  the child's guardian, or the district designated by the 
 17.28  commissioner of children, families, and learning if neither 
 17.29  parent nor guardian is living within the state. 
 17.30     (b) When a child is temporarily placed for care and 
 17.31  treatment in a day program located in another district and the 
 17.32  child continues to live within the district of residence during 
 17.33  the care and treatment, the district of residence is responsible 
 17.34  for providing transportation and an appropriate educational 
 17.35  program for the child.  The district may provide the educational 
 17.36  program at a school within the district of residence, at the 
 18.1   child's residence, or in the district in which the day treatment 
 18.2   center is located by paying tuition to that district. 
 18.3      (c) When a child is temporarily placed in a residential 
 18.4   program for care and treatment, the nonresident district in 
 18.5   which the child is placed is responsible for providing an 
 18.6   appropriate educational program for the child and necessary 
 18.7   transportation within the district while the child is attending 
 18.8   the educational program; and shall bill the district of the 
 18.9   child's residence for the actual cost of providing the 
 18.10  program, minus the revenue received on behalf of the child, as 
 18.11  outlined in subdivision 4, except that the board, lodging, and 
 18.12  treatment costs incurred in behalf of a child with a disability 
 18.13  placed outside of the school district of residence by the 
 18.14  commissioner of human services or the commissioner of 
 18.15  corrections or their agents, for reasons other than for making 
 18.16  provision for the child's special educational needs shall not 
 18.17  become the responsibility of either the district providing the 
 18.18  instruction or the district of the child's residence. 
 18.19     (d) The district of residence shall pay tuition and other 
 18.20  program costs, not including transportation costs, to the 
 18.21  district providing the instruction and services.  The district 
 18.22  of residence attendance may claim general education aid for the 
 18.23  child as provided by law.  Transportation costs shall be paid by 
 18.24  the district responsible for providing the transportation and 
 18.25  the state shall pay transportation aid to that district. 
 18.26     Sec. 7.  Minnesota Statutes 1995 Supplement, section 
 18.27  120.17, subdivision 7, is amended to read: 
 18.28     Subd. 7.  [PLACEMENT IN STATE INSTITUTION; RESPONSIBILITY.] 
 18.29  Responsibility for special instruction and services for a child 
 18.30  with a disability placed in a state institution on a temporary 
 18.31  basis shall be determined in the following manner: 
 18.32     (a) The legal residence of such child shall be the school 
 18.33  district in which the child's parent resides, if living, or the 
 18.34  child's guardian.  
 18.35     (b) When the educational needs of such child can be met 
 18.36  through the institutional program, the costs for such 
 19.1   instruction shall be paid by the department to which the 
 19.2   institution is assigned.  
 19.3      (c) When it is determined that such child can benefit from 
 19.4   public school enrollment, provision for such instruction shall 
 19.5   be made in the following manner: 
 19.6      (1) determination of eligibility for special instruction 
 19.7   and services shall be made by the commissioner of children, 
 19.8   families, and learning and the commissioner of the department 
 19.9   responsible for the institution; 
 19.10     (2) the school district where the institution is located 
 19.11  shall be responsible for providing transportation and an 
 19.12  appropriate educational program for the child, may claim general 
 19.13  education aid for the child, and shall make a tuition charge to 
 19.14  the child's district of residence for the actual cost of 
 19.15  providing the program, minus the revenue received on behalf of 
 19.16  the child; and 
 19.17     (3) the district of the child's residence shall pay the 
 19.18  tuition and other program costs excluding transportation costs 
 19.19  and may claim general education aid for the child.  
 19.20  Transportation costs shall be paid by the district where the 
 19.21  institution is located and the state shall pay transportation 
 19.22  aid to that district. 
 19.23     Sec. 8.  Minnesota Statutes 1995 Supplement, section 
 19.24  120.181, is amended to read: 
 19.25     120.181 [PLACEMENT OF NONHANDICAPPED; EDUCATION AND 
 19.26  TRANSPORTATION.] 
 19.27     The responsibility for providing instruction and 
 19.28  transportation for a pupil without a disability who has a 
 19.29  short-term or temporary physical or emotional illness or 
 19.30  disability, as determined by the standards of the state board, 
 19.31  and who is temporarily placed for care and treatment for that 
 19.32  illness or disability, shall be determined as provided in this 
 19.33  section.  
 19.34     (a) The school district of residence of the pupil shall be 
 19.35  the district in which the pupil's parent or guardian resides or 
 19.36  the district designated by the commissioner of children, 
 20.1   families, and learning if neither parent nor guardian is living 
 20.2   within the state.  
 20.3      (b) Prior to the placement of a pupil for care and 
 20.4   treatment, the district of residence shall be notified and 
 20.5   provided an opportunity to participate in the placement 
 20.6   decision.  When an immediate emergency placement is necessary 
 20.7   and time does not permit resident district participation in the 
 20.8   placement decision, the district in which the pupil is 
 20.9   temporarily placed, if different from the district of residence, 
 20.10  shall notify the district of residence of the emergency 
 20.11  placement within 15 days of the placement.  
 20.12     (c) When a pupil without a disability is temporarily placed 
 20.13  for care and treatment in a day program and the pupil continues 
 20.14  to live within the district of residence during the care and 
 20.15  treatment, the district of residence shall provide instruction 
 20.16  and necessary transportation for the pupil.  The district may 
 20.17  provide the instruction at a school within the district of 
 20.18  residence, at the pupil's residence, or in the case of a 
 20.19  placement outside of the resident district, in the district in 
 20.20  which the day treatment program is located by paying tuition to 
 20.21  that district.  The district of placement may contract with a 
 20.22  facility to provide instruction by teachers licensed by the 
 20.23  state board of teaching.  
 20.24     (d) When a pupil without a disability is temporarily placed 
 20.25  in a residential program for care and treatment, the district in 
 20.26  which the pupil is placed shall provide instruction for the 
 20.27  pupil and necessary transportation within that district while 
 20.28  the pupil is receiving instruction, and in the case of a 
 20.29  placement outside of the district of residence, the nonresident 
 20.30  district shall bill the district of residence for the actual 
 20.31  cost of providing the instruction for the regular school year 
 20.32  and for summer school, excluding transportation costs, minus the 
 20.33  amount of general education revenue and other revenue received 
 20.34  on behalf of the child.  When a pupil without a disability is 
 20.35  temporarily placed in a residential program outside the district 
 20.36  of residence, the administrator of the court placing the pupil 
 21.1   shall send timely written notice of the placement to the 
 21.2   district of residence.  The district of placement may contract 
 21.3   with a residential facility to provide instruction by teachers 
 21.4   licensed by the state board of teaching. 
 21.5      (e) The district of residence attendance shall include the 
 21.6   pupil in its residence count of pupil units and pay tuition as 
 21.7   provided in section 124.18 to the district providing the 
 21.8   instruction the state shall pay general education and other 
 21.9   state aids to that district.  Transportation costs shall be paid 
 21.10  by the district providing the transportation and the state shall 
 21.11  pay transportation aid to that district.  For purposes of 
 21.12  computing state transportation aid, pupils governed by this 
 21.13  subdivision shall be included in the handicapped transportation 
 21.14  category.  
 21.15     Sec. 9.  Minnesota Statutes 1994, section 122.541, 
 21.16  subdivision 2, is amended to read: 
 21.17     Subd. 2.  [AID; TRANSPORTATION.] (a) Each district shall 
 21.18  continue to count its resident pupils who are educated in a 
 21.19  cooperating district as resident pupils in the calculation of 
 21.20  pupil units for all purposes.  The agreement shall provide for 
 21.21  tuition payments between or among the districts.  
 21.22     (b) Each district shall continue to provide transportation 
 21.23  and collect transportation aid for its resident pupils pursuant 
 21.24  to sections 123.39, 124.223, and 124.225.  A district may 
 21.25  provide some or all transportation to its resident pupils by 
 21.26  contracting with a cooperating district.  For purposes of 
 21.27  section 124.225 124A.22, subdivisions 13 and 13b, the 
 21.28  commissioner may adjust the fiscal year 1996 base cost per 
 21.29  eligible pupil transported allowance to reflect changes in costs 
 21.30  resulting from the agreement.  
 21.31     Sec. 10.  Minnesota Statutes 1995 Supplement, section 
 21.32  124.17, subdivision 1, is amended to read: 
 21.33     Subdivision 1.  [PUPIL UNIT.] Pupil units for each 
 21.34  Minnesota resident pupil in average daily membership enrolled in 
 21.35  the district shall be counted according to this subdivision.  
 21.36     (a) A prekindergarten pupil with a disability who is 
 22.1   enrolled in a program approved by the commissioner and has an 
 22.2   individual education plan is counted as the ratio of the number 
 22.3   of hours of assessment and education service to 825 with a 
 22.4   minimum of 0.28, but not more than one. 
 22.5      (b) A prekindergarten pupil who is assessed but determined 
 22.6   not to be handicapped is counted as the ratio of the number of 
 22.7   hours of assessment service to 825.  
 22.8      (c) A kindergarten pupil with a disability who is enrolled 
 22.9   in a program approved by the commissioner is counted as the 
 22.10  ratio of the number of hours of assessment and education 
 22.11  services required in the fiscal year by the pupil's individual 
 22.12  education program plan to 875, but not more than one. 
 22.13     (d) A kindergarten pupil who is not included in paragraph 
 22.14  (c) is counted as .53 of a pupil unit for fiscal year 1995 and 
 22.15  thereafter. 
 22.16     (e) A pupil who is in any of grades 1 to 6 is counted as 
 22.17  1.06 pupil units for fiscal year 1995 and thereafter. 
 22.18     (f) For fiscal year 1996 and fiscal year 1997, a pupil who 
 22.19  is in any of grades 7 to 12 is counted as 1.3 pupil units.  For 
 22.20  fiscal year 1998, a pupil who is in any of grades 7 to 12 is 
 22.21  counted as 1.25 pupil units.  For fiscal year 1999 and later 
 22.22  years, a pupil who is in any of grades 7 to 12 is counted as 1.2 
 22.23  pupil units. 
 22.24     (g) For fiscal year 1996 and fiscal year 1997, a pupil who 
 22.25  is in the post-secondary enrollment options program is counted 
 22.26  as 1.3 pupil units.  For fiscal year 1998, a pupil who is in the 
 22.27  post-secondary enrollment options program is counted as 1.25 
 22.28  pupil units.  For fiscal year 1999 and later years, a pupil who 
 22.29  is in the post-secondary enrollment options program is counted 
 22.30  as 1.2 pupil units. 
 22.31     (h) In fiscal year 1998, the sum of a district's general 
 22.32  education revenue and referendum revenue may not be reduced by 
 22.33  more than two percent due to the reduction in the secondary 
 22.34  pupil weight from 1.3 as specified in paragraphs (f) and (g).  
 22.35  In fiscal year 1999 and later years, the sum of a district's 
 22.36  general education revenue and referendum revenue may not be 
 23.1   decreased by more than four percent due to the reduction in the 
 23.2   secondary weight from 1.3 as specified in paragraphs (f) and (g).
