HF 2

as introduced - 87th Legislature (2011 - 2012) Posted on 01/10/2011 10:12am

A bill for an act
relating to the state budget; creating priority-based budget process; establishing
a sunset process for state agencies; appropriating money; amending Minnesota
Statutes 2010, sections 3.885, by adding a subdivision; 3.97, by adding a
subdivision; 3.971, by adding a subdivision; 16A.11, subdivisions 2, 3; proposing
coding for new law in Minnesota Statutes, chapter 3.

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

ARTICLE 1

PRIORITY-BASED BUDGETING

Section 1.

Minnesota Statutes 2010, section 3.885, is amended by adding a subdivision
to read:

new text begin Subd. 11. new text end

new text begin Priority budgeting. new text end

new text begin (a) The commission shall set budget priorities that
must be used for submitting, considering, and enacting a priority-based biennial budget
beginning with the budget for fiscal years 2014 and 2015. The priority-based budget
process must align the state's available revenues to the core state functions and budget
priorities as identified by the commission and enacted in law.
new text end

new text begin (b) A state agency must submit information to the commission that it determines
necessary, according to the timeline established by the commission. At a minimum, each
agency must submit a mission statement, measurable goals, and must identify which
core state functions the agency and its programs and purposes support. Each agency
must include information on specific measures of results related to the mission and core
functions. Information submitted to the commission must include, but is not limited to, the
performance data required under section 16A.10.
new text end

new text begin (c) The commission must evaluate information submitted by state agencies and
develop the budget priorities for the next biennium. A bill establishing budget priorities
for the next biennium must be acted on by the legislature in each even-numbered year.
The governor must submit a biennial budget under section 16A.11, subdivisions 1 to 3,
based on available revenues and the budget priorities enacted under this section.
new text end

Sec. 2.

Minnesota Statutes 2010, section 16A.11, subdivision 2, is amended to read:

Subd. 2.

Part one: message.

Part one of the budget, the governor's message,
shall include the governor's recommendations on the financial policy of the state for the
coming biennium, describing the important features of the budget plan, embracing a
general budget summary setting forth the aggregate figures of the budget so as to show
the balanced relation between the total proposed expenditures and the total anticipated
income, with the basis and factors on which the estimates are made, the amount to be
borrowed, and other means of financing the budget for the coming biennium, compared
with the corresponding figures for at least the last two completed fiscal years and the
current year. The budget plan shall be supported by explanatory schedules or statements,
classifying its expenditures by agencies and funds, and the income by agencies, sources,
funds, and the proposed amount of new borrowing, as well as proposed new tax or revenue
sources. The budget plan shall be submitted for all special and dedicated funds, as well as
the general fund, and shall include the estimated amounts of federal aids, for whatever
purpose provided, together with estimated expenditures from them. new text begin For fiscal years 2014
and 2015 and later, the budget plan must be based on and incorporate the budget priorities
enacted under section 3.885, subdivision 11.
new text end

Sec. 3.

Minnesota Statutes 2010, section 16A.11, subdivision 3, is amended to read:

Subd. 3.

Part two: detailed budget.

(a) Part two of the budget, the detailed budget
estimates both of expenditures and revenues, must contain any statements on the financial
plan which the governor believes desirable or which may be required by the legislature.
The detailed estimates shall include the governor's budget arranged in tabular form. new text begin For
fiscal years 2014 and 2015 and later, the detailed budget estimates must incorporate the
budget priorities enacted under section 3.885, subdivision 11.
new text end

(b) Tables listing expenditures for the next biennium must show the appropriation
base for each year. The appropriation base is the amount appropriated for the second year
of the current biennium. The tables must separately show any adjustments to the base
required by current law or policies of the commissioner of management and budget. For
forecasted programs, the tables must also show the amount of the forecast adjustments,
based on the most recent forecast prepared by the commissioner of management and
budget under section 16A.103. For all programs, the tables must show the amount of
appropriation changes recommended by the governor, after adjustments to the base and
forecast adjustments, and the total recommendation of the governor for that year.

(c) The detailed estimates must include a separate line listing the total cost of
professional and technical service contracts for the prior biennium and the projected costs
of those contracts for the current and upcoming biennium. They must also include a
summary of the personnel employed by the agency, reflected as full-time equivalent
positions.

(d) The detailed estimates for internal service funds must include the number of
full-time equivalents by program; detail on any loans from the general fund, including
dollar amounts by program; proposed investments in technology or equipment of $100,000
or more; an explanation of any operating losses or increases in retained earnings; and a
history of the rates that have been charged, with an explanation of any rate changes and
the impact of the rate changes on affected agencies.

