1.1                          A bill for an act 
  1.2             relating to state government; appropriating money for 
  1.3             economic development and certain agencies of state 
  1.4             government; establishing and modifying programs; 
  1.5             regulating activities and practices; modifying fees; 
  1.6             eliminating certain boards; transferring regulatory 
  1.7             authority over health maintenance organizations and 
  1.8             similar entities to the commissioner of commerce; 
  1.9             making conforming changes; requiring reports; amending 
  1.10            Minnesota Statutes 1998, sections 45.0295; 53A.03; 
  1.11            53A.05, subdivision 1; 60A.14, subdivision 1; 60A.23, 
  1.12            subdivision 8; 60A.71, subdivision 7; 60B.02; 60B.03, 
  1.13            subdivisions 2 and 4; 60B.15; 60B.20; 60G.01, 
  1.14            subdivisions 2 and 4; 60K.06, subdivision 2; 62A.61; 
  1.15            62D.01, subdivision 2; 62D.02, subdivision 3, and by 
  1.16            adding a subdivision; 62D.03, subdivisions 1, 3, and 
  1.17            4; 62D.04, subdivisions 1, 2, 4, and by adding a 
  1.18            subdivision; 62D.05, subdivision 6; 62D.06, 
  1.19            subdivision 2; 62D.07, subdivisions 2, 3, and 10; 
  1.20            62D.08, subdivisions 1, 2, 3, 4, and 5; 62D.09, 
  1.21            subdivisions 1 and 8; 62D.10, subdivision 4; 62D.11, 
  1.22            subdivisions 1b, 2, 3, and by adding a subdivision; 
  1.23            62D.12, subdivisions 1, 2, and 9; 62D.121, 
  1.24            subdivisions 3a and 7; 62D.14, subdivisions 1, 3, 4, 
  1.25            5, and 6; 62D.15, subdivisions 1 and 4; 62D.16, 
  1.26            subdivisions 1 and 2; 62D.17, subdivisions 1, 3, 4, 
  1.27            and 5; 62D.18, subdivisions 1 and 7; 62D.19; 62D.20, 
  1.28            subdivision 1; 62D.21; 62D.211; 62D.22, subdivisions 4 
  1.29            and 10; 62D.24; 62D.30, subdivisions 1 and 3; 62L.02, 
  1.30            subdivision 8; 62L.05, subdivision 12; 62L.08, 
  1.31            subdivisions 10 and 11; 62M.11; 62M.16; 62N.02, 
  1.32            subdivision 4; 62N.26; 62N.31, subdivision 1; 62Q.01, 
  1.33            subdivision 2; 62Q.07; 62Q.075, subdivision 4; 
  1.34            62Q.105, subdivisions 6 and 7; 62Q.11; 62Q.22, 
  1.35            subdivisions 2, 6, and 7; 62Q.32; 62Q.51, subdivision 
  1.36            3; 62Q.525, subdivision 3; 62R.04, subdivision 5; 
  1.37            62R.25; 62T.01, subdivision 4; 65B.48, subdivision 3; 
  1.38            70A.14, subdivision 4; 72A.139, subdivision 2; 72B.04, 
  1.39            subdivision 10; 79.255, subdivision 10; 80A.28, 
  1.40            subdivision 1; 82A.08, subdivision 2; 82A.16, 
  1.41            subdivisions 2 and 6; 116J.415, subdivision 5; 
  1.42            116J.421, subdivision 3, and by adding subdivisions; 
  1.43            116J.63, subdivision 4; 116J.8745, subdivisions 1 and 
  1.44            2; 116L.03, subdivision 5; 116L.04, subdivision 1a; 
  1.45            116L.06, subdivision 4; 175.17; 176.181, subdivision 
  1.46            2a; 237.295, subdivision 1; 268.022, subdivision 1; 
  2.1             268.98, subdivision 3; 298.22, subdivision 2; 326.244, 
  2.2             subdivision 2, and by adding a subdivision; 326.86, 
  2.3             subdivision 1; 446A.072, subdivision 4; 462A.20, 
  2.4             subdivision 2, and by adding a subdivision; 462A.204, 
  2.5             by adding a subdivision; 462A.209; and 462A.21, by 
  2.6             adding a subdivision; proposing coding for new law in 
  2.7             Minnesota Statutes, chapters 116J; and 178; repealing 
  2.8             Minnesota Statutes 1998, sections 44A.001; 44A.01; 
  2.9             44A.02; 44A.023; 44A.025; 44A.031; 44A.0311; 44A.06; 
  2.10            44A.08; 44A.11; 62D.18; 62L.11, subdivision 2; 62Q.45, 
  2.11            subdivision 1; 138A.01; 138A.02; 138A.03; 138A.04; 
  2.12            138A.05; 138A.06; 341.01; 341.02; 341.04; 341.045; 
  2.13            341.05; 341.06; 341.07; 341.08; 341.09; 341.10; 
  2.14            341.11; 341.115; 341.12; 341.13; 341.15; 462A.28; 
  2.15            469.305; 469.306; 469.307; 469.308; and 469.31; Laws 
  2.16            1998, chapter 404, section 13, subdivision 5. 
  2.17  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.18                             ARTICLE 1 
  2.19                           APPROPRIATIONS 
  2.20  Section 1.  [ECONOMIC DEVELOPMENT; APPROPRIATIONS.] 
  2.21     The sums shown in the columns marked "APPROPRIATIONS" are 
  2.22  appropriated from the general fund, or another named fund, to 
  2.23  the agencies and for the purposes specified in this act, to be 
  2.24  available for the fiscal years indicated for each purpose.  The 
  2.25  figures "2000" and "2001," where used in this act, mean that the 
  2.26  appropriation or appropriations listed under them are available 
  2.27  for the year ending June 30, 2000, or June 30, 2001, 
  2.28  respectively.  The term "first year" means the fiscal year 
  2.29  ending June 30, 2000, and "second year" means the fiscal year 
  2.30  ending June 30, 2001. 
  2.31                          SUMMARY BY FUND
  2.32                            2000          2001           TOTAL
  2.33  General              $192,698,000   $188,779,000   $381,477,000
  2.34  Petroleum Tank
  2.35  Cleanup                 1,015,000      1,045,000      2,060,000
  2.36  Environmental Fund        700,000        700,000      1,400,000
  2.37  TANF                    6,000,000      4,000,000     10,000,000
  2.38  Trunk Highway             745,000        766,000      1,511,000 
  2.39  Workers' 
  2.40  Compensation           22,217,000     22,439,000     44,656,000
  2.41  Special Revenue           875,000        775,000      1,650,000
  2.42  TOTAL                $224,250,000   $218,504,000   $442,754,000
  2.43                                             APPROPRIATIONS 
  2.44                                         Available for the Year 
  2.45                                             Ending June 30 
  2.46                                            2000         2001 
  3.1   Sec. 2.  TRADE AND ECONOMIC DEVELOPMENT 
  3.2   Subdivision 1.  Total       
  3.3   Appropriation                          42,137,000    38,791,000
  3.4                 Summary by Fund
  3.5   General              39,192,000    35,825,000
  3.6   Trunk Highway           745,000       766,000 
  3.7   TANF                  1,500,000     1,500,000
  3.8   Environmental Fund      700,000       700,000 
  3.9   The amounts that may be spent from this 
  3.10  appropriation for each program are 
  3.11  specified in the following subdivisions.
  3.12  Subd. 2.  Business and Community 
  3.13  Development                           23,646,000     20,922,000
  3.14                Summary by Fund
  3.15  General             21,446,000     18,722,000
  3.16  TANF                 1,500,000      1,500,000
  3.17  Environmental Fund     700,000        700,000
  3.18  $4,017,000 the first year and 
  3.19  $4,017,000 the second year are for 
  3.20  Minnesota investment fund grants.  
  3.21  $400,000 the first year and $400,000 
  3.22  the second year are for grants to 
  3.23  Advantage Minnesota, Inc.  This is a 
  3.24  one-time appropriation and is not added 
  3.25  to the agency's base.  The funds are 
  3.26  available only if matched on at least a 
  3.27  dollar-for-dollar basis from other 
  3.28  sources.  The commissioner may release 
  3.29  the funds only upon: 
  3.30  (1) certification that matching funds, 
  3.31  in cash, from each participating 
  3.32  organization are available; and 
  3.33  (2) review and approval by the 
  3.34  commissioner of the proposed operations 
  3.35  plan of Advantage Minnesota, Inc. for 
  3.36  the biennium. 
  3.37  $6,418,000 the first year and 
  3.38  $6,418,000 the second year are for the 
  3.39  job skills partnership program.  If the 
  3.40  appropriation for either year is 
  3.41  insufficient, the appropriation for the 
  3.42  other year is available.  Of this 
  3.43  appropriation, $500,000 in each year is 
  3.44  a one-time appropriation.  This 
  3.45  appropriation does not cancel.  
  3.46  $1,500,000 the first year and 
  3.47  $1,500,000 the second year are 
  3.48  appropriated from the state's federal 
  3.49  TANF block grant under Title I of 
  3.50  Public Law Number 104-193 to the 
  3.51  commissioner of human services, to be 
  3.52  transferred to the commissioner of 
  4.1   trade and economic development for the 
  4.2   pathways program under Minnesota 
  4.3   Statutes, section 116L.04, subdivision 
  4.4   1a.  It is the intention of the 
  4.5   legislature that the general fund base 
  4.6   funding to the pathways program be 
  4.7   $1,500,000 per year in the 2002-2003 
  4.8   biennium. 
  4.9   $537,000 the first year and $537,000 
  4.10  the second year are from fees collected 
  4.11  under Minnesota Statutes, section 
  4.12  446A.04, subdivision 5, to administer 
  4.13  the programs of the public facilities 
  4.14  authority. 
  4.15  $2,000,000 the first year is for 
  4.16  wastewater infrastructure supplemental 
  4.17  assistance grants to municipalities 
  4.18  under Minnesota Statutes, section 
  4.19  446A.072.  This is a one-time 
  4.20  appropriation and is not added to the 
  4.21  agency's base. 
  4.22  $200,000 the first year and $200,000 
  4.23  the second year is for community 
  4.24  resources program allocations to cities 
  4.25  under Minnesota Statutes, sections 
  4.26  466A.01 to 466A.08, provided that only 
  4.27  the cities of Minneapolis and St. Paul 
  4.28  will be eligible to receive allocations 
  4.29  from this appropriation. 
  4.30  $100,000 the first year and $100,000 
  4.31  the second year are for grants to the 
  4.32  board of the rural policy and 
  4.33  development center for operation of the 
  4.34  center. 
  4.35  $155,000 the first year and $155,000 
  4.36  the second year are for grants to the 
  4.37  metropolitan economic development 
  4.38  association. 
  4.39  $187,000 the first year and $188,000 
  4.40  the second year are for grants to Women 
  4.41  Venture.  This is a one-time 
  4.42  appropriation and is not added to the 
  4.43  agency's base. 
  4.44  $350,000 the first year and $350,000 
  4.45  the second year are for grants to the 
  4.46  St. Paul rehabilitation center for its 
  4.47  current programs, including those 
  4.48  related to developing job-seeking 
  4.49  skills and workplace orientation, 
  4.50  intensive job development, functional 
  4.51  work English, and on-site job coaching. 
  4.52  $250,000 is for a grant to the city of 
  4.53  Windom to provide loans to assist an 
  4.54  expanding business.  This is a one-time 
  4.55  appropriation and is not added to the 
  4.56  agency's base. 
  4.57  $350,000 is for the biennium ending 
  4.58  June 30, 2001, for a grant to the Camp 
  4.59  Heartland center.  The grant may be 
  4.60  used for phase II capital expenditures 
  4.61  including, without limitation, a septic 
  4.62  system upgrade and bath/shower house 
  5.1   construction, construction of a family 
  5.2   lodge, renovation of a medical 
  5.3   facility, construction of staff housing 
  5.4   and offices, or expansion and upgrade 
  5.5   of the dining room and kitchen.  This 
  5.6   is a one-time appropriation and is not 
  5.7   added to the agency's base.  
  5.8   $2,800,000 in each year for purposes of 
  5.9   the contamination cleanup and 
  5.10  development grant program under 
  5.11  Minnesota Statutes, sections 116J.551 
  5.12  to 116J.558. 
  5.13  $15,000 is for a grant to the city of 
  5.14  Lake Benton for planning costs 
  5.15  associated with a new visitor center 
  5.16  and railroad depot building.  This is a 
  5.17  one-time appropriation and is not added 
  5.18  to the agency's base. 
  5.19  $100,000 the first year and $100,000 
  5.20  the second year are for microenterprise 
  5.21  technical assistance under Minnesota 
  5.22  Statutes, section 116J.8745.  
  5.23  $50,000 in 2000 is for a grant to the 
  5.24  Chatfield brass band music lending 
  5.25  library.  The money must be used for 
  5.26  computer hardware and software to 
  5.27  catalog the music collection and create 
  5.28  a Web site.  This is a one-time 
  5.29  appropriation and must not be added to 
  5.30  the agency's budget base. 
  5.31  $50,000 in fiscal year 2000 is for a 
  5.32  one-time grant to the Duluth Economic 
  5.33  Development Authority for the purchase 
  5.34  and installation of railroad ties to 
  5.35  improve the Lake Superior Mississippi 
  5.36  Railroad scenic railway along the St. 
  5.37  Louis Bay in Duluth. 
  5.38  $100,000 is appropriated for a grant to 
  5.39  the city of Lanesboro for 
  5.40  predevelopment costs for the Root River 
  5.41  Regional Arts Center.  This is a 
  5.42  one-time appropriation and is not added 
  5.43  to the agency's budget base. 
  5.44  $25,000 the first year and $25,000 the 
  5.45  second year is for grants to county and 
  5.46  district agricultural societies and 
  5.47  associations that are eligible to 
  5.48  receive aid under Minnesota Statutes, 
  5.49  section 38.02.  The commissioner shall 
  5.50  administer this appropriation pursuant 
  5.51  to a competitive grant process. 
  5.52  Subd. 3.  Minnesota Trade Office 
  5.53       2,275,000      2,318,000
  5.54  Subd. 4.  Tourism 
  5.55      10,904,000     10,909,000
  5.56                Summary by Fund
  5.57  General              10,159,000    10,143,000
  6.1   Trunk Highway           745,000       766,000
  6.2   To develop maximum private sector 
  6.3   involvement in tourism, $3,500,000 the 
  6.4   first year and $3,500,000 the second 
  6.5   year of the amounts appropriated for 
  6.6   marketing activities are contingent on 
  6.7   receipt of an equal contribution from 
  6.8   nonstate sources that have been 
  6.9   certified by the commissioner.  Up to 
  6.10  one-half of the match may be given in 
  6.11  in-kind contributions.  
  6.12  In order to maximize marketing grant 
  6.13  benefits, the commissioner must give 
  6.14  priority for joint venture marketing 
  6.15  grants to organizations with year-round 
  6.16  sustained tourism activities.  For 
  6.17  programs and projects submitted, the 
  6.18  commissioner must give priority to 
  6.19  those that encompass two or more areas 
  6.20  or that attract nonresident travelers 
  6.21  to the state. 
  6.22  If an appropriation for either year for 
  6.23  grants is not sufficient, the 
  6.24  appropriation for the other year is 
  6.25  available for it. 
  6.26  The commissioner may use grant dollars 
  6.27  or the value of in-kind services to 
  6.28  provide the state contribution for the 
  6.29  partnership program. 
  6.30  Any unexpended money from general fund 
  6.31  appropriations made under this 
  6.32  subdivision does not cancel but must be 
  6.33  placed in a special advertising account 
  6.34  for use by the office of tourism to 
  6.35  purchase additional media. 
  6.36  $829,000 the first year and $829,000 
  6.37  the second year are for the Minnesota 
  6.38  film board.  This appropriation is 
  6.39  available only upon receipt by the 
  6.40  board of $1 in matching contributions 
  6.41  of money or in-kind from nonstate 
  6.42  sources for every $3 provided by this 
  6.43  appropriation.  Of this amount, 
  6.44  $500,000 the first year and $500,000 
  6.45  the second year are for grants to the 
  6.46  Minnesota film board for a film 
  6.47  production jobs fund to stimulate 
  6.48  feature film production in Minnesota.  
  6.49  This appropriation is to reimburse film 
  6.50  producers for two to five percent of 
  6.51  documented wages which they paid to 
  6.52  Minnesotans for film production after 
  6.53  January 1, 1999. 
  6.54  $100,000 the first year is for a grant 
  6.55  to promote tourism in the Mille Lacs 
  6.56  area.  This is a one-time appropriation 
  6.57  and is not added to the agency's base. 
  6.58  Subd. 5.  Administration 
  6.59       3,897,000      3,192,000
  6.60  $750,000 the first year is appropriated 
  6.61  for enhancements to the journey travel 
  7.1   destination system.  The funds are 
  7.2   available only if matched in cash on at 
  7.3   least a dollar-for-dollar basis from 
  7.4   other sources.  This is a one-time 
  7.5   appropriation and is available until 
  7.6   spent. 
  7.7   Subd. 6.  Information and Analysis
  7.8        1,415,000      1,450,000
  7.9   Sec. 3.  MINNESOTA TECHNOLOGY, INC.    5,830,000      5,630,000
  7.10  $5,055,000 the first year and 
  7.11  $5,055,000 the second year are for 
  7.12  transfer from the general fund to the 
  7.13  Minnesota Technology, Inc. fund.  It is 
  7.14  the intention of the legislature that 
  7.15  base funding of $6,105,000 per year is 
  7.16  intended to be restored in the 
  7.17  2002-2003 biennium. 
  7.18  $75,000 the first year and $75,000 the 
  7.19  second year are for grants to the 
  7.20  Minnesota inventors congress. 
  7.21  $100,000 the first year and $100,000 
  7.22  the second year are for grants to the 
  7.23  Minnesota cold weather research 
  7.24  center.  By January 15, 2001, the 
  7.25  center will report to the legislature 
  7.26  on (1) the sources and amounts of its 
  7.27  nonstate matching funds, and (2) the 
  7.28  effectiveness of its program in 
  7.29  achieving quantifiable economic 
  7.30  development benefits to the state.  
  7.31  $600,000 the first year and $400,000 
  7.32  the second year are for grants to 
  7.33  Minnesota Project Innovation.  The 
  7.34  legislature intends to reduce the base 
  7.35  appropriation for this program to 
  7.36  $200,000 in 2002 and to eliminate the 
  7.37  base appropriation in 2003.  Any 
  7.38  amounts in excess of those stated 
  7.39  included in a budget should include a 
  7.40  change item. 
  7.41  Sec. 4.  ECONOMIC SECURITY  
  7.42  Subdivision 1.  Total 
  7.43  Appropriation                         45,140,000     38,371,000
  7.44                Summary by Fund
  7.45  General              43,865,000    37,596,000
  7.46  Special Revenue         775,000       775,000
  7.47  TANF Block Grant        500,000       -0- 
  7.48  Subd. 2.  Rehabilitation Services     22,502,000     22,013,000
  7.49                Summary by Fund
  7.50  General              22,002,000    22,013,000
  7.51  TANF                    500,000       -0-
  7.52  $1,800,000 the first year and 
  7.53  $1,800,000 the second year are for 
  8.1   centers for independent living.  The 
  8.2   commissioner is not required to 
  8.3   allocate this appropriation equally 
  8.4   among all centers. 
  8.5   $500,000 the first year is to provide 
  8.6   welfare-to-work extended employment 
  8.7   services to welfare recipients with 
  8.8   severe impairment to employment, as 
  8.9   defined in Minnesota Statutes, section 
  8.10  268A.15, subdivision 1a.  Of this 
  8.11  appropriation, up to five percent is 
  8.12  for administrative costs.  This is a 
  8.13  one-time appropriation and may not be 
  8.14  added to the budget base in the 
  8.15  biennium ending June 30, 2003.  This 
  8.16  appropriation is from the state's 
  8.17  federal TANF block grant under Public 
  8.18  Law Number 104-193 to the commissioner 
  8.19  of human services, to be transferred to 
  8.20  the commissioner of economic security.  
  8.21  This appropriation is available until 
  8.22  June 30, 2001.  
  8.23  $825,000 the first year and $827,000 
  8.24  the second year are for employment 
  8.25  support services for persons with 
  8.26  mental illness authorized under 
  8.27  Minnesota Statutes, section 268A.13.  
  8.28  $250,000 the first year and $250,000 
  8.29  the second year is for a grant to the 
  8.30  Minnesota employment center for deaf 
  8.31  and hard-of-hearing people.  
  8.32  In fiscal year 2000, $975,000 is to 
  8.33  increase the reimbursement rates for 
  8.34  extended employment services.  
  8.35  Effective for services rendered on or 
  8.36  after July 1, 1999, the commissioner 
  8.37  shall increase by ten percent all 
  8.38  reimbursement rates under Minnesota 
  8.39  Rules, part 3300.2035, subpart 6, item 
  8.40  A, for extended employment services for 
  8.41  persons with severe disabilities or 
  8.42  related conditions under Minnesota 
  8.43  Statutes, section 268A.15.  This amount 
  8.44  is added to the agency's base. 
  8.45  $100,000 the first year and $100,000 
  8.46  the second year are for a grant to 
  8.47  Advocating Change Together, Inc., 
  8.48  (ACT).  The grant must be used for the 
  8.49  training of individuals with 
  8.50  developmental and other mental health 
  8.51  disabilities, the maintenance of 
  8.52  related data, or technical assistance 
  8.53  for work advancement or additional 
  8.54  workforce training.  No part of this 
  8.55  grant may be applied to litigation 
  8.56  costs, or used for legal advocacy or 
  8.57  legal assistance purposes.  This is a 
  8.58  one-time appropriation and is available 
  8.59  until June 30, 2001. 
  8.60  Subd. 3.  State Services for the Blind 
  8.61       6,114,000      4,817,000
  8.62  $1,400,000 the first year is 
  8.63  appropriated to convert the 
  9.1   communication center to digital 
  9.2   technology and move the radio talking 
  9.3   book program to a different frequency.  
  9.4   The funds are available only if matched 
  9.5   in cash on at least a dollar-for-dollar 
  9.6   basis from private sources.  This is a 
  9.7   one-time appropriation and is available 
  9.8   until June 30, 2001. 
  9.9   The appropriation in the second year is 
  9.10  not available until the commissioners 
  9.11  of finance and economic security have 
  9.12  reviewed the operation of the state 
  9.13  services for the blind, determined why 
  9.14  a budget deficiency occurred in fiscal 
  9.15  year 1999 and what steps should be 
  9.16  taken to prevent a future deficiency 
  9.17  and reported their findings to the 
  9.18  legislature. 
  9.19  Subd. 4.  Workforce Preparation 
  9.20      16,474,000     11,491,000
  9.21                Summary by Fund
  9.22  General              15,699,000    10,716,000
  9.23  Special Revenue         775,000       775,000
  9.24  $775,000 the first year and $775,000 
  9.25  the second year are for job training 
  9.26  programs under Minnesota Statutes, 
  9.27  sections 268.60 to 268.64.  
  9.28  Notwithstanding Minnesota Statutes, 
  9.29  section 268.022, this appropriation is 
  9.30  from the workforce investment fund.  No 
  9.31  transfers from the workforce investment 
  9.32  fund shall be made for this purpose 
  9.33  after June 30, 2003.  In preparing the 
  9.34  budget for fiscal years beginning after 
  9.35  June 30, 2003, the commissioner of 
  9.36  finance must reflect in the budget 
  9.37  documents that no transfers will be 
  9.38  made. 
  9.39  $1,822,000 the first year and 
  9.40  $1,827,000 the second year are for 
  9.41  displaced homemaker programs under 
  9.42  Minnesota Statutes, section 268.96.  
  9.43  The commissioner shall prepare and 
  9.44  report to the legislature a plan for a 
  9.45  sliding scale fee structure for this 
  9.46  program. 
  9.47  $5,000,000 the first year is 
  9.48  appropriated to match available United 
  9.49  States Department of Labor 
  9.50  Welfare-to-Work funds. 
  9.51  $1,425,000 the first year and 
  9.52  $1,425,000 the second year are for 
  9.53  youth intervention programs under 
  9.54  Minnesota Statutes, section 268.30.  
  9.55  Funding from this appropriation may be 
  9.56  used to expand existing programs to 
  9.57  serve unmet needs and to create new 
  9.58  programs in underserved areas.  
  9.59  $851,000 the first year and $852,000 
  9.60  the second year are for the Youthbuild 
 10.1   program under Minnesota Statutes, 
 10.2   sections 268.361 to 268.366.  A 
 10.3   Minnesota Youthbuild program funded 
 10.4   under this section as authorized in 
 10.5   Minnesota Statutes, sections 268.361 to 
 10.6   268.367, qualifies as an approved 
 10.7   training program under Minnesota Rules, 
 10.8   part 5200.0930, subpart 1. 
 10.9   $116,000 the first year and $116,000 
 10.10  the second year are appropriated for 
 10.11  youth violence prevention programs to 
 10.12  match the federal juvenile 
 10.13  accountability incentive block grant.  
 10.14  This is a one-time appropriation. 
 10.15  Notwithstanding Minnesota Statutes, 
 10.16  section 268.022, subdivision 2, the 
 10.17  commissioner of finance shall transfer 
 10.18  to the general fund from the dedicated 
 10.19  fund $19,500,000 the first year and 
 10.20  $9,500,000 the second year of the money 
 10.21  collected through the special 
 10.22  assessment established in Minnesota 
 10.23  Statutes, section 268.022, subdivision 
 10.24  1.  No transfers from the dedicated 
 10.25  fund to the general fund are to be made 
 10.26  after June 30, 2003.  If the 
 10.27  commissioner of finance prepares a 
 10.28  budget for any period beginning after 
 10.29  June 30, 2003, that calls for such a 
 10.30  transfer, the budget documents must 
 10.31  reflect a change item. 
 10.32  Subd. 5.  Workforce Exchange 
 10.33          50,000         50,000
 10.34  The commissioner of economic security 
 10.35  is directed to prepare a plan to reduce 
 10.36  the number of line managers and reduce 
 10.37  the costs of operation in workforce 
 10.38  centers.  The legislature finds it 
 10.39  unacceptable to have up to five 
 10.40  managers in individual workforce 
 10.41  centers. 
 10.42  $50,000 the first year and $50,000 the 
 10.43  second year is appropriated for asset 
 10.44  preservation and facility repair. 
 10.45  $348,625 the first year is for systems 
 10.46  development for electronic commerce to 
 10.47  improve communication with customers of 
 10.48  the job service and reemployment 
 10.49  insurance program.  In accordance with 
 10.50  Minnesota Statutes, section 268.194, 
 10.51  subdivision 5, this money is a one-time 
 10.52  appropriation from federal money made 
 10.53  available specifically for that purpose 
 10.54  under United States Code, title 42, 
 10.55  section 1103, also known as the Reed 
 10.56  Act.  This appropriation is available 
 10.57  for two years after the date of 
 10.58  enactment. 
 10.59  $2,000,000 the first year and 
 10.60  $2,000,000 the second year are for 
 10.61  systems development for electronic 
 10.62  commerce in the reemployment insurance 
 10.63  program to improve communication with 
 11.1   employers.  In accordance with 
 11.2   Minnesota Statutes, section 268.194, 
 11.3   subdivision 5, this money is a one-time 
 11.4   appropriation from federal money to be 
 11.5   made available specifically for that 
 11.6   purpose under United States Code, title 
 11.7   42, section 1103, also known as the 
 11.8   Reed Act, and section 5403 of the 
 11.9   Federal Balanced Budget Act of 1997.  
 11.10  Each annual appropriation is available 
 11.11  for two years after the date of 
 11.12  enactment. 
 11.13  Sec. 5.  HOUSING FINANCE AGENCY       49,420,000     46,820,000
 11.14                Summary by Fund
 11.15  General              45,420,000    44,320,000
 11.16  TANF                  4,000,000     2,500,000
 11.17  Subdivision 1.  Total Appropriation 
 11.18  The amounts that may be spent from this 
 11.19  appropriation for certain programs are 
 11.20  specified in the following subdivisions.
 11.21  This appropriation is for transfer to 
 11.22  the housing development fund for the 
 11.23  programs specified.  Except as 
 11.24  otherwise indicated, this transfer is 
 11.25  part of the agency's permanent budget 
 11.26  base. 
 11.27  Subd. 2.  Rental Assistance for Mentally Ill 
 11.28  $1,700,000 the first year and 
 11.29  $1,700,000 the second year are for a 
 11.30  rental housing assistance program for 
 11.31  persons with a mental illness or 
 11.32  families with an adult member with a 
 11.33  mental illness under Minnesota 
 11.34  Statutes, section 462A.2097. 
 11.35  Subd. 3.  Family Homeless Prevention 
 11.36  $3,250,000 the first year and 
 11.37  $3,250,000 the second year is for the 
 11.38  family homeless prevention and 
 11.39  assistance program under Minnesota 
 11.40  Statutes, section 462A.204, and is 
 11.41  available until June 30, 2001.  Of this 
 11.42  amount, $1,875,000 the first year and 
 11.43  $375,000 the second year is from the 
 11.44  state's federal TANF block grant under 
 11.45  Title I of Public Law Number 104-193 to 
 11.46  the commissioner of human services, to 
 11.47  be transferred to the housing 
 11.48  development fund for this program.  It 
 11.49  is the intention of the legislature 
 11.50  that the general fund base funding to 
 11.51  this program be $6,500,000 for the 
 11.52  2002-2003 biennium. 