 23.3      Sec. 11.  Minnesota Statutes 1995 Supplement, section 
 23.4   124.17, subdivision 1c, is amended to read: 
 23.5      Subd. 1c.  [FOREIGN EXCHANGE PUPILS.] Notwithstanding 
 23.6   section 123.35, subdivision 8c, or any other law to the 
 23.7   contrary, a foreign exchange pupil enrolled in a district under 
 23.8   a cultural exchange program may be counted as a Minnesota 
 23.9   resident pupil for the purposes of this chapter and chapter 124A 
 23.10  even if the pupil has graduated from high school or the 
 23.11  equivalent. 
 23.12     Sec. 12.  Minnesota Statutes 1995 Supplement, section 
 23.13  124.17, subdivision 1d, is amended to read: 
 23.14     Subd. 1d.  [FISCAL YEAR 1997 AFDC PUPIL UNITS.] AFDC pupil 
 23.15  units for fiscal year 1993 and thereafter 1997 must be computed 
 23.16  according to this subdivision.  
 23.17     (a) The AFDC concentration percentage for a district equals 
 23.18  the product of 100 times the ratio of:  
 23.19     (1) the number of pupils enrolled in the district from 
 23.20  families receiving aid to families with dependent children 
 23.21  according to subdivision 1e; to 
 23.22     (2) the number of pupils in average daily membership 
 23.23  according to subdivision 1e enrolled in the district. 
 23.24     (b) The AFDC pupil weighting factor for a district equals 
 23.25  the lesser of one or the quotient obtained by dividing the 
 23.26  district's AFDC concentration percentage by 11.5.  
 23.27     (c) The AFDC pupil units for a district for fiscal year 
 23.28  1993 and thereafter equals the product of:  
 23.29     (1) the number of pupils enrolled in the district from 
 23.30  families receiving aid to families with dependent children 
 23.31  according to subdivision 1e; times 
 23.32     (2) the AFDC pupil weighting factor for the district; times 
 23.33     (3) .67. 
 23.34     Sec. 13.  Minnesota Statutes 1994, section 124.17, 
 23.35  subdivision 1e, is amended to read: 
 23.36     Subd. 1e.  [FISCAL YEAR 1997 AFDC PUPIL COUNTS.] AFDC pupil 
 24.1   counts and average daily membership for subdivisions 1b and 1d 
 24.2   shall be determined according to this subdivision: 
 24.3      (a) For districts where the number of pupils from families 
 24.4   receiving aid to families with dependent children has increased 
 24.5   over the preceding year for each of the two previous years, the 
 24.6   number of pupils enrolled in the district from families 
 24.7   receiving aid to families with dependent children shall be those 
 24.8   counted on October 1 of the previous school year.  The average 
 24.9   daily membership used shall be from the previous school year. 
 24.10     (b) For districts that do not meet the requirement of 
 24.11  paragraph (a), the number of pupils enrolled in the district 
 24.12  from families receiving aid to families with dependent children 
 24.13  shall be the average number of pupils on October 1 of the second 
 24.14  previous school year and October 1 of the previous school year.  
 24.15  The average daily membership used shall be the average number 
 24.16  enrolled in the previous school year and the second previous 
 24.17  school year. 
 24.18     Sec. 14.  Minnesota Statutes 1994, section 124.17, is 
 24.19  amended by adding a subdivision to read: 
 24.20     Subd. 1g.  [AFDC PUPIL UNITS.] AFDC pupil units for fiscal 
 24.21  year 1998 and thereafter must be computed according to this 
 24.22  subdivision. 
 24.23     (a) The AFDC concentration percentage for a district equals 
 24.24  the product of 100 times the ratio of: 
 24.25     (1) the number of pupils residing in the district from 
 24.26  families receiving aid to families with dependent children 
 24.27  according to this paragraph; to 
 24.28     (2) the number of pupils in average daily membership 
 24.29  according to this paragraph, residing in the district. 
 24.30     (b) The AFDC pupil weighting factor for AFDC pupils 
 24.31  residing in a district equals the lesser of one or the quotient 
 24.32  obtained by dividing the district's AFDC concentration 
 24.33  percentage by 11.5. 
 24.34     (c) The AFDC pupil units for a district for fiscal year 
 24.35  1998 and thereafter for each pupil enrolled in the district from 
 24.36  a family receiving aid to families with dependent children 
 25.1   according to paragraph (b), equals the product of: 
 25.2      (1) the AFDC pupil weighting factor for pupil's district of 
 25.3   residence; times 
 25.4      (2) .67. 
 25.5      Sec. 15.  Minnesota Statutes 1994, section 124.17, is 
 25.6   amended by adding a subdivision to read: 
 25.7      Subd. 1h.  [AFDC PUPIL COUNTS.] (a) AFDC pupil counts and 
 25.8   average daily membership for subdivision 1f, paragraph (a), 
 25.9   shall be determined according to this paragraph. 
 25.10     (i) For districts where the number of resident pupils from 
 25.11  families receiving aid to families with dependent children has 
 25.12  increased over the preceding year for each of the two previous 
 25.13  years, the number of pupils residing in the district from 
 25.14  families receiving aid to families with dependent children shall 
 25.15  be those counted on October 1 of the previous school year.  The 
 25.16  average daily membership used shall be from the previous school 
 25.17  year. 
 25.18     (ii) For districts that do not meet the requirement of 
 25.19  paragraph (i), the number of pupils residing in the district 
 25.20  from families receiving aid to families with dependent children 
 25.21  shall be the average number of pupils on October 1 of the second 
 25.22  previous school year and October 1 of the previous school year.  
 25.23     The average daily membership used shall be the average 
 25.24  number of pupils residing in the district in the previous school 
 25.25  year and the second previous school year. 
 25.26     (b) AFDC pupil counts for subdivision 1f, paragraph (b), 
 25.27  shall be determined according to this paragraph. 
 25.28     (i) For districts where the number of pupils from families 
 25.29  receiving aid to families with dependent children enrolled in 
 25.30  the district has increased over the preceding year for each of 
 25.31  the two previous years, the pupils enrolled in the district from 
 25.32  families receiving aid to families with dependent children shall 
 25.33  be those counted on October 1 of the previous school year. 
 25.34     (ii) For districts that do not meet the requirement of 
 25.35  paragraph (i), pupils enrolled in the district from families 
 25.36  receiving aid to families with dependent children shall be those 
 26.1   counted on October 1 of the previous school year times one-half, 
 26.2   plus those counted on October 1 of the second previous school 
 26.3   year times one-half. 
 26.4      Sec. 16.  Minnesota Statutes 1994, section 124.18, 
 26.5   subdivision 2, is amended to read: 
 26.6      Subd. 2.  [TUITION.] Except as otherwise provided in law, 
 26.7   every district that provides for the instruction of a pupil 
 26.8   without a disability in a nonresident district shall pay to the 
 26.9   nonresident district the actual cost of the instruction, 
 26.10  excluding transportation costs, minus the amount of general 
 26.11  education revenue and other revenue received on behalf of the 
 26.12  child.  Tuition for a nonresident pupil with a disability must 
 26.13  be determined according to section 120.17, subdivision 4.  
 26.14     The resident district shall also pay to the nonresident 
 26.15  district, for capital expenditures and debt service, $10 per 
 26.16  actual pupil unit in average daily membership for each 
 26.17  nonresident pupil unit.  However, a nonresident district may 
 26.18  include in its tuition, for capital expenditures and debt 
 26.19  service, an amount per actual pupil unit in average daily 
 26.20  membership based on the amount that the average expenditure for 
 26.21  capital expenditures and debt service determined by dividing 
 26.22  such annual expenditure by the total number of pupil units in 
 26.23  average daily membership in the district exceeds $10 per actual 
 26.24  pupil unit.  If the nonresident district has no capital 
 26.25  expenditures or debt service, it may use the money for any 
 26.26  purpose for which it is authorized to spend money.  
 26.27     Sec. 17.  Minnesota Statutes 1995 Supplement, section 
 26.28  124.225, subdivision 1, is amended to read: 
 26.29     Subdivision 1.  [DEFINITIONS.] For purposes of this 
 26.30  section, the terms defined in this subdivision have the meanings 
 26.31  given to them. 
 26.32     (a) "FTE" means a full-time equivalent pupil whose 
 26.33  transportation is authorized for aid purposes by section 124.223.
 26.34     (b) "Authorized cost for regular transportation" "Actual 
 26.35  expenditure per pupil transported in the regular and excess 
 26.36  transportation categories" means the sum of: 
 27.1      (1) all expenditures for transportation in the regular 
 27.2   category and excess categories, as defined in paragraph (c) (b), 
 27.3   clause (1), for which aid is authorized in section 124.223, plus 
 27.4      (2) an amount equal to one year's depreciation on the 
 27.5   district's school bus fleet and mobile units computed on a 
 27.6   straight line basis at the rate of 15 percent per year for 
 27.7   districts operating a program under section 121.585 for grades 1 
 27.8   to 12 for all students in the district and 12-1/2 percent per 
 27.9   year for other districts of the cost of the fleet, plus 
 27.10     (3) an amount equal to one year's depreciation on district 
 27.11  school buses reconditioned by the department of corrections 
 27.12  computed on a straight line basis at the rate of 33-1/3 percent 
 27.13  per year of the cost to the district of the reconditioning, plus 
 27.14     (4) an amount equal to one year's depreciation on the 
 27.15  district's type three school buses, as defined in section 
 27.16  169.01, subdivision 6, clause (5), which must be used a majority 
 27.17  of the time for the purposes in sections 124.223 and 124.226, 
 27.18  subdivisions 5, 8, and 9, and were purchased after July 1, 1982, 
 27.19  for authorized transportation of pupils, computed on a straight 
 27.20  line basis at the rate of 20 percent per year of the cost of the 
 27.21  type three school buses.  
 27.22     (c) (b) "Transportation category" means a category of 
 27.23  transportation service provided to pupils as follows:  
 27.24     (1) Regular transportation is transportation services 
 27.25  provided during the regular school year under section 124.223, 
 27.26  subdivisions 1 and 2, excluding the following transportation 
 27.27  services provided under section 124.223, subdivision 1:  
 27.28  transportation between schools; transportation to and from 
 27.29  service-learning programs; noon transportation to and from 
 27.30  school for kindergarten pupils attending half-day sessions; 
 27.31  transportation of pupils to and from schools located outside 
 27.32  their normal attendance areas under the provisions of a plan for 
 27.33  desegregation mandated by the state board of education or under 
 27.34  court order; and transportation of elementary pupils to and from 
 27.35  school within a mobility zone. 
 27.36     (2) Nonregular transportation is transportation services 
 28.1   provided under section 124.223, subdivision 1, that are excluded 
 28.2   from the regular category and transportation services provided 
 28.3   under section 124.223, subdivisions 3, 4, 5, 6, 7, 8, 9, and 10. 