ARTICLE 2

SUNSET OF STATE AGENCIES

Section 1.

Minnesota Statutes 2010, section 3.97, is amended by adding a subdivision
to read:

new text begin Subd. 3c. new text end

new text begin Sunset of state agencies. new text end

new text begin (a) The commission shall review legislative
auditor reports on the sunset of state agencies prepared according to the schedule in
section 3.993. The commission must report to the legislature at each regular legislative
session with recommendations on whether a public need exists for continuation of a state
agency, its advisory committees, policy boards, or agency functions according to the
evaluation criteria under section 3.981, subdivision 3. Prior to making recommendations
to the legislature on the sunset of a state agency, advisory committee, policy board, or
agency function, the commission shall hold public hearings on the relevant sunset review
report after receiving the report from the legislative auditor. For each state agency subject
to sunset review, the commission's report to the legislature must include recommendations
to abolish, continue, or reorganize the state agency, advisory committee, policy board,
or agency function.
new text end

new text begin (b) The commission shall have drafts of legislation prepared to carry out the
commission's recommendations under this section. The legislation must be introduced in
the same legislative session in which the sunset report was received from the legislative
auditor.
new text end

new text begin (c) The commission may direct the legislative auditor to review, according to the
process and criteria in this section and section 3.981, any agency, board, commission, or
program not listed in section 3.993. The commission must make recommendations to
and prepare legislation for the legislature to abolish, continue, or reorganize other state
agencies, advisory committees, policy boards, or agency functions after a sunset review.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 2.

Minnesota Statutes 2010, section 3.971, is amended by adding a subdivision to
read:

new text begin Subd. 8. new text end

new text begin Agency sunset reviews. new text end

new text begin The legislative auditor shall conduct reviews of
state agencies, advisory committees, policy boards, and agency functions according to the
schedule in section 3.993 to determine whether a public need exists for the continuation of
the state agency, advisory committee, policy board, or agency function.
new text end

Sec. 3.

new text begin [3.981] SUNSET REVIEW OF STATE AGENCIES.
new text end

new text begin Subdivision 1. new text end

new text begin State agency sunset information. new text end

new text begin Before September 1 of the
odd-numbered year before the year in which a state agency is subject to sunset review
under this section, the agency head shall report to the auditor:
new text end

new text begin (1) information on how the criteria in subdivision 3 apply to the agency;
new text end

new text begin (2) a priority-based budget for the agency according to the priorities developed
under article 1;
new text end

new text begin (3) an inventory of all boards, commissions, committees, and other entities related
to the agency; and
new text end

new text begin (4) any other information that the agency head considers appropriate or that is
requested by the legislative auditor.
new text end

new text begin Subd. 2. new text end

new text begin Sunset review. new text end

new text begin (a) Before January 1 of the year in which a state agency,
advisory committee, policy board, or agency functions are subject to sunset review, the
legislative auditor shall:
new text end

new text begin (1) review and take action necessary to verify the reports submitted by the agency;
and
new text end

new text begin (2) conduct a review of the agency based on the criteria provided in subdivision 3
and prepare a written report with recommendations.
new text end

new text begin (b) In its report on a state agency, the legislative auditor shall:
new text end

new text begin (1) make recommendations on the abolition, continuation, or reorganization of each
affected state agency and its advisory committees and on the need for the performance of
the functions of the agency and its advisory committees;
new text end

new text begin (2) make recommendations on the consolidation, transfer, or reorganization of
programs within state agencies not under review when the programs duplicate functions
performed in agencies under review; and
new text end

new text begin (3) make recommendations to improve the operations of the agency, its policy body,
and its advisory committees, including management recommendations that do not require
a change in the agency's enabling statute.
new text end

new text begin (c) The legislative auditor shall include the estimated fiscal impact of its
recommendations and may recommend appropriation levels for certain programs to
improve the operations of the state agency.
new text end

new text begin Subd. 3. new text end

new text begin Criteria for review. new text end

new text begin The legislative auditor shall consider the following
criteria in determining whether a public need exists for the continuation of a state agency,
its advisory committees, or for the performance of the functions of the agency or its
advisory committees:
new text end

new text begin (1) the efficiency and effectiveness of the agency or the advisory committee
operations;
new text end

new text begin (2) the extent to which the agency has identified and achieved its mission, goals,
and objectives or the extent to which an identified problem or need that the agency was
intended to address has been addressed;
new text end

new text begin (3) an identification of any activities of the agency in addition to those granted by
statute and of the authority for those activities and the extent to which those activities
are needed;
new text end

new text begin (4) an assessment of authority of the agency relating to fees, inspections,
enforcement, and penalties;
new text end