 11.53  Subd. 4.  Foreclosure Prevention Program
 11.54  $583,000 the first year and $583,000 
 11.55  the second year are for the foreclosure 
 11.56  prevention and assistance program under 
 11.57  Minnesota Statutes, section 462A.207. 
 12.1   Subd. 5.  Rental Assistance for
 12.2   Family Stabilization 
 12.3   $2,125,000 the first year and 
 12.4   $2,125,000 the second year are 
 12.5   appropriated from the state's federal 
 12.6   TANF block grant under Title I of 
 12.7   Public Law Number 104-193 to the 
 12.8   commissioner of human services, to be 
 12.9   transferred to the housing development 
 12.10  fund for the rent assistance for family 
 12.11  stabilization program under Minnesota 
 12.12  Statutes, section 462A.205.  It is the 
 12.13  intention of the legislature that the 
 12.14  general fund base funding for this 
 12.15  program be $2,000,000 per year for the 
 12.16  2002-2003 biennium. 
 12.17  Subd. 6.  Housing Trust Fund
 12.18  $2,348,000 the first year and 
 12.19  $2,348,000 the second year are for the 
 12.20  housing trust fund to be deposited in 
 12.21  the housing trust fund account created 
 12.22  under Minnesota Statutes, section 
 12.23  462A.201, and used for the purposes 
 12.24  provided in that section.  Of this 
 12.25  amount, $550,000 each year must be used 
 12.26  for transitional housing. 
 12.27  Subd. 7.  Affordable Rental Investment Fund
 12.28  $21,493,000 the first year and 
 12.29  $21,493,000 the second year are for the 
 12.30  affordable rental investment fund 
 12.31  program under Minnesota Statutes, 
 12.32  section 462A.21, subdivision 8b.  Of 
 12.33  this amount, $15,000,000 the first year 
 12.34  and $15,000,000 the second year are to 
 12.35  finance the acquisition, 
 12.36  rehabilitation, and debt restructuring 
 12.37  of federally assisted rental property 
 12.38  and for making equity take-out loans 
 12.39  under Minnesota Statutes, section 
 12.40  462A.05, subdivision 39.  The owner of 
 12.41  the federally assisted rental property 
 12.42  must agree to participate in the 
 12.43  applicable federally assisted housing 
 12.44  program and to extend any existing 
 12.45  low-income affordability restrictions 
 12.46  on the housing for the maximum term 
 12.47  permitted.  The owner must also enter 
 12.48  into an agreement that gives local 
 12.49  units of government, housing and 
 12.50  redevelopment authorities, and 
 12.51  nonprofit housing organizations the 
 12.52  right of first refusal if the rental 
 12.53  property is offered for sale.  Priority 
 12.54  must be given among comparable 
 12.55  properties to properties with the 
 12.56  longest remaining term under an 
 12.57  agreement for federal rental 
 12.58  assistance.  Priority must also be 
 12.59  given among comparable rental housing 
 12.60  developments to developments that are 
 12.61  or will be owned by local government 
 12.62  units, a housing and redevelopment 
 12.63  authority, or a nonprofit housing 
 12.64  organization.  Of this appropriation, 
 12.65  $5,000,000 in each year is a one-time 
 12.66  appropriation and is not added to the 
 13.1   agency's permanent base.  
 13.2   To the extent practicable, this 
 13.3   appropriation shall be used so that an 
 13.4   approximately equal number of housing 
 13.5   units are financed in the metropolitan 
 13.6   area, as defined in Minnesota Statutes, 
 13.7   section 473.121, subdivision 2, and in 
 13.8   the nonmetropolitan area. 
 13.9   Subd. 8.  Urban Indian Housing Program
 13.10  No appropriation is made for the urban 
 13.11  Indian housing program under Minnesota 
 13.12  Statutes, section 462A.07, subdivision 
 13.13  15.  It is the intention of the 
 13.14  legislature that the agency will use 
 13.15  accumulated reserves to fund this 
 13.16  program in the 2000-2001 biennium.  The 
 13.17  base of $187,000 per year is intended 
 13.18  to be restored in fiscal year 2002 and 
 13.19  beyond. 
 13.20  Subd. 9.  Tribal Indian Housing Program
 13.21  $1,683,000 the first year and 
 13.22  $1,683,000 the second year are for the 
 13.23  tribal Indian housing program under 
 13.24  Minnesota Statutes, section 462A.07, 
 13.25  subdivision 14.  
 13.26  Subd. 10.  Rural and Urban Homesteading
 13.27  $186,000 the first year and $186,000 
 13.28  the second year are for the Minnesota 
 13.29  rural and urban homesteading program 
 13.30  under Minnesota Statutes, section 
 13.31  462A.057.  
 13.32  Subd. 11.  Capacity Building Grants 
 13.33  $240,000 the first year and $240,000 
 13.34  the second year are for nonprofit 
 13.35  capacity building grants under 
 13.36  Minnesota Statutes, section 462A.21, 
 13.37  subdivision 3b.  
 13.38  Subd. 12.  Community Rehabilitation Program 
 13.39  $6,900,000 the first year and 
 13.40  $6,900,000 the second year are for the 
 13.41  community rehabilitation program under 
 13.42  Minnesota Statutes, section 462A.206.  
 13.43  Of this appropriation, $1,000,000 in 
 13.44  each year is a one-time appropriation 
 13.45  and is not added to the agency's base.  
 13.46  The housing finance agency is 
 13.47  encouraged to give consideration to 
 13.48  community rehabilitation program 
 13.49  applications for grants to purchase and 
 13.50  rehabilitate housing for families which 
 13.51  is also used for the purpose of 
 13.52  providing child care services targeted 
 13.53  to underserved immigrant and refugee 
 13.54  families.  Grantees receiving money 
 13.55  under this provision must coordinate 
 13.56  housing assistance with related 
 13.57  services funded by the commissioner of 
 13.58  children, families, and learning.  The 
 13.59  housing finance agency shall report to 
 14.1   the legislature on the number of 
 14.2   housing units purchased and 
 14.3   rehabilitated for this purpose. 
 14.4   $275,000 the first year and $275,000 
 14.5   the second year are for full-cycle home 
 14.6   ownership and purchase-rehabilitation 
 14.7   lending initiatives under Minnesota 
 14.8   Statutes, section 462A.21, subdivision 
 14.9   25.  
 14.10  Subd. 13.  Housing Rehabilitation 
 14.11  and Accessibility Program 
 14.12  $4,287,000 the first year and 
 14.13  $4,287,000 the second year are for the 
 14.14  housing rehabilitation and 
 14.15  accessibility program under Minnesota 
 14.16  Statutes, section 462A.05, subdivisions 
 14.17  14a and 15a.  
 14.18  Subd. 14.  Home Ownership Assistance Fund 
 14.19  $900,000 the first year and $900,000 
 14.20  the second year are for the home 
 14.21  ownership assistance fund under 
 14.22  Minnesota Statutes, section 462A.21, 
 14.23  subdivision 8.  
 14.24  Subd. 15.  School Stability Demonstration 
 14.25  $1,000,000 the first year is to 
 14.26  administer the program established in 
 14.27  Minnesota Statutes, section 462A.204, 
 14.28  subdivision 8, if enacted.  In making 
 14.29  grants under this program, the 
 14.30  commissioner shall award sufficient 
 14.31  funds for a grantee to serve a 
 14.32  substantial number of the families 
 14.33  estimated to meet the criteria of 
 14.34  Minnesota Statutes, section 462A.204, 
 14.35  subdivision 8, paragraph (c), clause 
 14.36  (1) or (2), in at least one school 
 14.37  within a school district.  This is a 
 14.38  one-time appropriation. 
 14.39  Subd. 16.  Innovative and Inclusionary 
 14.40  Housing Demonstration Projects 
 14.41  (a) $1,600,000 is appropriated from the 
 14.42  general fund to the commissioner of the 
 14.43  Minnesota housing finance agency for 
 14.44  transfer to the housing development 
 14.45  fund for the community rehabilitation 
 14.46  program under Minnesota Statutes, 
 14.47  section 462A.206.  This appropriation 
 14.48  is for at least three, and not more 
 14.49  than six, innovative affordable housing 
 14.50  demonstration projects.  
 14.51  (b) These pilot projects are to create 
 14.52  owner-occupied homes which use 
 14.53  innovative building techniques or 
 14.54  materials to lower construction costs 
 14.55  while maintaining high quality 
 14.56  construction and livability.  At least 
 14.57  one pilot project must be in a city of 
 14.58  the first class and at least one must 
 14.59  be in a suburb located in the 
 14.60  seven-county metropolitan area.  
 14.61  Applications for grants from this 
 15.1   appropriation must identify the 
 15.2   targeted population for whom housing 
 15.3   will be provided with the grant.  
 15.4   (c) The commissioner will develop 
 15.5   procedures to implement this 
 15.6   demonstration project and establish 
 15.7   criteria upon which to judge grant 
 15.8   applications.  These criteria must 
 15.9   include:  (1) local effort by the 
 15.10  community; (2) the community's 
 15.11  willingness to waive restrictions which 
 15.12  would otherwise increase costs of 
 15.13  construction; (3) consistency with 
 15.14  regionally developed investment 
 15.15  guidelines; (4) the extent to which the 
 15.16  project will promote inclusionary 
 15.17  housing; and (5) the extent to which a 
 15.18  grant would leverage funding from 
 15.19  nonstate sources.  
 15.20  (d) For purposes of paragraph (c), the 
 15.21  term "inclusionary housing" means a new 
 15.22  construction development including 
 15.23  housing with a variety of prices and 
 15.24  designs which serve families with a 
 15.25  range of incomes and housing needs.  
 15.26  This appropriation must be used 
 15.27  principally for projects which close 
 15.28  the gap between the market price of 
 15.29  housing in an area and the price 
 15.30  affordable to the targeted income level 
 15.31  or the cost of producing housing and 
 15.32  the market price of the housing.  This 
 15.33  is a one-time appropriation and is not 
 15.34  added to the agency's permanent base. 
 15.35  Subd. 17.  Homeownership Counseling
 15.36  $50,000 in the first year and $50,000 
 15.37  in the second year is appropriated from 
 15.38  the general fund to the housing 
 15.39  development fund for the fiscal 
 15.40  biennium ending June 30, 2001, for 
 15.41  purposes of the community 
 15.42  rehabilitation program under Minnesota 
 15.43  Statutes, section 462A.206.  This 
 15.44  appropriation must be used to make a 
 15.45  grant to a statewide organization that 
 15.46  advocates on behalf of persons with 
 15.47  mental retardation or related 
 15.48  conditions.  The grant must be used to 
 15.49  provide entry cost assistance, 
 15.50  prepurchase and postpurchase counseling 
 15.51  to persons with various disabilities 
 15.52  who are participating in the Fannie Mae 
 15.53  Homechoice demonstration project and 
 15.54  other projects designed to encourage 
 15.55  home ownership among persons with 
 15.56  disabilities. 
 15.57  Subd. 18.  Cancellations 
 15.58  The unobligated and unencumbered 
 15.59  balance in the contract for deed 
 15.60  guarantee account under Minnesota 
 15.61  Statutes, section 462A.2091 is 
 15.62  transferred to the full cycle 
 15.63  homeownership services program under 
 15.64  Minnesota Statutes, section 462A.209.  
 16.1   The unobligated and unencumbered 
 16.2   balance appropriated to the advisory 
 16.3   task force on lead hazard reduction 
 16.4   established under Laws 1997, chapter 
 16.5   200, article 4, section 1, is 
 16.6   transferred to the housing 
 16.7   rehabilitation and accessibility 
 16.8   program under Minnesota Statutes, 
 16.9   section 462A.05, subdivisions 14a and 
 16.10  15a, for use in the emergency loan 
 16.11  fund.  Priority for the use of these 
 16.12  funds shall be given to emergency loans 
 16.13  and grants for lead hazard reduction.  
 16.14  The unobligated and unencumbered 
 16.15  balance appropriated to the community 
 16.16  rehabilitation fund account under Laws 
 16.17  1997, chapter 200, article 1, section 
 16.18  6, for grants to acquire, demolish, and 
 16.19  remove substandard multiple-unit 
 16.20  residential property or acquire, 
 16.21  rehabilitate, and reconfigure 
 16.22  multiple-unit residential rental 
 16.23  property is transferred to the 
 16.24  affordable rental investment fund 
 16.25  program under Minnesota Statutes, 
 16.26  section 462A.21, subdivision 8b.  
 16.27  Sec. 6.  COMMERCE 
 16.28  Subdivision 1.  Total 
 16.29  Appropriation                         18,927,000     19,115,000
 16.30                Summary by Fund
 16.31  General              17,245,000    17,486,000
 16.32  Petro Cleanup         1,015,000     1,045,000 
 16.33  Workers'
 16.34  Compensation            567,000       584,000
 16.35  Special Revenue         100,000       -0-  
 16.36  The amounts that may be spent from this 
 16.37  appropriation for each program are 
 16.38  specified in the following subdivisions.
 16.39  Subd. 2.  Financial Examinations 
 16.40       3,963,000      4,052,000
 16.41  Subd. 3.  Registration and Insurance 
 16.42       4,916,000      6,589,000
 16.43                Summary by Fund
 16.44  General               4,249,000     6,005,000
 16.45  Workers' 
 16.46  Compensation            567,000       584,000
 16.47  Special Revenue         100,000       -0-
 16.48  The commissioner shall evaluate the 
 16.49  feasibility of a state crop revenue 
 16.50  insurance program to complement similar 
 16.51  federal programs. 
 16.52  $100,000 of this appropriation is from 
 17.1   the special revenue fund and is not 
 17.2   available unless H. F. No. 743 is 
 17.3   enacted. 
 17.4   $784,000 the second year is for 
 17.5   transfer to the commissioner of health 
 17.6   to assume responsibilities for HMO 
 17.7   regulation. 
 17.8   Subd. 4.  Enforcement and Licensing 
 17.9        4,355,000      4,296,000
 17.10  Subd. 5.  Petroleum Tank Release 
 17.11  Cleanup Board 
 17.12       1,015,000      1,045,000
 17.13  This appropriation is from the 
 17.14  petroleum tank release cleanup fund. 
 17.15  Subd. 6.  Administrative Services 
 17.16       4,678,000      3,133,000 
 17.17  $1,400,000 the first year is a one-time 
 17.18  appropriation to redesign and 
 17.19  re-engineer the department's data base. 
 17.20  $90,000 the first year is a one-time 
 17.21  appropriation for expanding website 
 17.22  capabilities.  
 17.23  Sec. 7.  BOARD OF ACCOUNTANCY            607,000        624,000
 17.24  Sec. 8.  BOARD OF ARCHITECTURE,
 17.25  ENGINEERING, LAND SURVEYING, 
 17.26  LANDSCAPE ARCHITECTURE, AND 
 17.27  INTERIOR DESIGN                          770,000        794,000 
 17.28  Sec. 9.  BOARD OF BARBER   
 17.29  EXAMINERS                                144,000        149,000
 17.30  Sec. 10.  BOARD OF BOXING                 84,000          -0-
 17.31  Sec. 11.  LABOR AND INDUSTRY 
 17.32  Subdivision 1.  Total             
 17.33  Appropriation                         23,843,000     24,183,000
 17.34                Summary by Fund
 17.35  General               3,736,000     3,913,000
 17.36  Workers'     
 17.37  Compensation         20,107,000    20,270,000
 17.38  The amounts that may be spent from this 
 17.39  appropriation for each program are 
 17.40  specified in the following subdivisions.
 17.41  Subd. 2.  Workers' Compensation
 17.42      10,586,000     10,833,000
 17.43  This appropriation is from the workers' 
 17.44  compensation fund. 
 17.45  Subd. 3.  Workplace Services 
 17.46       6,711,000      6,980,000
 18.1                 Summary by Fund
 18.2   General               2,672,000     2,844,000
 18.3   Workers'
 18.4   Compensation          4,039,000     4,136,000
 18.5   Subd. 4.  General Support 
 18.6        6,546,000      6,370,000
 18.7                 Summary by Fund
 18.8   General               1,064,000     1,069,000
 18.9   Workers'     
 18.10  Compensation          5,482,000     5,301,000
 18.11  Sec. 12.  BUREAU OF MEDIATION 
 18.12  SERVICES                               2,130,000      2,180,000
 18.13  Sec. 13.  WORKERS' COMPENSATION
 18.14  COURT OF APPEALS                       1,543,000      1,585,000
 18.15  This appropriation is from the workers' 
 18.16  compensation fund. 
 18.17  Sec. 14.  PUBLIC UTILITIES  
 18.18  COMMISSION                             3,781,000      3,880,000
 18.19  Sec. 15.  DEPARTMENT OF PUBLIC SERVICE 
 18.20  Subdivision 1.  Total       
 18.21  Appropriation                          9,595,000      9,805,000
 18.22  The amounts that may be spent from this 
 18.23  appropriation for each program are 
 18.24  specified in the following subdivisions.
 18.25  Subd. 2.  Telecommunications
 18.26         962,000        980,000
 18.27  Subd. 3.  Weights and Measures 
 18.28       3,138,000      3,207,000
 18.29  Subd. 4.  Information and Operations 
 18.30  Management 
 18.31       1,575,000      1,618,000
 18.32  Subd. 5.  Energy 
 18.33       3,920,000      4,000,000
 18.34  $588,000 each year is for transfer to 
 18.35  the energy and conservation account 
 18.36  established in Minnesota Statutes, 
 18.37  section 216B.241, subdivision 2a, for 
 18.38  programs administered by the 
 18.39  commissioner of children, families, and 
 18.40  learning to improve the energy 
 18.41  efficiency of residential oil-fired 
 18.42  heating plants in low-income households 
 18.43  and, when necessary, to provide 
 18.44  weatherization services to the homes. 
 18.45  Sec. 16.  MINNESOTA HISTORICAL 
 18.46  SOCIETY 
 19.1   Subdivision 1.  Total       
 19.2   Appropriation                         24,514,000     24,744,000
 19.3   The amounts that may be spent from this 
 19.4   appropriation for each program are 
 19.5   specified in the following subdivisions.
 19.6   Subd. 2.  Education and 
 19.7   Outreach 
 19.8   General                12,699,000     12,812,000
 19.9   Subd. 3.  Preservation and Access
 19.10  General                 9,318,000      9,479,000
 19.11  Subd. 4.  Information Program 
 19.12  Delivery 
 19.13       2,141,000      2,155,000
 19.14  Subd. 5.  Fiscal Agent
 19.15  General                   346,000        298,000
 19.16  (a) Sibley House Association 
 19.17          88,000         88,000
 19.18  This appropriation is available for 
 19.19  operation and maintenance of the Sibley 
 19.20  House and related buildings on the Old 
 19.21  Mendota state historic site operated by 
 19.22  the Sibley House Association.  
 19.23  (b) Minnesota International Center 
 19.24          50,000         50,000
 19.25  (c) Minnesota Air National   
 19.26  Guard Museum 
 19.27          19,000        -0-
 19.28  (d) Institute for Learning and
 19.29  Teaching - Project 120
 19.30         110,000        110,000 
 19.31  (e) Minnesota Military Museum
 19.32          29,000        -0-
 19.33  (f) Farmamerica
 19.34          50,000         50,000
 19.35  (g) Winona County Historical Society
 19.36          10,000        -0-
 19.37  This is a one-time appropriation and is 
 19.38  not added to the agency's base. 
 19.39  (h) Balances Forward
 19.40  Any unencumbered balance remaining in 
 19.41  this subdivision the first year does 
 19.42  not cancel but is available for the 
 19.43  second year of the biennium. 
 20.1   Sec. 17.  MINNESOTA MUNICIPAL
 20.2   BOARD                                    162,000        -0-
 20.3   Sec. 18.  COUNCIL ON BLACK
 20.4   MINNESOTANS                              320,000        329,000
 20.5   $25,000 each year is for expenses 
 20.6   associated with the Dr. Martin Luther 
 20.7   King Day activities. 
 20.8   Sec. 19.  COUNCIL ON 
 20.9   CHICANO-LATINO AFFAIRS                   314,000        324,000
 20.10  Sec. 20.  COUNCIL ON
 20.11  ASIAN-PACIFIC MINNESOTANS                277,000        286,000
 20.12  Sec. 21.  INDIAN AFFAIRS 
 20.13  COUNCIL                                  551,000        567,000 
 20.14  Sec. 22.  OFFICE OF STRATEGIC 
 20.15  AND LONG-RANGE PLANNING                  161,000        327,000
 20.16  To assume administrative 
 20.17  responsibilities resulting from the 
 20.18  sunset of the Municipal Board under 
 20.19  Laws 1997, chapter 202, article 5, 
 20.20  section 8. 
 20.21                             ARTICLE 2 
 20.22                           MISCELLANEOUS 
 20.23     Section 1.  Minnesota Statutes 1998, section 45.0295, is 
 20.24  amended to read: 
 20.25     45.0295 [FEES.] 
 20.26     (a) The following fees shall be paid to the commissioner: 
 20.27     (1) for a letter of certification of licensure, $20; 
 20.28     (2) for a license history, $20; 
 20.29     (3) for a duplicate license, $10; 
 20.30     (4) for a change of name or address, $10; 
 20.31     (5) for a temporary license, $10; 
 20.32     (6) (1) for each hour or fraction of one hour of course 
 20.33  approval for continuing education sought, $10; and 
 20.34     (7) (2) for each continuing education course coordinator 
 20.35  approval, $100. 
 20.36     (b) All fees paid to the commissioner under this section 
 20.37  are nonrefundable, except that an overpayment of a fee shall be 
 20.38  returned upon proper application. 
 20.39     Sec. 2.  Minnesota Statutes 1998, section 53A.03, is 
 20.40  amended to read: 
 20.41     53A.03 [APPLICATION FOR LICENSE; FEES.] 
 20.42     (a) An application for a license must be in writing, under 
 21.1   oath, and in the form prescribed and furnished by the 
 21.2   commissioner and must contain the following: 
 21.3      (1) the full name and address (both of residence and place 
 21.4   of business) of the applicant, and if the applicant is a 
 21.5   partnership or association, of every member, and the name and 
 21.6   business address if the applicant is a corporation; 
 21.7      (2) the county and municipality, with street and number, if 
 21.8   any, of all currency exchange locations operated by the 
 21.9   applicant; and 
 21.10     (3) the applicant's occupation or profession, for the ten 
 21.11  years immediately preceding the application; present or previous 
 21.12  connection with any other currency exchange in this or any other 
 21.13  state; whether the applicant has ever been convicted of any 
 21.14  crime; and the nature of the applicant's occupancy of the 
 21.15  premises to be licensed; and if the applicant is a partnership 
 21.16  or a corporation, the information specified in this paragraph 
 21.17  must be supplied for each partner and each officer and director 
 21.18  of the corporation.  If the applicant is a partnership or a 
 21.19  nonpublicly held corporation, the information specified in this 
 21.20  paragraph must be required of each partner and each officer, 
 21.21  director, and stockholders owning in excess of ten percent of 
 21.22  the corporate stock of the corporation.  
 21.23     (b) The application shall be accompanied by a nonrefundable 
 21.24  fee of $250 $1,000 for the review of the initial application.  
 21.25  Upon approval by the commissioner, an additional license fee 
 21.26  of $50 $500 must be paid by the applicant as an annual license 
 21.27  fee for the remainder of the calendar year.  An annual license 
 21.28  fee of $50 $500 is due for each subsequent calendar year of 
 21.29  operation upon submission of a license renewal application on or 
 21.30  before September 1.  Fees must be deposited in the state 
 21.31  treasury and credited to the general fund.  Upon payment of the 
 21.32  required annual license fee, the commissioner shall issue a 
 21.33  license for the year beginning January 1. 
 21.34     (c) The commissioner shall require the applicant to submit 
 21.35  to a background investigation conducted by the bureau of 
 21.36  criminal apprehension as a condition of licensure.  As part of 
 22.1   the background investigation, the bureau of criminal 
 22.2   apprehension shall conduct criminal history checks of Minnesota 
 22.3   records and is authorized to exchange fingerprints with the 
 22.4   Federal Bureau of Investigation for the purpose of a criminal 
 22.5   background check of the national files.  The cost of the 
 22.6   investigation must be paid by the applicant. 
 22.7      (d) For purposes of this section, "applicant" includes an 
 22.8   employee who exercises management or policy control over the 
 22.9   company, a director, an officer, a limited or general partner, a 
 22.10  manager, or a shareholder holding more than ten percent of the 
 22.11  outstanding stock of the corporation. 
 22.12     Sec. 3.  Minnesota Statutes 1998, section 53A.05, 
 22.13  subdivision 1, is amended to read: 
 22.14     Subdivision 1.  [NAME OR LOCATION.] If a licensee proposes 
 22.15  to change the name or location of any or all of its currency 
 22.16  exchanges, the licensee shall file an application for approval 
 22.17  of the change with the commissioner.  The commissioner shall not 
 22.18  approve a change of location if the requirements of sections 
 22.19  53A.02, subdivision 2, and 53A.04 have not been satisfied.  If 
 22.20  the change is approved by the commissioner, the commissioner 
 22.21  shall issue an amended license in the licensee's new name or 
 22.22  location.  A $50 $100 fee must be paid for the amended license. 
 22.23     Sec. 4.  Minnesota Statutes 1998, section 60A.14, 
 22.24  subdivision 1, is amended to read: 
 22.25     Subdivision 1.  [FEES OTHER THAN EXAMINATION FEES.] In 
 22.26  addition to the fees and charges provided for examinations, the 
 22.27  following fees must be paid to the commissioner for deposit in 
 22.28  the general fund: 
 22.29     (a) by township mutual fire insurance companies: 
 22.30     (1) for filing certificate of incorporation $25 and 
 22.31  amendments thereto, $10; 
 22.32     (2) for filing annual statements, $15; 
 22.33     (3) for each annual certificate of authority, $15; 
 22.34     (4) for filing bylaws $25 and amendments thereto, $10. 
 22.35     (b) by other domestic and foreign companies including 
 22.36  fraternals and reciprocal exchanges: 
 23.1      (1) for filing certified copy of certificate of articles of 
 23.2   incorporation, $100; 
 23.3      (2) for filing annual statement, $225; 
 23.4      (3) for filing certified copy of amendment to certificate 
 23.5   or articles of incorporation, $100; 
 23.6      (4) for filing bylaws, $75 or amendments thereto, $75; 
 23.7      (5) for each company's certificate of authority, $575, 
 23.8   annually. 
 23.9      (c) the following general fees apply: 
 23.10     (1) for each certificate, including certified copy of 
 23.11  certificate of authority, renewal, valuation of life policies, 
 23.12  corporate condition or qualification, $25; 
 23.13     (2) for each copy of paper on file in the commissioner's 
 23.14  office 50 cents per page, and $2.50 for certifying the same; 
 23.15     (3) for license to procure insurance in unadmitted foreign 
 23.16  companies, $575; 
 23.17     (4) for valuing the policies of life insurance companies, 
 23.18  one cent per $1,000 of insurance so valued, provided that the 
 23.19  fee shall not exceed $13,000 per year for any company.  The 
 23.20  commissioner may, in lieu of a valuation of the policies of any 
 23.21  foreign life insurance company admitted, or applying for 
 23.22  admission, to do business in this state, accept a certificate of 
 23.23  valuation from the company's own actuary or from the 
 23.24  commissioner of insurance of the state or territory in which the 
 23.25  company is domiciled; 
 23.26     (5) for receiving and filing certificates of policies by 
 23.27  the company's actuary, or by the commissioner of insurance of 
 23.28  any other state or territory, $50; 
 23.29     (6) for each appointment of an agent filed with the 
 23.30  commissioner, a domestic insurer shall remit $5 and all other 
 23.31  insurers shall remit $3; 
 23.32     (7) for filing forms and rates, $50 $75 per filing; 
 23.33     (8) for annual renewal of surplus lines insurer license, 
 23.34  $300. 
 23.35     The commissioner shall adopt rules to define filings that 
 23.36  are subject to a fee. 
 24.1      Sec. 5.  Minnesota Statutes 1998, section 60A.23, 
 24.2   subdivision 8, is amended to read: 
 24.3      Subd. 8.  [SELF-INSURANCE OR INSURANCE PLAN ADMINISTRATORS 
 24.4   WHO ARE VENDORS OF RISK MANAGEMENT SERVICES.] (1)  [SCOPE.] This 
 24.5   subdivision applies to any vendor of risk management services 
 24.6   and to any entity which administers, for compensation, a 
 24.7   self-insurance or insurance plan.  This subdivision does not 
 24.8   apply (a) to an insurance company authorized to transact 
 24.9   insurance in this state, as defined by section 60A.06, 
 24.10  subdivision 1, clauses (4) and (5); (b) to a service plan 
 24.11  corporation, as defined by section 62C.02, subdivision 6; (c) to 
 24.12  a health maintenance organization, as defined by section 62D.02, 
 24.13  subdivision 4; (d) to an employer directly operating a 
 24.14  self-insurance plan for its employees' benefits; (e) to an 
 24.15  entity which administers a program of health benefits 
 24.16  established pursuant to a collective bargaining agreement 
 24.17  between an employer, or group or association of employers, and a 
 24.18  union or unions; or (f) to an entity which administers a 
 24.19  self-insurance or insurance plan if a licensed Minnesota insurer 
 24.20  is providing insurance to the plan and if the licensed insurer 
 24.21  has appointed the entity administering the plan as one of its 
 24.22  licensed agents within this state. 
 24.23     (2)  [DEFINITIONS.] For purposes of this subdivision the 
 24.24  following terms have the meanings given them. 
 24.25     (a) "Administering a self-insurance or insurance plan" 
 24.26  means (i) processing, reviewing or paying claims, (ii) 
 24.27  establishing or operating funds and accounts, or (iii) otherwise 
 24.28  providing necessary administrative services in connection with 
 24.29  the operation of a self-insurance or insurance plan. 
 24.30     (b) "Employer" means an employer, as defined by section 
 24.31  62E.02, subdivision 2. 
 24.32     (c) "Entity" means any association, corporation, 
 24.33  partnership, sole proprietorship, trust, or other business 
 24.34  entity engaged in or transacting business in this state. 
 24.35     (d) "Self-insurance or insurance plan" means a plan 
 24.36  providing life, medical or hospital care, accident, sickness or 
 25.1   disability insurance for the benefit of employees or members of 
 25.2   an association, or a plan providing liability coverage for any 
 25.3   other risk or hazard, which is or is not directly insured or 
 25.4   provided by a licensed insurer, service plan corporation, or 
 25.5   health maintenance organization. 