 28.4      (3) Excess transportation is transportation to and from 
 28.5   school during the regular school year for secondary pupils 
 28.6   residing at least one mile but less than two miles from the 
 28.7   public school they could attend or from the nonpublic school 
 28.8   actually attended, and transportation to and from school for 
 28.9   pupils residing less than one mile from school who are 
 28.10  transported because of extraordinary traffic, drug, or crime 
 28.11  hazards. 
 28.12     (4) Desegregation transportation is transportation within 
 28.13  and outside of the district during the regular school year of 
 28.14  pupils to and from schools located outside their normal 
 28.15  attendance areas under a plan for desegregation mandated by the 
 28.16  state board or under court order.  
 28.17     (5) Handicapped transportation is transportation provided 
 28.18  under section 124.223, subdivision 4, for pupils with a 
 28.19  disability between home or a respite care facility and school or 
 28.20  other buildings where special instruction required by sections 
 28.21  120.17 and 120.1701 is provided. 
 28.22     (d) "Mobile unit" means a vehicle or trailer designed to 
 28.23  provide facilities for educational programs and services, 
 28.24  including diagnostic testing, guidance and counseling services, 
 28.25  and health services.  A mobile unit located off nonpublic school 
 28.26  premises is a neutral site as defined in section 123.932, 
 28.27  subdivision 9. 
 28.28     (e) "Current year" means the school year for which aid will 
 28.29  be paid.  
 28.30     (f) "Base year" means the second school year preceding the 
 28.31  school year for which aid will be paid.  
 28.32     (g) "Base cost" means the ratio of: 
 28.33     (1) the sum of the authorized cost in the base year for 
 28.34  regular transportation as defined in paragraph (b) plus the 
 28.35  actual cost in the base year for excess transportation as 
 28.36  defined in paragraph (c); 
 29.1      (2) to the sum of the number of weighted FTE's in the 
 29.2   regular and excess categories in the base year. 
 29.3      (h) "Pupil weighting factor" for the excess transportation 
 29.4   category for a school district means the lesser of one, or the 
 29.5   result of the following computation: 
 29.6      (1) Divide the square mile area of the school district by 
 29.7   the number of FTE's in the regular and excess categories in the 
 29.8   base year. 
 29.9      (2) Raise the result in clause (1) to the one-fifth power. 
 29.10     (3) Divide four-tenths by the result in clause (2). 
 29.11     The pupil weighting factor for the regular transportation 
 29.12  category is one.  
 29.13     (i) "Weighted FTE's"  means the number of FTE's in each 
 29.14  transportation category multiplied by the pupil weighting factor 
 29.15  for that category. 
 29.16     (j) "Sparsity index" for a school district means the 
 29.17  greater of .005 or the ratio of the square mile area of the 
 29.18  school district to the sum of the number of weighted FTE's by 
 29.19  the district in the regular and excess categories in the base 
 29.20  year. 
 29.21     (k) "Density index" for a school district means the greater 
 29.22  of one or the result obtained by subtracting the product of the 
 29.23  district's sparsity index times 20 from two. 
 29.24     (l) "Contract transportation index" for a school district 
 29.25  means the greater of one or the result of the following 
 29.26  computation: 
 29.27     (1) Multiply the district's sparsity index by 20. 
 29.28     (2) Select the lesser of one or the result in clause (1). 
 29.29     (3) Multiply the district's percentage of regular FTE's in 
 29.30  the current year using vehicles that are not owned by the school 
 29.31  district by the result in clause (2). 
 29.32     (m) "Adjusted predicted base cost" means the predicted base 
 29.33  cost as computed in subdivision 3a as adjusted under subdivision 
 29.34  7a. 
 29.35     (n) "Regular transportation allowance" means the adjusted 
 29.36  predicted base cost, inflated and adjusted under subdivision 7b. 
 30.1      Sec. 18.  Minnesota Statutes 1995 Supplement, section 
 30.2   124.225, subdivision 7f, is amended to read: 
 30.3      Subd. 7f.  [RESERVED REVENUE FOR TRANSPORTATION SAFETY.] A 
 30.4   district shall reserve an amount equal to the greater of $500 or 
 30.5   $1.50 times the number of fund balance actual pupil units, for 
 30.6   that school year to provide student transportation safety 
 30.7   programs under section 123.799.  This revenue may only be used 
 30.8   if the district complies with the reporting requirements of 
 30.9   section 123.7991, 123.805, 169.452, 169.4582, or 171.321, 
 30.10  subdivision 5. 
 30.11     Sec. 19.  Minnesota Statutes 1995 Supplement, section 
 30.12  124.273, subdivision 1c, is amended to read: 
 30.13     Subd. 1c.  [REVENUE FOR FISCAL YEARS 1996 AND 1997.] A 
 30.14  district's limited English proficiency programs revenue for 
 30.15  fiscal year years 1996 and later 1997 equals the product of: 
 30.16     (1) the district's base revenue for limited English 
 30.17  proficiency programs under this section and section 124.321, 
 30.18  times 
 30.19     (2) the ratio of: 
 30.20     (i) the greater of 20 or the number of pupils of limited 
 30.21  English proficiency enrolled in the district during the current 
 30.22  fiscal year to 
 30.23     (ii) the greater of 20 or the number of pupils of limited 
 30.24  English proficiency enrolled in the district during fiscal year 
 30.25  1995. 
 30.26     Sec. 20.  Minnesota Statutes 1994, section 124.273, is 
 30.27  amended by adding a subdivision to read: 
 30.28     Subd. 2d.  [REVENUE.] A district's limited English 
 30.29  proficiency programs revenue for fiscal year 1998 and later 
 30.30  equals the product of $542 times the greater of 20 or the number 
 30.31  of pupils of limited English proficiency enrolled in the 
 30.32  district during the current fiscal year. 
 30.33     Sec. 21.  Minnesota Statutes 1994, section 124A.029, 
 30.34  subdivision 4, is amended to read: 
 30.35     Subd. 4.  [PER PUPIL REVENUE OPTION CONVERSION.] A district 
 30.36  may, by school board resolution, request that the department 
 31.1   convert the levy authority under section 124.912, subdivisions 2 
 31.2   and 3, or its current referendum revenue, excluding authority 
 31.3   based on a dollar amount, authorized before July 1, 1993, to an 
 31.4   allowance per pupil.  The district must adopt a resolution and 
 31.5   submit a copy of the resolution to the department by July 1, 
 31.6   1993.  (a) The department shall convert a each district's 
 31.7   referendum revenue authority for fiscal year 1995 1998 and later 
 31.8   years to an allowance per pupil unit as follows:  the revenue 
 31.9   allowance equals the amount determined by dividing the 
 31.10  district's maximum revenue under section 124A.03 or 124.912, 
 31.11  subdivisions 2 and 3, for fiscal year 1994 1997 by the 
 31.12  district's 1993-1994 1996-1997 actual pupil units.  A district's 
 31.13  maximum revenue for all later years for which the revenue is 
 31.14  authorized equals the revenue allowance times the district's 
 31.15  actual pupil units for that year.  If a district has referendum 
 31.16  authority under section 124A.03 and levy authority under section 
 31.17  124.912, subdivisions 2 and 3, and the district requests that 
 31.18  each be converted, the department shall convert separate revenue 
 31.19  allowances for each.  However, if a district's referendum 
 31.20  revenue is limited to a dollar amount, the maximum revenue under 
 31.21  section 124A.03 must not exceed that dollar amount.  If the 
 31.22  referendum authority of a district is converted according to 
 31.23  this subdivision, and the question on the referendum ballot did 
 31.24  not provide for an expiration date, the authority shall expire 
 31.25  according to section 124A.0311. 
 31.26     (b) For referendum authorities approved before July 1, 
 31.27  1996, and effective beginning with taxes payable in 1997, the 
 31.28  revenue allowance equals the amount determined by dividing the 
 31.29  district's maximum revenue under Minnesota Statutes 1994, 
 31.30  section 124A.03, for fiscal year 1998 by the district's 
 31.31  1997-1998 actual pupil units. 
 31.32     (c) For districts with more than one referendum authority, 
 31.33  separate allowances shall be computed for each authority.  The 
 31.34  referendum allowance reduction under subdivision 3b shall be 
 31.35  applied first to authorities levied against net tax capacity, 
 31.36  and then to authorities levied against referendum market value.  
 32.1   For districts with more than one authority levied against net 
 32.2   tax capacity or against referendum market value, the referendum 
 32.3   allowance reduction shall be applied first to the authority with 
 32.4   the earliest expiration date. 
 32.5      Sec. 22.  Minnesota Statutes 1994, section 124A.03, 
 32.6   subdivision 1b, is amended to read: 
 32.7      Subd. 1b.  [REFERENDUM ALLOWANCE.] A district's referendum 
 32.8   revenue allowance equals the referendum revenue authority for 
 32.9   that year divided by its actual resident pupil units for that 
 32.10  school year. 
 32.11     Sec. 23.  Minnesota Statutes 1994, section 124A.03, 
 32.12  subdivision 1e, is amended to read: 
 32.13     Subd. 1e.  [TOTAL REFERENDUM REVENUE.] The total referendum 
 32.14  revenue for each district equals the district's referendum 
 32.15  allowance times the actual resident pupil units for the school 
 32.16  year. 
 32.17     Sec. 24.  Minnesota Statutes 1994, section 124A.03, 
 32.18  subdivision 1f, is amended to read: 
 32.19     Subd. 1f.  [REFERENDUM EQUALIZATION REVENUE.] A district's 
 32.20  referendum equalization revenue equals $315 times the district's 
 32.21  actual resident pupil units for that year. 
 32.22     Referendum equalization revenue must not exceed a 
 32.23  district's total referendum revenue for that year. 
 32.24     Sec. 25.  Minnesota Statutes 1995 Supplement, section 
 32.25  124A.03, subdivision 2, is amended to read: 
 32.26     Subd. 2.  [REFERENDUM REVENUE.] (a) The revenue authorized 
 32.27  by section 124A.22, subdivision 1, may be increased in the 
 32.28  amount approved by the voters of the district at a referendum 
 32.29  called for the purpose.  The referendum may be called by the 
 32.30  school board or shall be called by the school board upon written 
 32.31  petition of qualified voters of the district.  The referendum 
 32.32  shall be conducted one or two calendar years before the 
 32.33  increased levy authority, if approved, first becomes payable. 
 32.34  Only one election to approve an increase may be held in a 
 32.35  calendar year.  Unless the referendum is conducted by mail under 
 32.36  paragraph (g), the referendum must be held on the first Tuesday 
 33.1   after the first Monday in November.  The ballot shall state the 
 33.2   maximum amount of the increased revenue per actual resident 
 33.3   pupil unit, the estimated referendum tax rate as a percentage of 
 33.4   market value in the first year it is to be levied, and that the 
 33.5   revenue shall be used to finance school operations.  The ballot 
 33.6   may state that existing referendum levy authority is expiring.  