new text begin (5) an assessment of whether less restrictive or alternative methods of performing
any function that the agency performs could adequately protect or provide service to
the public;
new text end

new text begin (6) the extent to which the jurisdiction of the agency and the programs administered
by the agency overlap or duplicate those of other agencies, the extent of coordination
between agencies, and the extent to which the programs administered by the agency can
be consolidated with the programs of other state agencies;
new text end

new text begin (7) the promptness and effectiveness with which the agency addresses complaints
concerning entities or other persons affected by the agency, including an assessment of the
agency's administrative hearings process;
new text end

new text begin (8) an assessment of the agency's rulemaking process and the extent to which the
agency has encouraged participation by the public in making its rules and decisions and
the extent to which the public participation has resulted in rules that benefit the public;
new text end

new text begin (9) the extent to which the agency has complied with federal and state laws and
applicable rules regarding equality of employment opportunity and the rights and privacy
of individuals, and state law and applicable rules of any state agency regarding purchasing
guidelines and programs for historically underutilized businesses;
new text end

new text begin (10) the extent to which the agency issues and enforces rules relating to potential
conflicts of interest of its employees;
new text end

new text begin (11) the extent to which the agency complies with chapter 13 and follows records
management practices that enable the agency to respond efficiently to requests for public
information; and
new text end

new text begin (12) the effect of federal intervention or loss of federal funds if the state agency, its
advisory committees, policy boards, or agency functions are abolished.
new text end

new text begin Subd. 4. new text end

new text begin Sunset recommendations report. new text end

new text begin (a) In its sunset report on a state
agency, the legislative auditor shall:
new text end

new text begin (1) make recommendations on the abolition, continuation, or reorganization of each
affected state agency and its advisory committees and on the need for the performance of
the functions of the agency and its advisory committees;
new text end

new text begin (2) make recommendations on the consolidation, transfer, or reorganization of
programs within state agencies not under review when the programs duplicate functions
performed in agencies under review; and
new text end

new text begin (3) make recommendations to improve the operations of the agency, its policy body,
and its advisory committees, including management recommendations that do not require
a change in the agency's enabling statute.
new text end

new text begin (b) The commission shall include the estimated fiscal impact of its recommendations
and may recommend appropriation levels for certain programs to improve the operations
of the state agency.
new text end

Sec. 4.

new text begin [3.99] STATE AGENCIES SUBJECT TO SUNSET REVIEW.
new text end

new text begin Subdivision 1. new text end

new text begin Continuation by law. new text end

new text begin During the regular session immediately before
the sunset review of a state agency or an advisory committee according to the schedule
under section 3.993, the legislature may enact legislation to continue the agency or
advisory committee for a period not to exceed 12 years. Notwithstanding the requirements
for sunset review and continuation, the legislature may:
new text end

new text begin (1) terminate a state agency or advisory committee at a date earlier than that
provided by the review schedule in section 3.933; or
new text end

new text begin (2) consider any other legislation relative to a state agency or advisory committee.
new text end

new text begin Subd. 2. new text end

new text begin Procedures after termination. new text end

new text begin (a) Unless otherwise provided by law:
new text end

new text begin (1) a state agency, advisory committee, policy board, or agency function may
continue until September 1 of the year following enactment of its sunset legislation
to conclude its business;
new text end

new text begin (2) the power and authority of the agency or advisory committee is not reduced or
otherwise limited during the year following enactment of its sunset legislation;
new text end

new text begin (3) a state agency, advisory committee, policy board, or agency function is
terminated and shall cease all activities at the expiration of the one-year period following
enactment of its sunset legislation; and
new text end

new text begin (4) all rules that have been adopted by a state agency that are related to the sunset
of the state agency, advisory committee, policy board, or agency function expire at the
end of the one-year period.
new text end

new text begin (b) Except as otherwise provided by law, all money appropriated to or in a dedicated
fund of an abolished state agency, advisory committee, policy board, or agency function
on September 1 of the even-numbered year after abolishment cancels to or is transferred
to the general fund.
new text end

new text begin (c) Sunset legislation must designate an appropriate state agency for the transfer of
the property and records in the custody of an abolished state agency or advisory committee
on September 1 of the even-numbered year after abolishment. If no agency is designated,
the property and records must be transferred to the commissioner of administration.
new text end