 25.6      (e) "Vendor of risk management services" means an entity 
 25.7   providing for compensation actuarial, financial management, 
 25.8   accounting, legal or other services for the purpose of designing 
 25.9   and establishing a self-insurance or insurance plan for an 
 25.10  employer. 
 25.11     (3)  [LICENSE.] No vendor of risk management services or 
 25.12  entity administering a self-insurance or insurance plan may 
 25.13  transact this business in this state unless it is licensed to do 
 25.14  so by the commissioner.  An applicant for a license shall state 
 25.15  in writing the type of activities it seeks authorization to 
 25.16  engage in and the type of services it seeks authorization to 
 25.17  provide.  The license may be granted only when the commissioner 
 25.18  is satisfied that the entity possesses the necessary 
 25.19  organization, background, expertise, and financial integrity to 
 25.20  supply the services sought to be offered.  The commissioner may 
 25.21  issue a license subject to restrictions or limitations upon the 
 25.22  authorization, including the type of services which may be 
 25.23  supplied or the activities which may be engaged in.  The license 
 25.24  fee is $500 $1,000 for the initial application and $500 $1,000 
 25.25  for each two-year renewal.  All licenses are for a period of two 
 25.26  years. 
 25.27     (4)  [REGULATORY RESTRICTIONS; POWERS OF THE COMMISSIONER.] 
 25.28  To assure that self-insurance or insurance plans are financially 
 25.29  solvent, are administered in a fair and equitable fashion, and 
 25.30  are processing claims and paying benefits in a prompt, fair, and 
 25.31  honest manner, vendors of risk management services and entities 
 25.32  administering insurance or self-insurance plans are subject to 
 25.33  the supervision and examination by the commissioner.  Vendors of 
 25.34  risk management services, entities administering insurance or 
 25.35  self-insurance plans, and insurance or self-insurance plans 
 25.36  established or operated by them are subject to the trade 
 26.1   practice requirements of sections 72A.19 to 72A.30.  In lieu of 
 26.2   an unlimited guarantee from a parent corporation for a vendor of 
 26.3   risk management services or an entity administering insurance or 
 26.4   self-insurance plans, the commissioner may accept a surety bond 
 26.5   in a form satisfactory to the commissioner in an amount equal to 
 26.6   120 percent of the total amount of claims handled by the 
 26.7   applicant in the prior year.  If at any time the total amount of 
 26.8   claims handled during a year exceeds the amount upon which the 
 26.9   bond was calculated, the administrator shall immediately notify 
 26.10  the commissioner.  The commissioner may require that the bond be 
 26.11  increased accordingly. 
 26.12     (5)  [RULEMAKING AUTHORITY.] To carry out the purposes of 
 26.13  this subdivision, the commissioner may adopt rules pursuant to 
 26.14  sections 14.001 to 14.69.  These rules may: 
 26.15     (a) establish reporting requirements for administrators of 
 26.16  insurance or self-insurance plans; 
 26.17     (b) establish standards and guidelines to assure the 
 26.18  adequacy of financing, reinsuring, and administration of 
 26.19  insurance or self-insurance plans; 
 26.20     (c) establish bonding requirements or other provisions 
 26.21  assuring the financial integrity of entities administering 
 26.22  insurance or self-insurance plans; or 
 26.23     (d) establish other reasonable requirements to further the 
 26.24  purposes of this subdivision. 
 26.25     Sec. 6.  Minnesota Statutes 1998, section 60A.71, 
 26.26  subdivision 7, is amended to read: 
 26.27     Subd. 7.  [FEES.] Each applicant for a reinsurance 
 26.28  intermediary license shall pay to the commissioner a fee of 
 26.29  $160 $200 for an initial two-year license and a fee of $120 $150 
 26.30  for each renewal.  Applications shall be submitted on forms 
 26.31  prescribed by the commissioner. 
 26.32     Sec. 7.  Minnesota Statutes 1998, section 60K.06, 
 26.33  subdivision 2, is amended to read: 
 26.34     Subd. 2.  [LICENSING FEES.] (a) In addition to the fees and 
 26.35  charges provided for examinations, each agent licensed pursuant 
 26.36  to section 60K.03 shall pay to the commissioner: 
 27.1      (1) a fee of $60 $80 per license for an initial license 
 27.2   issued to an individual agent, and a fee of $60 $80 for each 
 27.3   renewal; 
 27.4      (2) a fee of $160 $200 for an initial license issued to a 
 27.5   partnership, limited liability company, or corporation, and a 
 27.6   fee of $120 $150 for each renewal; 
 27.7      (3) a fee of $75 for an initial amendment (variable 
 27.8   annuity) to a license, and a fee of $50 for each renewal; and 
 27.9      (4) a fee of $500 for an initial surplus lines agent's 
 27.10  license, and a fee of $500 for each renewal. 
 27.11     (b) Persons whose applications have been properly and 
 27.12  timely filed who have not received notice of denial of renewal 
 27.13  are approved for renewal and may continue to transact business 
 27.14  whether or not the renewed license has been received on or 
 27.15  before November 1 of the renewal year.  Applications for renewal 
 27.16  of a license are timely filed if received by the commissioner on 
 27.17  or before the 15th day preceding the license renewal date of the 
 27.18  applicant on forms duly executed and accompanied by appropriate 
 27.19  fees.  An application mailed is considered timely filed if 
 27.20  addressed to the commissioner, with proper postage, and 
 27.21  postmarked on or before the 15th day preceding the licensing 
 27.22  renewal date of the applicant. 
 27.23     (c) Initial licenses issued under this section must be 
 27.24  valid for a period not to exceed two years.  The commissioner 
 27.25  shall assign an expiration date to each initial license so that 
 27.26  approximately one-half of all licenses expire each year.  Each 
 27.27  initial license must expire on October 31 of the expiration year 
 27.28  assigned by the commissioner. 
 27.29     (d) All fees shall be retained by the commissioner and are 
 27.30  nonreturnable, except that an overpayment of any fee must be 
 27.31  refunded upon proper application. 
 27.32     Sec. 8.  Minnesota Statutes 1998, section 65B.48, 
 27.33  subdivision 3, is amended to read: 
 27.34     Subd. 3.  Self-insurance, subject to approval of the 
 27.35  commissioner, is effected by filing with the commissioner in 
 27.36  satisfactory form: 
 28.1      (1) a continuing undertaking by the owner or other 
 28.2   appropriate person to pay tort liabilities or basic economic 
 28.3   loss benefits, or both, and to perform all other obligations 
 28.4   imposed by sections 65B.41 to 65B.71; 
 28.5      (2) evidence that appropriate provision exists for prompt 
 28.6   administration of all claims, benefits, and obligations provided 
 28.7   by sections 65B.41 to 65B.71; 
 28.8      (3) evidence that reliable financial arrangements, 
 28.9   deposits, or commitments exist providing assurance, 
 28.10  substantially equivalent to that afforded by a policy of 
 28.11  insurance complying with sections 65B.41 to 65B.71, for payment 
 28.12  of tort liabilities, basic economic loss benefits, and all other 
 28.13  obligations imposed by sections 65B.41 to 65B.71; and 
 28.14     (4) a nonrefundable initial application fee of $500 $1,500 
 28.15  and an annual renewal fee of $100 $400 for political 
 28.16  subdivisions and $250 $500 for nonpolitical entities.  
 28.17     Sec. 9.  Minnesota Statutes 1998, section 70A.14, 
 28.18  subdivision 4, is amended to read: 
 28.19     Subd. 4.  [DURATION.] Licenses issued pursuant to this 
 28.20  section shall remain in effect until the licensee withdraws from 
 28.21  the state or until the license is suspended or revoked.  The fee 
 28.22  for each license shall be $1,000 $3,000, payable every three 
 28.23  years. 
 28.24     Sec. 10.  Minnesota Statutes 1998, section 72B.04, 
 28.25  subdivision 10, is amended to read: 
 28.26     Subd. 10.  [FEES.] A fee of $40 $80 is imposed for each 
 28.27  initial license or temporary permit and $25 $80 for each renewal 
 28.28  thereof or amendment thereto.  A fee of $20 is imposed for the 
 28.29  registration of each nonlicensed adjuster who is required to 
 28.30  register under section 72B.06.  All fees shall be transmitted to 
 28.31  the commissioner and shall be payable to the state treasurer.  
 28.32  If a fee is paid for an examination and if within one year from 
 28.33  the date of that payment no written request for a refund is 
 28.34  received by the commissioner or the examination for which the 
 28.35  fee was paid is not taken, the fee is forfeited to the state of 
 28.36  Minnesota. 
 29.1      Sec. 11.  Minnesota Statutes 1998, section 79.255, 
 29.2   subdivision 10, is amended to read: 
 29.3      Subd. 10.  [FEE.] A registration or exemption certificate 
 29.4   fee of $50 $100 shall be paid. 
 29.5      Sec. 12.  Minnesota Statutes 1998, section 80A.28, 
 29.6   subdivision 1, is amended to read: 
 29.7      Subdivision 1.  (a) There shall be a filing fee of $100 for 
 29.8   every application for registration or notice filing.  There 
 29.9   shall be an additional fee of one-tenth of one percent of the 
 29.10  maximum aggregate offering price at which the securities are to 
 29.11  be offered in this state, and the maximum combined fees shall 
 29.12  not exceed $300.  
 29.13     (b) When an application for registration is withdrawn 
 29.14  before the effective date or a preeffective stop order is 
 29.15  entered under section 80A.13, subdivision 1, all but the $100 
 29.16  filing fee shall be returned.  If an application to register 
 29.17  securities is denied, the total of all fees received shall be 
 29.18  retained. 
 29.19     (c) Where a filing is made in connection with a federal 
 29.20  covered security under section 18(b)(2) of the Securities Act of 
 29.21  1933, there is a fee of $100 for every initial filing.  If the 
 29.22  filing is made in connection with redeemable securities issued 
 29.23  by an open end management company or unit investment trust, as 
 29.24  defined in the Investment Company Act of 1940, there is an 
 29.25  additional fee of 1/20 of one percent of the maximum aggregate 
 29.26  offering price at which the securities are to be offered in this 
 29.27  state.  If the filing is made in connection with redeemable 
 29.28  securities issued by such a company or trust, there is no 
 29.29  maximum fee for securities filings made according to this 
 29.30  paragraph.  If the filing is made in connection with any other 
 29.31  federal covered security under Section 18(b)(2) of the 
 29.32  Securities Act of 1933, there is an additional fee of one-tenth 
 29.33  of one percent of the maximum aggregate offering price at which 
 29.34  the securities are to be offered in this state, and the combined 
 29.35  fees shall not exceed $300.  Beginning with fiscal year 2000 and 
 29.36  continuing each fiscal year thereafter, upon completion of the 
 30.1   fiscal year, the commissioner shall determine the total amount 
 30.2   of all fees that were collected under this paragraph in 
 30.3   connection with any filings made during the last completed 
 30.4   fiscal year on behalf of a security that is a federal covered 
 30.5   security pursuant to section 18(b)(2) of the Securities Act of 
 30.6   1933.  To the extent the total fees collected by the 
 30.7   commissioner in connection with such filings exceeds 
 30.8   $21,072,000, the commissioner shall refund, on a pro rata basis, 
 30.9   to all persons who paid any fees during such completed fiscal 
 30.10  year, the amount of such fees collected by the commissioner that 
 30.11  are in excess of $21,072,000.  No refunds are required of 
 30.12  amounts of $100 or less for a fiscal year. 
 30.13     Sec. 13.  Minnesota Statutes 1998, section 82A.08, 
 30.14  subdivision 2, is amended to read: 
 30.15     Subd. 2.  [FEE.] Every annual report filed pursuant to this 
 30.16  section shall be accompanied by a fee of $100 $500. 
 30.17     Sec. 14.  Minnesota Statutes 1998, section 82A.16, 
 30.18  subdivision 2, is amended to read: 
 30.19     Subd. 2.  [FEE AND CONTENTS.] A salesperson or broker may 
 30.20  apply for a license by filing a fee of $25 $50 and an 
 30.21  application with the commissioner which includes the following 
 30.22  information: 
 30.23     (1) the applicant's name, age, residence address, and, in 
 30.24  the case of a salesperson, the name and place of business of the 
 30.25  membership camping operator or broker on whose behalf the 
 30.26  salesperson will be acting; 
 30.27     (2) the applicant's date and place of birth; 
 30.28     (3) a statement whether or not the applicant within the 
 30.29  past ten years has been convicted of a misdemeanor or felony 
 30.30  involving theft, fraud, or dishonesty or whether or not the 
 30.31  applicant within the past ten years has been enjoined from, had 
 30.32  any civil penalty assessed for, or been found to have engaged in 
 30.33  any violation of any securities, land sales, camping, or 
 30.34  consumer protection statutes; 
 30.35     (4) a statement whether or not the applicant is named as a 
 30.36  defendant in a pending criminal indictment or proceeding 
 31.1   involving fraud, theft, or dishonesty or is a defendant in a 
 31.2   pending lawsuit arising out of alleged violations of securities, 
 31.3   land sales, camping, or consumer protection statutes.  A copy of 
 31.4   the charge, complaint, or lawsuit shall be provided to the 
 31.5   commissioner; 
 31.6      (5) a statement describing the applicant's employment 
 31.7   history for the past five years and whether or not any 
 31.8   termination of employment during the last five years was 
 31.9   occasioned by a theft, fraud, or act of dishonesty; 
 31.10     (6) an affidavit certifying that the applicant is 
 31.11  knowledgeable concerning the provisions of this section and 
 31.12  sections 82A.05, 82A.13, and 82A.14, and any rules adopted under 
 31.13  those sections; 
 31.14     (7) a statement whether or not the applicant has ever been 
 31.15  licensed by this state or its political subdivisions to engage 
 31.16  in any other business or profession; whether any such license 
 31.17  has been denied, suspended, or revoked and, if so, the 
 31.18  circumstances of the denial, suspension, or revocation; 
 31.19     (8) such other information as the commissioner may 
 31.20  reasonably deem necessary to administer the provisions of 
 31.21  sections 82A.01 to 82A.26, by rule or order. 
 31.22     Sec. 15.  Minnesota Statutes 1998, section 82A.16, 
 31.23  subdivision 6, is amended to read: 
 31.24     Subd. 6.  [RENEWAL.] The license of a salesperson and 
 31.25  broker shall be renewed annually by the filing of a form 
 31.26  prescribed by the commissioner and payment of a fee of $10 $25. 
 31.27     Sec. 16.  Minnesota Statutes 1998, section 116J.415, 
 31.28  subdivision 5, is amended to read: 
 31.29     Subd. 5.  [LOAN CRITERIA.] The following criteria apply to 
 31.30  loans made under the challenge grant program:  
 31.31     (1) loans must be made to businesses that are not likely to 
 31.32  undertake a project for which loans are sought without 
 31.33  assistance from the challenge grant program; 
 31.34     (2) a loan must be used for a project designed principally 
 31.35  to benefit low-income persons through the creation of job or 
 31.36  business opportunities for them; 
 32.1      (3) the minimum loan is $5,000 and the maximum 
 32.2   is $100,000 $200,000; 
 32.3      (4) a loan may not exceed 50 percent of the total cost of 
 32.4   an individual project; 
 32.5      (5) a loan may not be used for a retail development 
 32.6   project; and 
 32.7      (6) a business applying for a loan, except a 
 32.8   microenterprise loan under subdivision 6, must be sponsored by a 
 32.9   resolution of the governing body of the local governmental unit 
 32.10  within whose jurisdiction the project is located. 
 32.11     Sec. 17.  Minnesota Statutes 1998, section 116J.421, 
 32.12  subdivision 3, is amended to read: 
 32.13     Subd. 3.  [DUTIES.] The center shall: 
 32.14     (1) research and identify present and emerging social and 
 32.15  economic issues for rural Minnesota, including health care, 
 32.16  transportation, crime, housing, and job training; 
 32.17     (2) forge alliances and partnerships with rural communities 
 32.18  to find practical solutions to economic and social problems; 
 32.19     (3) provide a resource center for rural communities on 
 32.20  issues of importance to them; 
 32.21     (4) encourage collaboration across higher education 
 32.22  institutions to provide interdisciplinary team approaches to 
 32.23  problem solving with rural communities; and 
 32.24     (5) involve students in center projects. 
 32.25     Sec. 18.  Minnesota Statutes 1998, section 116J.421, is 
 32.26  amended by adding a subdivision to read: 
 32.27     Subd. 6.  [USED APPROPRIATION.] State appropriations to the 
 32.28  board, whether from the general fund or the rural policy and 
 32.29  development fund, may, at the discretion of the board, be 
 32.30  expended for administration of the center and to carry out its 
 32.31  duties under this section or under other law. 
 32.32     Sec. 19.  Minnesota Statutes 1998, section 116J.421, is 
 32.33  amended by adding a subdivision to read: 
 32.34     Subd. 7.  [BOARD COMPENSATION AND OTHER 
 32.35  FUNDS.] Compensation and expense reimbursement of board members 
 32.36  is as provided in section 15.0575, subdivision 3. 
 33.1      Sec. 20.  Minnesota Statutes 1998, section 116J.63, 
 33.2   subdivision 4, is amended to read: 
 33.3      Subd. 4.  The office of tourism may market tourism-related 
 33.4   publications, trade, and media promotional material promotion 
 33.5   and advertising programs and information distribution to 
 33.6   businesses and organizations.  The proceeds from the marketing 
 33.7   must be placed in a special account revenue accounts and are 
 33.8   appropriated to the commissioner to prepare and distribute the 
 33.9   office's publications and media promotional materials implement 
 33.10  the programs for which the revenue is collected. 
 33.11     Sec. 21.  Minnesota Statutes 1998, section 116J.8745, 
 33.12  subdivision 1, is amended to read: 
 33.13     Subdivision 1.  [TECHNICAL ASSISTANCE; LOAN 
 33.14  ADMINISTRATION.] The commissioner of trade and economic 
 33.15  development shall make grants to nonprofit organizations to 
 33.16  provide technical assistance to individuals with entrepreneurial 
 33.17  plans that require microenterprise loans in an amount ranging 
 33.18  from approximately $1,000 to $25,000, and for loan 
 33.19  administration costs related to those microenterprise loans. 
 33.20  Microenterprise is a small business which employs under five 
 33.21  employees plus the owner and requires under $25,000 to start to 
 33.22  support the startup and growth of self-employment and 
 33.23  microbusinesses.  Eligible businesses are microenterprises 
 33.24  employing under five people plus the owner and requiring under 
 33.25  $25,000 or no capital to start or expand the business.  Eligible 
 33.26  expenses include loan administration costs related to providing 
 33.27  microenterprise loans. 
 33.28     Sec. 22.  Minnesota Statutes 1998, section 116J.8745, 
 33.29  subdivision 2, is amended to read: 
 33.30     Subd. 2.  [GRANT ELIGIBILITY AND ALLOCATION.] Nonprofit 
 33.31  organizations must apply for grants under this section following 
 33.32  procedures established by the commissioner.  To be eligible for 
 33.33  a grant, an organization must demonstrate to the commissioner 
 33.34  that it has the appropriate expertise.  The commissioner shall 
 33.35  give preference for grants to organizations that target 
 33.36  nontraditional entrepreneurs such as women, members of a 
 34.1   minority, low-income individuals, or persons seeking work who 
 34.2   are currently on or recently removed from welfare assistance. 
 34.3      An application must include: 
 34.4      (1) the local need for microenterprise support; 
 34.5      (2) proposed criteria for business eligibility; 
 34.6      (3) proposals for identifying and serving eligible 
 34.7   businesses; 
 34.8      (4) a description of technical assistance to be provided to 
 34.9   eligible businesses; 
 34.10     (5) proposals to coordinate technical assistance with 
 34.11  financial assistance; and 
 34.12     (6) a demonstration of ability to collaborate with other 
 34.13  agencies including educational and financial institutions; and 
 34.14     (7) project goals identifying the number of eligible 
 34.15  businesses to be assisted with the state funds awarded under the 
 34.16  grant. 
 34.17     Sec. 23.  [116J.9665] [WORLD TRADE CENTER.] 
 34.18     Subdivision 1.  [DEFINITIONS.] For purposes of this 
 34.19  section, the following terms have the meaning given them: 
 34.20     (1) "Conference and service center" means the approximately 
 34.21  20,000 square feet of space on the third and fourth floors of 
 34.22  the Minnesota world trade center that the state of Minnesota has 
 34.23  the right to possess, occupy, and use subject to the terms and 
 34.24  conditions of the development agreement. 
 34.25     (2) "Development agreement" means the agreement entered 
 34.26  into by and between the world trade center board, as agent of 
 34.27  the state of Minnesota, and Oxford Development Minnesota, Inc. 
 34.28  dated July 27, 1984, and the amendments to that agreement, for 
 34.29  development and construction of a world trade center at a 
 34.30  designated site in Minnesota. 
 34.31     (3) "Minnesota world trade center" means the facility 
 34.32  constructed in accordance with the development agreement or 
 34.33  other facilities meeting the membership requirements of the 
 34.34  World Trade Centers Association. 
 34.35     Subd. 2.  [GENERALLY.] The commissioner shall facilitate 
 34.36  and support Minnesota world trade center programs and services 
 35.1   and promote the Minnesota world trade center. 
 35.2      Subd. 3.  [POWERS.] In furtherance of the goals set forth 
 35.3   in subdivision 2, and in addition to the powers granted by 
 35.4   sections 116J.035 and 116J.966, the commissioner may: 
 35.5      (1) define, formulate, administer, and deliver programs and 
 35.6   services through the world trade center; 
 35.7      (2) establish satellite operations of the Minnesota world 
 35.8   trade center within the continental United States; 
 35.9      (3) accept gifts and grants from other sources; 
 35.10     (4) set and collect fees for services and programs; 
 35.11     (5) adopt membership requirements for an association of 
 35.12  members of the Minnesota world trade center; 
 35.13     (6) participate jointly with private persons, firms, 
 35.14  corporations, or organizations or with public entities in 
 35.15  appropriate programs or projects and enter into contracts to 
 35.16  spend money to carry out those programs or projects; 
 35.17     (7) acquire and dispose of personal property, including 
 35.18  inchoate and intellectual property, royalties, stock, and stock 
 35.19  warrants; 
 35.20     (8) enter into contracts or agreements with a federal or 
 35.21  state agency, individual, business entity, or other 
 35.22  organization; 
 35.23     (9) acquire and dispose of real property or an interest in 
 35.24  real property; and 
 35.25     (10) hold and maintain membership for the Minnesota world 
 35.26  trade center in the World Trade Centers Association. 
 35.27     Performance of these powers is not subject to chapters 14, 
 35.28  16A, 16B, and 16C.  
 35.29     Subd. 4.  [DUTIES.] The commissioner shall: 
 35.30     (1) promote and market the Minnesota world trade center and 
 35.31  membership in the World Trade Center Association; 
 35.32     (2) sponsor conferences or other promotional events in the 
 35.33  conference and service center; 
 35.34     (3) sponsor, develop, and conduct educational programs 
 35.35  related to international trade; 
 35.36     (4) establish and maintain an office in the Minnesota world 
 36.1   trade center; and 
 36.2      (5) not duplicate programs or services provided by the 
 36.3   commissioner of agriculture. 
 36.4      Subd. 5.  [PROMOTIONAL EXPENSES.] The commissioner may 
 36.5   expend money to carry out this section.  Promotional expenses 
 36.6   include, but are not limited to, expenses for the food, lodging, 
 36.7   and travel of consultants and speakers, and publications and 
 36.8   other forms of advertising.  Promotional expenditures may be 
 36.9   made in the same manner as expenditures made by private persons, 
 36.10  firms, corporations, or associations for similar purposes, and 
 36.11  are not subject to regulation by the commissioner of employee 
 36.12  relations. 
 36.13     Subd. 6.  [WORLD TRADE CENTER ACCOUNT.] The world trade 
 36.14  center account is in the special revenue fund.  All money 
 36.15  received from the use of the conference and service center or 
 36.16  appropriated under this section must be deposited in the 
 36.17  account.  Money in the account including interest earned is 
 36.18  appropriated to the commissioner and must be used exclusively 
 36.19  for the purposes of this section. 
 36.20     Subd. 7.  [SERVICE INFORMATION; CLASSIFICATION OF DATA.] (a)
 36.21  Service information, including databases, purchased by the 
 36.22  commissioner or developed by the commissioner for sale pursuant 
 36.23  to this section, is not subject to chapter 13. 
 36.24     (b) For purposes of this subdivision, "business transaction"
 36.25  means a transaction between parties other than the 
 36.26  commissioner.  The following data received or developed by the 
 36.27  commissioner is private with respect to data on individuals and 
 36.28  nonpublic with respect to data not on individuals: 
 36.29     (1) data relating to the financial condition of individuals 
 36.30  or businesses receiving or performing services by or on behalf 
 36.31  of the commissioner in furtherance of this section; 
 36.32     (2) at the request of either party to the transaction data 
 36.33  on business transactions; and 
 36.34     (3) at the request of the person or business seeking the 
 36.35  information, the identities of persons or businesses requesting 
 36.36  business or trade information from the commissioner, and the 
 37.1   nature of the trade information. 
 37.2      Subd. 8.  [USE OF CONFERENCE AND SERVICE CENTER.] The 
 37.3   commissioner shall operate or provide for the operation of the 
 37.4   conference and service center.  Priority use of the conference 
 37.5   and service center must be given to programs and activities 
 37.6   related to international trade.  The commissioner may permit use 
 37.7   of the center for public benefits and other revenue-raising 
 37.8   purposes only after all requests for use of the center for 
 37.9   international business have been accommodated. 
 37.10     Sec. 24.  Minnesota Statutes 1998, section 116L.03, 
 37.11  subdivision 5, is amended to read: 
 37.12     Subd. 5.  [TERMS.] The terms of appointed members shall be 
 37.13  for four years except for the initial appointments.  The initial 
 37.14  appointments of the governor shall have the following terms:  
 37.15  two members each for one, two, three, and four years.  
 37.16  Compensation for board members will be allowable as provided for 
 37.17  in section 15.0575, subdivision 3. 
 37.18     Sec. 25.  Minnesota Statutes 1998, section 116L.04, 
 37.19  subdivision 1a, is amended to read: 
 37.20     Subd. 1a.  [PATHWAYS PROGRAM.] The pathways program may 
 37.21  provide grants-in-aid for developing programs which assist in 
 37.22  the transition of persons from welfare to work.  The program is 
 37.23  to be operated by the board.  The board shall consult and 
 37.24  coordinate with the Job Training Partnership Act, Title II-A, 
 37.25  program administrators at the department of economic security to 
 37.26  design and provide services for temporary assistance for needy 
 37.27  families recipients. 
 37.28     Pathways grants-in-aid may be awarded to educational or 
 37.29  other nonprofit training institutions for education and training 
 37.30  programs that serve public assistance recipients transitioning 
 37.31  from public assistance to employment. 
 37.32     Preference shall be given to projects that: 
 37.33     (1) provide employment with benefits paid to employees; 
 37.34     (2) provide employment where there are defined career paths 
 37.35  for trainees; 
 37.36     (3) pilot the development of an educational pathway that 
 38.1   can be used on a continuing basis for transitioning persons from 
 38.2   public assistance directly to work; and 
 38.3      (4) demonstrate the active participation of department of 
 38.4   economic security workforce centers, Minnesota state college and 
 38.5   university institutions and other educational institutions, and 
 38.6   local welfare agencies. 
 38.7      Pathways projects must demonstrate the active involvement 
 38.8   and financial commitment of private business.  Pathways projects 
 38.9   must be matched with cash or in-kind contributions on at least a 
 38.10  one-to-one ratio by participating private business. 
 38.11     A single grant to any one institution shall not exceed 
 38.12  $200,000 $400,000. 
 38.13     The board shall annually, by March 31, report to the 
 38.14  commissioners of economic security and trade and economic 
 38.15  development on pathways programs, including the number of public 
 38.16  assistance recipients participating in the program, the number 
 38.17  of participants placed in employment, the salary and benefits 
 38.18  they receive, and the state program costs per participant. 
 38.19     Sec. 26.  Minnesota Statutes 1998, section 116L.06, 
 38.20  subdivision 4, is amended to read: 
 38.21     Subd. 4.  [LOAN TERMS.] Loans may be secured or unsecured, 
 38.22  shall be for a term of no more than two five years, and shall 
 38.23  bear no interest.  The maximum amount of a loan is $250,000.  A 
 38.24  loan origination fee of up to two percent of the principal of 
 38.25  the loan may be charged.  An employer may have only one 
 38.26  outstanding loan.  The loans shall contain such other standard 
 38.27  commercial loan terms as the board deems appropriate. 
 38.28     Sec. 27.  Minnesota Statutes 1998, section 175.17, is 
 38.29  amended to read: 
 38.30     175.17 [POWERS AND DUTIES, COMMISSIONER OF THE DEPARTMENT 
 38.31  OF LABOR AND INDUSTRY.] 
 38.32     (1) The commissioner shall administer the laws relating to 
 38.33  workers' compensation and the laws governing employees of the 
 38.34  state, a county, or other governmental subdivisions who contract 
 38.35  tuberculosis; 
 38.36     (2) The commissioner shall adopt reasonable and proper 
 39.1   rules governing rules of practice before the workers' 
 39.2   compensation division in matters which are not before a 
 39.3   compensation judge; 
 39.4      (3) The commissioner shall collect, collate, and publish 
 39.5   statistical and other information relating to work under the 
 39.6   department's jurisdiction and make public reports the 
 39.7   commissioner judges necessary, including such other reports as 
 39.8   may be required by law; 
 39.9      (4) The commissioner shall establish and maintain branch 
 39.10  offices as needed for the conduct of the affairs of the workers' 
 39.11  compensation division; 
 39.12     (5) The commissioner may: 
 39.13     (a) apply for, receive, and spend money received from 
 39.14  federal, municipal, county, regional, and other government 
 39.15  agencies and private sources; and 
 39.16     (b) apply for, accept, and disburse grants and other aids 
 39.17  from public and private sources.  