 33.7   In this case, the ballot may also compare the proposed levy 
 33.8   authority to the existing expiring levy authority, and express 
 33.9   the proposed increase as the amount, if any, over the expiring 
 33.10  referendum levy authority.  The ballot shall designate the 
 33.11  specific number of years, not to exceed ten, for which the 
 33.12  referendum authorization shall apply.  The notice required under 
 33.13  section 275.60 may be modified to read, in cases of renewing 
 33.14  existing levies: 
 33.15     "BY VOTING "YES" ON THIS BALLOT QUESTION, YOU MAY BE VOTING 
 33.16     FOR A PROPERTY TAX INCREASE." 
 33.17     The ballot may contain a textual portion with the 
 33.18  information required in this subdivision and a question stating 
 33.19  substantially the following:  
 33.20     "Shall the increase in the revenue proposed by (petition 
 33.21  to) the board of ........., School District No. .., be approved?"
 33.22     If approved, an amount equal to the approved revenue per 
 33.23  actual resident pupil unit times the actual resident pupil units 
 33.24  for the school year beginning in the year after the levy is 
 33.25  certified shall be authorized for certification for the number 
 33.26  of years approved, if applicable, or until revoked or reduced by 
 33.27  the voters of the district at a subsequent referendum. 
 33.28     (b) The school board shall prepare and deliver by first 
 33.29  class mail at least 15 days but no more than 30 days prior to 
 33.30  the day of the referendum to each taxpayer a notice of the 
 33.31  referendum and the proposed revenue increase.  The school board 
 33.32  need not mail more than one notice to any taxpayer.  For the 
 33.33  purpose of giving mailed notice under this subdivision, owners 
 33.34  shall be those shown to be owners on the records of the county 
 33.35  auditor or, in any county where tax statements are mailed by the 
 33.36  county treasurer, on the records of the county treasurer.  Every 
 34.1   property owner whose name does not appear on the records of the 
 34.2   county auditor or the county treasurer shall be deemed to have 
 34.3   waived this mailed notice unless the owner has requested in 
 34.4   writing that the county auditor or county treasurer, as the case 
 34.5   may be, include the name on the records for this purpose.  The 
 34.6   notice must project the anticipated amount of tax increase in 
 34.7   annual dollars and annual percentage for typical residential 
 34.8   homesteads, agricultural homesteads, apartments, and 
 34.9   commercial-industrial property within the school district. 
 34.10     The notice for a referendum may state that an existing 
 34.11  referendum levy is expiring and project the anticipated amount 
 34.12  of increase over the existing referendum levy, if any, in annual 
 34.13  dollars and annual percentage for typical residential 
 34.14  homesteads, agricultural homesteads, apartments, and 
 34.15  commercial-industrial property within the school district. 
 34.16     The notice must include the following statement:  "Passage 
 34.17  of this referendum will result in an increase in your property 
 34.18  taxes."  However, in cases of renewing existing levies, the 
 34.19  notice may include the following statement:  "Passage of this 
 34.20  referendum may result in an increase in your property taxes." 
 34.21     (c) A referendum on the question of revoking or reducing 
 34.22  the increased revenue amount authorized pursuant to paragraph 
 34.23  (a) may be called by the school board and shall be called by the 
 34.24  school board upon the written petition of qualified voters of 
 34.25  the district.  A referendum to revoke or reduce the levy amount 
 34.26  must be based upon the dollar amount, local tax rate, or amount 
 34.27  per actual resident pupil unit, that was stated to be the basis 
 34.28  for the initial authorization.  Revenue approved by the voters 
 34.29  of the district pursuant to paragraph (a) must be received at 
 34.30  least once before it is subject to a referendum on its 
 34.31  revocation or reduction for subsequent years.  Only one 
 34.32  revocation or reduction referendum may be held to revoke or 
 34.33  reduce referendum revenue for any specific year and for years 
 34.34  thereafter. 
 34.35     (d) A petition authorized by paragraph (a) or (c) shall be 
 34.36  effective if signed by a number of qualified voters in excess of 
 35.1   15 percent of the registered voters of the school district on 
 35.2   the day the petition is filed with the school board.  A 
 35.3   referendum invoked by petition shall be held on the date 
 35.4   specified in paragraph (a). 
 35.5      (e) The approval of 50 percent plus one of those voting on 
 35.6   the question is required to pass a referendum authorized by this 
 35.7   subdivision. 
 35.8      (f) At least 15 days prior to the day of the referendum, 
 35.9   the district shall submit a copy of the notice required under 
 35.10  paragraph (b) to the commissioner of children, families, and 
 35.11  learning.  Within 15 days after the results of the referendum 
 35.12  have been certified by the school board, or in the case of a 
 35.13  recount, the certification of the results of the recount by the 
 35.14  canvassing board, the district shall notify the commissioner of 
 35.15  children, families, and learning of the results of the 
 35.16  referendum. 
 35.17     (g) Except for a referendum held under subdivision 2b, any 
 35.18  referendum under this section held on a day other than the first 
 35.19  Tuesday after the first Monday in November must be conducted by 
 35.20  mail in accordance with section 204B.46.  Notwithstanding 
 35.21  paragraph (b) to the contrary, in the case of a referendum 
 35.22  conducted by mail under this paragraph, the notice required by 
 35.23  paragraph (b) shall be prepared and delivered by first class 
 35.24  mail at least 20 days before the referendum. 
 35.25     Sec. 26.  Minnesota Statutes 1994, section 124A.03, 
 35.26  subdivision 3b, is amended to read: 
 35.27     Subd. 3b.  [REFERENDUM ALLOWANCE REDUCTION.] A district's 
 35.28  referendum allowance under subdivision 1c is reduced by the 
 35.29  amounts calculated in paragraphs (a), (b), (c), and (d). 
 35.30     (a) The referendum allowance reduction equals the amount by 
 35.31  which a district's supplemental revenue reduction exceeds the 
 35.32  district's supplemental revenue allowance for fiscal year 1993. 
 35.33     (b) Notwithstanding paragraph (a), if a district's initial 
 35.34  referendum allowance is less than ten percent of the formula 
 35.35  allowance for that year, the reduction equals the lesser of (1) 
 35.36  an amount equal to $100, or (2) the amount calculated in 
 36.1   paragraph (a). 
 36.2      (c) Notwithstanding paragraph (a) or (b), a school 
 36.3   district's referendum allowance reduction equals (1) an amount 
 36.4   equal to $100, times (2) one minus the ratio of 20 percent of 
 36.5   the formula allowance minus the district's initial referendum 
 36.6   allowance limit to 20 percent of the formula allowance for that 
 36.7   year if: 
 36.8      (i) the district's adjusted net tax capacity for assessment 
 36.9   year 1992 per actual resident pupil unit for fiscal year 1995 is 
 36.10  less than $3,000; 
 36.11     (ii) the district's net unappropriated operating fund 
 36.12  balance as of June 30, 1993, divided by the actual resident 
 36.13  pupil units for fiscal year 1995 is less than $200; 
 36.14     (iii) the district's supplemental revenue allowance for 
 36.15  fiscal year 1993 is equal to zero; and 
 36.16     (iv) the district's initial referendum revenue authority 
 36.17  for the current year divided by the district's net tax capacity 
 36.18  for assessment year 1992 is greater than ten percent. 
 36.19     (d) Notwithstanding paragraph (a), (b), or (c), the 
 36.20  referendum revenue reduction for a newly reorganized district is 
 36.21  computed as follows: 
 36.22     (1) for a newly reorganized district created effective July 
 36.23  1, 1994, the referendum revenue reduction equals the lesser of 
 36.24  the amount calculated for the combined district under paragraph 
 36.25  (a), (b), or (c), or the sum of the amounts by which each of the 
 36.26  reorganizing district's supplemental revenue reduction exceeds 
 36.27  its respective supplemental revenue allowances calculated for 
 36.28  the districts as if they were still in existence for fiscal year 
 36.29  1995; or 
 36.30     (2) for a newly reorganized district created after July 1, 
 36.31  1994, the referendum revenue reduction equals the lesser of the 
 36.32  amount calculated for the combined district under paragraph (a), 
 36.33  (b), or (c), or the sum of the amounts by which each of the 
 36.34  reorganizing district's supplemental revenue reduction exceeds 
 36.35  its respective supplemental revenue allowances calculated for 
 36.36  the year preceding the year of reorganization. 
 37.1      Sec. 27.  Minnesota Statutes 1994, section 124A.034, 
 37.2   subdivision 1, is amended to read: 
 37.3      Subdivision 1.  [TO RESIDENT DISTRICT OF ATTENDANCE.] Aid 
 37.4   for shared time pupils shall be paid to the district of the 
 37.5   pupil's residence.  If a pupil attends shared time classes in 
 37.6   another district, the resident district shall pay to the 
 37.7   district of attendance an amount of tuition equal to the ratio 
 37.8   in section 124A.02, subdivision 20, times the amount of tuition 
 37.9   which would be charged and paid for a nonresident public school 
 37.10  pupil in a similar circumstance attendance.  The district of 
 37.11  residence shall not be obligated for tuition except by previous 
 37.12  agreement. 
 37.13     Sec. 28.  Minnesota Statutes 1994, section 124A.036, as 
 37.14  amended by Laws 1995, First Special Session chapter 3, article 
 37.15  16, section 13, is amended to read: 
 37.16     124A.036 [PAYMENTS TO RESIDENT AND NONRESIDENT DISTRICTS.] 
 37.17     Subdivision 1.  [AID TO DISTRICT OF RESIDENCE ATTENDANCE.] 
 37.18  Referendum aid shall be paid to the district of residence.  
 37.19  Other general education aid shall be paid to the district 
 37.20  of residence attendance unless otherwise specifically provided 
 37.21  by law.  
 37.22     Subd. 1a.  [REPORTING; REVENUE FOR HOMELESS.] For all 
 37.23  school purposes, unless otherwise specifically provided by law, 
 37.24  a homeless pupil must be considered a resident of the school 
 37.25  district that enrolls the pupil. 
 37.26     Subd. 2.  [DISTRICT WITHOUT SCHOOLS.] Except as otherwise 
 37.27  provided in law, any district not maintaining classified 
 37.28  elementary or secondary schools shall pay the tuition required 
 37.29  in order to enable resident pupils to attend school in another 
 37.30  district when necessary, and shall receive general education aid 
 37.31  on the same basis as other districts.  The aid shall be computed 
 37.32  as if the pupils were enrolled in the district of residence.  
 37.33     Subd. 3.  [NOTIFICATION OF RESIDENT DISTRICT.] A district 
 37.34  educating a pupil who is a resident of another district shall 
 37.35  notify the district of residence within 60 days of the date the 
 37.36  pupil is determined by the district to be a nonresident, but not 
 38.1   later than August 1 following the end of the school year in 
 38.2   which the pupil is educated.  If the district of residence does 
 38.3   not receive a notification from the providing district pursuant 
 38.4   to this subdivision, it shall not be liable to that district for 
 38.5   any tuition billing received after August 1 of the next school 
 38.6   year.  
