1.1                          A bill for an act
  1.2             relating to economic development; requiring some 
  1.3             businesses with state or local financial assistance to 
  1.4             pay at least a poverty level wage; proposing coding 
  1.5             for new law in Minnesota Statutes, chapter 177. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  [177.255] [STATE ASSISTANCE; EMPLOYMENT; 
  1.8   POVERTY LEVEL WAGE.] 
  1.9      Subdivision 1.  [APPLICATION.] (a) This section only 
  1.10  applies to the following types of employers: 
  1.11     (1) a for profit corporation; 
  1.12     (2) a nonprofit corporation provided that the ratio of 
  1.13  total compensation of the corporation's chief executive officer 
  1.14  exceeds the full time equivalent of its lowest paid employee by 
  1.15  25 to 1; 
  1.16     (3) a partnership; 
  1.17     (4) a limited liability company; or 
  1.18     (5) a sole proprietorship.  
  1.19     This section excludes those employers that satisfy the 
  1.20  definition of a small business in section 645.445.  
  1.21  Notwithstanding the requirement that a small business must be a 
  1.22  for profit business, any nonprofit corporation that otherwise 
  1.23  satisfies the definition in section 645.445 is excluded from 
  1.24  satisfying the provisions of this section. 
  1.25     (b) Of the employers listed in paragraph (a), this section 
  2.1   only applies to employers that receive state or local assistance 
  2.2   in the form of a grant, loan, or tax increment financing, if: 
  2.3      (1) the sum of all three types of assistance exceeds 
  2.4   $25,000 in a fiscal year; and 
  2.5      (2) the purpose of the assistance is economic development 
  2.6   or job growth. 
  2.7      (c) Employers that meet the criteria stated in paragraphs 
  2.8   (a) and (b) must pay every employee hired as a result of the 
  2.9   assistance at least a poverty level wage.  For purposes of this 
  2.10  section, "poverty level wage" means the hourly wage, including 
  2.11  the employer's share of any health or dental coverage, necessary 
  2.12  for an employee working 40 hours a week, 52 weeks a year, to 
  2.13  earn an annual wage equal to 100 percent of the federal poverty 
  2.14  level for a family of four. 
  2.15     If the employer fails to pay a poverty level wage the 
  2.16  recipient shall pay the local human service agency an amount 
  2.17  equal to two times the difference between the poverty level wage 
  2.18  and the wage actually paid. 
  2.19     Subd. 2.  [ON-THE-JOB TRAINING EXEMPTION.] (a) The 
  2.20  requirement to pay at least a poverty level wage under 
  2.21  subdivision 1 does not apply to an employee engaged in 
  2.22  on-the-job training.  For purposes of this section, "on-the-job 
  2.23  training" means: 
  2.24     (1) an apprenticeship program for an apprentice defined by 
  2.25  section 178.06; 
  2.26     (2) a preapprenticeship program that assists learners to 
  2.27  explore occupational areas and assess their skills and interests 
  2.28  in those areas, and acquire knowledge and skills necessary to 
  2.29  succeed in youth apprenticeship programs; or 
  2.30     (3) a training program, not to exceed six months, that is 
  2.31  offered to an individual while employed in productive work that 
  2.32  provides training, technical and other related skills, and 
  2.33  personal skills that are essential to the full and adequate 
  2.34  performance of the employment. 
  2.35     (b) An employer must pay at least a poverty level wage to 
  2.36  an employee who would otherwise be exempt under paragraph (a), 
  3.1   if: 
  3.2      (1) any other individual has been laid off by the employer 
  3.3   from the position to be filled by the eligible employee or from 
  3.4   any substantially equivalent position; or 
  3.5      (2) the employer has terminated the employment of any 
  3.6   regular employee or otherwise reduced the number of employees 
  3.7   with the intention of replacing the employee by hiring an 
  3.8   employee who is not required to receive at least a poverty level 
  3.9   wage. 
  3.10     Subd. 3.  [APPLICATION FOR ON-THE-JOB TRAINING 
  3.11  EXEMPTION.] An employer seeking exemption under subdivision 2 
  3.12  must: 
  3.13     (1) notify the commissioner of labor and industry.  The 
  3.14  commissioner must certify that the on-the-job training program 
  3.15  meets the criteria stated in subdivision 2; and 
  3.16     (2) describe the program in writing, retain a copy of the 
  3.17  program, and provide a copy of the program to the commissioner 
  3.18  of labor and industry and to the employee. 
  3.19     Subd. 4.  [BONA FIDE FOREIGN STATE OFFER; EXEMPTION.] This 
  3.20  section does not apply if the chief executive officer of the 
  3.21  assistance recipient certifies to the entity providing the 
  3.22  assistance that but for the assistance the recipient would have 
  3.23  relocated in another state due to an offer of assistance of the 
  3.24  other state.  The chief executive officer must provide details 
  3.25  of the offer with the certification. 
  3.26     Subd. 5.  [ASSISTANCE EXEMPTION.] This section does not 
  3.27  apply to the following types of assistance: 
  3.28     (1) tax increment financing for redevelopment activities, 
  3.29  including assistance financed with increments (i) from districts 
  3.30  defined as redevelopment districts or renewal and renovation 
  3.31  districts under section 469.174, subdivision 10 or 10a, or (ii) 
  3.32  from another type of district used to pay for redevelopment 
  3.33  activities as defined in section 469.176, subdivision 4j; 
  3.34     (2) tax increment assistance financed by districts defined 
  3.35  as housing districts under section 469.174, subdivision 11; 
  3.36     (3) tax increment assistance financed by districts created 
  4.1   as hazardous substance subdistricts under section 469.175; 
  4.2      (4) grant and loan assistance for the removal or 
  4.3   remediation of a hazardous substance, hazardous waste, 
  4.4   pollutant, or contaminant, including human waste, as defined by 
  4.5   section 115B.02; 
  4.6      (5) loan or loan guarantee assistance from the tourism loan 
  4.7   program under section 116J.617; and 
  4.8      (6) grant assistance from contamination cleanup grants 
  4.9   under section 116J.552. 
  4.10     Subd. 6.  [EMPLOYEE EXEMPTION.] This section does not apply 
  4.11  to an employee who is a blind or disabled eligible individual as 
  4.12  that term is defined in United States Code, title 42, section 
  4.13  1382, paragraph (a). 
  4.14     Sec. 2.  [LEGISLATIVE AUDITOR; POVERTY AND CHOICES FOR 
  4.15  ECONOMIC DEVELOPMENT.] 
  4.16     The legislative audit commission is requested to direct the 
  4.17  legislative auditor to examine the cost of low paying jobs in 
  4.18  Minnesota.  The study shall consist of two parts.  The first 
  4.19  part is to estimate the cost of government transfer payments for 
  4.20  families with income below the federal poverty threshold.  To 
  4.21  the extent possible, the study shall separate transfer payments 
  4.22  by program, family type, and region.  The second part shall 
  4.23  examine the role of state government in increasing wages to a 
  4.24  livable level. 
  4.25     Sec. 3.  [EFFECTIVE DATE; APPLICABILITY.] 
  4.26     Section 1 applies to grant, loan, and tax increment 
  4.27  financing authorized on or after August 1, 1996.