 39.18     Sec. 28.  Minnesota Statutes 1998, section 176.181, 
 39.19  subdivision 2a, is amended to read: 
 39.20     Subd. 2a.  [APPLICATION FEE.] Every initial application 
 39.21  filed pursuant to subdivision 2 requesting authority to 
 39.22  self-insure shall be accompanied by a nonrefundable fee of 
 39.23  $2,500 $4,000.  When an employer seeks to be added as a member 
 39.24  of an existing approved group under section 79A.03, subdivision 
 39.25  6, the proposed new member shall pay a nonrefundable $250 $400 
 39.26  application fee to the commissioner at the time of application.  
 39.27  Each annual report due August 1 under section 79A.03, 
 39.28  subdivision 9, shall be accompanied by an annual fee 
 39.29  of $200 $500.  
 39.30     Sec. 29.  [178.12] [APPRENTICESHIP REGISTRATION ACCOUNT IN 
 39.31  SPECIAL REVENUE FUND.] 
 39.32     The apprenticeship registration account is established in 
 39.33  the special revenue fund of the state treasury.  An annual 
 39.34  registration fee will be charged to each sponsor for each 
 39.35  apprentice registered in the program.  The fee is established at 
 39.36  $130 per apprentice.  Subsequent adjustments to this fee will be 
 40.1   made pursuant to section 16A.1285, subdivision 2.  The fees 
 40.2   collected and any interest earned are appropriated to the 
 40.3   commissioner for purposes of this chapter.  
 40.4      Sec. 30.  Minnesota Statutes 1998, section 237.295, 
 40.5   subdivision 1, is amended to read: 
 40.6      Subdivision 1.  [PAYMENT FOR INVESTIGATION.] (a) Whenever 
 40.7   the department or commission, in a proceeding upon its own 
 40.8   motion, on complaint, or upon an application to it, considers it 
 40.9   necessary, in order to carry out the duties imposed on it, to 
 40.10  investigate the books, accounts, practices, and activities of 
 40.11  any company, parties to the proceeding shall pay the expenses 
 40.12  reasonably attributable to the proceeding.  The department and 
 40.13  commission shall ascertain the expenses, and the department 
 40.14  shall render a bill for those expenses to the parties, at the 
 40.15  conclusion of the proceeding.  The department is authorized to 
 40.16  submit billings to parties at intervals selected by the 
 40.17  department during the course of a proceeding.  
 40.18     (b) The allocation of costs may be adjusted for cause by 
 40.19  the commission during the course of the proceeding, or upon the 
 40.20  closing of the docket and issuance of an order.  In addition to 
 40.21  the rights granted in subdivision 3, parties to a proceeding may 
 40.22  object to the allocation at any time during the proceeding.  
 40.23  Withdrawal by a party to a proceeding does not absolve the party 
 40.24  from paying allocated costs as determined by the commission.  
 40.25  The commission may decide that a party should not pay any 
 40.26  allocated costs of the proceeding.  
 40.27     (c) The bill constitutes notice of the assessment and a 
 40.28  demand for payment.  The amount of the bills assessed by the 
 40.29  department under this subdivision must be paid by the parties 
 40.30  into the state treasury within 30 days from the date of 
 40.31  assessment.  The total amount, in a calendar year, for which a 
 40.32  telephone company may become liable, by reason of costs incurred 
 40.33  by the department and commission within that calendar year, may 
 40.34  not exceed two-fifths of one percent of the gross jurisdictional 
 40.35  operating revenue of the telephone company in the last preceding 
 40.36  calendar year.  Direct charges may be assessed without regard to 
 41.1   this limitation until the gross jurisdictional operating revenue 
 41.2   of the telephone company for the preceding calendar year has 
 41.3   been reported for the first time.  Where, under this 
 41.4   subdivision, costs are incurred within a calendar year that are 
 41.5   in excess of two-fifths of one percent of the gross 
 41.6   jurisdictional operating revenues, the excess costs are not 
 41.7   chargeable as part of the remainder under subdivision 2. 
 41.8      (d) Except as otherwise provided in paragraph (e), for 
 41.9   purposes of assessing the cost of a proceeding to a party, 
 41.10  "party" means any entity or group subject to the laws and rules 
 41.11  of this state, however organized, whether public or private, 
 41.12  whether domestic or foreign, whether for profit or nonprofit, 
 41.13  and whether natural, corporate, or political, such as a business 
 41.14  or commercial enterprise organized as any type or combination of 
 41.15  corporation, limited liability company, partnership, limited 
 41.16  liability partnership, proprietorship, association, cooperative, 
 41.17  joint venture, carrier, or utility, and any successor or 
 41.18  assignee of any of them; a social or charitable organization; 
 41.19  and any type or combination of political subdivision, which 
 41.20  includes the executive, judicial, or legislative branch of the 
 41.21  state, a local government unit, an agency of the state or a 
 41.22  local government unit, or a combination of any of them.  
 41.23     (e) For assessment and billing purposes, "party" does not 
 41.24  include: 
 41.25     (i) the department of public service or the residential 
 41.26  utilities division of the office of attorney general; any entity 
 41.27  or group instituted primarily for the purpose of mutual help and 
 41.28  not conducted for profit; intervenors awarded compensation under 
 41.29  section 237.075, subdivision 10; or any individual or group or 
 41.30  counsel for the individual or group representing the interests 
 41.31  of end users or classes of end users of services provided by 
 41.32  telephone companies or telecommunications carriers, as 
 41.33  determined by the commission.; 
 41.34     (ii) political subdivisions of the state participating as 
 41.35  task force members, offering comments, or requesting or 
 41.36  appearing at a hearing in a rulemaking proceeding under section 
 42.1   237.163, subdivision 8, paragraph (a); or 
 42.2      (iii) political subdivisions of the state appearing before 
 42.3   the commission pursuant to a complaint brought under section 
 42.4   237.163, subdivision 8, paragraph (b). 
 42.5      The exemption in clauses (ii) and (iii) does not apply to a 
 42.6   municipality which owns or operates a telephone exchange within 
 42.7   its own borders pursuant to section 237.19 with regard to a 
 42.8   proceeding that could affect the operation of the municipality's 
 42.9   local exchange telephone service. 
 42.10     Sec. 31.  Minnesota Statutes 1998, section 268.022, 
 42.11  subdivision 1, is amended to read: 
 42.12     Subdivision 1.  [DETERMINATION AND COLLECTION OF SPECIAL 
 42.13  ASSESSMENT.] (a) In addition to all other taxes, assessments, 
 42.14  and payment obligations under chapter 268, each employer, except 
 42.15  an employer making payments in lieu of taxes is liable for a 
 42.16  special assessment levied at the rate of one-tenth of one A 
 42.17  special assessment shall be levied during a calendar year upon 
 42.18  those employers which, pursuant to section 268.051, subdivision 
 42.19  1, are liable for reemployment insurance taxes, except an 
 42.20  employer that has, applicable to that calendar year: 
 42.21     (1) a reemployment insurance experience rating of zero 
 42.22  pursuant to section 268.051, subdivision 3; or 
 42.23     (2) been assigned the applicable reemployment insurance tax 
 42.24  rate for new employers pursuant to section 268.051, subdivision 
 42.25  5, paragraph (a). 
 42.26     The special assessment shall be .07 percent per year on all 
 42.27  taxable wages, as defined in section 268.04 268.035, subdivision 
 42.28  25b 24.  The special assessment shall become due and be 
 42.29  paid by each employer to the department on the same schedule and 
 42.30  in the same manner as other reemployment insurance taxes. 
 42.31     (b) The special assessment levied under this section is in 
 42.32  addition to, and shall not affect the computation of any other 
 42.33  reemployment insurance taxes, assessments, or other payment 
 42.34  obligations due under this chapter. 
 42.35     (c) Notwithstanding any provision to the contrary, If on 
 42.36  June 30 of any year, beginning in the year 2001, the unobligated 
 43.1   balance of the special assessment fund under this section is 
 43.2   greater than $30,000,000 $20,000,000, the special assessment for 
 43.3   the following calendar year only shall be levied at a rate of 
 43.4   1/20th of one 0.03 percent on all taxable wages.  
 43.5      (d) If on July 1 of any year the seasonally adjusted total 
 43.6   rate of unemployment in Minnesota, as determined by the 
 43.7   commissioner, equaled or exceeded 5 percent for any six of the 
 43.8   prior 12 months, the commissioner may eliminate the exceptions 
 43.9   to assessment in paragraph (a), clauses (1) and (2), for the 
 43.10  following calendar year. 
 43.11     Sec. 32.  Minnesota Statutes 1998, section 268.98, 
 43.12  subdivision 3, is amended to read: 
 43.13     Subd. 3. [COST LIMITATIONS.] (a) For purposes of sections 
 43.14  268.9781 and 268.9782, funds allocated to a grantee are subject 
 43.15  to the following limitations: 
 43.16     (1) a maximum of 15 percent for administration in a worker 
 43.17  adjustment services plan and ten percent in a dislocation event 
 43.18  services grant; 
 43.19     (2) a minimum of 50 percent for provision of training 
 43.20  assistance; 
 43.21     (3) a minimum of ten percent and maximum of 30 percent for 
 43.22  provision of support services; and no more than five percent 
 43.23  statewide may be allocated annually for support services, as 
 43.24  defined in section 268.975, subdivision 13; and 
 43.25     (4) the balance used for provision of basic readjustment 
 43.26  assistance. 
 43.27     (b) A waiver of the cost limitation on providing training 
 43.28  assistance may be requested.  The waiver may not permit less 
 43.29  than 30 percent of the funds be spent on training assistance. 
 43.30     (c) The commissioner shall prescribe the form and manner 
 43.31  for submission of an application for a waiver under paragraph 
 43.32  (b).  Criteria for granting a waiver shall be established by the 
 43.33  commissioner in consultation with the workforce development 
 43.34  council. 
 43.35     Sec. 33.  Minnesota Statutes 1998, section 298.22, 
 43.36  subdivision 2, is amended to read: 
 44.1      Subd. 2.  [IRON RANGE RESOURCES AND REHABILITATION BOARD.] 
 44.2   There is hereby created the iron range resources and 
 44.3   rehabilitation board, consisting of 11 members, five ten of whom 
 44.4   are state senators appointed by the subcommittee on committees 
 44.5   of the rules committee of the senate, and five of whom are 
 44.6   representatives, appointed by the speaker of the house of 
 44.7   representatives.  The members shall be appointed in January of 
 44.8   every odd-numbered year governor, with advice and consent of the 
 44.9   senate.  Terms, removal, compensation, and filling of vacancies 
 44.10  are governed by section 15.0575.  No more than six members of 
 44.11  the board may support the same political party.  The 11th member 
 44.12  of the board is the commissioner of natural resources.  
 44.13  Vacancies on the board shall be filled in the same manner as the 
 44.14  original members were chosen.  At least a majority of the 
 44.15  legislative All members of the board shall be elected from state 
 44.16  senatorial or legislative districts in which over 50 percent of 
 44.17  the residents other than the commissioner of natural resources 
 44.18  must reside within a tax relief area as defined in section 
 44.19  273.134.  All expenditures and projects made by the commissioner 
 44.20  of iron range resources and rehabilitation shall first be 
 44.21  submitted to the iron range resources and rehabilitation board 
 44.22  for approval by at least eight board members of expenditures and 
 44.23  projects for rehabilitation purposes as provided by this 
 44.24  section, and the method, manner, and time of payment of all 
 44.25  funds proposed to be disbursed shall be first approved or 
 44.26  disapproved by the board.  The board shall biennially make its 
 44.27  report to the governor and the legislature on or before November 
 44.28  15 of each even-numbered year.  The expenses of the board shall 
 44.29  be paid by the state from the funds raised pursuant to this 
 44.30  section. 
 44.31     Sec. 34.  Minnesota Statutes 1998, section 326.244, 
 44.32  subdivision 2, is amended to read: 
 44.33     Subd. 2.  [PROCEDURE.] (a) At or before commencement of any 
 44.34  installation required to be inspected by the board, the 
 44.35  electrical contractor, installer, special electrician, or owner 
 44.36  making the installation shall submit to the board a request for 
 45.1   inspection, in a form prescribed by the board, together with the 
 45.2   fees required for the installation.  
 45.3      (b) The fees required are a handling fee and an inspection 
 45.4   fee, in the amounts set forth in subdivision 6.  The handling 
 45.5   fee shall be set by the board in an amount sufficient to pay the 
 45.6   cost of printing and handling the form requesting an 
 45.7   inspection.  The inspection fee shall be set by the board in an 
 45.8   amount sufficient to pay the actual costs of the inspection and 
 45.9   the board's costs in administering the inspection.  All fees 
 45.10  shall be set pursuant to the procedure of sections 14.001 to 
 45.11  14.69.  
 45.12     (c) If the inspector finds that the installation is not in 
 45.13  compliance with accepted standards of construction for safety to 
 45.14  life and property as required by section 326.243, the inspector 
 45.15  shall by written order condemn the installation or noncomplying 
 45.16  portion thereof, or order service to the installation 
 45.17  disconnected, and shall send a copy of the order to the board.  
 45.18  If the installation or the noncomplying part will seriously and 
 45.19  proximately endanger human life and property, the order of the 
 45.20  inspector, when approved by the inspector's superior, shall 
 45.21  require immediate condemnation or disconnection.  In all other 
 45.22  cases, the order of the inspector shall permit a reasonable 
 45.23  opportunity for the installation to be brought into compliance 
 45.24  with accepted standards of construction for safety to life and 
 45.25  property prior to the effective time established for 
 45.26  condemnation or disconnection. 
 45.27     (d) Copies of each condemnation or disconnection order 
 45.28  shall be served personally or by mail upon the property owner, 
 45.29  and the electrical contractor, installer, or special electrician 
 45.30  making the installation, and other persons as the board by rule 
 45.31  may direct.  An aggrieved party may appeal any condemnation or 
 45.32  disconnection order by filing with the board a notice of appeal 
 45.33  within ten days after (1) service upon the aggrieved party of 
 45.34  the condemnation or disconnection order, if this service is 
 45.35  required, or (2) filing of the order with the board, whichever 
 45.36  is later.  The appeal shall proceed and the order of the 
 46.1   inspector shall have the effect the order, by its terms, and the 
 46.2   rules of the board provides.  The board shall adopt rules 
 46.3   providing procedures for the conduct of appeals, including 
 46.4   provisions for the stay of enforcement of the order of the 
 46.5   inspector pending such appeal when justified by the 
 46.6   circumstances.  
 46.7      Sec. 35.  Minnesota Statutes 1998, section 326.244, is 
 46.8   amended by adding a subdivision to read: 
 46.9      Subd. 6.  [FEE SCHEDULE.] State electrical inspection fees 
 46.10  shall be paid according to the following schedule.  
 46.11     (a) The minimum fee for each separate inspection of an 
 46.12  installation, replacement, alteration, or repair limited to one 
 46.13  inspection only is $15.  
 46.14     (b) The inspection fee for each service, change of service, 
 46.15  temporary service, power supply unit, addition, alteration, or 
 46.16  repair to a service or power supply unit shall be:  0- to and 
 46.17  including 200-ampere capacity, $15; for each additional 
 46.18  100-ampere capacity or fraction thereof, $5.  A separate request 
 46.19  for electrical inspection shall be filed for temporary services. 
 46.20     (c) The fee for each circuit or feeder, or addition, 
 46.21  alteration, or repair of a circuit or feeder including the 
 46.22  equipment served, and including circuits fed from feeders, 
 46.23  except as provided for in paragraph (d), clauses (1) to (11), 
 46.24  shall be:  
 46.25     (1) 0- to and including 100-ampere capacity, $4; and 
 46.26     (2) for each additional 100-ampere capacity or fraction 
 46.27  thereof, $2.  
 46.28     (d) Limitations and additions to the fees of paragraphs (a) 
 46.29  to (c): 
 46.30     (1) The fee for a single-family dwelling shall not exceed 
 46.31  $55 if the electrical service is not over 200-ampere capacity.  
 46.32  This fee includes not more than three inspections.  The fee for 
 46.33  a single-family dwelling over 200- to and including 400-ampere 
 46.34  capacity shall not exceed $100.  This fee includes not more than 
 46.35  four inspections.  These fees shall apply to each separate 
 46.36  service, and include the service, feeders, circuits, fixtures, 
 47.1   and equipment.  The fee for additional inspections shall be the 
 47.2   reinspection fee in paragraph (f).  Multifamily dwellings with 
 47.3   individual services to each unit are computed at the 
 47.4   single-family dwelling rate.  
 47.5      (2) The fee for each farm building or farm structure with a 
 47.6   service not over 200-ampere capacity shall not exceed $55.  This 
 47.7   fee includes not more than three inspections.  The fee for each 
 47.8   building or structure with a service over 200- to and including 
 47.9   400-ampere capacity shall not exceed $100.  This fee includes 
 47.10  not more than four inspections.  These fees include the 
 47.11  services, feeders, circuits, fixtures, and equipment.  The fee 
 47.12  for additional inspections shall be the reinspection fee in 
 47.13  paragraph (f).  Pole-top current metering and pole-top 
 47.14  disconnecting means on the farm yard pole are exempt from 
 47.15  inspection and inspection fees.  
 47.16     (3) The fee for each unit of a multifamily dwelling having 
 47.17  three to six dwelling units shall not exceed $30.  The fee for 
 47.18  each multifamily dwelling exceeding six units shall not exceed 
 47.19  $20 per dwelling unit.  This fee includes only the wiring in an 
 47.20  individual dwelling unit and the final feeder to that unit.  The 
 47.21  fee for the service and all other circuits shall be as specified 
 47.22  in paragraphs (a) to (c), except that the fee for each house 
 47.23  panel shall not exceed $55.  A separate request for electrical 
 47.24  inspection is required for each building.  The fee for a 
 47.25  two-unit dwelling or duplex shall be the same as for two 
 47.26  single-family dwellings.  
 47.27     (4) Recreational vehicle parks fees shall be in accordance 
 47.28  with paragraphs (a) to (c). 
 47.29     (5) The fee for mobile home park stalls shall be $6 per 
 47.30  unit stall exclusive of the feeder to the mobile home with a 
 47.31  minimum fee of $15 per inspection trip.  The fee for permanently 
 47.32  installed feeders shall be in accordance with paragraph (c). 
 47.33     (6) In addition to the preceding fees in this paragraph, 
 47.34  the fee for each street lighting standard shall be $1, and the 
 47.35  fee for each traffic signal standard shall be $2.  Circuits 
 47.36  originating within the standard shall not be used when computing 
 48.1   the fee. 
 48.2      (7) In addition to the preceding fees in this paragraph, 
 48.3   the fees for all transformers and generators for light, heat, 
 48.4   and power shall be $5 per unit plus $3 per ten-kilovolt-amperes 
 48.5   or fraction thereof.  The maximum fee for a transformer or 
 48.6   generator in this category is $40. 
 48.7      (8) In addition to the preceding fees in this paragraph, 
 48.8   the inspection fees for transformers for signs and outline 
 48.9   lighting shall be $5 per unit. 
 48.10     (9) In addition to the preceding fees in this paragraph, 
 48.11  unless included in the maximum fee, the inspection fee for 
 48.12  remote control, signal, alarm, or communication circuits and 
 48.13  circuits of less than 50 volts shall be $5 for ten openings or 
 48.14  devices of each system plus $2 for each additional ten or 
 48.15  fraction thereof, with a minimum fee of $15 per inspection trip. 
 48.16     (10) In addition to the preceding fees in this paragraph, 
 48.17  the inspection fee for each separate inspection of a swimming 
 48.18  pool shall be $15.  Reinforcing steel and bonding for swimming 
 48.19  pools requires a rough-in inspection.  
 48.20     (11) In addition to the preceding fees in this paragraph, 
 48.21  the fee for all wiring on center pivot irrigation booms shall be 
 48.22  $30.  The fees for all other wiring for the irrigation system 
 48.23  shall be as specified in this subdivision.  
 48.24     (e) Investigation fees:  Work without a request for 
 48.25  electrical inspection.  
 48.26     (1) Whenever any work for which a request for electrical 
 48.27  inspection is required by the board has begun without first 
 48.28  obtaining the request for inspection, a special investigation 
 48.29  shall be made before a request for electrical inspection is 
 48.30  accepted by the board. 
 48.31     (2) An investigation fee, in addition to the full fee 
 48.32  required by paragraphs (a) to (d), shall be paid before an 
 48.33  inspection is made.  The investigation fee shall be equal to the 
 48.34  amount of the fee required by paragraphs (a) to (d).  The 
 48.35  payment of the investigation fee does not exempt any person from 
 48.36  compliance with all other provisions of the board rules or 
 49.1   statutes nor from any penalty prescribed by law.  
 49.2      (f) When reinspection is necessary to determine whether 
 49.3   unsafe conditions have been corrected and the conditions are not 
 49.4   the subject of an appeal pending before the board or any court, 
 49.5   a reinspection fee of $15 may be assessed in writing by the 
 49.6   inspector. 
 49.7      (g) For inspections not covered in this subdivision, or for 
 49.8   requested special inspections or services, the fee shall be $23 
 49.9   per hour, including travel time, plus 24 cents per mile 
 49.10  traveled, plus the reasonable cost of equipment or material 
 49.11  consumed.  This provision is applicable to inspection of empty 
 49.12  conduits and other jobs as may be determined by the board. 
 49.13     (h) For inspection of transient projects, including but not 
 49.14  limited to carnivals and circuses, the inspection fees shall be 
 49.15  as specified in this paragraph. 
 49.16     The fee for inspection of power supply units shall be that 
 49.17  fee specified in paragraph (b).  A like fee will be required for 
 49.18  power supply units at each engagement during the season.  Rides, 
 49.19  devices, or concessions shall be inspected at their first 
 49.20  appearance of the season, and the inspection fee shall be $15 
 49.21  per unit. 
 49.22     In addition to the fee for the power supply units, there 
 49.23  shall be a general inspection for each engagement during the 
 49.24  season at the hourly rate, with a two-hour minimum.  In addition 
 49.25  to the above fees, inspections required on Saturdays, Sundays, 
 49.26  holidays, or after regular business hours will be at the hourly 
 49.27  rate, including travel time.  An owner of a migratory amusement 
 49.28  enterprise shall notify the board of its season itinerary and 
 49.29  make application for initial inspection a minimum of 14 days 
 49.30  before its first engagement in the state.  For subsequent 
 49.31  engagements not listed on the itinerary sent to the board, where 
 49.32  the board is not notified at least 48 hours in advance, a charge 
 49.33  of $100 will be made in addition to all required fees.  Also, a 
 49.34  fee at the hourly rate will be charged for additional time spent 
 49.35  by the inspector if the equipment is not ready for inspection at 
 49.36  the time and date specified on the request for electrical 
 50.1   inspection.  The fee for reinspection of corrections is $15 for 
 50.2   each reinspection.  
 50.3      (i) The handling fee to pay the cost of printing and 
 50.4   handling of the form requesting an inspection shall be $1.  
 50.5      Sec. 36.  Minnesota Statutes 1998, section 326.86, 
 50.6   subdivision 1, is amended to read: 
 50.7      Subdivision 1.  [LICENSING FEE.] The licensing fee for 
 50.8   persons licensed pursuant to sections 326.83 to 326.991 
 50.9   is $75 $100 per year.  The commissioner may adjust the fees 
 50.10  under section 16A.1285 to recover the costs of administration 
 50.11  and enforcement.  The fees must be limited to the cost of 
 50.12  license administration and enforcement and must be deposited in 
 50.13  the state treasury and credited to the general fund.  
 50.14     Sec. 37.  Minnesota Statutes 1998, section 446A.072, 
 50.15  subdivision 4, is amended to read: 
 50.16     Subd. 4.  [FUNDING LEVEL.] (a) The authority shall provide 
 50.17  supplemental assistance for essential project component costs as 
 50.18  certified by the commissioner of the pollution control agency 
 50.19  under section 116.182, subdivision 4.  
 50.20     (b) A municipality may not receive more than $4,000,000 
 50.21  under this section unless specifically approved by law. 
 50.22     (c) The authority shall provide supplemental assistance for 
 50.23  up to one-half of the eligible grant funding level determined by 
 50.24  the United States Department of Agriculture Rural Development 
 50.25  funding for projects listed on the agency's project priority 
 50.26  list, in priority order.  For municipalities that are not 
 50.27  eligible for United States Department of Agriculture Rural 
 50.28  Development funding for wastewater, the authority shall provide 
 50.29  supplemental assistance for:  (1) essential project component 
 50.30  costs calculated by first determining the amount needed to 
 50.31  reduce a municipality's annual residential sewer costs to 1.4 
 50.32  percent of the municipality's median household income or $25 per 
 50.33  month per household, whichever is greater, and then multiplying 
 50.34  that amount by 80 percent to determine the actual award amount 
 50.35  to supplement loans under section 446A.07; and (2) up to 50 
 50.36  percent of the incremental costs specifically identified by the 
 51.1   agency as being attributable to more stringent wastewater 
 51.2   standards required to protect outstanding resource value waters 
 51.3   or outstanding international resource value waters. 
 51.4      (d) Notwithstanding paragraph (b), in the event that a 
 51.5   municipality's monthly residential sewer service charges average 
 51.6   above $50, the authority will provide 90 percent of the grant 
 51.7   amount needed to reduce the average monthly sewer service charge 
 51.8   to $50, provided the project is ranked in the top 50 percentile 
 51.9   of the agency's intended use plan. 
 51.10     (e) Notwithstanding paragraphs (b), (c), and (d), a 
 51.11  municipality with an annual median household income of $40,000 
 51.12  or greater shall not be eligible for a grant, except for 
 51.13  incremental costs specifically identified by the agency as being 
 51.14  attributable to more stringent wastewater standards required to 
 51.15  protect outstanding resource value waters or outstanding 
 51.16  international resource value waters. 
 51.17     (f) The authority shall provide supplemental assistance to 
 51.18  a municipality that would not otherwise qualify for supplemental 
 51.19  assistance if: 
 51.20     (1) the municipality voluntarily accepts a sewer connection 
 51.21  from another governmental unit to serve residential, industrial, 
 51.22  or commercial developments that were completed before March 1, 
 51.23  1996, or are on lots whose plats were recorded before that date; 
 51.24  and 
 51.25     (2) fees charged by the municipality for the connection 
 51.26  must take into account state and federal grants used by the 
 51.27  municipality for the construction of the treatment plant. 
 51.28  The amount of supplemental assistance under this paragraph must 
 51.29  be sufficient to reduce debt service payments under section 
 51.30  446A.07 to an extent equivalent to a zero percent loan in an 
 51.31  amount up to the other governmental unit's project costs 
 51.32  necessary for connection.  Eligibility for supplemental 
 51.33  assistance under this paragraph ends three years after the 
 51.34  agency certifies that the connection has met the operational 
 51.35  performance standards established by the agency. 
 51.36     Sec. 38.  Minnesota Statutes 1998, section 462A.20, 
 52.1   subdivision 2, is amended to read: 
 52.2      Subd. 2.  [WHICH MONEY IN FUND.] There shall be paid into 
 52.3   the housing development fund: 
 52.4      (a) Any moneys appropriated and made available by the state 
 52.5   for the purposes of the fund; 
 52.6      (b) Any moneys which the agency receives in repayment of 
 52.7   advances made from the fund; 
 52.8      (c) Any other moneys which may be made available to the 
 52.9   agency for the purpose of the fund from any other source or 
 52.10  sources; 
 52.11     (d) All fees and charges collected by the agency; 
 52.12     (e) All interest or other income not required by the 
 52.13  provisions of a resolution or indenture securing notes or bonds 
 52.14  to be paid into another special fund; but the agency shall not 
 52.15  expend money for its cost of general administration of agency 
 52.16  programs in any fiscal year in excess of such limit for such 
 52.17  fiscal year as may be established by law.  "Cost of general 
 52.18  administration of agency programs" does not include debt 
 52.19  service, amortization of deferred financing costs, loan 
 52.20  origination costs, professional and other contractual services, 
 52.21  any deposit or expenditure required to be made by the provisions 
 52.22  of a bond or note resolution or indenture, or any deposit or 
 52.23  expenditure made to preserve the security for the bonds or notes.
 52.24     Sec. 39.  Minnesota Statutes 1998, section 462A.20, is 
 52.25  amended by adding a subdivision to read: 
 52.26     Subd. 2a.  [OPERATING COSTS REPORT.] On or before February 
 52.27  15 of each year, the agency shall deliver a report to the chairs 
 52.28  of the finance and appropriations committees of the legislature 
 52.29  on the costs of operating the agency in the previous fiscal year.
 52.30  The report shall include the expenditures for salaries and 
 52.31  benefits, rent, professional and technical services, general 
 52.32  agency administration, and agency's audited financial statements 
 52.33  which include information on expenditures and receipts relating 
 52.34  to debt issuance and administration and loan origination and 
 52.35  administration.  The report shall include a budget plan for 
 52.36  salaries and benefits, rent, professional and technical 
 53.1   services, and general administration for the current fiscal 
 53.2   year, including estimates of changes in costs from the previous 
 53.3   fiscal year.  If it appears that the costs in the current fiscal 
 53.4   year will exceed the budget plan contained in the report 
 53.5   submitted under this subdivision, the agency must submit a 
 53.6   revised budget plan to the commissioner of finance and obtain 
 53.7   the commissioner's concurrence with the revised plan. 