 38.7      Subd. 4.  [STATE AGENCY AND COURT PLACEMENTS.] If a state 
 38.8   agency or a court of the state desires to place a child in a 
 38.9   school district which is not the child's district of residence, 
 38.10  that agency or court shall, prior to placement, allow the 
 38.11  district of residence an opportunity to participate in the 
 38.12  placement decision and notify the district of residence, the 
 38.13  district of attendance and the commissioner of children, 
 38.14  families, and learning of the placement decision.  When a state 
 38.15  agency or court determines that an immediate emergency placement 
 38.16  is necessary and that time does not permit district 
 38.17  participation in the placement decision or notice to the 
 38.18  districts and the commissioner of children, families, and 
 38.19  learning of the placement decision prior to the placement, the 
 38.20  agency or court may make the decision and placement without that 
 38.21  participation or prior notice.  The agency or court shall notify 
 38.22  the district of residence, the district of attendance and the 
 38.23  commissioner of children, families, and learning of an emergency 
 38.24  placement within 15 days of the placement.  
 38.25     Subd. 5.  [ALTERNATIVE ATTENDANCE PROGRAMS.] The general 
 38.26  education aid for districts must be adjusted for each pupil 
 38.27  attending a nonresident district under sections 120.062, 
 38.28  120.075, 120.0751, 120.0752, 124C.45 to 124C.48, and 126.22.  
 38.29  The adjustments must be made according to this subdivision. 
 38.30     (a) General education aid paid to a resident district must 
 38.31  be reduced by an amount equal to the general education 
 38.32  referendum revenue exclusive of compensatory revenue 
 38.33  attributable to the pupil in the resident district. 
 38.34     (b) General education aid paid to a district serving a 
 38.35  pupil in programs listed in this subdivision shall be increased 
 38.36  by an amount equal to the general education lesser of the 
 39.1   referendum revenue exclusive of compensatory revenue 
 39.2   attributable to the pupil in the resident district or the 
 39.3   nonresident district.  
 39.4      (c) The difference between the amount of the adjustment in 
 39.5   paragraph (a) and the amount of the adjustment in paragraph (b) 
 39.6   shall be credited to the individual education account of the 
 39.7   pupil under section 32. 
 39.8      (d) If the amount of the reduction to be made from the 
 39.9   general education aid of the resident district is greater than 
 39.10  the amount of general education aid otherwise due the district, 
 39.11  the excess reduction must be made from other state aids due the 
 39.12  district. 
 39.13     (d) (e) The district of residence shall pay tuition to a 
 39.14  district or an area learning center, operated according to 
 39.15  paragraph (e), providing special instruction and services to a 
 39.16  pupil with a disability, as defined in section 120.03, or a 
 39.17  pupil, as defined in section 120.181, who is enrolled in a 
 39.18  program listed in this subdivision.  The tuition shall be equal 
 39.19  to (1) the actual cost of providing special instruction and 
 39.20  services to the pupil, including a proportionate amount for debt 
 39.21  service and for capital expenditure facilities and equipment, 
 39.22  and debt service but not including any amount for 
 39.23  transportation, minus (2) the amount of general education aid, 
 39.24  the amount of capital expenditure facilities aid and capital 
 39.25  expenditure equipment aid received under section 124.245, 
 39.26  subdivision 6, and special education aid, attributable to that 
 39.27  pupil, that is received by the district providing special 
 39.28  instruction and services. 
 39.29     (e) An area learning center operated by an educational 
 39.30  cooperative service unit, intermediate district, education 
 39.31  district, or a joint powers cooperative may elect through the 
 39.32  action of the constituent boards to charge tuition for pupils 
 39.33  rather than to calculate general education aid adjustments under 
 39.34  paragraph (a), (b), or (c).  The tuition must be equal to the 
 39.35  greater of the average general education revenue per pupil unit 
 39.36  attributable to the pupil, or the actual cost of providing the 
 40.1   instruction, excluding transportation costs, if the pupil meets 
 40.2   the requirements of section 120.03 or 120.181. 
 40.3      Sec. 29.  Minnesota Statutes 1994, section 124A.22, 
 40.4   subdivision 5, is amended to read: 
 40.5      Subd. 5.  [DEFINITIONS.] The definitions in this 
 40.6   subdivision apply only to subdivisions 6 and 6a.  
 40.7      (a) "High school" means a secondary school that has pupils 
 40.8   enrolled in at least the 10th, 11th, and 12th grades.  If there 
 40.9   is no secondary school in the district that has pupils enrolled 
 40.10  in at least the 10th, 11th, and 12th grades, and the school is 
 40.11  at least 19 miles from the next nearest school, the commissioner 
 40.12  shall designate one school in the district as a high school for 
 40.13  the purposes of this section. 
 40.14     (b) "Secondary average daily membership" means, for a 
 40.15  district that has only one high school, the average daily 
 40.16  membership of resident pupils in grades 7 through 12.  For a 
 40.17  district that has more than one high school, "secondary average 
 40.18  daily membership" for each high school means the product of the 
 40.19  average daily membership of resident pupils in grades 7 through 
 40.20  12 in the high school, times the ratio of six to the number of 
 40.21  grades in the high school. 
 40.22     (c) "Attendance area" means the total surface area of the 
 40.23  district, in square miles, divided by the number of high schools 
 40.24  in the district.  For a district that does not operate a high 
 40.25  school and is less than 19 miles from the nearest operating high 
 40.26  school, the attendance area equals zero. 
 40.27     (d) "Isolation index" for a high school means the square 
 40.28  root of 55 percent of the attendance area plus the distance in 
 40.29  miles, according to the usually traveled routes, between the 
 40.30  high school and the nearest high school.  For a district in 
 40.31  which there is located land defined in section 84A.01, 84A.20, 
 40.32  or 84A.31, the distance in miles is the sum of: 
 40.33     (1) the square root of one-half of the attendance area; and 
 40.34     (2) the distance from the border of the district to the 
 40.35  nearest high school. 
 40.36     (e) "Qualifying high school" means a high school that has 
 41.1   an isolation index greater than 23 and that has secondary 
 41.2   average daily membership of less than 400.  
 41.3      (f) "Qualifying elementary school" means an elementary 
 41.4   school that is located 19 miles or more from the nearest 
 41.5   elementary school or from the nearest elementary school within 
 41.6   the district and, in either case, has an elementary average 
 41.7   daily membership of an average of 20 or fewer per grade. 
 41.8      (g) "Elementary average daily membership" means, for a 
 41.9   district that has only one elementary school, the average daily 
 41.10  membership of resident pupils in kindergarten through grade 6.  
 41.11  For a district that has more than one elementary school, 
 41.12  "average daily membership" for each school means the average 
 41.13  daily membership of kindergarten through grade 6 multiplied by 
 41.14  the ratio of seven to the number of grades in the elementary 
 41.15  school.  For a building in a district where the nearest 
 41.16  elementary school is at least 65 miles distant, pupils served 
 41.17  shall be used to determine average daily membership. 
 41.18     Sec. 30.  Minnesota Statutes 1995 Supplement, section 
 41.19  124A.22, subdivision 6, is amended to read: 
 41.20     Subd. 6.  [SECONDARY SPARSITY REVENUE.] (a) A district's 
 41.21  secondary sparsity revenue for a school year equals the sum of 
 41.22  the results of the following calculation for each qualifying 
 41.23  high school in the district: 
 41.24     (1) the formula allowance for the school year less $300, 
 41.25  multiplied by 
 41.26     (2) the secondary average daily membership of the high 
 41.27  school, multiplied by 
 41.28     (3) the quotient obtained by dividing 400 minus the 
 41.29  secondary average daily membership by 400 plus the secondary 
 41.30  daily membership, multiplied by 
 41.31     (4) the lesser of 1.5 or the quotient obtained by dividing 
 41.32  the isolation index minus 23 by ten. 
 41.33     (b) A newly formed school district that is the result of 
 41.34  districts combining under the cooperation and combination 
 41.35  program or consolidating under section 122.23 shall receive 
 41.36  secondary sparsity revenue equal to the greater of:  (1) the 
 42.1   amount calculated under paragraph (a) for the combined district; 
 42.2   or (2) the sum of the amounts of secondary sparsity revenue the 
 42.3   former school districts had in the year prior to consolidation, 
 42.4   increased for any subsequent changes in the secondary sparsity 
 42.5   formula. 
 42.6      Sec. 31.  Minnesota Statutes 1995 Supplement, section 
 42.7   124A.225, subdivision 1, is amended to read: 
 42.8      Subdivision 1.  [REVENUE.] Of a district's general 
 42.9   education revenue an amount equal to the sum of the number of 
 42.10  elementary fund balance pupils in average daily membership 
 42.11  defined in section 124.17, subdivision 1h, and one-half of the 
 42.12  number of kindergarten fund balance pupils in average daily 
 42.13  membership as defined in section 124.17, subdivision 1h, times 
 42.14  .06 for fiscal year 1995 and thereafter times the formula 
 42.15  allowance must be reserved according to this section. 
 42.16     Sec. 32.  [124A.75] [INDIVIDUAL EDUCATION FUND.] 
 42.17     (a) There is created in the state treasury an individual 
 42.18  education fund.  Accounts within this fund shall be established 
 42.19  by the commissioner of children, families, and learning for the 
 42.20  purpose of managing individual education accounts. 
 42.21     (b) The commissioner shall annually deposit in the 
 42.22  individual education account of a pupil the amount determined 
 42.23  under section 124A.036, subdivision 5, paragraph (c). 
 42.24     (c) The commissioner shall determine application procedures 
 42.25  for parents to request approval for a withdrawal of funds 
 42.26  deposited in the account on behalf of their children.  
 42.27  Withdrawals shall be made only for actual costs of educational 
 42.28  programs earning credit for graduation, or toward post-secondary 
 42.29  education or career training. 
 42.30     Sec. 33.  [REPEALER.] 
 42.31     Minnesota Statutes 1994, sections 120.062, subdivision 12; 
 42.32  124.17, subdivision 1f; 124.225, subdivisions 3a, 7a, 7b, 7d, 
 42.33  7e, 8a, 8k, and 10; 124.226, subdivisions 1, 2, 3, 3a, 4, 5, 6, 
 42.34  7, 8, and 9; 124A.03, subdivision 3b, effective for revenue for 
 42.35  fiscal year 1998; and 124A.034, subdivision 1a. 
 42.36                             ARTICLE 5
 43.1                    ACCELERATED GRADUATION OPTION
 43.2      Section 1.  Minnesota Statutes 1994, section 120.80, 
 43.3   subdivision 1, is amended to read: 
 43.4      Subdivision 1.  Notwithstanding any law to the contrary, 
 43.5   any secondary school student who has completed all required 
 43.6   courses may, with the approval of the student, the student's 
 43.7   parent or guardian, and local school officials, or accomplished 
 43.8   all required outcomes, shall, at the student's request if 18 
 43.9   years old, or otherwise at the student's parents' request 
 43.10  graduate prior to the completion of the school year early.  