new text begin (d) The legislature recognizes the state's continuing obligation to pay bonded
indebtedness and all other obligations, including lease, contract, and other written
obligations, incurred by a state agency abolished under sunset legislation. Nothing in the
sunset legislation may impair or impede the payment of bonded indebtedness and all
other obligations, including lease, contract, and other written obligations, in accordance
with their terms. If an abolished state agency has outstanding bonded indebtedness or
other outstanding obligations, including lease, contract, and other written obligations, the
bonds and all other obligations, including lease, contract, and other written obligations,
remain valid and enforceable in accordance with their terms and subject to all applicable
terms and conditions of the laws and proceedings authorizing the bonds and all other
obligations, including lease, contract, and other written obligations. Sunset legislation
for a state agency, advisory committee, policy board, or agency function must designate
an appropriate state agency to continue all covenants contained in the bonds and in
all other obligations, including lease, contract, and other written obligations, and the
proceedings authorizing them, including the issuance of bonds, and the performance of all
other obligations, including lease, contract, and other written obligations, to complete the
construction of projects or the performance of other obligations, including lease, contract,
and other written obligations. The designated state agency shall provide payment from
the sources of payment of the bonds in accordance with the terms of the bonds and shall
provide payment from the sources of payment of all other obligations, including lease,
contract, and other written obligations, in accordance with their terms, whether from
taxes, revenues, or otherwise, until the bonds and interest on the bonds are paid in full
and all other obligations, including lease, contract, and other written obligations, are
performed and paid in full.
new text end

new text begin Subd. 3. new text end

new text begin Relocation of employees. new text end

new text begin If an employee is displaced because a state
agency or its advisory committee is abolished or reorganized, the state agency shall make
a reasonable effort to relocate the displaced employee.
new text end

new text begin Subd. 4. new text end

new text begin Saving provision. new text end

new text begin Except as otherwise expressly provided in law,
abolition of a state agency does not affect rights and duties that matured, penalties that
were incurred, civil or criminal liabilities that arose, or proceedings that were begun
before the effective date of the abolition.
new text end

new text begin new text end

Sec. 5.

new text begin [3.993] SUNSET REVIEW SCHEDULE.
new text end

new text begin Subdivision 1. new text end

new text begin Group 1. new text end

new text begin The following agencies are subject to sunset review under
section 3.981 before June 30, 2013: Department of Health, Department of Human Rights,
Department of Human Services, all health-related licensing boards listed in section
214.01, Council on Affairs of Chicano/Latino People, Council on Black Minnesotans,
Council on Asian-Pacific Minnesotans, Indian Affairs Council, Council on Disabilities,
and all advisory groups associated with these agencies.
new text end

new text begin Subd. 2. new text end

new text begin Group 2. new text end

new text begin The following agencies are subject to sunset review before June
30, 2015: Department of Education, Board of Teaching, Minnesota Office of Higher
Education, and all advisory groups associated with these agencies.
new text end

new text begin Subd. 3. new text end

new text begin Group 3. new text end

new text begin The following agencies are subject to sunset review before
June 30, 2017: Department of Commerce, Department of Employment and Economic
Development, Department of Labor and Industry, all non-health-related licensing boards
listed in section 214.01 except as otherwise provided in this section, Explore Minnesota
Tourism, Public Utilities Commission, Iron Range Resources and Rehabilitation
Board, Bureau of Mediation Services, Combative Sports Commission, Amateur Sports
Commission, and all advisory groups associated with these agencies.
new text end

new text begin Subd. 4. new text end

new text begin Group 4. new text end

new text begin The following agencies are subject to sunset review before
June 30, 2019: Department of Corrections, Department of Public Safety, Department of
Transportation, Peace Officer Standards and Training Board, Corrections Ombudsman,
and all advisory groups associated with these agencies.
new text end

new text begin Subd. 5. new text end

new text begin Group 5. new text end

new text begin The following agencies are subject to sunset review before June
30, 2021: Department of Agriculture, Department of Natural Resources, Pollution Control
Agency, Board of Animal Health, Board of Water and Soil Resources, and all advisory
groups associated with these agencies.
new text end

new text begin Subd. 6. new text end

new text begin Group 6. new text end

new text begin The following agencies are subject to sunset review before
June 30, 2023: Department of Administration, Department of Management and Budget,
Department of Military Affairs, Department of Revenue, Department of Veterans Affairs,
Arts Board, Minnesota Zoo, Office of Administrative Hearings, Board of Campaign
Finance and Public Disclosure, Capitol Area Architectural and Planning Board, Office
of Enterprise Technology, Minnesota Racing Commission, and all advisory groups
associated with these agencies.
new text end

Sec. 6. new text begin APPROPRIATION.
new text end

new text begin $....... is appropriated from the general fund for fiscal years 2012 and 2013 to the
legislative auditor for sunset review of state agencies under Minnesota Statutes, section
3.981, if enacted.
new text end