 53.8      Sec. 40.  Minnesota Statutes 1998, section 462A.204, is 
 53.9   amended by adding a subdivision to read: 
 53.10     Subd. 8.  [SCHOOL STABILITY DEMONSTRATION.] (a) The agency 
 53.11  in consultation with the interagency task force on homelessness 
 53.12  may establish a school stability demonstration project under the 
 53.13  family homeless prevention and assistance program.  The purpose 
 53.14  of the demonstration project is to secure stable housing for 
 53.15  families with school-age children who have moved frequently and 
 53.16  for unaccompanied youth.  For purposes of this subdivision, 
 53.17  "unaccompanied youth" are minors who are leaving foster care or 
 53.18  juvenile correctional facilities, or minors who meet the 
 53.19  definition of a child in need of services or protection under 
 53.20  section 260.015, subdivision 2a, but for whom no court finding 
 53.21  has been made pursuant to that statute. 
 53.22     (b) The agency shall make grants to family homeless 
 53.23  prevention and assistance projects in communities with a school 
 53.24  or schools that have a significant degree of student mobility. 
 53.25     (c) Each demonstration project must be designed to reduce 
 53.26  school absenteeism; stabilize children in one home setting, or 
 53.27  at a minimum, in one school setting; and reduce shelter usage.  
 53.28  Each demonstration project must include plans for the following: 
 53.29     (1) targeting of families with children under age 12 who, 
 53.30  in the last 12 months have either:  changed schools or homes at 
 53.31  least once or been absent from school at least 15 percent of the 
 53.32  school year and who have either been evicted from their housing; 
 53.33  are living in overcrowded or hazardous lead conditions in their 
 53.34  current housing; or are paying more than 50 percent of their 
 53.35  income for rent; 
 53.36     (2) targeting of unaccompanied youth in need of an 
 54.1   alternative residential setting; 
 54.2      (3) connecting families with the social services necessary 
 54.3   to maintain the family's stability in their home; 
 54.4      (4) connecting families with job training programs; 
 54.5      (5) assessing the impact of the demonstration project on 
 54.6   student performance and report its findings to the agency; and 
 54.7      (6) one or more of the following: 
 54.8      (i) provision of rental assistance for a specified period 
 54.9   of time, which may exceed 24 months provided they have applied 
 54.10  for section 8 housing assistance; or 
 54.11     (ii) development of permanent supportive housing or 
 54.12  transitional housing. 
 54.13     (d) Notwithstanding subdivision 2, grants under this 
 54.14  section may be used to acquire, rehabilitate, or construct 
 54.15  transitional or permanent housing. 
 54.16     (e) Each grantee under the demonstration project must 
 54.17  include representatives of the local school district or targeted 
 54.18  schools, or both, and of the local community correction agencies 
 54.19  on its advisory committee. 
 54.20     (f) Beginning in 2001, each grantee shall submit an annual 
 54.21  demonstration project report to the state interagency task force 
 54.22  on homelessness.  The report must include the actual program 
 54.23  results compared to program objectives, including for the 
 54.24  families served in the project a comparison before and after 
 54.25  assistance from the demonstration project of the rate of school 
 54.26  absenteeism, the number of residential and school moves, and the 
 54.27  number of incidents and length of homeless shelter usage, and 
 54.28  academic progress. 
 54.29     Sec. 41.  Minnesota Statutes 1998, section 462A.209, is 
 54.30  amended to read: 
 54.31     462A.209 [HOME OWNERSHIP ASSISTANCE.] 
 54.32     Subdivision 1.  [FULL CYCLE HOME OWNERSHIP SERVICES.] The 
 54.33  full cycle home ownership services program shall be used to fund 
 54.34  nonprofit organizations and political subdivisions providing, 
 54.35  building capacity to provide, or supporting full cycle lending 
 54.36  for home ownership to low and moderate income home buyers and 
 55.1   homeowners, including seniors.  The purpose of the program is to 
 55.2   encourage private investment in affordable housing and 
 55.3   collaboration of nonprofit organizations and political 
 55.4   subdivisions with each other and private lenders in providing 
 55.5   full cycle lending services. 
 55.6      Subd. 2.  [DEFINITION.] "Full cycle home ownership 
 55.7   services" means supporting eligible home buyers and owners 
 55.8   through all phases of purchasing and keeping a home, by 
 55.9   providing prepurchase home buyer education, prepurchase 
 55.10  counseling and credit repair, prepurchase property inspection 
 55.11  and technical and financial assistance to buyers in 
 55.12  rehabilitating the home, postpurchase and counseling including 
 55.13  home equity conversion loan counseling, mortgage default 
 55.14  counseling, postpurchase assistance with home maintenance, entry 
 55.15  cost assistance, and access to flexible loan products. 
 55.16     Subd. 3.  [ELIGIBILITY.] The agency shall establish 
 55.17  eligibility criteria for nonprofit organizations and political 
 55.18  subdivisions to receive funding under this section.  The 
 55.19  eligibility criteria must require the nonprofit organization or 
 55.20  political subdivision to provide, to build capacity to provide, 
 55.21  or support full cycle home ownership services for eligible home 
 55.22  buyers.  The agency may fund a nonprofit organization or 
 55.23  political subdivision that will provide full cycle home 
 55.24  ownership services by coordinating with one or more other 
 55.25  organizations that will provide specific components of full 
 55.26  cycle home ownership services.  The agency may make exceptions 
 55.27  to providing all components of full cycle lending if justified 
 55.28  by the application.  If there are more applicants requesting 
 55.29  funding than there are funds available, the agency shall award 
 55.30  the funds on a competitive basis and also assure an equitable 
 55.31  geographic distribution of the available funds.  The eligibility 
 55.32  criteria must require the nonprofit organization or political 
 55.33  subdivision to have a demonstrated involvement in the local 
 55.34  community and to target the housing affordability needs of the 
 55.35  local community or, in the case of home equity conversion loan 
 55.36  counseling, to have demonstrated experience with counseling 
 56.1   older persons on housing, to be knowledgeable about programs in 
 56.2   Minnesota that may provide alternatives to home equity 
 56.3   conversion, and to provide the counseling in Minnesota.  
 56.4   Partnerships and collaboration with innovative, grass roots, or 
 56.5   community-based initiatives shall be encouraged.  The agency 
 56.6   shall give priority to nonprofit organizations and political 
 56.7   subdivisions that provide matching funds.  Applicants for funds 
 56.8   under section 462A.057 may also apply funds under this program. 
 56.9      Subd. 4.  [ENTRY COST HOME OWNERSHIP OPPORTUNITY PROGRAM.] 
 56.10  The agency may establish an entry cost home ownership 
 56.11  opportunity program, on terms and conditions it deems advisable, 
 56.12  to assist individuals with downpayment and closing costs to 
 56.13  finance the purchase of a home. 
 56.14     Sec. 42.  Minnesota Statutes 1998, section 462A.21, is 
 56.15  amended by adding a subdivision to read: 
 56.16     Subd. 25.  [FULL CYCLE HOMEOWNERSHIP SERVICES.] The agency 
 56.17  may spend money for the purposes of section 462A.209 and may pay 
 56.18  the costs and expenses necessary and incidental to the 
 56.19  development and operation of the program.  
 56.20     Sec. 43.  [ACCOUNTABILITY MEASURES.] 
 56.21     The commissioner of economic security shall adopt 
 56.22  accountability measures to ensure that money from the dedicated 
 56.23  fund established under Minnesota Statutes, section 268.022, 
 56.24  allocated for training assistance and support services, as 
 56.25  defined in Minnesota Statutes, section 268.975, subdivisions 12 
 56.26  and 13, is used to further the purposes of the program.  The 
 56.27  commissioner shall report to the legislature by October 1, 1999, 
 56.28  on the accountability measures and shall make the measures 
 56.29  effective by November 1, 1999. 
 56.30     Sec. 44.  [GRANT REQUIREMENTS WAIVED.] 
 56.31     A grant by the commissioner of trade and economic 
 56.32  development to Grant county for community infrastructure 
 56.33  improvements needed to develop value-added agriprocessing 
 56.34  facilities is not subject to the maximum grant limitation of 
 56.35  Minnesota Statutes, section 116J.8731, subdivision 5, or agency 
 56.36  policy regarding maximum grant per job created. 
 57.1      Sec. 45.  [REPORT TO LEGISLATURE.] 
 57.2      The commissioner of the Minnesota housing finance agency 
 57.3   shall report to the legislature by February 1, 2001, on current 
 57.4   and proposed strategies related to HIV/AIDS for coordinating 
 57.5   local, state, and federal housing resources to address 
 57.6   identified opportunities and needs, plans for future 
 57.7   implementation, and recommendations for future legislative 
 57.8   action.  The commissioner shall consult with the commissioners 
 57.9   of health and human services and representatives of affected 
 57.10  populations in preparing this report.  
 57.11     Sec. 46.  [PRINCIPLES ESTABLISHED.] 
 57.12     When considering potential state investments to assist 
 57.13  Minnesota's mining industry, the commissioner of trade and 
 57.14  economic development will consider the following principles: 
 57.15     (1) any state investment should receive a direct financial 
 57.16  return and should be structured as a loan or equity investment; 
 57.17     (2) investment decisions should take into account the 
 57.18  evolution of the entire mining industry and should not be made 
 57.19  solely with reference to individual projects; 
 57.20     (3) in the case of large development projects, state funds 
 57.21  should be disbursed at the same time as the majority of other 
 57.22  funds committed to the project and should not be available for 
 57.23  predevelopment or early stage funding; 
 57.24     (4) the commissioner of trade and economic development will 
 57.25  direct consideration of state investments in the mining industry 
 57.26  in consultation with the commissioners of natural resources, 
 57.27  revenue, the pollution control agency, and the iron range 
 57.28  resources and rehabilitation board; and 
 57.29     (5) no state investment will be made without thorough 
 57.30  review, including independent professional analysis as needed, 
 57.31  of all financial aspects of the investment. 
 57.32     Sec. 47.  [MEMBERSHIP AGREEMENT.] 
 57.33     The commissioner shall request the executive board of the 
 57.34  World Trade Centers Association to transfer the membership of 
 57.35  the Minnesota world trade center corporation in the World Trade 
 57.36  Centers Association to the department of trade and economic 
 58.1   development, Minnesota trade office. 
 58.2      Sec. 48.  [TRANSFERS.] 
 58.3      All of the rights and obligations of the Minnesota world 
 58.4   trade center corporation under the development agreement and all 
 58.5   existing contracts related to the approximately 20,000 square 
 58.6   feet to which the world trade center corporation is a party or 
 58.7   beneficiary is transferred to the state of Minnesota, department 
 58.8   of trade and economic development, Minnesota trade office.  All 
 58.9   other property of the world trade center corporation is 
 58.10  transferred and appropriated to the commissioner per Minnesota 
 58.11  Statutes 1998, section 15.039. 
 58.12     Sec. 49.  [TRANSFER OF POSITIONS AND EMPLOYEES.] 
 58.13     All positions and employees of the world trade conference 
 58.14  center are transferred to the executive branch of the state 
 58.15  government under the department of trade and economic 
 58.16  development on July 1, 1999, under the following conditions. 
 58.17     The commissioner of employee relations will determine which 
 58.18  positions are to be placed in the classified service and which 
 58.19  are placed in the unclassified service of the state in 
 58.20  accordance with appropriate provisions of Minnesota Statutes, 
 58.21  chapter 43A.  The commissioner will allocate positions to 
 58.22  appropriate classes in the state classification plan.  Positions 
 58.23  transferred with their incumbents do not create vacancies in 
 58.24  state service. 
 58.25     Employees transferred to unlimited classified positions are 
 58.26  transferred to state service without examinations.  Those 
 58.27  transferred to positions in the managerial plan pursuant to 
 58.28  Minnesota Statutes, section 43A.18, subdivision 3, who have 
 58.29  completed 12 months of service in their position and all others 
 58.30  who have completed six months of service in their positions are 
 58.31  transferred with permanent status.  Employees transferred to 
 58.32  managerial positions with less than 12 months of service in 
 58.33  their positions are transferred with probationary status.  
 58.34  However, all time spent by these employees in the positions must 
 58.35  be credited toward meeting the probationary period requirement 
 58.36  of the contract or plan governing the classification to which 
 59.1   their positions have been assigned. 
 59.2      Employees transferred to limited classified positions or to 
 59.3   temporary unclassified positions shall receive emergency, 
 59.4   temporary, or temporary unclassified appointments under 
 59.5   provisions of Minnesota Statutes, section 43A.15, subdivisions 2 
 59.6   and 3, or Minnesota Statutes, section 43A.08, subdivision 2a, as 
 59.7   appropriate. 
 59.8      The appointing authority and incumbent employees of 
 59.9   unlimited positions whose positions have been assigned by the 
 59.10  department of employee relations to classes in the state 
 59.11  classification plan shall have access to the provisions of 
 59.12  Minnesota Statutes, section 43A.07, subdivision 3, regarding 
 59.13  protested allocation of their positions effective July 1, 1999, 
 59.14  and for 30 days thereafter.  
 59.15     Sec. 50.  [SPENDING APPROVED.] 
 59.16     Requests to spend federal funds from the commissioners of 
 59.17  economic security, trade and economic development, and public 
 59.18  service for which further review was requested under Minnesota 
 59.19  Statutes, section 3.3005, subdivision 2a, in February 1999, are 
 59.20  approved for the purposes indicated in the requests. 
 59.21     Sec. 51.  [REPEALER.] 
 59.22     (a) Minnesota Statutes 1998, sections 44A.001; 44A.01; 
 59.23  44A.02; 44A.023; 44A.025; 44A.031; 44A.0311; 44A.06; 44A.08; and 
 59.24  44A.11, are repealed.  
 59.25     (b) Minnesota Statutes 1998, sections 138A.01; 138A.02; 
 59.26  138A.03; 138A.04; 138A.05; 138A.06; 462A.28; 469.305; 469.306; 
 59.27  469.307; 469.308; and 469.31, are repealed.  
 59.28     (c) Minnesota Statutes 1998, sections 341.01; 341.02; 
 59.29  341.04; 341.045; 341.05; 341.06; 341.07; 341.08; 341.09; 341.10; 
 59.30  341.11; 341.115; 341.12; 341.13; and 341.15, are repealed. 
 59.31     (d) Laws 1998, chapter 404, section 13, subdivision 5, is 
 59.32  repealed. 
 59.33     Sec. 52.  [EFFECTIVE DATES.] 
 59.34     Section 44 is effective the day following final enactment.  
 59.35     Sections 48 is effective June 30, 1999. 
 59.36     Section 51, paragraph (a), is effective July 1, 1999. 
 60.1      Section 51, paragraph (b), is effective July 1, 1999. 
 60.2      Section 51, paragraph (c), is effective June 30, 2000. 
 60.3      Section 51, paragraph (d), is effective the day following 
 60.4   final enactment. 
 60.5                              ARTICLE 3 
 60.6                   HEALTH MAINTENANCE ORGANIZATIONS 
 60.7      Section 1.  Minnesota Statutes 1998, section 62D.01, 
 60.8   subdivision 2, is amended to read: 
 60.9      Subd. 2.  (a) Faced with the continuation of mounting costs 
 60.10  of health care coupled with its inaccessibility to large 
 60.11  segments of the population, the legislature has determined that 
 60.12  there is a need to explore alternative methods for the delivery 
 60.13  of health care services, with a view toward achieving greater 
 60.14  efficiency and economy in providing these services. 
 60.15     (b) It is, therefore, the policy of the state to eliminate 
 60.16  the barriers to the organization, promotion, and expansion of 
 60.17  health maintenance organizations; to provide for their 
 60.18  regulation by the state commissioner of health commerce and the 
 60.19  state commissioner of health; and to exempt them from the 
 60.20  operation of the insurance and nonprofit health service plan 
 60.21  corporation laws of the state except as hereinafter provided. 
 60.22     (c) It is further the intention of the legislature to 
 60.23  closely monitor the development of health maintenance 
 60.24  organizations in order to assess their impact on the costs of 
 60.25  health care to consumers, the accessibility of health care to 
 60.26  consumers, and the quality of health care provided to consumers. 
 60.27     Sec. 2.  Minnesota Statutes 1998, section 62D.02, 
 60.28  subdivision 3, is amended to read: 
 60.29     Subd. 3.  "Commissioner of health commerce" or 
 60.30  "commissioner" means the state commissioner of health commerce 
 60.31  or a designee. 
 60.32     Sec. 3.  Minnesota Statutes 1998, section 62D.02, is 
 60.33  amended by adding a subdivision to read: 
 60.34     Subd. 17.  [QUALITY OF CARE.] "Quality of care" means the 
 60.35  degree to which health services for individuals and populations 
 60.36  are consistent with current professional knowledge and accepted 
 61.1   standards for: 
 61.2      (1) availability and access to provider network and care 
 61.3   management systems; 
 61.4      (2) provider credentialing and monitoring procedures and 
 61.5   needs of the community and individuals served; 
 61.6      (3) process for appropriate, effective, patient-centered 
 61.7   care delivery consistent with accepted practice parameters; and 
 61.8      (4) patient satisfaction and increased likelihood of 
 61.9   desired clinical and functional outcomes. 
 61.10     Sec. 4.  Minnesota Statutes 1998, section 62D.03, 
 61.11  subdivision 1, is amended to read: 
 61.12     Subdivision 1.  Notwithstanding any law of this state to 
 61.13  the contrary, any nonprofit corporation organized to do so or a 
 61.14  local governmental unit may apply to the commissioner of health 
 61.15  for a certificate of authority to establish and operate a health 
 61.16  maintenance organization in compliance with sections 62D.01 to 
 61.17  62D.30.  No person shall establish or operate a health 
 61.18  maintenance organization in this state, nor sell or offer to 
 61.19  sell, or solicit offers to purchase or receive advance or 
 61.20  periodic consideration in conjunction with a health maintenance 
 61.21  organization or health maintenance contract unless the 
 61.22  organization has a certificate of authority under sections 
 61.23  62D.01 to 62D.30. 
 61.24     Sec. 5.  Minnesota Statutes 1998, section 62D.03, 
 61.25  subdivision 3, is amended to read: 
 61.26     Subd. 3.  The commissioner or commissioner of health may 
 61.27  require any person providing physician and hospital services 
 61.28  with payments made in the manner set forth in section 62D.02, 
 61.29  subdivision 4, to apply for a certificate of authority under 
 61.30  sections 62D.01 to 62D.30.  An applicant may continue to operate 
 61.31  until the commissioner of health acts upon the application.  In 
 61.32  the event that an application is denied, the applicant shall 
 61.33  henceforth be treated as a health maintenance organization whose 
 61.34  certificate of authority has been revoked.  Any person directed 
 61.35  to apply for a certificate of authority shall be subject to the 
 61.36  provisions of this subdivision. 
 62.1      Sec. 6.  Minnesota Statutes 1998, section 62D.03, 
 62.2   subdivision 4, is amended to read: 
 62.3      Subd. 4.  Each application for a certificate of authority 
 62.4   shall be verified by an officer or authorized representative of 
 62.5   the applicant, and shall be in a form prescribed by the 
 62.6   commissioner of health.  Each application shall include the 
 62.7   following: 
 62.8      (a) a copy of the basic organizational document, if any, of 
 62.9   the applicant and of each major participating entity; such as 
 62.10  the articles of incorporation, or other applicable documents, 
 62.11  and all amendments thereto; 
 62.12     (b) a copy of the bylaws, rules and regulations, or similar 
 62.13  document, if any, and all amendments thereto which regulate the 
 62.14  conduct of the affairs of the applicant and of each major 
 62.15  participating entity; 
 62.16     (c) a list of the names, addresses, and official positions 
 62.17  of the following: 
 62.18     (1) all members of the board of directors, or governing 
 62.19  body of the local government unit, and the principal officers 
 62.20  and shareholders of the applicant organization; and 
 62.21     (2) all members of the board of directors, or governing 
 62.22  body of the local government unit, and the principal officers of 
 62.23  the major participating entity and each shareholder beneficially 
 62.24  owning more than ten percent of any voting stock of the major 
 62.25  participating entity; 
 62.26     The commissioner may by rule identify persons included in 
 62.27  the term "principal officers"; 
 62.28     (d) a full disclosure of the extent and nature of any 
 62.29  contract or financial arrangements between the following:  
 62.30     (1) the health maintenance organization and the persons 
 62.31  listed in clause (c)(1); 
 62.32     (2) the health maintenance organization and the persons 
 62.33  listed in clause (c)(2); 
 62.34     (3) each major participating entity and the persons listed 
 62.35  in clause (c)(1) concerning any financial relationship with the 
 62.36  health maintenance organization; and 
 63.1      (4) each major participating entity and the persons listed 
 63.2   in clause (c)(2) concerning any financial relationship with the 
 63.3   health maintenance organization; 
 63.4      (e) the name and address of each participating entity and 
 63.5   the agreed upon duration of each contract or agreement; 
 63.6      (f) a copy of the form of each contract binding the 
 63.7   participating entities and the health maintenance organization.  
 63.8   Contractual provisions shall be consistent with the purposes of 
 63.9   sections 62D.01 to 62D.30, in regard to the services to be 
 63.10  performed under the contract, the manner in which payment for 
 63.11  services is determined, the nature and extent of 
 63.12  responsibilities to be retained by the health maintenance 
 63.13  organization, the nature and extent of risk sharing permissible, 
 63.14  and contractual termination provisions; 
 63.15     (g) a copy of each contract binding major participating 
 63.16  entities and the health maintenance organization.  Contract 
 63.17  information filed with the commissioner shall be confidential 
 63.18  and subject to the provisions of section 13.37, subdivision 1, 
 63.19  clause (b), upon the request of the health maintenance 
 63.20  organization.  
 63.21     Upon initial filing of each contract, the health 
 63.22  maintenance organization shall file a separate document 
 63.23  detailing the projected annual expenses to the major 
 63.24  participating entity in performing the contract and the 
 63.25  projected annual revenues received by the entity from the health 
 63.26  maintenance organization for such performance.  The commissioner 
 63.27  shall disapprove any contract with a major participating entity 
 63.28  if the contract will result in an unreasonable expense under 
 63.29  section 62D.19.  The commissioner shall approve or disapprove a 
 63.30  contract within 30 days of filing.  
 63.31     Within 120 days of the anniversary of the implementation of 
 63.32  each contract, the health maintenance organization shall file a 
 63.33  document detailing the actual expenses incurred and reported by 
 63.34  the major participating entity in performing the contract in the 
 63.35  preceding year and the actual revenues received from the health 
 63.36  maintenance organization by the entity in payment for the 
 64.1   performance; 
 64.2      (h) a statement generally describing the health maintenance 
 64.3   organization, its health maintenance contracts and separate 
 64.4   health service contracts, facilities, and personnel, including a 
 64.5   statement describing the manner in which the applicant proposes 
 64.6   to provide enrollees with comprehensive health maintenance 
 64.7   services and separate health services; 
 64.8      (i) a copy of the form of each evidence of coverage to be 
 64.9   issued to the enrollees; 
 64.10     (j) a copy of the form of each individual or group health 
 64.11  maintenance contract and each separate health service contract 
 64.12  which is to be issued to enrollees or their representatives; 
 64.13     (k) financial statements showing the applicant's assets, 
 64.14  liabilities, and sources of financial support.  If the 
 64.15  applicant's financial affairs are audited by independent 
 64.16  certified public accountants, a copy of the applicant's most 
 64.17  recent certified financial statement may be deemed to satisfy 
 64.18  this requirement; 
 64.19     (l) a description of the proposed method of marketing the 
 64.20  plan, a schedule of proposed charges, and a financial plan which 
 64.21  includes a three-year projection of the expenses and income and 
 64.22  other sources of future capital; 
 64.23     (m) a statement reasonably describing the geographic area 
 64.24  or areas to be served and the type or types of enrollees to be 
 64.25  served; 
 64.26     (n) a description of the complaint procedures to be 
 64.27  utilized as required under section 62D.11; 
 64.28     (o) a description of the procedures and programs to be 
 64.29  implemented to meet the requirements of section 62D.04, 
 64.30  subdivision 1, clauses (b) and (c) subdivision 1a, paragraph 
 64.31  (a), clauses (1) and (2), and to monitor the quality of health 
 64.32  care provided to enrollees; 
 64.33     (p) a description of the mechanism by which enrollees will 
 64.34  be afforded an opportunity to participate in matters of policy 
 64.35  and operation under section 62D.06; 
 64.36     (q) a copy of any agreement between the health maintenance 
 65.1   organization and an insurer or nonprofit health service 
 65.2   corporation regarding reinsurance, stop-loss coverage, 
 65.3   insolvency coverage, or any other type of coverage for potential 
 65.4   costs of health services, as authorized in sections 62D.04, 
 65.5   subdivision 1, clause (f), 62D.05, subdivision 3, and 62D.13; 
 65.6      (r) a copy of the conflict of interest policy which applies 
 65.7   to all members of the board of directors and the principal 
 65.8   officers of the health maintenance organization, as described in 
 65.9   section 62D.04, subdivision 1, paragraph (g).  All currently 
 65.10  licensed health maintenance organizations shall also file a 
 65.11  conflict of interest policy with the commissioner within 60 days 
 65.12  after August 1, 1990, or at a later date if approved by the 
 65.13  commissioner; 
 65.14     (s) a copy of the statement that describes the health 
 65.15  maintenance organization's prior authorization administrative 
 65.16  procedures; 
 65.17     (t) a copy of the agreement between the guaranteeing 
 65.18  organization and the health maintenance organization, as 
 65.19  described in section 62D.043, subdivision 6; and 
 65.20     (u) other information as the commissioner of health may 
 65.21  reasonably require to be provided. 
 65.22     Sec. 7.  Minnesota Statutes 1998, section 62D.04, 
 65.23  subdivision 1, is amended to read: 
 65.24     Subdivision 1.  Upon receipt of an application for a 
 65.25  certificate of authority, the commissioner of health shall 
 65.26  determine whether the applicant for a certificate of authority 
 65.27  has: 
 65.28     (a) demonstrated the willingness and potential ability to 
 65.29  assure that health care services will be provided in such a 
 65.30  manner as to enhance and assure both the availability and 
 65.31  accessibility of adequate personnel and facilities; 
 65.32     (b) arrangements for an ongoing evaluation of the quality 
 65.33  of health care; 
 65.34     (c) a procedure to develop, compile, evaluate, and report 
 65.35  statistics relating to the cost of its operations, the pattern 
 65.36  of utilization of its services, the quality, availability and 
 66.1   accessibility of its services, and such other matters as may be 
 66.2   reasonably required by regulation of the commissioner of health; 
 66.3      (d) reasonable provisions for emergency and out of area 
 66.4   health care services; 
 66.5      (e) (a) demonstrated that it is financially responsible and 
 66.6   may reasonably be expected to meet its obligations to enrollees 
 66.7   and prospective enrollees.  In making this determination, the 
 66.8   commissioner of health shall require the amounts of net worth 
 66.9   and working capital required in section 62D.042, the deposit 
 66.10  required in section 62D.041, and in addition shall consider: 
 66.11     (1) the financial soundness of its arrangements for health 
 66.12  care services and the proposed schedule of charges used in 
 66.13  connection therewith; 
 66.14     (2) arrangements which will guarantee for a reasonable 
 66.15  period of time the continued availability or payment of the cost 
 66.16  of health care services in the event of discontinuance of the 
 66.17  health maintenance organization; and 
 66.18     (3) agreements with providers for the provision of health 
 66.19  care services; 
 66.20     (f) (b) demonstrated that it will assume full financial 
 66.21  risk on a prospective basis for the provision of comprehensive 
 66.22  health maintenance services, including hospital care; provided, 
 66.23  however, that the requirement in this paragraph shall not 
 66.24  prohibit the following: 
 66.25     (1) a health maintenance organization from obtaining 
 66.26  insurance or making other arrangements (i) for the cost of 
 66.27  providing to any enrollee comprehensive health maintenance 
 66.28  services, the aggregate value of which exceeds $5,000 in any 
 66.29  year, (ii) for the cost of providing comprehensive health care 
 66.30  services to its members on a nonelective emergency basis, or 
 66.31  while they are outside the area served by the organization, or 
 66.32  (iii) for not more than 95 percent of the amount by which the 
 66.33  health maintenance organization's costs for any of its fiscal 
 66.34  years exceed 105 percent of its income for such fiscal years; 
 66.35  and 
 66.36     (2) a health maintenance organization from having a 
 67.1   provision in a group health maintenance contract allowing an 
 67.2   adjustment of premiums paid based upon the actual health 
 67.3   services utilization of the enrollees covered under the 
 67.4   contract, except that at no time during the life of the contract 
 67.5   shall the contract holder fully self-insure the financial risk 
 67.6   of health care services delivered under the contract.  Risk 
 67.7   sharing arrangements shall be subject to the requirements of 
 67.8   sections 62D.01 to 62D.30; 
 67.9      (g) (c) demonstrated that it has made provisions for and 
 67.10  adopted a conflict of interest policy applicable to all members 
 67.11  of the board of directors and the principal officers of the 
 67.12  health maintenance organization.  The conflict of interest 
 67.13  policy shall include the procedures described in section 
 67.14  317A.255, subdivisions 1 and 2.  However, the commissioner is 
 67.15  not precluded from finding that a particular transaction is an 
 67.16  unreasonable expense as described in section 62D.19 even if the 
 67.17  directors follow the required procedures; and 
 67.18     (h) (d) otherwise met the requirements of sections 62D.01 
 67.19  to 62D.30. 
 67.20     Sec. 8.  Minnesota Statutes 1998, section 62D.04, is 
 67.21  amended by adding a subdivision to read: 
 67.22     Subd. 1a.  [REVIEW BY COMMISSIONER OF HEALTH.] (a) Upon 
 67.23  receipt of an application for a certificate of authority, the 
 67.24  commissioner shall request that the commissioner of health 
 67.25  certify whether the applicant has: 
 67.26     (1) demonstrated the willingness and potential ability to 
 67.27  assure that health care services will be provided in such a 
 67.28  manner so as to enhance and assure both the availability and 
 67.29  accessibility of adequate personnel and facilities; 
 67.30     (2) arrangements for an ongoing evaluation of the quality 
 67.31  of health care; 
 67.32     (3) a procedure to develop, compile, evaluate, and report 
 67.33  statistics relating to the cost of its operations, the pattern 
 67.34  of utilization of its services, the quality, availability and 
 67.35  accessibility of its services, and such other matters as may be 
 67.36  reasonably required by rule of the commissioner; and 
 68.1      (4) reasonable provisions for emergency and out-of-area 
 68.2   health care services. 