 43.11  General education revenue attributable to the student must be 
 43.12  paid as though the student was in attendance for the entire year 
 43.13  prorated. 
 43.14     Sec. 2.  [123.355] [OVERVIEW.] 
 43.15     Subdivision 1.  [PURPOSE.] The purpose of this article is 
 43.16  to: 
 43.17     (1) stimulate, recognize, and reward learning and 
 43.18  competencies obtained by students at their own initiative 
 43.19  outside normal curricular programs; and 
 43.20     (2) reduce costly and unproductive duplication of learning 
 43.21  obtained inside and outside the school curriculum. 
 43.22     Subd. 2.  [NONSCHOOL LEARNING DEFINED.] Nonschool learning 
 43.23  includes, but is not limited to, competencies gained through 
 43.24  summer, after-school, or evening classes; summer camps; courses 
 43.25  provided by colleges, community education, or nonprofit or 
 43.26  for-profit enterprises; extracurricular or cocurricular 
 43.27  activities; computer-based, television, or distance learning; 
 43.28  education-to-employment transitions programs; employment and 
 43.29  internships; or other independent learning.  
 43.30     Subd. 3.  [CREDIT FOR NONSCHOOL LEARNING.] After June 30, 
 43.31  1997, a school district, certificate school, or a charter school 
 43.32  must maintain a simple and timely procedure to evaluate and 
 43.33  grant credit for required learning outcomes and competencies 
 43.34  demonstrated by a student after participating in nonschool 
 43.35  learning. 
 43.36     Subd. 4.  [APPEAL.] A student who is denied credit by a 
 44.1   school district for nonschool learning under this section, may 
 44.2   appeal the decision to the commissioner of the department of 
 44.3   children, families, and learning.  The commissioner may consider 
 44.4   evidence provided by the student from independent assessment 
 44.5   organizations or may require the student to demonstrate the 
 44.6   nonschool learning to an independent assessment organization 
 44.7   selected by the commissioner.  If evidence provided by the 
 44.8   student or required by the commissioner from an independent 
 44.9   assessment organization is found to be credible by the 
 44.10  commissioner, the commissioner may require the school district 
 44.11  to give the student the appropriate credit and reimburse the 
 44.12  student or the commissioner for the expense of the assessment. 
 44.13     Subd. 5.  [NO DUPLICATE COURSEWORK.] If a student earns 
 44.14  credit for nonschool learning under this section, the school 
 44.15  district must not require the student to take school district 
 44.16  classes for credits that substantially duplicate the outcomes 
 44.17  demonstrated from the nonschool learning for which credit was 
 44.18  earned.  
 44.19     Sec. 3.  Minnesota Statutes 1994, section 123.38, 
 44.20  subdivision 2a, is amended to read: 
 44.21     Subd. 2a.  Cocurricular activities shall mean school 
 44.22  sponsored and directed activities designed to provide 
 44.23  opportunities for pupils to participate, on an individual or 
 44.24  group basis, in school and public events for the improvement of 
 44.25  skills.  Cocurricular activities are not offered that produce 
 44.26  outcomes required by the state or the district must be made 
 44.27  available for school credit, cannot be counted toward graduation 
 44.28  for those students who produce the outcomes, and have one or 
 44.29  more of the following characteristics: 
 44.30     (a) They are conducted at regular and uniform times during 
 44.31  school hours, or at times established by school authorities; 
 44.32     (b) Although not offered for credit, They are directed or 
 44.33  supervised by instructional staff in a learning environment 
 44.34  similar to that found in courses offered for credit; or 
 44.35     (c) They are partially funded by public moneys for general 
 44.36  instructional purposes under direction and control of the board. 
 45.1      Sec. 4.  Minnesota Statutes 1994, section 123.38, 
 45.2   subdivision 2b, is amended to read: 
 45.3      Subd. 2b.  (a) The board may take charge of and control all 
 45.4   extracurricular activities of the teachers and children of the 
 45.5   public schools in the district.  Extracurricular activities 
 45.6   shall mean all direct and personal services for public school 
 45.7   pupils for their enjoyment that are managed and operated under 
 45.8   the guidance of an adult or staff member.  
 45.9      (b) Extracurricular activities have all of the following 
 45.10  characteristics: 
 45.11     (1) they are not offered for school credit nor required for 
 45.12  graduation; 
 45.13     (2) they are generally conducted outside school hours, or 
 45.14  if partly during school hours, at times agreed by the 
 45.15  participants, and approved by school authorities; and 
 45.16     (3) (2) the content of the activities is determined 
 45.17  primarily by the pupil participants under the guidance of a 
 45.18  staff member or other adult. 
 45.19     (c) If the board does not take charge of and control 
 45.20  extracurricular activities, these activities shall be 
 45.21  self-sustaining with all expenses, except direct salary costs 
 45.22  and indirect costs of the use of school facilities, met by dues, 
 45.23  admissions, or other student fundraising events.  The general 
 45.24  fund or the technical colleges fund, if applicable, shall 
 45.25  reflect only those salaries directly related to and readily 
 45.26  identified with the activity and paid by public funds.  Other 
 45.27  revenues and expenditures for extra curricular activities must 
 45.28  be recorded according to the "Manual of Instruction for Uniform 
 45.29  Student Activities Accounting for Minnesota School Districts and 
 45.30  Area Vocational-Technical Colleges."  Extracurricular activities 
 45.31  not under board control must have an annual financial audit and 
 45.32  must also be audited annually for compliance with this section. 
 45.33     (d) If the board takes charge of and controls 
 45.34  extracurricular activities, any or all costs of these activities 
 45.35  may be provided from school revenues and all revenues and 
 45.36  expenditures for these activities shall be recorded in the same 
 46.1   manner as other revenues and expenditures of the district.  
 46.2      (e) If the board takes charge of and controls 
 46.3   extracurricular activities, no such activity shall be 
 46.4   participated in by the teachers or pupils in the district, nor 
 46.5   shall the school name or any allied name be used in connection 
 46.6   therewith, except by consent and direction of the board. 
 46.7      Sec. 5.  [123.356] [OPEN FACILITIES.] 
 46.8      (a) Teachers employed by the district or otherwise, and 
 46.9   other education providers, may offer advanced enrichment or 
 46.10  remedial courses for credit or otherwise on a fee basis on 
 46.11  school district premises when the premises are not otherwise 
 46.12  required for school district purposes including during the 
 46.13  summer, before or after school, and on weekends and holidays.  
 46.14  Arrangements under this section may be made under Minnesota 
 46.15  Statutes, section 123.36, subdivision 5 or 10, or other law. 
 46.16     (b) A district or other education provider that charges a 
 46.17  fee to a student under this section must provide scholarships 
 46.18  and other financial support on a sliding fee scale based on 
 46.19  household income for those students who cannot afford the full 
 46.20  fee. 
 46.21     (c) A school district cannot unreasonably restrict access 
 46.22  to facilities by other education providers and community 
 46.23  nonprofit organizations. 
 46.24     Sec. 6.  [PILOTS.] 
 46.25     (a) A school district that has a pilot site under Minnesota 
 46.26  Statutes, section 121.585, may receive state board designation 
 46.27  as a pilot site for accelerated graduation options under this 
 46.28  article. 
 46.29     (b) A school that is not a learning year site cannot limit 
 46.30  access to its facilities by other education providers. 
 46.31     (c) Students from surrounding districts who live within an 
 46.32  hour's commute of a learning year site may apply to take courses 
 46.33  at learning year sites for credit and may receive transportation 
 46.34  assistance by any reasonable means including partial 
 46.35  transportation grants.  The district may include the incremented 
 46.36  cost of the transportation assistance if any, in its nonregular 
 47.1   transportation costs. 
 47.2      (d) The revenue computation and reporting under Minnesota 
 47.3   Statutes, section 121.585, must be used to finance accelerated 
 47.4   graduation by any district including learning site districts. 
 47.5      Sec. 7.  [123.357] [INDEPENDENT CERTIFICATION OF LEARNING.] 
 47.6      The commissioner shall establish procedures for nonprofit 
 47.7   educational providers or assessment organizations to certify 
 47.8   competencies or credits for learning.  Competencies and credits 
 47.9   certified through this process must be accepted by a student's 
 47.10  school district, charter school, or eligible voucher school.  
 47.11  School districts, charter schools, and eligible voucher schools 
 47.12  may appeal to the commissioner if they are not in agreement with 
 47.13  certification from a particular provider or assessment 
 47.14  organization for a particular student. 
 47.15                             ARTICLE 6 
 47.16            EDUCATION AND EMPLOYMENT TRANSITIONS ACCOUNT 
 47.17     Section 1.  Minnesota Statutes 1994, section 124.17, is 
 47.18  amended by adding a subdivision to read: 
 47.19     Subd. 2g.  [IETP PUPILS.] The average daily membership for 
 47.20  a pupil with an IETP plan participating in the education and 
 47.21  employment transitions program equals the lesser of (a) 1.00, or 
 47.22  (b) the greater of 
 47.23     (1) .12, or 
 47.24     (2) the ratio of (i) the sum of the number of hours the 
 47.25  pupil is enrolled in the secondary school during the school year 
 47.26  to (ii) the total number of hours in the secondary school during 
 47.27  the school year. 
 47.28     Sec. 2.  [126B.15] [EDUCATION AND EMPLOYMENT TRANSITIONS 
 47.29  ACCOUNT PROGRAM.] 
 47.30     Subdivision 1.  [GENERAL DESCRIPTION.] A student-based 
 47.31  system of funding is established to support the participation of 
 47.32  secondary students in work-based learning programs that continue 
 47.33  beyond high school and lead to on-going employment in technical 
 47.34  jobs in Minnesota industries. 
 47.35     Subd. 2.  [PURPOSE.] The purpose of the program is to 
 47.36  integrate academic and technical learning and to meet the needs 
 48.1   of Minnesota employers for a quality labor force. 
 48.2      Subd. 3.  [GOALS.] The goals of the program are to give 
 48.3   young people the power and responsibility to select the best 
 48.4   sources of work and learning to lead to a fulfilling career, and 
 48.5   to motivate high school students to start career training by 
 48.6   providing seamless public-private funding for a single education 
 48.7   training plan extending beyond high school. 
 48.8      Subd. 4.  [STUDENT ELIGIBILITY.] A student who is 
 48.9   participating in an education and employment transitions 
 48.10  program, under this chapter, including a program of part-time or 
 48.11  full-time work-based learning or youth apprenticeship is 
 48.12  eligible to have a program account which can be drawn on on the 
 48.13  student's behalf, to help pay for the program.  The student must:
 48.14     (1) be a member of a household whose income is not more 
 48.15  than 185 percent of the federal poverty level; 
 48.16     (2) be at least 16 years of age; 
 48.17     (3) have met learning benchmarks toward achieving Minnesota 
 48.18  graduation standards as specified by the commissioner; 
 48.19     (4) have an approved individual education/training plan 
 48.20  (IETP) that includes integration or coordination of work-based 
 48.21  learning with the pursuit of competence necessary to meet 
 48.22  graduation standards; and 
 48.23     (5) have received a commitment of matching funds or in-kind 
 48.24  services from an employer, public, or private training program, 
 48.25  post-secondary institution, scholarship, financial aid, student 
 48.26  earnings, or family support. 