 68.3      (b) The commissioner of health shall provide the 
 68.4   certification, or notification that certification is not 
 68.5   forthcoming, to the commissioner within the time period 
 68.6   specified in subdivision 2. 
 68.7      Sec. 9.  Minnesota Statutes 1998, section 62D.04, 
 68.8   subdivision 2, is amended to read: 
 68.9      Subd. 2.  Within 90 days after the receipt of the 
 68.10  application for a certificate of authority, the commissioner of 
 68.11  health shall determine whether or not the applicant meets the 
 68.12  requirements of this section.  If the commissioner of health 
 68.13  determines that the applicant meets the requirements of sections 
 68.14  62D.01 to 62D.30, the commissioner shall issue a certificate of 
 68.15  authority to the applicant.  The commissioner shall not issue a 
 68.16  certificate without the certification by the commissioner of 
 68.17  health required by subdivision 1a.  If the commissioner of 
 68.18  health determines that the applicant is not qualified, the 
 68.19  commissioner shall so notify the applicant and shall specify the 
 68.20  reason or reasons for such disqualification. 
 68.21     Sec. 10.  Minnesota Statutes 1998, section 62D.04, 
 68.22  subdivision 4, is amended to read: 
 68.23     Subd. 4.  [CONTINUED COMPLIANCE.] Upon being granted a 
 68.24  certificate of authority to operate as a health maintenance 
 68.25  organization, the organization must continue to operate in 
 68.26  compliance with the standards set forth in subdivision 1 
 68.27  subdivisions 1 and 1a.  Noncompliance may result in the 
 68.28  imposition of a fine or the suspension or revocation of the 
 68.29  certificate of authority, in accordance with sections 62D.15 to 
 68.30  62D.17.  The commissioner of health shall inform the 
 68.31  commissioner of any failure to comply with subdivision 1a. 
 68.32     Sec. 11.  Minnesota Statutes 1998, section 62D.05, 
 68.33  subdivision 6, is amended to read: 
 68.34     Subd. 6.  [SUPPLEMENTAL BENEFITS.] (a) A health maintenance 
 68.35  organization may, as a supplemental benefit, provide coverage to 
 68.36  its enrollees for health care services and supplies received 
 69.1   from providers who are not employed by, under contract with, or 
 69.2   otherwise affiliated with the health maintenance organization.  
 69.3   Supplemental benefits may be provided if the following 
 69.4   conditions are met:  
 69.5      (1) a health maintenance organization desiring to offer 
 69.6   supplemental benefits must at all times comply with the 
 69.7   requirements of sections 62D.041 and 62D.042; 
 69.8      (2) a health maintenance organization offering supplemental 
 69.9   benefits must maintain an additional surplus in the first year 
 69.10  supplemental benefits are offered equal to the lesser of 
 69.11  $500,000 or 33 percent of the supplemental benefit expenses.  At 
 69.12  the end of the second year supplemental benefits are offered, 
 69.13  the health maintenance organization must maintain an additional 
 69.14  surplus equal to the lesser of $1,000,000 or 33 percent of the 
 69.15  supplemental benefit expenses.  At the end of the third year 
 69.16  benefits are offered and every year after that, the health 
 69.17  maintenance organization must maintain an additional surplus 
 69.18  equal to the greater of $1,000,000 or 33 percent of the 
 69.19  supplemental benefit expenses.  When in the judgment of the 
 69.20  commissioner the health maintenance organization's surplus is 
 69.21  inadequate, the commissioner may require the health maintenance 
 69.22  organization to maintain additional surplus; 
 69.23     (3) claims relating to supplemental benefits must be 
 69.24  processed in accordance with the requirements of section 
 69.25  72A.201; and 
 69.26     (4) in marketing supplemental benefits, the health 
 69.27  maintenance organization shall fully disclose and describe to 
 69.28  enrollees and potential enrollees the nature and extent of the 
 69.29  supplemental coverage, and any claims filing and other 
 69.30  administrative responsibilities in regard to supplemental 
 69.31  benefits.  
 69.32     (b) The commissioner may, pursuant to chapter 14, adopt, 
 69.33  enforce, and administer rules relating to this subdivision, 
 69.34  including:  rules insuring that these benefits are supplementary 
 69.35  and not substitutes for comprehensive health maintenance 
 69.36  services by addressing percentage of out-of-plan coverage; rules 
 70.1   relating to the establishment of necessary financial reserves; 
 70.2   rules relating to marketing practices; and other rules necessary 
 70.3   for the effective and efficient administration of this 
 70.4   subdivision.  The commissioner, in adopting rules, shall give 
 70.5   consideration to existing laws and rules administered and 
 70.6   enforced by the department of commerce commissioner relating to 
 70.7   health insurance plans.  
 70.8      Sec. 12.  Minnesota Statutes 1998, section 62D.06, 
 70.9   subdivision 2, is amended to read: 
 70.10     Subd. 2.  The governing body shall establish a mechanism to 
 70.11  afford the enrollees an opportunity to express their opinions in 
 70.12  matters of policy and operation through the establishment of 
 70.13  advisory panels, by the use of advisory referenda on major 
 70.14  policy decisions, or through the use of other mechanisms as may 
 70.15  be prescribed or permitted by the commissioner of health. 
 70.16     Sec. 13.  Minnesota Statutes 1998, section 62D.07, 
 70.17  subdivision 2, is amended to read: 
 70.18     Subd. 2.  No evidence of coverage or contract, or amendment 
 70.19  thereto shall be issued or delivered to any person in this state 
 70.20  until a copy of the form of the evidence of coverage or contract 
 70.21  or amendment thereto has been filed with the commissioner of 
 70.22  health pursuant to section 62D.03 or 62D.08. 
 70.23     Sec. 14.  Minnesota Statutes 1998, section 62D.07, 
 70.24  subdivision 3, is amended to read: 
 70.25     Subd. 3.  Contracts and evidences of coverage shall contain:
 70.26     (a) No provisions or statements which are unjust, unfair, 
 70.27  inequitable, misleading, deceptive, or which are untrue, 
 70.28  misleading, or deceptive as defined in section 62D.12, 
 70.29  subdivision 1; 
 70.30     (b) A clear, concise and complete statement of: 
 70.31     (1) the health care services and the insurance or other 
 70.32  benefits, if any, to which the enrollee is entitled under the 
 70.33  health maintenance contract; 
 70.34     (2) any exclusions or limitations on the services, kind of 
 70.35  services, benefits, or kind of benefits, to be provided, 
 70.36  including any deductible or copayment feature and requirements 
 71.1   for referrals, prior authorizations, and second opinions; 
 71.2      (3) where and in what manner information is available as to 
 71.3   how services, including emergency and out of area services, may 
 71.4   be obtained; 
 71.5      (4) the total amount of payment and copayment, if any, for 
 71.6   health care services and the indemnity or service benefits, if 
 71.7   any, which the enrollee is obligated to pay with respect to 
 71.8   individual contracts, or an indication whether the plan is 
 71.9   contributory or noncontributory with respect to group 
 71.10  certificates; and 
 71.11     (5) a description of the health maintenance organization's 
 71.12  method for resolving enrollee complaints and a statement 
 71.13  identifying the commissioner as an external source with whom 
 71.14  complaints may be registered; and 
 71.15     (c) On the cover page of the evidence of coverage and 
 71.16  contract, a clear and complete statement of enrollees' rights.  
 71.17  The statement must be in bold print and captioned "Important 
 71.18  Enrollee Information and Enrollee Bill of Rights" and must 
 71.19  include but not be limited to the following provisions in the 
 71.20  following language or in substantially similar language approved 
 71.21  in advance by the commissioner, except that paragraph (8) does 
 71.22  not apply to prepaid health plans providing coverage for 
 71.23  programs administered by the commissioner of human services:  
 71.24                        ENROLLEE INFORMATION 
 71.25     (1) COVERED SERVICES:  Services provided by (name of health 
 71.26  maintenance organization) will be covered only if services are 
 71.27  provided by participating (name of health maintenance 
 71.28  organization) providers or authorized by (name of health 
 71.29  maintenance organization).  Your contract fully defines what 
 71.30  services are covered and describes procedures you must follow to 
 71.31  obtain coverage. 
 71.32     (2) PROVIDERS:  Enrolling in (name of health maintenance 
 71.33  organization) does not guarantee services by a particular 
 71.34  provider on the list of providers.  When a provider is no longer 
 71.35  part of (name of health maintenance organization), you must 
 71.36  choose among remaining (name of the health maintenance 
 72.1   organization) providers. 
 72.2      (3) REFERRALS:  Certain services are covered only upon 
 72.3   referral.  See section (section number) of your contract for 
 72.4   referral requirements.  All referrals to non-(name of health 
 72.5   maintenance organization) providers and certain types of health 
 72.6   care providers must be authorized by (name of health maintenance 
 72.7   organization). 
 72.8      (4) EMERGENCY SERVICES:  Emergency services from providers 
 72.9   who are not affiliated with (name of health maintenance 
 72.10  organization) will be covered only if proper procedures are 
 72.11  followed.  Your contract explains the procedures and benefits 
 72.12  associated with emergency care from (name of health maintenance 
 72.13  organization) and non-(name of health maintenance organization) 
 72.14  providers. 
 72.15     (5) EXCLUSIONS:  Certain services or medical supplies are 
 72.16  not covered.  You should read the contract for a detailed 
 72.17  explanation of all exclusions. 
 72.18     (6) CONTINUATION:  You may convert to an individual health 
 72.19  maintenance organization contract or continue coverage under 
 72.20  certain circumstances.  These continuation and conversion rights 
 72.21  are explained fully in your contract. 
 72.22     (7) CANCELLATION:  Your coverage may be canceled by you or 
 72.23  (name of health maintenance organization) only under certain 
 72.24  conditions.  Your contract describes all reasons for 
 72.25  cancellation of coverage. 
 72.26     (8) NEWBORN COVERAGE:  If your health plan provides for 
 72.27  dependent coverage, a newborn infant is covered from birth, but 
 72.28  only if services are provided by participating (name of health 
 72.29  maintenance organization) providers or authorized by (name of 
 72.30  health maintenance organization).  Certain services are covered 
 72.31  only upon referral.  (Name of health maintenance organization) 
 72.32  will not automatically know of the infant's birth or that you 
 72.33  would like coverage under your plan.  You should notify (name of 
 72.34  health maintenance organization) of the infant's birth and that 
 72.35  you would like coverage.  If your contract requires an 
 72.36  additional premium for each dependent, (name of health 
 73.1   maintenance organization) is entitled to all premiums due from 
 73.2   the time of the infant's birth until the time you notify (name 
 73.3   of health maintenance organization) of the birth.  (Name of 
 73.4   health maintenance organization) may withhold payment of any 
 73.5   health benefits for the newborn infant until any premiums you 
 73.6   owe are paid. 
 73.7      (9) PRESCRIPTION DRUGS AND MEDICAL EQUIPMENT:  Enrolling in 
 73.8   (name of health maintenance organization) does not guarantee 
 73.9   that any particular prescription drug will be available nor that 
 73.10  any particular piece of medical equipment will be available, 
 73.11  even if the drug or equipment is available at the start of the 
 73.12  contract year. 
 73.13                      ENROLLEE BILL OF RIGHTS 
 73.14     (1) Enrollees have the right to available and accessible 
 73.15  services including emergency services, as defined in your 
 73.16  contract, 24 hours a day and seven days a week; 
 73.17     (2) Enrollees have the right to be informed of health 
 73.18  problems, and to receive information regarding treatment 
 73.19  alternatives and risks which is sufficient to assure informed 
 73.20  choice; 
 73.21     (3) Enrollees have the right to refuse treatment, and the 
 73.22  right to privacy of medical and financial records maintained by 
 73.23  the health maintenance organization and its health care 
 73.24  providers, in accordance with existing law; 
 73.25     (4) Enrollees have the right to file a complaint with the 
 73.26  health maintenance organization and the commissioner of health 
 73.27  commerce and the right to initiate a legal proceeding when 
 73.28  experiencing a problem with the health maintenance organization 
 73.29  or its health care providers; 
 73.30     (5) Enrollees have the right to a grace period of 31 days 
 73.31  for the payment of each premium for an individual health 
 73.32  maintenance contract falling due after the first premium during 
 73.33  which period the contract shall continue in force; 
 73.34     (6) Medicare enrollees have the right to voluntarily 
 73.35  disenroll from the health maintenance organization and the right 
 73.36  not to be requested or encouraged to disenroll except in 
 74.1   circumstances specified in federal law; and 
 74.2      (7) Medicare enrollees have the right to a clear 
 74.3   description of nursing home and home care benefits covered by 
 74.4   the health maintenance organization. 
 74.5      Sec. 15.  Minnesota Statutes 1998, section 62D.07, 
 74.6   subdivision 10, is amended to read: 
 74.7      Subd. 10.  An individual health maintenance organization 
 74.8   contract and an evidence of coverage must contain a department 
 74.9   of health commerce telephone number that the enrollee can call 
 74.10  to register a complaint about a health maintenance organization. 
 74.11     Sec. 16.  Minnesota Statutes 1998, section 62D.08, 
 74.12  subdivision 1, is amended to read: 
 74.13     Subdivision 1.  A health maintenance organization shall, 
 74.14  unless otherwise provided for by rules adopted by the 
 74.15  commissioner of health, file notice with the commissioner of 
 74.16  health prior to any modification of the operations or documents 
 74.17  described in the information submitted under clauses (a), (b), 
 74.18  (e), (f), (g), (i), (j), (l), (m), (n), (o), (p), (q), (r), (s), 
 74.19  and (t) of section 62D.03, subdivision 4.  If the modification 
 74.20  involves the operations or documents described in the 
 74.21  information submitted under section 62D.03, subdivision 4, 
 74.22  clause (o), the notice of modification must be filed with the 
 74.23  commissioner of health at the same time it is filed with the 
 74.24  commissioner.  The commissioner of health shall provide the 
 74.25  commissioner with a recommendation on the approval or 
 74.26  disapproval of the modifications within 60 days of the filing.  
 74.27  If the commissioner of health does not disapprove of the filing 
 74.28  within 60 days, it shall be deemed approved and may be 
 74.29  implemented by the health maintenance organization. 
 74.30     Sec. 17.  Minnesota Statutes 1998, section 62D.08, 
 74.31  subdivision 2, is amended to read: 
 74.32     Subd. 2.  Every health maintenance organization shall 
 74.33  annually, on or before April 1, file a verified report with the 
 74.34  commissioner of health and with the commissioner of health, 
 74.35  covering the preceding calendar year.  However, utilization data 
 74.36  required under subdivision 3, clause (c), shall be filed on or 
 75.1   before July 1. 
 75.2      Sec. 18.  Minnesota Statutes 1998, section 62D.08, 
 75.3   subdivision 3, is amended to read: 
 75.4      Subd. 3.  Such report shall be on forms prescribed by the 
 75.5   commissioner of health, and shall include: 
 75.6      (a) A financial statement of the organization, including 
 75.7   its balance sheet and receipts and disbursements for the 
 75.8   preceding year certified by an independent certified public 
 75.9   accountant, reflecting at least (1) all prepayment and other 
 75.10  payments received for health care services rendered, (2) 
 75.11  expenditures to all providers, by classes or groups of 
 75.12  providers, and insurance companies or nonprofit health service 
 75.13  plan corporations engaged to fulfill obligations arising out of 
 75.14  the health maintenance contract, (3) expenditures for capital 
 75.15  improvements, or additions thereto, including but not limited to 
 75.16  construction, renovation or purchase of facilities and capital 
 75.17  equipment, and (4) a supplementary statement of assets, 
 75.18  liabilities, premium revenue, and expenditures for risk sharing 
 75.19  business under section 62D.04, subdivision 1, on forms 
 75.20  prescribed by the commissioner; 
 75.21     (b) The number of new enrollees enrolled during the year, 
 75.22  the number of group enrollees and the number of individual 
 75.23  enrollees as of the end of the year and the number of enrollees 
 75.24  terminated during the year; 
 75.25     (c) A summary of information compiled pursuant to section 
 75.26  62D.04, subdivision 1, clause (c) subdivision 1a, paragraph (a), 
 75.27  clause (3), in such form as may be required by the 
 75.28  commissioner of health; 
 75.29     (d) A report of the names and addresses of all persons set 
 75.30  forth in section 62D.03, subdivision 4, clause (c), who were 
 75.31  associated with the health maintenance organization or the major 
 75.32  participating entity during the preceding year, and the amount 
 75.33  of wages, expense reimbursements, or other payments to such 
 75.34  individuals for services to the health maintenance organization 
 75.35  or the major participating entity, as those services relate to 
 75.36  the health maintenance organization, including a full disclosure 
 76.1   of all financial arrangements during the preceding year required 
 76.2   to be disclosed pursuant to section 62D.03, subdivision 4, 
 76.3   clause (d); 
 76.4      (e) A separate report addressing health maintenance 
 76.5   contracts sold to individuals covered by Medicare, title XVIII 
 76.6   of the Social Security Act, as amended, including the 
 76.7   information required under section 62D.30, subdivision 6; and 
 76.8      (f) Such other information relating to the performance of 
 76.9   the health maintenance organization as is reasonably necessary 
 76.10  to enable the commissioner of health to carry out the duties 
 76.11  under sections 62D.01 to 62D.30. 
 76.12     Sec. 19.  Minnesota Statutes 1998, section 62D.08, 
 76.13  subdivision 4, is amended to read: 
 76.14     Subd. 4.  Any health maintenance organization which fails 
 76.15  to file a verified report with the commissioner and with the 
 76.16  commissioner of health on or before April 1 of the year due 
 76.17  shall be subject to the levy of a fine up to $500 for each day 
 76.18  the report is past due.  This failure will serve as a basis for 
 76.19  other disciplinary action against the organization, including 
 76.20  suspension or revocation, in accordance with sections 62D.15 to 
 76.21  62D.17 and chapter 45.  The commissioner may grant an extension 
 76.22  of the reporting deadline upon good cause shown by the health 
 76.23  maintenance organization.  Any fine levied or disciplinary 
 76.24  action taken against the organization under this subdivision is 
 76.25  subject to the contested case and judicial review provisions of 
 76.26  sections 14.57 to 14.69.  
 76.27     Sec. 20.  Minnesota Statutes 1998, section 62D.08, 
 76.28  subdivision 5, is amended to read: 
 76.29     Subd. 5.  Every health maintenance organization shall 
 76.30  inform the commissioner of any change in the information 
 76.31  described in section 62D.03, subdivision 4, clause (e), 
 76.32  including any change in address, any modification of the 
 76.33  duration of any contract or agreement, and any addition to the 
 76.34  list of participating entities, within ten working days of the 
 76.35  notification of the change.  Any cancellation or discontinuance 
 76.36  of any contract or agreement listed in section 62D.03, 
 77.1   subdivision 4, clause (e), or listed subsequently in accordance 
 77.2   with this subdivision, shall be reported to the commissioner 120 
 77.3   days before the effective date.  When the health maintenance 
 77.4   organization terminates a provider for cause, death, disability, 
 77.5   or loss of license, the health maintenance organization must 
 77.6   notify the commissioner within three working days of the date 
 77.7   the health maintenance organization sends out or receives the 
 77.8   notice of cancellation, discontinuance, or termination.  Any 
 77.9   health maintenance organization which fails to notify the 
 77.10  commissioner within the time periods prescribed in this 
 77.11  subdivision shall be subject to the levy of a fine up to $200 
 77.12  per contract for each day the notice is past due, accruing up to 
 77.13  the date the organization notifies the commissioner of the 
 77.14  cancellation or discontinuance.  Any fine levied under this 
 77.15  subdivision is subject to the contested case and judicial review 
 77.16  provisions of chapter 14.  The levy of a fine does not preclude 
 77.17  the commissioner from using other penalties described in 
 77.18  sections 62D.15 to 62D.17 and chapter 45. 
 77.19     Sec. 21.  Minnesota Statutes 1998, section 62D.09, 
 77.20  subdivision 1, is amended to read: 
 77.21     Subdivision 1.  (a) Any written marketing materials which 
 77.22  may be directed toward potential enrollees and which include a 
 77.23  detailed description of benefits provided by the health 
 77.24  maintenance organization shall include a statement of enrollee 
 77.25  information and rights as described in section 62D.07, 
 77.26  subdivision 3, paragraphs (b) and (c).  Prior to any oral 
 77.27  marketing presentation, the agent marketing the plan must inform 
 77.28  the potential enrollees that any complaints concerning the 
 77.29  material presented should be directed to the health maintenance 
 77.30  organization, the commissioner of health, or, if applicable, the 
 77.31  employer. 
 77.32     (b) Detailed marketing materials must affirmatively 
 77.33  disclose all exclusions and limitations in the organization's 
 77.34  services or kinds of services offered to the contracting party, 
 77.35  including but not limited to the following types of exclusions 
 77.36  and limitations: 
 78.1      (1) health care services not provided; 
 78.2      (2) health care services requiring copayments or 
 78.3   deductibles paid by enrollees; 
 78.4      (3) the fact that access to health care services does not 
 78.5   guarantee access to a particular provider type; and 
 78.6      (4) health care services that are or may be provided only 
 78.7   by referral of a physician. 
 78.8      (c) No marketing materials may lead consumers to believe 
 78.9   that all health care needs will be covered.  All marketing 
 78.10  materials must alert consumers to possible uncovered expenses 
 78.11  with the following language in bold print:  "THIS HEALTH CARE 
 78.12  PLAN MAY NOT COVER ALL YOUR HEALTH CARE EXPENSES; READ YOUR 
 78.13  CONTRACT CAREFULLY TO DETERMINE WHICH EXPENSES ARE COVERED."  
 78.14  Immediately following the disclosure required under paragraph 
 78.15  (b), clause (3), consumers must be given a telephone number to 
 78.16  use to contact the health maintenance organization for specific 
 78.17  information about access to provider types. 
 78.18     (d) The disclosures required in paragraphs (b) and (c) are 
 78.19  not required on billboards or image, and name identification 
 78.20  advertisement. 
 78.21     Sec. 22.  Minnesota Statutes 1998, section 62D.09, 
 78.22  subdivision 8, is amended to read: 
 78.23     Subd. 8.  Each health maintenance organization shall issue 
 78.24  a membership card to its enrollees.  The membership card must: 
 78.25     (1) identify the health maintenance organization; 
 78.26     (2) include the name, address, and telephone number to call 
 78.27  if the enrollee has a complaint; 
 78.28     (3) include the telephone number to call or the instruction 
 78.29  on how to receive authorization for emergency care; and 
 78.30     (4) include one of the following: 
 78.31     (i) the telephone number to call to appeal to or file a 
 78.32  complaint with the commissioner of health; or 
 78.33     (ii) for persons enrolled under section 256B.69, 256D.03, 
 78.34  or 256L.12, the telephone number to call to file a complaint 
 78.35  with the ombudsperson designated by the commissioner of human 
 78.36  services under section 256B.69 and the address to appeal to the 
 79.1   commissioner of human services.  The ombudsperson shall annually 
 79.2   provide the commissioner of health with a summary of complaints 
 79.3   and actions taken. 
 79.4      Sec. 23.  Minnesota Statutes 1998, section 62D.10, 
 79.5   subdivision 4, is amended to read: 
 79.6      Subd. 4.  A health plan may apply to the commissioner of 
 79.7   health for a waiver of the requirements of this section or for 
 79.8   authorization to impose such underwriting restrictions upon open 
 79.9   enrollment as are necessary (a) to preserve its financial 
 79.10  stability, (b) to prevent excessive adverse selection by 
 79.11  prospective enrollees, or (c) to avoid unreasonably high or 
 79.12  unmarketable charges for enrollee coverage for health care 
 79.13  services.  The commissioner of health upon a showing of good 
 79.14  cause, shall approve or upon failure to show good cause shall 
 79.15  deny such application within 30 days of the receipt thereof from 
 79.16  the health plan.  The commissioner of health may, in accordance 
 79.17  with chapter 14, promulgate rules to implement this section. 
 79.18     Sec. 24.  Minnesota Statutes 1998, section 62D.11, 
 79.19  subdivision 1b, is amended to read: 
 79.20     Subd. 1b.  [EXPEDITED RESOLUTION OF COMPLAINTS ABOUT 
 79.21  MEDICALLY URGENT SERVICES.] In addition to any remedy contained 
 79.22  in subdivision 1a, when a complaint involves a dispute about a 
 79.23  health maintenance organization's coverage of a medically urgent 
 79.24  service, the commissioner or the commissioner of health may also 
 79.25  order the health maintenance organization to use an expedited 
 79.26  system to process the complaint. 
 79.27     Sec. 25.  Minnesota Statutes 1998, section 62D.11, 
 79.28  subdivision 2, is amended to read: 
 79.29     Subd. 2.  The health maintenance organization shall 
 79.30  maintain a record of each written complaint filed with it for 
 79.31  five years and the commissioner of health and the commissioner 
 79.32  of health shall have access to the records. 
 79.33     Sec. 26.  Minnesota Statutes 1998, section 62D.11, 
 79.34  subdivision 3, is amended to read: 
 79.35     Subd. 3.  [DENIAL OF COVERAGE.] Within a reasonable time 
 79.36  after receiving an enrollee's written or oral communication to 
 80.1   the health maintenance organization concerning a denial of 
 80.2   coverage or inadequacy of services, the health maintenance 
 80.3   organization shall provide the enrollee with a written statement 
 80.4   of the reason for the denial of coverage, and a statement 
 80.5   approved by the commissioner of health which explains the health 
 80.6   maintenance organization complaint procedures, and in the case 
 80.7   of Medicare enrollees, which also explains Medicare appeal 
 80.8   procedures. 
 80.9      Sec. 27.  Minnesota Statutes 1998, section 62D.11, is 
 80.10  amended by adding a subdivision to read: 
 80.11     Subd. 5.  [REFERRAL TO COMMISSIONER OF HEALTH.] (a) The 
 80.12  commissioner shall determine whether a complaint relates 
 80.13  primarily to quality of care.  The commissioner shall refer such 
 80.14  complaints to the commissioner of health for information, 
 80.15  recommendation, investigation, or resolution. 
 80.16     (b) All investigation, examination, rulemaking action, 
 80.17  penalty assessment, and enforcement authority under this chapter 
 80.18  is available to the commissioner of health on matters related to 
 80.19  the quality of care. 
 80.20     Sec. 28.  Minnesota Statutes 1998, section 62D.12, 
 80.21  subdivision 1, is amended to read: 
 80.22     Subdivision 1.  No health maintenance organization or 
 80.23  representative thereof may cause or knowingly permit the use of 
 80.24  advertising or solicitation which is untrue or misleading, or 
 80.25  any form of evidence of coverage which is deceptive.  Each 
 80.26  health maintenance organization shall be subject to sections 
 80.27  72A.17 to 72A.32, relating to the regulation of trade practices, 
 80.28  except (a) to the extent that the nature of a health maintenance 
 80.29  organization renders such sections clearly inappropriate and (b) 
 80.30  that enforcement shall be by the commissioner of health and not 
 80.31  by the commissioner of commerce.  Every health maintenance 
 80.32  organization shall be subject to sections 8.31 and 325F.69. 
 80.33     Sec. 29.  Minnesota Statutes 1998, section 62D.12, 
 80.34  subdivision 2, is amended to read: 
 80.35     Subd. 2.  No health maintenance organization may cancel or 
 80.36  fail to renew the coverage of an enrollee except for (a) failure 
 81.1   to pay the charge for health care coverage; (b) termination of 
 81.2   the health care plan; (c) termination of the group plan; (d) 
 81.3   enrollee moving out of the area served, subject to section 
 81.4   62A.17, subdivisions 1 and 6, and section 62D.104; (e) enrollee 
 81.5   moving out of an eligible group, subject to section 62A.17, 
 81.6   subdivisions 1 and 6, and section 62D.104; (f) failure to make 
 81.7   copayments required by the health care plan; or (g) other 
 81.8   reasons established in rules promulgated by the commissioner of 
 81.9   health. 
 81.10     Sec. 30.  Minnesota Statutes 1998, section 62D.12, 
 81.11  subdivision 9, is amended to read: 
 81.12     Subd. 9.  All net earnings of the health maintenance 
 81.13  organization shall be devoted to the nonprofit purposes of the 
 81.14  health maintenance organization in providing comprehensive 
 81.15  health care.  No health maintenance organization shall provide 
 81.16  for the payment, whether directly or indirectly, of any part of 
 81.17  its net earnings, to any person as a dividend or rebate; 
 81.18  provided, however, that health maintenance organizations may 
 81.19  make payments to providers or other persons based upon the 
 81.20  efficient provision of services or as incentives to provide 
 81.21  quality care.  The commissioner of health shall, pursuant to 
 81.22  sections 62D.01 to 62D.30, revoke the certificate of authority 
 81.23  of any health maintenance organization in violation of this 
 81.24  subdivision. 
 81.25     Sec. 31.  Minnesota Statutes 1998, section 62D.121, 
 81.26  subdivision 3a, is amended to read: 
 81.27     Subd. 3a.  If the replacement coverage is health 
 81.28  maintenance organization coverage, as explained in subdivisions 
 81.29  2 and 2a, the fee shall not exceed 125 percent of the cost of 
 81.30  the average fee charged by health maintenance organizations for 
 81.31  a similar health plan.  The commissioner of health will shall 
 81.32  determine the average cost of the plan on the basis of 
 81.33  information provided annually by the health maintenance 
 81.34  organizations concerning the rates charged by the health 
 81.35  maintenance organizations for the plans offered.  Fees or 
 81.36  premiums charged under this section must be actuarially 
 82.1   justified. 