 48.27     Subd. 5.  [PROGRAM ELIGIBILITY.] Participating education 
 48.28  and employment transition programs must be approved jointly by 
 48.29  the commissioners of children, families, and learning and of 
 48.30  labor and industry. 
 48.31     Sec. 3.  [126B.16] [IETP ACCOUNT.] 
 48.32     Subdivision 1.  [FOR EACH STUDENT.] Each eligible student 
 48.33  in the program with an approved IETP shall have an IETP account. 
 48.34     Subd. 2.  [STATE CONTRIBUTION.] The state contribution into 
 48.35  each eligible student's IETP account is the amount of general 
 48.36  education revenue, referendum revenue, and district cooperation 
 49.1   revenue attributable to the student if the student had stayed in 
 49.2   the regular secondary school program for grades 11 and 12. 
 49.3      Subd. 3.  [VARIABLE LEVEL OF RESOURCES.] The total level of 
 49.4   resources in a student's account may vary each year, depending 
 49.5   on the program requirements specified in the student's 
 49.6   individual education/training plan (IETP) and the level of 
 49.7   private matching specified in the student's plan. 
 49.8      Subd. 4.  [STATE-MATCH MIX.] The student's IETP must 
 49.9   specify how the state resources and matching resources mix, 
 49.10  subject to the commissioner's approval, over the period of the 
 49.11  plan to fund the program needs of the learner. 
 49.12     Subd. 5.  [STATE AID.] The state aid paid to the student's 
 49.13  school district on the student's behalf must be computed using 
 49.14  the average daily membership in section 3. 
 49.15     Sec. 4.  [126B.17] [IETP ACCOUNTS.] 
 49.16     Subdivision 1.  [WHO MAY DRAW ON.] A student's IETP account 
 49.17  may be drawn on by eligible public schools and colleges, 
 49.18  nonpublic schools, job training organizations, employers, labor 
 49.19  organizations, or private post-secondary institutions at the 
 49.20  direction of the student. 
 49.21     Subd. 2.  [ISSUANCE AND REVENUES.] The account must be 
 49.22  authorized by the student's school district of residence using 
 49.23  forms and schedules determined by the commissioner.  The 
 49.24  district may add to the account with other nonstate sources. 
 49.25     Sec. 5.  [126B.18] [DISPOSITION OF STATE MONEY.] 
 49.26     The amount needed to fund payments to the school district 
 49.27  over the three to four years of the plan would be set aside for 
 49.28  payments to the district, and paid out each year as earned.  The 
 49.29  remaining state funds in each student's account, together with 
 49.30  private matching funds, would be available to fund other 
 49.31  components of the program. 
 49.32     Sec. 6.  [126B.19] [DURATION.] 
 49.33     If the eligible student makes progress satisfactory to the 
 49.34  student's chosen program and plan, the IETP account can be 
 49.35  renewed for up to two years beyond high school, for a total of 
 49.36  no more than four years.  The duration of the program and the 
 50.1   funding provisions must be specified in the IETP.  The duration 
 50.2   must be as is appropriate and necessary for entry into the 
 50.3   selected occupation.  The duration may be extended beyond four 
 50.4   years, under special circumstances, if approved by the 
 50.5   commissioner. 
 50.6                              ARTICLE 7 
 50.7              POST-SECONDARY ENROLLMENT OPTIONS PROGRAM
 50.8      Section 1.  Minnesota Statutes 1995 Supplement, section 
 50.9   123.3514, subdivision 6, is amended to read: 
 50.10     Subd. 6.  [FINANCIAL ARRANGEMENTS.] For a pupil enrolled in 
 50.11  a course under this section, the department of children, 
 50.12  families, and learning shall make payments according to this 
 50.13  subdivision for courses that were taken for secondary credit.  
 50.14     The department shall not make payments to a school district 
 50.15  or post-secondary institution for a course taken for 
 50.16  post-secondary credit only.  The department shall not make 
 50.17  payments to a post-secondary institution for a course from which 
 50.18  a student officially withdraws during the first 14 days of the 
 50.19  quarter or semester. 
 50.20     A post-secondary institution shall receive the following: 
 50.21     (1) for an institution granting quarter credit, the 
 50.22  reimbursement per credit hour shall be an amount equal to 88 
 50.23  percent of the product of the formula allowance, multiplied by 
 50.24  1.3, and divided by 45; or 
 50.25     (2) for an institution granting semester credit, the 
 50.26  reimbursement per credit hour shall be an amount equal to 88 
 50.27  percent of the product of the general revenue formula allowance, 
 50.28  multiplied by 1.3, and divided by 30. 
 50.29     The department of children, families, and learning shall 
 50.30  pay to each post-secondary institution 100 percent of the amount 
 50.31  in clause (1) or (2) within 30 days of receiving initial 
 50.32  enrollment information each quarter or semester.  If changes in 
 50.33  enrollment occur during a quarter or semester, the change shall 
 50.34  be reported by the post-secondary institution at the time the 
 50.35  enrollment information for the succeeding quarter or semester is 
 50.36  submitted.  At any time the department of children, families, 
 51.1   and learning notifies a post-secondary institution that an 
 51.2   overpayment has been made, the institution shall promptly remit 
 51.3   the amount due. At the end of each school year, the department 
 51.4   of education shall pay the tuition reimbursement amount within 
 51.5   30 days to the post-secondary institutions that enroll pupils 
 51.6   under this section.  The amount of tuition reimbursement shall 
 51.7   equal the lesser of: 
 51.8      (1) the actual costs of tuition, textbooks, materials, and 
 51.9   fees directly related to the course or program charged for the 
 51.10  secondary pupil enrolling in a course or program under this 
 51.11  section; or 
 51.12     (2) an amount equal to the difference between the formula 
 51.13  allowance plus the total tier revenue attributable to that pupil 
 51.14  and an amount computed by multiplying the formula allowance plus 
 51.15  the total tier revenue attributable to that pupil by a ratio.  
 51.16  The ratio to be used is the total number of hours that the pupil 
 51.17  is enrolled in courses in the secondary school during the 
 51.18  regular school year over the total number of secondary 
 51.19  instructional hours per pupil in that pupil's resident district. 
 51.20     The amount paid for each pupil shall be subtracted from the 
 51.21  foundation aid paid to the pupil's resident district.  If the 
 51.22  amount to be subtracted is greater than the amount of foundation 
 51.23  aid due the district, the excess reduction shall be made from 
 51.24  other state aids due to the district.  
 51.25                                "B"
 51.26                CHOICE FOR SCHOOLS AND SCHOOL BOARDS
 51.27                             ARTICLE 8
 51.28                     CHARTER SCHOOL CONVERSION 
 51.29     Section 1.  Minnesota Statutes 1995 Supplement, section 
 51.30  120.064, subdivision 4a, is amended to read: 
 51.31     Subd. 4a.  [CONVERSION OF EXISTING SCHOOLS.] (a) A school 
 51.32  board may, on its own motion, convert one or more, or all, of 
 51.33  its existing schools to charter schools. 
 51.34     (b) A school board may convert one or more of its existing 
 51.35  schools to charter schools under this section if 90 percent of 
 51.36  the full-time teachers at the school sign a petition seeking 
 52.1   conversion.  The conversion must occur at the beginning of an 
 52.2   academic year. 
 52.3                              ARTICLE 9
 52.4                       SCHOOL BOARD CONTRACTING
 52.5      Section 1.  Minnesota Statutes 1994, section 123.35, is 
 52.6   amended by adding a subdivision to read: 
 52.7      Subd. 1a.  [CONTRACTS FOR SERVICES.] Notwithstanding any 
 52.8   law to the contrary, a school board may contract with a public 
 52.9   or private entity to provide instructional and noninstructional 
 52.10  services.  The board may reduce its administration accordingly.  
 52.11  The board shall not enter into an agreement restricting the 
 52.12  powers provided in this subdivision.  
 52.13     Sec. 2.  Minnesota Statutes 1994, section 123.35, is 
 52.14  amended by adding a subdivision to read: 
 52.15     Subd. 1b.  [REORGANIZATION AS A NONPROFIT ENTITY.] A school 
 52.16  board may reorganize its school district administration under 
 52.17  chapter 317A.  The board and the reorganized administration 
 52.18  shall contract for the administration to provide instructional 
 52.19  and noninstructional services.  The board shall not enter any 
 52.20  agreement restricting the powers provided in this subdivision. 
 52.21     Sec. 3.  Minnesota Statutes 1994, section 123.35, is 
 52.22  amended by adding a subdivision to read:  
 52.23     Subd. 1c.  [LOW PERFORMING SCHOOLS.] (a) A school board of 
 52.24  a school district with more than 4,500 pupils enrolled in 
 52.25  district schools shall annually solicit proposals from public 
 52.26  and private entities to assume operation of the lowest 
 52.27  performing elementary school operated by the district.  The 
 52.28  school district is not eligible to submit a proposal.  A 
 52.29  district shall measure performance of an elementary school using 
 52.30  the procedure the district uses to measure performance in its 
 52.31  annual PER report. 
 52.32     (b) A school board's contract with a public or private 
 52.33  entity to operate a low performing elementary school shall have 
 52.34  a term of three years.  
 52.35                             ARTICLE 10
 52.36                          SITE MANAGEMENT
 53.1      Section 1.  Minnesota Statutes 1994, section 123.33, 
 53.2   subdivision 1, is amended to read: 
 53.3      Subdivision 1.  The general care, management, and control 
 53.4   of independent districts shall be vested in a board of 
 53.5   directors, to be known as the school board.  The term of office 
 53.6   of a member shall be four years and until a successor 
 53.7   qualifies.  The membership of the school board shall consist of 
 53.8   six elected directors together with such ex officio member as 
 53.9   may be provided by law.  But the board may submit to the 
 53.10  electors at any school election the question whether the board 
 53.11  shall consist of seven members and if a majority of those voting 
 53.12  on the proposition favor a seven-member board, a seventh member 
 53.13  shall be elected at the next election of directors for a 
 53.14  four-year term and thereafter the board shall consist of seven 
 53.15  members. 
 53.16     Those districts with a seven-member board may submit to the 
 53.17  electors at any school election at least 150 days before the 
 53.18  next election of three members of the board the question whether 
 53.19  the board shall consist of six members.  If a majority of those 
 53.20  voting on the proposition favor a six-member board instead of a 
 53.21  seven-member board, two members instead of three members shall 
 53.22  be elected at the next election of the board of directors and 
 53.23  thereafter the board shall consist of six members. 