 82.2      Sec. 32.  Minnesota Statutes 1998, section 62D.121, 
 82.3   subdivision 7, is amended to read: 
 82.4      Subd. 7.  [GEOGRAPHIC ACCESSIBILITY.] If the 
 82.5   commissioner of health determines that there are not enough 
 82.6   providers to assure that enrollees have accessible health 
 82.7   services available in a geographic service area, the 
 82.8   commissioner of health shall institute a plan of corrective 
 82.9   action that shall be followed by the health maintenance 
 82.10  organization.  Such a plan may include but not be limited to 
 82.11  requiring the health maintenance organization to make payments 
 82.12  to nonparticipating providers for health services for enrollees, 
 82.13  requiring the health maintenance organization to discontinue 
 82.14  accepting new enrollees in that service area, and requiring the 
 82.15  health maintenance organization to reduce its geographic service 
 82.16  area.  If a nonparticipating provider has been a participating 
 82.17  provider with the health maintenance organization within the 
 82.18  last year, any payments made under this section must not exceed 
 82.19  the payment level of the previous contract unless the 
 82.20  commissioner of health determines that without adjusting 
 82.21  payments the health maintenance organization will be unable to 
 82.22  meet the health care needs of enrollees in the area. 
 82.23     Sec. 33.  Minnesota Statutes 1998, section 62D.14, 
 82.24  subdivision 1, is amended to read: 
 82.25     Subdivision 1.  The commissioner of health may make an 
 82.26  examination of the affairs of any health maintenance 
 82.27  organization and its contracts, agreements, or other 
 82.28  arrangements with any participating entity as often as the 
 82.29  commissioner of health deems necessary for the protection of the 
 82.30  interests of the people of this state, but not less frequently 
 82.31  than once every three years.  Examinations of participating 
 82.32  entities pursuant to this subdivision shall be limited to their 
 82.33  dealings with the health maintenance organization and its 
 82.34  enrollees, except that examinations of major participating 
 82.35  entities may include inspection of the entity's financial 
 82.36  statements kept in the ordinary course of business.  The 
 83.1   commissioner may require major participating entities to submit 
 83.2   the financial statements directly to the commissioner.  
 83.3   Financial statements of major participating entities are subject 
 83.4   to the provisions of section 13.37, subdivision 1, clause (b), 
 83.5   upon request of the major participating entity or the health 
 83.6   maintenance organization with which it contracts. 
 83.7      Sec. 34.  Minnesota Statutes 1998, section 62D.14, 
 83.8   subdivision 3, is amended to read: 
 83.9      Subd. 3.  In order to accomplish the duties under this 
 83.10  section with respect to the dealings of the participating 
 83.11  entities with the health maintenance organization, the 
 83.12  commissioner of health shall have has the right to: 
 83.13     (a) inspect or otherwise evaluate the quality, 
 83.14  appropriateness, and timeliness of services performed, or 
 83.15  arrange with the commissioner of health for the commissioner of 
 83.16  health to do so; 
 83.17     (b) audit and inspect any books and records of a health 
 83.18  maintenance organization and a participating entity which 
 83.19  pertain to services performed and determinations of amounts 
 83.20  payable under such contract; 
 83.21     (c) require persons or organizations under examination to 
 83.22  be deposed and to answer interrogatories, regardless of whether 
 83.23  an administrative hearing or other civil proceeding has been or 
 83.24  will be initiated; and 
 83.25     (d) employ site visits, public hearings, or any other 
 83.26  procedures considered appropriate to obtain the information 
 83.27  necessary to determine the issues.  
 83.28     Sec. 35.  Minnesota Statutes 1998, section 62D.14, 
 83.29  subdivision 4, is amended to read: 
 83.30     Subd. 4.  Any data or information pertaining to the 
 83.31  diagnosis, treatment, or health of any enrollee, or any 
 83.32  application obtained from any person, shall be private as 
 83.33  defined in chapter 13 and shall not be disclosed to any person 
 83.34  except (a) to the extent necessary to carry out the purposes of 
 83.35  sections 62D.01 to 62D.30, the commissioner and the commissioner 
 83.36  of health and a designee shall have access to the above data or 
 84.1   information but the data removed from the health maintenance 
 84.2   organization or participating entity shall not identify any 
 84.3   particular patient or client by name or contain any other unique 
 84.4   personal identifier; (b) upon the express consent of the 
 84.5   enrollee or applicant; (c) pursuant to statute or court order 
 84.6   for the production of evidence or the discovery thereof; or (d) 
 84.7   in the event of claim or litigation between such person and the 
 84.8   provider or health maintenance organization wherein such data or 
 84.9   information is pertinent.  In any case involving a suspected 
 84.10  violation of a law applicable to health maintenance 
 84.11  organizations in which access to health data maintained by the 
 84.12  health maintenance organization or participating entity is 
 84.13  necessary, the commissioner and the commissioner of health and 
 84.14  agents, while maintaining the privacy rights of individuals and 
 84.15  families, shall be permitted to obtain data that identifies any 
 84.16  particular patient or client by name.  A health maintenance 
 84.17  organization shall be entitled to claim any statutory privileges 
 84.18  against such disclosure which the provider who furnished such 
 84.19  information to the health maintenance organization is entitled 
 84.20  to claim. 
 84.21     Sec. 36.  Minnesota Statutes 1998, section 62D.14, 
 84.22  subdivision 5, is amended to read: 
 84.23     Subd. 5.  The commissioner of health shall and the 
 84.24  commissioner of health have the power to administer oaths to and 
 84.25  examine witnesses, and to issue subpoenas. 
 84.26     Sec. 37.  Minnesota Statutes 1998, section 62D.14, 
 84.27  subdivision 6, is amended to read: 
 84.28     Subd. 6.  Reasonable expenses of examinations under this 
 84.29  section shall be assessed by the commissioner of health against 
 84.30  the organization being examined, and shall be remitted to the 
 84.31  commissioner of health for deposit in the general fund of the 
 84.32  state treasury. 
 84.33     Sec. 38.  Minnesota Statutes 1998, section 62D.15, 
 84.34  subdivision 1, is amended to read: 
 84.35     Subdivision 1.  [SUSPENSION OR REVOCATION.] (a) The 
 84.36  commissioner of health may suspend or revoke any certificate of 
 85.1   authority issued to a health maintenance organization under 
 85.2   sections 62D.01 to 62D.30 if the commissioner finds that: 
 85.3      (a) (1) The health maintenance organization is operating 
 85.4   significantly in contravention of its basic organizational 
 85.5   document, its health maintenance contract, or in a manner 
 85.6   contrary to that described in and reasonably inferred from any 
 85.7   other information submitted under section 62D.03, unless 
 85.8   amendments to such submissions have been filed with and approved 
 85.9   by the commissioner of health; 
 85.10     (b) (2) The health maintenance organization issues 
 85.11  evidences of coverage which do not comply with the requirements 
 85.12  of section 62D.07; 
 85.13     (c) (3) The health maintenance organization is unable to 
 85.14  fulfill its obligations to furnish comprehensive health 
 85.15  maintenance services as required under its health maintenance 
 85.16  contract; 
 85.17     (d) (4) The health maintenance organization is no longer 
 85.18  financially responsible and may reasonably be expected to be 
 85.19  unable to meet its obligations to enrollees or prospective 
 85.20  enrollees; 
 85.21     (e) (5) The health maintenance organization has failed to 
 85.22  implement a mechanism affording the enrollees an opportunity to 
 85.23  participate in matters of policy and operation under section 
 85.24  62D.06; 
 85.25     (f) (6) The health maintenance organization has failed to 
 85.26  implement the complaint system required by section 62D.11 in a 
 85.27  manner designed to reasonably resolve valid complaints; 
 85.28     (g) (7) The health maintenance organization, or any person 
 85.29  acting with its sanction, has advertised or merchandised its 
 85.30  services in an untrue, misrepresentative, misleading, deceptive, 
 85.31  or unfair manner; 
 85.32     (h) (8) The continued operation of the health maintenance 
 85.33  organization would be hazardous to its enrollees; or 
 85.34     (i) (9) The health maintenance organization has otherwise 
 85.35  failed to substantially comply with sections 62D.01 to 62D.30 or 
 85.36  with any other statute or administrative rule applicable to 
 86.1   health maintenance organizations, or has submitted false 
 86.2   information in any report required hereunder. 
 86.3      (b) The commissioner of health may by order suspend or 
 86.4   revoke the certificate of authority of a health maintenance 
 86.5   organization when the commissioner of health finds failure to 
 86.6   comply with section 62D.04, subdivision 1a, or any other area of 
 86.7   responsibility assigned by statute or rule to the commissioner 
 86.8   of health.  The commissioner of health shall notify the 
 86.9   commissioner of any action taken under this paragraph. 
 86.10     Sec. 39.  Minnesota Statutes 1998, section 62D.15, 
 86.11  subdivision 4, is amended to read: 
 86.12     Subd. 4.  When the certificate of authority of a health 
 86.13  maintenance organization is revoked, the organization shall 
 86.14  proceed, immediately following the effective date of the order 
 86.15  of revocation, to wind up its affairs, and shall conduct no 
 86.16  further business except as may be essential to the orderly 
 86.17  conclusion of the affairs of the organization. It shall engage 
 86.18  in no further advertising or solicitation whatsoever.  The 
 86.19  commissioner of health may, by written order, permit further 
 86.20  operation of the organization as the commissioner may find to be 
 86.21  in the best interest of enrollees, to the end that enrollees 
 86.22  will be afforded the greatest practical opportunity to obtain 
 86.23  continuing health care coverage. 
 86.24     Sec. 40.  Minnesota Statutes 1998, section 62D.16, 
 86.25  subdivision 1, is amended to read: 
 86.26     Subdivision 1.  When the commissioner of health has cause 
 86.27  to believe that grounds for the denial, suspension or revocation 
 86.28  of a certificate of authority exists, the commissioner shall 
 86.29  notify the health maintenance organization in writing 
 86.30  specifically stating the grounds for denial, suspension or 
 86.31  revocation and fixing a time of at least 20 days thereafter for 
 86.32  a hearing on the matter, except in summary proceedings as 
 86.33  provided in section 62D.18. 
 86.34     Sec. 41.  Minnesota Statutes 1998, section 62D.16, 
 86.35  subdivision 2, is amended to read: 
 86.36     Subd. 2.  After such hearing, or upon the failure of the 
 87.1   health maintenance organization to appear at the hearing, the 
 87.2   commissioner of health shall take action as is deemed advisable 
 87.3   and shall issue written findings which shall be mailed to the 
 87.4   health maintenance organization.  The action of the commissioner 
 87.5   of health shall be subject to judicial review pursuant to 
 87.6   chapter 14. 
 87.7      Sec. 42.  Minnesota Statutes 1998, section 62D.17, 
 87.8   subdivision 1, is amended to read: 
 87.9      Subdivision 1.  The commissioner of health may, for any 
 87.10  violation of statute or rule applicable to a health maintenance 
 87.11  organization, or in lieu of suspension or revocation of a 
 87.12  certificate of authority under section 62D.15, levy an 
 87.13  administrative penalty in an amount up to $25,000 for each 
 87.14  violation.  In the case of contracts or agreements made pursuant 
 87.15  to section 62D.05, subdivisions 2 to 4, each contract or 
 87.16  agreement entered into or implemented in a manner which violates 
 87.17  sections 62D.01 to 62D.30 shall be considered a separate 
 87.18  violation.  In determining the level of an administrative 
 87.19  penalty, the commissioner shall consider the following factors: 
 87.20     (1) the number of enrollees affected by the violation; 
 87.21     (2) the effect of the violation on enrollees' health and 
 87.22  access to health services; 
 87.23     (3) if only one enrollee is affected, the effect of the 
 87.24  violation on that enrollee's health; 
 87.25     (4) whether the violation is an isolated incident or part 
 87.26  of a pattern of violations; and 
 87.27     (5) the economic benefits derived by the health maintenance 
 87.28  organization or a participating provider by virtue of the 
 87.29  violation; and 
 87.30     (6) any recommendation made by the commissioner of health. 
 87.31     Reasonable notice in writing to the health maintenance 
 87.32  organization shall be given of the intent to levy the penalty 
 87.33  and the reasons therefor, and the health maintenance 
 87.34  organization may have 15 days within which to file a written 
 87.35  request for an administrative hearing and review of the 
 87.36  commissioner of health's commissioner's determination.  Such 
 88.1   administrative hearing shall be subject to judicial review 
 88.2   pursuant to chapter 14. 
 88.3      Sec. 43.  Minnesota Statutes 1998, section 62D.17, 
 88.4   subdivision 3, is amended to read: 
 88.5      Subd. 3.  (a) If the commissioner of health shall, for any 
 88.6   reason, have cause to believe that any violation of sections 
 88.7   62D.01 to 62D.30 has occurred or is threatened, the commissioner 
 88.8   of health may, before commencing action under sections 62D.15 
 88.9   and 62D.16, and subdivision 1, give notice to the health 
 88.10  maintenance organization and to the representatives, or other 
 88.11  persons who appear to be involved in such suspected violation, 
 88.12  to arrange a voluntary conference with the alleged violators or 
 88.13  their authorized representatives for the purpose of attempting 
 88.14  to ascertain the facts relating to such suspected violation and, 
 88.15  in the event it appears that any violation has occurred or is 
 88.16  threatened, to arrive at an adequate and effective means of 
 88.17  correcting or preventing such violation. 
 88.18     (b) Proceedings under this subdivision shall not be 
 88.19  governed by any formal procedural requirements, and may be 
 88.20  conducted in such manner as the commissioner of health may deem 
 88.21  appropriate under the circumstances. 
 88.22     Sec. 44.  Minnesota Statutes 1998, section 62D.17, 
 88.23  subdivision 4, is amended to read: 
 88.24     Subd. 4.  (a) The commissioner of health may issue an order 
 88.25  directing a health maintenance organization or a representative 
 88.26  of a health maintenance organization to cease and desist from 
 88.27  engaging in any act or practice in violation of the provisions 
 88.28  of sections 62D.01 to 62D.30. 
 88.29     (1) The cease and desist order may direct a health 
 88.30  maintenance organization to pay for or provide a service when 
 88.31  that service is required by statute or rule to be provided. 
 88.32     (2) The commissioner may issue a cease and desist order 
 88.33  directing may direct a health maintenance organization to pay 
 88.34  for a service that is required by statute or rule to be 
 88.35  provided, only if there is a demonstrable and irreparable harm 
 88.36  to the public or an enrollee.  
 89.1      (3) If the cease and desist order involves a dispute over 
 89.2   the medical necessity of a procedure based on its experimental 
 89.3   nature, the commissioner may issue a cease and desist order only 
 89.4   if the following conditions are met:  
 89.5      (i) the commissioner has consulted with appropriate and 
 89.6   identified experts; 
 89.7      (ii) the commissioner has reviewed relevant scientific and 
 89.8   medical literature; and 
 89.9      (iii) the commissioner has considered all other relevant 
 89.10  factors including whether final approval of the technology or 
 89.11  procedure has been granted by the appropriate government agency; 
 89.12  the availability of scientific evidence concerning the effect of 
 89.13  the technology or procedure on health outcomes; the availability 
 89.14  of scientific evidence that the technology or procedure is as 
 89.15  beneficial as established alternatives; and the availability of 
 89.16  evidence of benefit or improvement without the technology or 
 89.17  procedure. 
 89.18     (b) Within 20 days after service of the order to cease and 
 89.19  desist, the respondent may request a hearing on the question of 
 89.20  whether acts or practices in violation of sections 62D.01 to 
 89.21  62D.30 have occurred.  Such hearings shall be subject to 
 89.22  judicial review as provided by chapter 14. 
 89.23     If the acts or practices involve violation of the reporting 
 89.24  requirements of section 62D.08, or if the commissioner has 
 89.25  ordered the rehabilitation, liquidation, or conservation of the 
 89.26  health maintenance organization in accordance with section 
 89.27  62D.18, the health maintenance organization may request an 
 89.28  expedited hearing on the matter.  The hearing shall be held 
 89.29  within 15 days of the request.  Within ten days thereafter, an 
 89.30  administrative law judge shall issue a recommendation on the 
 89.31  matter.  The commissioner shall make a final determination on 
 89.32  the matter within ten days of receipt of the administrative law 
 89.33  judge's recommendation.  
 89.34     When a request for a stay accompanies the hearing request, 
 89.35  the matter shall be referred to the office of administrative 
 89.36  hearings within three working days of receipt of the request. 
 90.1   Within ten days thereafter, an administrative law judge shall 
 90.2   issue a recommendation to grant or deny the stay.  The 
 90.3   commissioner shall grant or deny the stay within five days of 
 90.4   receipt of the administrative law judge's recommendation. 
 90.5      To the extent the acts or practices alleged do not involve 
 90.6   (1) violations of section 62D.08; (2) violations which may 
 90.7   result in the financial insolvency of the health maintenance 
 90.8   organization; (3) violations which threaten the life and health 
 90.9   of enrollees; (4) violations which affect whole classes of 
 90.10  enrollees; or (5) violations of benefits or service requirements 
 90.11  mandated by law; if a timely request for a hearing is made, the 
 90.12  cease and desist order shall be stayed for a period of 90 days 
 90.13  from the date the hearing is requested or until a final 
 90.14  determination is made on the order, whichever is earlier.  
 90.15  During this stay, the respondent may show cause why the order 
 90.16  should not become effective upon the expiration of the stay.  
 90.17  Arguments on this issue shall be made through briefs filed with 
 90.18  the administrative law judge no later than ten days prior to the 
 90.19  expiration of the stay.  
 90.20     Sec. 45.  Minnesota Statutes 1998, section 62D.17, 
 90.21  subdivision 5, is amended to read: 
 90.22     Subd. 5.  In the event of noncompliance with a cease and 
 90.23  desist order issued pursuant to subdivision 4, the commissioner 
 90.24  of health may institute a proceeding to obtain injunctive relief 
 90.25  or other appropriate relief in Ramsey county district court. 
 90.26     Sec. 46.  Minnesota Statutes 1998, section 62D.18, 
 90.27  subdivision 1, is amended to read: 
 90.28     Subdivision 1.  [COMMISSIONER OF HEALTH; COURT ORDER.] The 
 90.29  commissioner of health may apply by verified petition to the 
 90.30  district court of Ramsey county or the county in which the 
 90.31  principal office of the health maintenance organization is 
 90.32  located for an order directing the commissioner of health to 
 90.33  rehabilitate or liquidate a health maintenance organization.  
 90.34  The rehabilitation or liquidation of a health maintenance 
 90.35  organization shall be conducted under the supervision of the 
 90.36  commissioner of health under the procedures, and with the powers 
 91.1   granted to a rehabilitator or liquidator, in chapter 60B, except 
 91.2   to the extent that the nature of health maintenance 
 91.3   organizations renders the procedures or powers clearly 
 91.4   inappropriate and as provided in this subdivision or in chapter 
 91.5   60B.  A health maintenance organization shall be considered an 
 91.6   insurance company for the purposes of rehabilitation or 
 91.7   liquidation as provided in subdivisions 4, 6, and 7. 
 91.8      Sec. 47.  Minnesota Statutes 1998, section 62D.18, 
 91.9   subdivision 7, is amended to read: 
 91.10     Subd. 7.  [EXAMINATION ACCOUNT.] The commissioner of health 
 91.11  shall assess against a health maintenance organization not yet 
 91.12  in rehabilitation or liquidation a fee sufficient to cover the 
 91.13  costs of a special examination.  The fee must be deposited in an 
 91.14  examination account.  Money in the account is appropriated to 
 91.15  the commissioner of health to pay for the examinations.  If the 
 91.16  money in the account is insufficient to pay the initial costs of 
 91.17  examinations, the commissioner may use other money appropriated 
 91.18  to the commissioner, provided the other appropriation is 
 91.19  reimbursed from the examination account when it contains 
 91.20  sufficient money.  Money from the examination account must be 
 91.21  used to pay per diem salaries and expenses of special examiners, 
 91.22  including meals, lodging, laundry, transportation, and mileage.  
 91.23  The salary of regular employees of the health commerce 
 91.24  department must not be paid out of the account. 
 91.25     Sec. 48.  Minnesota Statutes 1998, section 62D.19, is 
 91.26  amended to read: 
 91.27     62D.19 [UNREASONABLE EXPENSES.] 
 91.28     No health maintenance organization shall incur or pay for 
 91.29  any expense of any nature which is unreasonably high in relation 
 91.30  to the value of the service or goods provided.  The commissioner 
 91.31  of health shall implement and enforce this section by rules 
 91.32  adopted under this section. 
 91.33     In an effort to achieve the stated purposes of sections 
 91.34  62D.01 to 62D.30; in order to safeguard the underlying nonprofit 
 91.35  status of health maintenance organizations; and to ensure that 
 91.36  the payment of health maintenance organization money to major 
 92.1   participating entities results in a corresponding benefit to the 
 92.2   health maintenance organization and its enrollees, when 
 92.3   determining whether an organization has incurred an unreasonable 
 92.4   expense in relation to a major participating entity, due 
 92.5   consideration shall be given to, in addition to any other 
 92.6   appropriate factors, whether the officers and trustees of the 
 92.7   health maintenance organization have acted with good faith and 
 92.8   in the best interests of the health maintenance organization in 
 92.9   entering into, and performing under, a contract under which the 
 92.10  health maintenance organization has incurred an expense.  The 
 92.11  commissioner has standing to sue, on behalf of a health 
 92.12  maintenance organization, officers or trustees of the health 
 92.13  maintenance organization who have breached their fiduciary duty 
 92.14  in entering into and performing such contracts. 
 92.15     Sec. 49.  Minnesota Statutes 1998, section 62D.20, 
 92.16  subdivision 1, is amended to read: 
 92.17     Subdivision 1.  [RULEMAKING.] The commissioner of health 
 92.18  may, pursuant to chapter 14, promulgate such reasonable rules as 
 92.19  are necessary or proper to carry out the provisions of sections 
 92.20  62D.01 to 62D.30.  Included among such rules shall be those 
 92.21  which provide minimum requirements for the provision of 
 92.22  comprehensive health maintenance services, as defined in section 
 92.23  62D.02, subdivision 7, and reasonable exclusions therefrom.  
 92.24  Nothing in such rules shall force or require a health 
 92.25  maintenance organization to provide elective, induced abortions, 
 92.26  except as medically necessary to prevent the death of the 
 92.27  mother, whether performed in a hospital, other abortion 
 92.28  facility, or the office of a physician; the rules shall provide 
 92.29  every health maintenance organization the option of excluding or 
 92.30  including elective, induced abortions, except as medically 
 92.31  necessary to prevent the death of the mother, as part of its 
 92.32  comprehensive health maintenance services.  
 92.33     Sec. 50.  Minnesota Statutes 1998, section 62D.21, is 
 92.34  amended to read: 
 92.35     62D.21 [FEES.] 
 92.36     Every health maintenance organization subject to sections 
 93.1   62D.01 to 62D.30 shall pay to the commissioner of health fees as 
 93.2   prescribed by the commissioner of health pursuant to section 
 93.3   144.122 for the following: 
 93.4      (a) Filing an application for a certificate of authority, 
 93.5      (b) Filing an amendment to a certificate of authority, 
 93.6      (c) Filing each annual report, and 
 93.7      (d) Other filings, as specified by rule. 
 93.8      Sec. 51.  Minnesota Statutes 1998, section 62D.211, is 
 93.9   amended to read: 
 93.10     62D.211 [RENEWAL FEE.] 
 93.11     Each health maintenance organization subject to sections 
 93.12  62D.01 to 62D.30 shall submit to the commissioner of health each 
 93.13  year before June 15 a certificate of authority renewal fee in 
 93.14  the amount of $10,000 each plus 20 cents per person enrolled in 
 93.15  the health maintenance organization on December 31 of the 
 93.16  preceding year.  The commissioner may adjust the renewal fee in 
 93.17  rule under the provisions of chapter 14. 
 93.18     Sec. 52.  Minnesota Statutes 1998, section 62D.22, 
 93.19  subdivision 4, is amended to read: 
 93.20     Subd. 4.  To the extent that it furthers the purposes of 
 93.21  sections 62D.01 to 62D.30, the commissioner of health shall 
 93.22  attempt to coordinate the operations of sections 62D.01 to 
 93.23  62D.30 relating to the quality of health care services with the 
 93.24  operations of United States Code, title 42, sections 1320c to 
 93.25  1320c-20.  The commissioner shall seek and consider 
 93.26  recommendations from the commissioner of health regarding this 
 93.27  coordination. 
 93.28     Sec. 53.  Minnesota Statutes 1998, section 62D.22, 
 93.29  subdivision 10, is amended to read: 
 93.30     Subd. 10.  Any person or committee conducting a review of a 
 93.31  health maintenance organization or a participating entity, 
 93.32  pursuant to sections 62D.01 to 62D.30, shall have access to any 
 93.33  data or information necessary to conduct the review.  All data 
 93.34  or information is subject to admission into evidence in any 
 93.35  civil action initiated by the commissioner of health against the 
 93.36  health maintenance organization.  The data and information are 
 94.1   subject to chapter 13.  
 94.2      Sec. 54.  Minnesota Statutes 1998, section 62D.24, is 
 94.3   amended to read: 
 94.4      62D.24 [STATE COMMISSIONER OF HEALTH'S AUTHORITY TO 
 94.5   CONTRACT.] 
 94.6      The commissioner of health, in carrying out the obligations 
 94.7   under sections 62D.01 to 62D.30, may contract with the 
 94.8   commissioner of commerce health or other qualified persons to 
 94.9   make recommendations concerning the determinations required to 
 94.10  be made.  Such recommendations may be accepted in full or in 
 94.11  part by the commissioner of health. 
 94.12     Sec. 55.  Minnesota Statutes 1998, section 62D.30, 
 94.13  subdivision 1, is amended to read: 
 94.14     Subdivision 1.  The commissioner of health may establish 
 94.15  demonstration projects to allow health maintenance organizations 
 94.16  to extend coverage to:  
 94.17     (a) Individuals enrolled in Part A or Part B, or both, of 
 94.18  the Medicare program, Title XVIII of the Social Security Act, 
 94.19  United States Code, title 42, section 1395 et seq.; 
 94.20     (b) Groups of fewer than 50 employees where each group is 
 94.21  covered by a single group health policy; 
 94.22     (c) Individuals who are not eligible for enrollment in any 
 94.23  group health maintenance contracts; and 
 94.24     (d) Low income population groups.  
 94.25     For purposes of this section, the commissioner of health 
 94.26  may waive compliance with minimum benefits pursuant to sections 
 94.27  62A.151 and 62D.02, subdivision 7, full financial risk pursuant 
 94.28  to section 62D.04, subdivision 1, clause (f), open enrollment 
 94.29  pursuant to section 62D.10, and to applicable rules if there is 
 94.30  reasonable evidence that the rules prohibit the operation of the 
 94.31  demonstration project.  The commissioner shall provide for 
 94.32  public comment before any statute or rule is waived.  
 94.33     Sec. 56.  Minnesota Statutes 1998, section 62D.30, 
 94.34  subdivision 3, is amended to read: 
 94.35     Subd. 3.  A health maintenance organization electing to 
 94.36  participate in a demonstration project shall apply to the 
 95.1   commissioner for approval on a form developed by the 
 95.2   commissioner.  The application shall include at least the 
 95.3   following:  
 95.4      (a) A statement identifying the population that the project 
 95.5   is designed to serve; 
 95.6      (b) A description of the proposed project including a 
 95.7   statement projecting a schedule of costs and benefits for the 
 95.8   enrollee; 
 95.9      (c) Reference to the sections of Minnesota Statutes and 
 95.10  department of health commerce rules for which waiver is 
 95.11  requested; 
 95.12     (d) Evidence that application of the requirements of 
 95.13  applicable Minnesota Statutes and department of health commerce 
 95.14  rules would, unless waived, prohibit the operation of the 
 95.15  demonstration project; 
 95.16     (e) Evidence that another arrangement is available for 
 95.17  assumption of full financial risk if full financial risk is 
 95.18  waived under subdivision 1; 
 95.19     (f) An estimate of the number of years needed to adequately 
 95.20  demonstrate the project's effects; and 
 95.21     (g) Other information the commissioner may reasonably 
 95.22  require. 
 95.23     Sec. 57.  [REPORT; REGULATION OF RISK-BEARING ENTITIES.] 
 95.24     The commissioners of commerce and health shall study the 
 95.25  issues involved in consistent regulation of all entities that 
 95.26  assume financial risks related to health coverage in this 
 95.27  state.  The study must consider all such entities, regardless of 
 95.28  current licensure or regulation.  The commissioners must 
 95.29  consider laws recently enacted by the state of Ohio on this 
 95.30  subject and any relevant model laws or regulations adopted or 
 95.31  under consideration by the National Association of Insurance 
 95.32  Commissioners.  The commissioners shall provide a written 
 95.33  report, with recommendations, to the legislature in compliance 
 95.34  with Minnesota Statutes, section 3.195, no later than January 
 95.35  15, 2000. 
 95.36     Sec. 58.  [EFFECT OF TRANSFER OF RESPONSIBILITIES.] 
 96.1      Minnesota Statutes, section 15.039, applies to this act. 
 96.2      Sec. 59.  [REPEALER.] 
 96.3      Minnesota Statutes 1998, section 62D.18, is repealed. 
 96.4      Sec. 60.  [EFFECTIVE DATE.] 
 96.5      This article is effective July 1, 2000, except that section 
 96.6   57 is effective the day following final enactment. 
 96.7                              ARTICLE 4 
 96.8            COMMUNITY INTEGRATED SERVICE NETWORKS, HEALTH 
 96.9       CARE COOPERATIVES, AND COMMUNITY PURCHASING ARRANGEMENTS 
 96.10     Section 1.  Minnesota Statutes 1998, section 62N.02, 
 96.11  subdivision 4, is amended to read: 
 96.12     Subd. 4.  [COMMISSIONER.] "Commissioner" means the 
 96.13  commissioner of health commerce or the commissioner's designated 
 96.14  representative.  With respect to this chapter, the commissioner 
 96.15  of health has the same role as under chapter 62D. 