 53.24     Sec. 2.  Minnesota Statutes 1994, section 123.33, is 
 53.25  amended by adding a subdivision to read: 
 53.26     Subd. 1a.  [REVENUE AND COST ALLOCATION.] (a) Revenue for a 
 53.27  fiscal year received or receivable by the district shall be 
 53.28  allocated to education sites defined in section 123.951 
 53.29  according to this subdivision.  Revenue shall remain allocated 
 53.30  to each site until used by the site.  The district remains 
 53.31  responsible for legally entering into contracts and expending 
 53.32  funds and shall receive and disburse revenue and make purchases 
 53.33  on behalf of the sites.  Each site must be charged the actual 
 53.34  costs of goods and services, including teachers' salaries, 
 53.35  incurred at the site. 
 53.36     (b) Except as provided in paragraph (c), not less than 95 
 54.1   percent of revenue attributable to the general fund excluding 
 54.2   total operating capital revenue and not less than 25 percent of 
 54.3   total operating capital revenue shall be allocated to education 
 54.4   sites in the district.  The allocation shall be based on the 
 54.5   number of pupil units served at the site as a portion of total 
 54.6   pupil units served in the district. 
 54.7      (c) 100 percent of compensatory education revenue shall be 
 54.8   allocated to the education sites at which qualifying students 
 54.9   were enrolled as determined under section 124.175.  Revenue 
 54.10  received under sections 124.32 and 124.321 shall be allocated to 
 54.11  the sites where the costs are incurred. 
 54.12     (d) The district must charge each participating site the 
 54.13  cost of teachers at the site, and actual costs of goods and 
 54.14  services attributable to the general fund or a proportionate 
 54.15  share of costs attributable to the facilities and equipment 
 54.16  accounts in the capital fund incurred at the site. 
 54.17     Sec. 3.  Minnesota Statutes 1994, section 123.951, is 
 54.18  amended to read: 
 54.19     123.951 [SCHOOL EDUCATION SITE DECISION-MAKING AGREEMENT.] 
 54.20     (a) A school board may shall enter into an agreement 
 54.21  arrangement with a school education site decision-making team 
 54.22  teams concerning the specific governance, management, or and 
 54.23  control of any school each education site in the district.  Upon 
 54.24  a written request from a proposed school site decision-making 
 54.25  team, an initial school site decision-making team shall be 
 54.26  appointed by the school board and may include the school 
 54.27  principal, representatives of teachers in the school, 
 54.28  representatives of other employees in the school, 
 54.29  representatives of parents of pupils in the school, 
 54.30  representatives of pupils in the school, representatives of 
 54.31  other members in the community, or others determined appropriate 
 54.32  by the board.  For the purposes of this section and section 
 54.33  124.175, an education site is defined as a separate facility or 
 54.34  program within a facility having a separate management 
 54.35  organization.  Based on the recommendations of the education 
 54.36  site principal or other person having control and supervision at 
 55.1   the site, the school board shall appoint members to the site 
 55.2   decision-making team.  The school education site decision-making 
 55.3   team shall include the school principal or other person 
 55.4   having general control and supervision of the school education 
 55.5   site. 
 55.6      (b) School Education site decision-making agreements must 
 55.7   may delegate powers and duties to site teams and involve staff 
 55.8   members, students as appropriate, and parents in decision making.
 55.9      (c) An agreement arrangement may, at the option of the 
 55.10  education site, include: 
 55.11     (1) a mechanism to implement flexible support systems for 
 55.12  improvement in student achievement of education outcomes and for 
 55.13  the implementation of the graduation rule; 
 55.14     (2) a decision-making structure that allows teachers to 
 55.15  identify instructional problems and control and apply the 
 55.16  resources needed to solve them; 
 55.17     (3) a mechanism to allow principals, or other persons 
 55.18  having general control and supervision of the school, to make 
 55.19  decisions regarding how financial and personnel resources are 
 55.20  best allocated at the site and from whom goods or services are 
 55.21  purchased; 
 55.22     (4) a mechanism to implement parental involvement programs 
 55.23  under section 126.69 and to provide for effective parental 
 55.24  communication and feedback on this involvement at the site 
 55.25  level; 
 55.26     (5) a provision that would allow the team to determine who 
 55.27  is hired into licensed and nonlicensed positions; 
 55.28     (6) a provision that would allow teachers to choose the 
 55.29  principal lead teacher or other person having general control at 
 55.30  the site; 
 55.31     (7) direct contact with other social service providers; 
 55.32     (8) in-service training for site decision-making team 
 55.33  members for financial management of school sites; and 
 55.34     (9) any other powers and duties determined appropriate by 
 55.35  the board each education site at a discussion conducted at the 
 55.36  site by the principal or other site leader. 
 56.1      The school board of the district remains the legal employer 
 56.2   under clauses (5) and (6). 
 56.3      (d) Any powers or duties not delegated to the school 
 56.4   education site management team in the school site management 
 56.5   agreement arrangement shall remain with the school board. 
 56.6      (e) Approved agreements Descriptions of the arrangement 
 56.7   shall be filed with the commissioner.  If a school board denies 
 56.8   a request to enter into a school site management agreement, it 
 56.9   shall provide a copy of the request and the reasons for its 
 56.10  denial to the commissioner. 
 56.11     Sec. 4.  Minnesota Statutes 1995 Supplement, section 
 56.12  124.175, is amended to read: 
 56.13     124.175 [AFDC PUPIL COUNT.] 
 56.14     Each year by March January 1, the department of human 
 56.15  services shall certify to the department of children, families, 
 56.16  and learning, for each education site in each school district, 
 56.17  the number of pupils from families receiving aid to families 
 56.18  with dependent children who were enrolled in a public school on 
 56.19  October 1 of the preceding year.  The department of children, 
 56.20  families, and learning shall certify to each school district the 
 56.21  number of pupils from families receiving aid to dependent 
 56.22  children at each site in the district by January 15 of each year.
 56.23     Sec. 5.  Minnesota Statutes 1995 Supplement, section 
 56.24  124C.74, is amended by adding a subdivision to read: 
 56.25     Subd. 5.  [ADDITIONAL ELIGIBLE SCHOOLS.] For purposes of 
 56.26  this section, school district includes a school operating under 
 56.27  section 123.951, and a school operating under the accelerated 
 56.28  graduation option program described in article 5. 
 56.29     Sec. 6.  [EFFECTIVE DATE.] 
 56.30     Section 4 is effective July 1, 1997.  Sections 1 to 3 are 
 56.31  effective for the 1997-1998 school year and thereafter for 
 56.32  education sites that have participated in training sessions 
 56.33  organized and conducted by a nonstate organization receiving 
 56.34  funds under Laws 1995, First Special Session chapter 3, article 
 56.35  7, section 5, subdivision 3.  Sections 1 to 3 are effective 
 56.36  beginning July 1, 1999, for other sites that elect to use the 
 57.1   authority provided in Minnesota Statutes, section 123.951, 
 57.2   paragraph (c), and for the 1999-2000 school year and thereafter 
 57.3   for all remaining education sites in the same or other districts.
 57.4                              ARTICLE 11
 57.5                             DIVESTITURE
 57.6      Section 1.  [123.3515] [DIVESTITURE; OPTIONAL.] 
 57.7      A school board may transfer the operation of any or all of 
 57.8   its school district learning programs to one or more of the 
 57.9   following: 
 57.10     (1) a charter school under Minnesota Statutes, section 
 57.11  120.064; 
 57.12     (2) an education site under Minnesota Statutes, section 
 57.13  123.951; or 
 57.14     (3) a private or public entity that contracts with the 
 57.15  board to provide learning services.  
 57.16                                "C" 
 57.17          PROVIDING INFORMATION AND MONITORING PERFORMANCE
 57.18                             ARTICLE 12
 57.19               STATEWIDE EDUCATION INFORMATION SYSTEM
 57.20     Section 1.  [121.97] [STATEWIDE EDUCATION INFORMATION 
 57.21  SYSTEM.] 
 57.22     (a) The commissioner of children, families, and learning 
 57.23  shall establish and maintain a statewide education information 
 57.24  system.  Information on all aspects of kindergarten through 
 57.25  grade 12 education in the state shall be gathered, processed, 
 57.26  and distributed to students and school districts.  This 
 57.27  information shall include, but not be limited to: 
 57.28     (1) the formation and operation of charter schools, 
 57.29  eligible voucher schools, and education sites; 
 57.30     (2) the enrollment patterns of students for charter 
 57.31  schools, eligible voucher schools, and education sites; 
 57.32     (3) the performance of students at charter schools, 
 57.33  eligible voucher schools, and education sites; 
 57.34     (4) participation requirements and patterns in the 
 57.35  post-secondary enrollment options program for students and 
 57.36  public and private colleges and universities; and 
 58.1      (5) research results and recommendations from Minnesota 
 58.2   Assessment of Education Progress, Inc. 
 58.3      (b) School districts, charter schools, eligible voucher 
 58.4   schools, and post-secondary schools shall cooperate with the 
 58.5   commissioner to implement and maintain the statewide education 
 58.6   information system. 
 58.7      Sec. 2.  [APPROPRIATION.] 
 58.8      $....... is appropriated from the general fund in fiscal 
 58.9   year 1997 to the department of children, families, and learning 
 58.10  for the purposes of section 1. 
 58.11                             ARTICLE 13
 58.12                      RESEARCH AND EVALUATION
 58.13     Section 1.  [121.98] [MINNESOTA ASSESSMENT OF EDUCATIONAL 
 58.14  PROGRESS, INC.] 
 58.15     Subdivision 1.  [ESTABLISHMENT; PURPOSE.] Minnesota 
 58.16  Assessment of Educational Progress, Inc. is established and 
 58.17  shall be organized and operated as a nonprofit corporation.  
 58.18  Except as otherwise provided in this section, the corporation is 
 58.19  governed by chapter 317A.  The purpose of the corporation is to 
 58.20  assess the performance of Minnesota schools, educational 
 58.21  programs and services, and students for kindergarten through 
 58.22  grade 12. 
 58.23     Subd. 2.  [DUTIES; COOPERATION.] (a) The corporation shall: 
 58.24     (1) assess the performance of kindergarten through grade 12 
 58.25  students by: 
 58.26     (i) evaluating data on students obtained from the 
 58.27  department of children, families, and learning and school 
 58.28  districts; 
 58.29     (ii) independent annual testing of students using random 
 58.30  sample survey techniques; and 
 58.31     (iii) comparing the performance data of Minnesota students 
 58.32  with students in other states and countries; 
 58.33     (2) assess the operation and learning programs of charter 
 58.34  schools, eligible voucher schools, and education sites; and 
 58.35     (3) assess educational programs and services including, but 
 58.36  not limited to, the post-secondary enrollment options program. 
 59.1      (b) The corporation shall report its assessment findings in 
 59.2   an annual report made available to the public. 
 59.3      Subd. 3.  [BOARD.] The governor shall appoint a board of 
 59.4   three persons with experience in education and assessment to 
 59.5   incorporate and perform the duties of the corporation. 
 59.6      Sec. 2.  [APPROPRIATION.] 
 59.7      $....... is appropriated in fiscal year 1997 to the board 
 59.8   of Minnesota Assessment of Educational Progress, Inc. for the 
 59.9   purposes of section 1.