 96.16     Sec. 2.  Minnesota Statutes 1998, section 62N.26, is 
 96.17  amended to read: 
 96.18     62N.26 [SHARED SERVICES COOPERATIVE.] 
 96.19     The commissioner of health shall establish, or assist in 
 96.20  establishing, a shared services cooperative organized under 
 96.21  chapter 308A to make available administrative and legal 
 96.22  services, technical assistance, provider contracting and billing 
 96.23  services, and other services to those community integrated 
 96.24  service networks that choose to participate in the cooperative.  
 96.25  The commissioner shall provide, to the extent funds are 
 96.26  appropriated, start-up loans sufficient to maintain the shared 
 96.27  services cooperative until its operations can be maintained by 
 96.28  fees and contributions.  The cooperative must not be staffed, 
 96.29  administered, or supervised by the commissioner of health.  The 
 96.30  cooperative shall make use of existing resources that are 
 96.31  already available in the community, to the extent possible. 
 96.32     Sec. 3.  Minnesota Statutes 1998, section 62N.31, 
 96.33  subdivision 1, is amended to read: 
 96.34     Subdivision 1.  [GENERAL.] Each health care providing 
 96.35  entity seeking initial accreditation as an accredited capitated 
 96.36  provider shall submit to the commissioner of health sufficient 
 97.1   information to establish that the applicant has operational 
 97.2   capacity, facilities, personnel, and financial capability to 
 97.3   provide the contracted covered services to the enrollees of the 
 97.4   network for which it seeks accreditation (1) on an ongoing 
 97.5   basis; and (2) for a period of 120 days following the insolvency 
 97.6   of the network without receiving payment from the network.  
 97.7   Accreditation shall continue until abandoned by the accredited 
 97.8   capitated provider or revoked by the commissioner in accordance 
 97.9   with subdivision 4.  The applicant may establish financial 
 97.10  capability by demonstrating that the provider amount at risk can 
 97.11  be covered by or through any of allocated or restricted funds, a 
 97.12  letter of credit, the taxing authority of the applicant or 
 97.13  governmental sponsor of the applicant, an unrestricted fund 
 97.14  balance at least two times the provider amount at risk, 
 97.15  reinsurance, either purchased directly by the applicant or by 
 97.16  the community network to which it will be accredited, or any 
 97.17  other method accepted by the commissioner.  Accreditation of a 
 97.18  health care providing entity shall not in itself limit the right 
 97.19  of the accredited capitated provider to seek payment of unpaid 
 97.20  capitated amounts from a community network, whether the 
 97.21  community network is solvent or insolvent; provided that, if the 
 97.22  community network is subject to any liquidation, rehabilitation, 
 97.23  or conservation proceedings, the accredited capitated provider 
 97.24  shall have the status accorded creditors under section 60B.44, 
 97.25  subdivision 10. 
 97.26     Sec. 4.  Minnesota Statutes 1998, section 62R.04, 
 97.27  subdivision 5, is amended to read: 
 97.28     Subd. 5.  [COMMISSIONER.] Unless otherwise specified, 
 97.29  "commissioner" means the commissioner of health for a health 
 97.30  care network cooperative licensed under chapter 62D or 62N and 
 97.31  the commissioner of commerce for a health care network 
 97.32  cooperative licensed under chapter 62C.  With respect to this 
 97.33  chapter, the commissioner of health has the same role as under 
 97.34  chapter 62D. 
 97.35     Sec. 5.  Minnesota Statutes 1998, section 62R.25, is 
 97.36  amended to read: 
 98.1      62R.25 [NOTIFICATION OF CONTRACT; REPORT TO LEGISLATURE.] 
 98.2      (a) Each health provider cooperative shall notify the 
 98.3   office of rural health commissioner in writing upon entering a 
 98.4   contract described in section 62R.17. 
 98.5      (b) The department of health, office of rural health, shall 
 98.6   provide an information report to the MinnesotaCare finance 
 98.7   division of the house health and human services committee and 
 98.8   the senate health care committee no later than January 15, 1999, 
 98.9   on the status of direct contracting between health provider 
 98.10  cooperatives and self-insured employer plans or qualified 
 98.11  employers in accordance with sections 62R.17 to 62R.26.  The 
 98.12  report shall consider the effects on public policy and on health 
 98.13  provider cooperatives of a possible requirement that health 
 98.14  provider cooperatives using direct contracting be obligated to 
 98.15  become community integrated service networks. 
 98.16     Sec. 6.  Minnesota Statutes 1998, section 62T.01, 
 98.17  subdivision 4, is amended to read: 
 98.18     Subd. 4.  [COMMISSIONER.] "Commissioner" means the 
 98.19  commissioner of health commerce.  With respect to this chapter, 
 98.20  the commissioner of health has the same role as under chapter 
 98.21  62D. 
 98.22     Sec. 7.  [EFFECTIVE DATE.] 
 98.23     This article is effective July 1, 2000. 
 98.24                             ARTICLE 5 
 98.25                         CONFORMING CHANGES 
 98.26     Section 1.  Minnesota Statutes 1998, section 60B.02, is 
 98.27  amended to read: 
 98.28     60B.02 [PERSONS COVERED.] 
 98.29     The proceedings authorized by sections 60B.01 to 60B.61 may 
 98.30  be applied to: 
 98.31     (1) All insurers who are doing, or have done, an insurance 
 98.32  business in this state, and against whom claims arising from 
 98.33  that business may exist now or in the future; 
 98.34     (2) All insurers who purport to do an insurance business in 
 98.35  this state; 
 98.36     (3) All insurers who have insureds resident in this state; 
 99.1      (4) All other persons organized or in the process of 
 99.2   organizing with the intent to do an insurance business in this 
 99.3   state; and 
 99.4      (5) All nonprofit service plan corporations incorporated or 
 99.5   operating under the Nonprofit Health Service Plan Corporation 
 99.6   Act, health maintenance organizations operating under chapter 
 99.7   62D, any health plan incorporated under chapter 317A, all 
 99.8   fraternal benefit societies operating under chapter 64B, except 
 99.9   those associations enumerated in section 64B.38, all township 
 99.10  mutual or other companies operating under chapter 67A, and all 
 99.11  reciprocals or interinsurance exchanges operating under chapter 
 99.12  71A. 
 99.13     Sec. 2.  Minnesota Statutes 1998, section 60B.03, 
 99.14  subdivision 2, is amended to read: 
 99.15     Subd. 2.  [COMMISSIONER.] "Commissioner" means the 
 99.16  commissioner of commerce of the state of Minnesota and, in that 
 99.17  commissioner's absence or disability, a deputy or other person 
 99.18  duly designated to act in that commissioner's place.  In the 
 99.19  context of rehabilitation or liquidation of a health maintenance 
 99.20  organization, "commissioner" means the commissioner of health of 
 99.21  the state of Minnesota and, in that commissioner's absence or 
 99.22  disability, a deputy or other person duly designated to act in 
 99.23  that commissioner's place. 
 99.24     Sec. 3.  Minnesota Statutes 1998, section 60B.03, 
 99.25  subdivision 4, is amended to read: 
 99.26     Subd. 4.  [INSURER.] "Insurer" means any person who is 
 99.27  doing, has done, purports to do or is licensed to do an 
 99.28  insurance business and is or has been subject to the authority 
 99.29  of, or to liquidation, rehabilitation, reorganization, or 
 99.30  conservation by, a the commissioner.  For purposes of sections 
 99.31  60B.01 to 60B.61, all other persons included under section 
 99.32  60B.02 shall be deemed to be insurers. 
 99.33     Sec. 4.  Minnesota Statutes 1998, section 60B.15, is 
 99.34  amended to read: 
 99.35     60B.15 [GROUNDS FOR REHABILITATION.] 
 99.36     The commissioner may apply by verified petition to the 
100.1   district court for Ramsey county or for the county in which the 
100.2   principal office of the insurer is located for an order 
100.3   directing the commissioner to rehabilitate a domestic insurer or 
100.4   an alien insurer domiciled in this state on any one or more of 
100.5   the following grounds: 
100.6      (1) Any ground on which the commissioner may apply for an 
100.7   order of liquidation under section 60B.20, whenever the 
100.8   commissioner believes that the insurer may be successfully 
100.9   rehabilitated without substantial increase in the risk of loss 
100.10  to creditors of the insurer, its policyholders or to the public; 
100.11     (2) That the commissioner has reasonable cause to believe 
100.12  that there has been theft from the insurer, wrongful 
100.13  sequestration or diversion of the insurer's assets, forgery or 
100.14  fraud affecting the insurer or other illegal conduct in, by or 
100.15  with respect to the insurer, which endanger assets in an amount 
100.16  threatening insolvency of the insurer; 
100.17     (3) That substantial and unexplained discrepancies exist 
100.18  between the insurer's records and the most recent annual report 
100.19  or other official company reports; 
100.20     (4) That the insurer, after written demand by the 
100.21  commissioner, has failed to remove any person who in fact has 
100.22  executive authority in the insurer, whether an officer, manager, 
100.23  general agent, employee, or other person, if the person has been 
100.24  found by the commissioner after notice and hearing to be 
100.25  dishonest or untrustworthy in a way affecting the insurer's 
100.26  business such as is the basis for action under section 60A.052; 
100.27     (5) That control of the insurer, whether by stock ownership 
100.28  or otherwise, and whether direct or indirect, is in one or more 
100.29  persons found by the commissioner after notice and hearing to be 
100.30  dishonest or untrustworthy such as is the basis for action under 
100.31  section 60A.052; 
100.32     (6) That the insurer, after written demand by the 
100.33  commissioner, has failed within a reasonable period of time to 
100.34  terminate the employment and status and all influences on 
100.35  management of any person who in fact has executive authority in 
100.36  the insurer, whether an officer, manager, general agent, 
101.1   employee or other person if the person has refused to submit to 
101.2   lawful examination under oath by the commissioner concerning the 
101.3   affairs of the insurer, whether in this state or elsewhere; 
101.4      (7) That after lawful written demand by the commissioner 
101.5   the insurer has failed to submit promptly any of its own 
101.6   property, books, accounts, documents, or other records, or those 
101.7   of any subsidiary or related company within the control of the 
101.8   insurer, or those of any person having executive authority in 
101.9   the insurer so far as they pertain to the insurer, to reasonable 
101.10  inspection or examination by the commissioner or an authorized 
101.11  representative.  If the insurer is unable to submit the 
101.12  property, books, accounts, documents, or other records of a 
101.13  person having executive authority in the insurer, it shall be 
101.14  excused from doing so if it promptly and effectively terminates 
101.15  the relationship of the person to the insurer; 
101.16     (8) That without first obtaining the written consent of the 
101.17  commissioner, or if required by law, the written consent of the 
101.18  attorney general, the insurer has transferred, or attempted to 
101.19  transfer, substantially its entire property or business, or has 
101.20  entered into any transaction the effect of which is to merge, 
101.21  consolidate, or reinsure substantially its entire property or 
101.22  business of any other person; 
101.23     (9) That the insurer or its property has been or is the 
101.24  subject of an application for the appointment of a receiver, 
101.25  trustee, custodian, conservator or sequestrator or similar 
101.26  fiduciary of the insurer or its property otherwise than as 
101.27  authorized under sections 60B.01 to 60B.61, and that such 
101.28  appointment has been made or is imminent, and that such 
101.29  appointment might divest the courts of this state of 
101.30  jurisdiction or prejudice orderly delinquency proceedings under 
101.31  sections 60B.01 to 60B.61; 
101.32     (10) That within the previous year the insurer has 
101.33  willfully violated its charter or articles of incorporation or 
101.34  its bylaws or any applicable insurance law or regulation of any 
101.35  state, or of the federal government, or any valid order of the 
101.36  commissioner under section 60B.11 in any manner or as to any 
102.1   matter which threatens substantial injury to the insurer, its 
102.2   creditors, it policyholders or the public, or having become 
102.3   aware within the previous year of an unintentional or willful 
102.4   violation has failed to take all reasonable steps to remedy the 
102.5   situation resulting from the violation and to prevent the same 
102.6   violations in the future; 
102.7      (11) That the directors of the insurer are deadlocked in 
102.8   the management of the insurer's affairs and that the members or 
102.9   shareholders are unable to break the deadlock and that 
102.10  irreparable injury to the insurer, its creditors, its 
102.11  policyholders, or the public is threatened by reason thereof; 
102.12     (12) That the insurer has failed to pay for 60 days after 
102.13  due date any obligation to this state or any political 
102.14  subdivision thereof or any judgment entered in this state, 
102.15  except that such nonpayment shall not be a ground until 60 days 
102.16  after any good faith effort by the insurer to contest the 
102.17  obligation or judgment has been terminated, whether it is before 
102.18  the commissioner or in the courts; 
102.19     (13) That the insurer has failed to file its annual report 
102.20  or other report within the time allowed by law, and after 
102.21  written demand by the commissioner has failed to give an 
102.22  adequate explanation immediately; 
102.23     (14) That two-thirds of the board of directors, or the 
102.24  holders of a majority of the shares entitled to vote, or a 
102.25  majority of members or policyholders of an insurer subject to 
102.26  control by its members or policyholders, consent to 
102.27  rehabilitation under sections 60B.01 to 60B.61; 
102.28     (15) That the insurer is engaging in a systematic practice 
102.29  of reaching settlements with and obtaining releases from 
102.30  policyholders or third party claimants and then unreasonably 
102.31  delaying payment of or failing to pay the agreed upon 
102.32  settlements; 
102.33     (16) That the insurer is in such condition that the further 
102.34  transaction of business would be hazardous, financially or 
102.35  otherwise, to its policyholders, its creditors, or the public; 
102.36     (17) That within the previous 12 months the insurer has 
103.1   systematically attempted to compromise with its creditors on the 
103.2   ground that it is financially unable to pay its claims in full; 
103.3      (18) In the context of a health maintenance organization, 
103.4   "insurer" when used in clauses (1) to (17) means "health 
103.5   maintenance organization." In addition to the grounds in clauses 
103.6   (1) to (17), any one of the following constitutes grounds for 
103.7   rehabilitation of a health maintenance organization: 
103.8      (a) the health maintenance organization is unable or is 
103.9   expected to be unable to meet its debts as they become due; 
103.10     (b) grounds exist under section 62D.042, subdivision 7; 
103.11     (c) the health maintenance organization's liabilities 
103.12  exceed the current value of its assets, exclusive of intangibles 
103.13  and, where the guaranteeing organization's financial condition 
103.14  no longer meets the requirements of sections 62D.041 and 
103.15  62D.042, exclusive of any deposits, letters of credit, or 
103.16  guarantees provided by any guaranteeing organization under 
103.17  chapter 62D; 
103.18     (d) in addition to grounds under clause (16), within the 
103.19  last year the health maintenance organization has failed, and 
103.20  the commissioner of health expects such failure to continue in 
103.21  the future, to make comprehensive medical care adequately 
103.22  available and accessible to its enrollees and the health 
103.23  maintenance organization has not successfully implemented a plan 
103.24  of corrective action pursuant to section 62D.121, subdivision 7; 
103.25  and 
103.26     (e) in addition to grounds under clause (16), within the 
103.27  last year the directors or officers of the health maintenance 
103.28  organization willfully violated the requirements of section 
103.29  317A.251, or having become aware within the previous year of an 
103.30  unintentional or willful violation of section 317A.251, have 
103.31  failed to take all reasonable steps to remedy the situation 
103.32  resulting from the violation and to prevent the same violation 
103.33  in the future; 
103.34     (19) An affiliate of the insurer has been placed in 
103.35  conservatorship, rehabilitation, liquidation, or other court 
103.36  supervision such that the insurer's financial condition may be 
104.1   jeopardized.  
104.2      Sec. 5.  Minnesota Statutes 1998, section 60B.20, is 
104.3   amended to read: 
104.4      60B.20 [GROUNDS FOR LIQUIDATION.] 
104.5      The commissioner may apply by verified petition to the 
104.6   district court for Ramsey county or for the county in which the 
104.7   principal office of the insurer is located for an order to 
104.8   liquidate a domestic insurer or an alien insurer domiciled in 
104.9   this state on any one or more of the following grounds: 
104.10     (1) Any ground on which the commissioner may apply for an 
104.11  order of rehabilitation under section 60B.15, whenever the 
104.12  commissioner believes that attempts to rehabilitate the insurer 
104.13  would substantially increase the risk of loss to its creditors, 
104.14  its policyholders, or the public, or would be futile, or that 
104.15  rehabilitation would serve no useful purpose; 
104.16     (2) That the insurer is or is about to become insolvent; 
104.17     (3) That the insurer has not transacted the business for 
104.18  which it was organized or incorporated during the previous 12 
104.19  months or has transacted only a token such business during that 
104.20  period, although authorized to do so throughout that period, or 
104.21  that more than 12 months after incorporation it has failed to 
104.22  become authorized to do the business for which it was organized 
104.23  or incorporated; 
104.24     (4) That the insurer has commenced, or within the previous 
104.25  year has attempted to commence, voluntary dissolution or 
104.26  liquidation otherwise than as provided in section 60B.04, 
104.27  subdivision 3 in the case of a solvent insurer; 
104.28     (5) That the insurer has concealed records or assets from 
104.29  the commissioner or improperly removed them from the 
104.30  jurisdiction, or the commissioner believes that the insurer is 
104.31  about to do so; 
104.32     (6) That the insurer does not satisfy the requirements that 
104.33  would be applicable if it were seeking initial authorization in 
104.34  this state to do the business for which it was organized or 
104.35  incorporated, except for: 
104.36     (i) Requirements that are intended to apply only at the 
105.1   time the initial authorization to do business is obtained, and 
105.2   not thereafter; and 
105.3      (ii) Requirements that are expressly made inapplicable by 
105.4   the laws establishing the requirements; 
105.5      (7) That the holders of two-thirds of the shares entitled 
105.6   to vote, or two-thirds of the members or policyholders entitled 
105.7   to vote in an insurer controlled by its members or 
105.8   policyholders, have consented to a petition; 
105.9      (8) In the context of a health maintenance organization, 
105.10  "insurer" when used in clauses (1) to (7) means "health 
105.11  maintenance organization." In addition to the grounds in clauses 
105.12  (1) to (7), any one of the following constitutes grounds for 
105.13  liquidation of a health maintenance organization: 
105.14     (i) the health maintenance organization is unable or is 
105.15  expected to be unable to meet its debts as they become due; 
105.16     (ii) grounds exist under section 62D.042, subdivision 7; 
105.17     (iii) the health maintenance organization's liabilities 
105.18  exceed the current value of its assets, exclusive of intangibles 
105.19  and, where the guaranteeing organization's financial condition 
105.20  no longer meets the requirements of sections 62D.041 and 
105.21  62D.042, exclusive of any deposits, letters of credit, or 
105.22  guarantees provided by any guaranteeing organization under 
105.23  chapter 62D; 
105.24     (iv) within the last year the health maintenance 
105.25  organization has failed, and the commissioner of health expects 
105.26  failure to continue in the future, to make comprehensive medical 
105.27  care adequately available and accessible to its enrollees and 
105.28  the health maintenance organization has not successfully 
105.29  implemented a plan of corrective action pursuant to section 
105.30  62D.121, subdivision 7; and 
105.31     (v) within the last year the directors or officers of the 
105.32  health maintenance organization willfully violated the 
105.33  requirements of section 317A.251, or having become aware within 
105.34  the previous year of an unintentional or willful violation of 
105.35  section 317A.251, have failed to take all reasonable steps to 
105.36  remedy the situation resulting from the violation and to prevent 
106.1   the same violation in the future. 
106.2      Sec. 6.  Minnesota Statutes 1998, section 60G.01, 
106.3   subdivision 2, is amended to read: 
106.4      Subd. 2.  [COMMISSIONER.] "Commissioner" means the 
106.5   commissioner of commerce, except that "commissioner" means the 
106.6   commissioner of health for administrative supervision of health 
106.7   maintenance organizations. 
106.8      Sec. 7.  Minnesota Statutes 1998, section 60G.01, 
106.9   subdivision 4, is amended to read: 
106.10     Subd. 4.  [DEPARTMENT.] "Department" means the department 
106.11  of commerce, except that "department" means the department of 
106.12  health for administrative supervision of health maintenance 
106.13  organizations. 
106.14     Sec. 8.  Minnesota Statutes 1998, section 62A.61, is 
106.15  amended to read: 
106.16     62A.61 [DISCLOSURE OF METHODS USED BY HEALTH CARRIERS TO 
106.17  DETERMINE USUAL AND CUSTOMARY FEES.] 
106.18     (a) A health carrier that bases reimbursement to health 
106.19  care providers upon a usual and customary fee must maintain in 
106.20  its office a copy of a description of the methodology used to 
106.21  calculate fees including at least the following: 
106.22     (1) the frequency of the determination of usual and 
106.23  customary fees; 
106.24     (2) a general description of the methodology used to 
106.25  determine usual and customary fees; and 
106.26     (3) the percentile of usual and customary fees that 
106.27  determines the maximum allowable reimbursement. 
106.28     (b) A health carrier must provide a copy of the information 
106.29  described in paragraph (a) to the commissioner of health or the 
106.30  commissioner of commerce, upon request. 
106.31     (c) The commissioner of health or the commissioner of 
106.32  commerce, as appropriate, may use to enforce this section any 
106.33  enforcement powers otherwise available to the commissioner with 
106.34  respect to the health carrier.  The commissioner of health or 
106.35  commerce, as appropriate, may require health carriers to provide 
106.36  the information required under this section and may use any 
107.1   powers granted under other laws relating to the regulation of 
107.2   health carriers to enforce compliance. 
107.3      (d) For purposes of this section, "health carrier" has the 
107.4   meaning given in section 62A.011. 
107.5      Sec. 9.  Minnesota Statutes 1998, section 62L.02, 
107.6   subdivision 8, is amended to read: 
107.7      Subd. 8.  [COMMISSIONER.] "Commissioner" means the 
107.8   commissioner of commerce for health carriers subject to the 
107.9   jurisdiction of the department of commerce or the commissioner 
107.10  of health for health carriers subject to the jurisdiction of the 
107.11  department of health, or the relevant commissioner's designated 
107.12  representative.  For purposes of sections 62L.13 to 62L.22, 
107.13  "commissioner" means the commissioner of commerce or that 
107.14  commissioner's designated representative. 
107.15     Sec. 10.  Minnesota Statutes 1998, section 62L.05, 
107.16  subdivision 12, is amended to read: 
107.17     Subd. 12.  [DEMONSTRATION PROJECTS.] Nothing in this 
107.18  chapter prohibits a health maintenance organization from 
107.19  offering a demonstration project authorized under section 62D.30.
107.20  The commissioner of health may approve a demonstration project 
107.21  which offers benefits that do not meet the requirements of a 
107.22  small employer plan if the commissioner finds that the 
107.23  requirements of section 62D.30 are otherwise met. 
107.24     Sec. 11.  Minnesota Statutes 1998, section 62L.08, 
107.25  subdivision 10, is amended to read: 
107.26     Subd. 10.  [RATING REPORT.] Beginning January 1, 1995, and 
107.27  annually thereafter, the commissioners of health and 
107.28  commerce commissioner shall provide a joint report to the 
107.29  legislature on the effect of the rating restrictions required by 
107.30  this section and the appropriateness of proceeding with 
107.31  additional rate reform.  Each report must include an analysis of 
107.32  the availability of health care coverage due to the rating 
107.33  reform, the equitable and appropriate distribution of risk and 
107.34  associated costs, the effect on the self-insurance market, and 
107.35  any resulting or anticipated change in health plan design and 
107.36  market share and availability of health carriers. 
108.1      Sec. 12.  Minnesota Statutes 1998, section 62L.08, 
108.2   subdivision 11, is amended to read: 
108.3      Subd. 11.  [LOSS RATIO STANDARDS.] Notwithstanding section 
108.4   62A.02, subdivision 3, relating to loss ratios, each policy or 
108.5   contract form used with respect to a health benefit plan 
108.6   offered, or issued in the small employer market, is subject, 
108.7   beginning July 1, 1993, to section 62A.021.  The commissioner of 
108.8   health has, with respect to carriers under that commissioner's 
108.9   jurisdiction, all of the powers of the commissioner of commerce 
108.10  under that section. 
108.11     Sec. 13.  Minnesota Statutes 1998, section 62M.11, is 
108.12  amended to read: 
108.13     62M.11 [COMPLAINTS TO COMMERCE OR HEALTH.] 
108.14     Notwithstanding the provisions of sections 62M.01 to 
108.15  62M.16, an enrollee may file a complaint regarding a 
108.16  determination not to certify directly to the commissioner 
108.17  responsible for regulating the utilization review 
108.18  organization of commerce. 
108.19     Sec. 14.  Minnesota Statutes 1998, section 62M.16, is 
108.20  amended to read: 
108.21     62M.16 [RULEMAKING.] 
108.22     If it is determined that rules are reasonable and necessary 
108.23  to accomplish the purpose of sections 62M.01 to 62M.16, the 
108.24  rules must be adopted through a joint rulemaking process by both 
108.25  the department of commerce and the department of health by the 
108.26  commissioner of commerce. 
108.27     Sec. 15.  Minnesota Statutes 1998, section 62Q.01, 
108.28  subdivision 2, is amended to read: 
108.29     Subd. 2.  [COMMISSIONER.] "Commissioner" means the 
108.30  commissioner of health for purposes of regulating health 
108.31  maintenance organizations, and community integrated service 
108.32  networks, or the commissioner of commerce for purposes of 
108.33  regulating all other health plan companies.  For all other 
108.34  purposes, "commissioner" means the commissioner of health. 
108.35     Sec. 16.  Minnesota Statutes 1998, section 62Q.07, is 
108.36  amended to read: 
109.1      62Q.07 [ACTION PLANS.] 
109.2      Subdivision 1.  [ACTION PLANS REQUIRED.] (a) To increase 
109.3   public awareness and accountability of health plan companies, 
109.4   all health plan companies that issue or renew a health plan, as 
109.5   defined in section 62Q.01, must annually file with the 
109.6   applicable commissioner an action plan that satisfies the 
109.7   requirements of this section beginning July 1, 1994, as a 
109.8   condition of doing business in Minnesota.  For purposes of this 
109.9   subdivision, "health plan" includes the coverages described in 
109.10  section 62A.011, subdivision 3, clause (10).  Each health plan 
109.11  company must also file its action plan with the information 
109.12  clearinghouse.  Action plans are required solely to provide 
109.13  information to consumers, purchasers, and the larger community 
109.14  as a first step toward greater accountability of health plan 
109.15  companies.  The sole function of the commissioner in relation to 
109.16  the action plans is to ensure that each health plan company 
109.17  files a complete action plan, that the action plan is truthful 
109.18  and not misleading, and that the action plan is reviewed by 
109.19  appropriate community agencies. 
109.20     (b) If a the commissioner responsible for regulating a 
109.21  health plan company required to file an action plan under this 
109.22  section has reason to believe an action plan is false or 
109.23  misleading, the commissioner may conduct an investigation to 
109.24  determine whether the action plan is truthful and not 
109.25  misleading, and may require the health plan company to submit 
109.26  any information that the commissioner reasonably deems necessary 
109.27  to complete the investigation.  If the commissioner determines 
109.28  that an action plan is false or misleading, the commissioner may 
109.29  require the health plan company to file an amended plan or may 
109.30  take any action authorized under chapter 72A. 
109.31     Subd. 2.  [CONTENTS OF ACTION PLANS.] (a) An action plan 
109.32  must include a detailed description of all of the health plan 
109.33  company's methods and procedures, standards, qualifications, 
109.34  criteria, and credentialing requirements for designating the 
109.35  providers who are eligible to participate in the health plan 
109.36  company's provider network, including any limitations on the 
110.1   numbers of providers to be included in the network.  This 
110.2   description must be updated by the health plan company and filed 
110.3   with the applicable agency commissioner on a quarterly basis.  
110.4      (b) An action plan must include the number of full-time 
110.5   equivalent physicians, by specialty, nonphysician providers, and 
110.6   allied health providers used to provide services.  The action 
110.7   plan must also describe how the health plan company intends to 
110.8   encourage the use of nonphysician providers, midlevel 
110.9   practitioners, and allied health professionals, through at least 
110.10  consumer education, physician education, and referral and 
110.11  advisement systems.  The annual action plan must also include 
110.12  data that is broken down by type of provider, reflecting actual 
110.13  utilization of midlevel practitioners and allied professionals 
110.14  by enrollees of the health plan company during the previous 
110.15  year.  Until July 1, 1995, a health plan company may use 
110.16  estimates if actual data is not available.  For purposes of this 
110.17  paragraph, "provider" has the meaning given in section 62J.03, 
110.18  subdivision 8.  
110.19     (c) An action plan must include a description of the health 
110.20  plan company's policy on determining the number and the type of 
110.21  providers that are necessary to deliver cost-effective health 
110.22  care to its enrollees.  The action plan must also include the 
110.23  health plan company's strategy, including provider recruitment 
110.24  and retention activities, for ensuring that sufficient providers 
110.25  are available to its enrollees. 
110.26     (d) An action plan must include a description of actions 
110.27  taken or planned by the health plan company to ensure that 
110.28  information from report cards, outcome studies, and complaints 
110.29  is used internally to improve quality of the services provided 
110.30  by the health plan company. 
110.31     (e) An action plan must include a detailed description of 
110.32  the health plan company's policies and procedures for enrolling 
110.33  and serving high risk and special needs populations.  This 
110.34  description must also include the barriers that are present for 
110.35  the high risk and special needs population and how the health 
110.36  plan company is addressing these barriers in order to provide 
111.1   greater access to these populations.  "High risk and special 
111.2   needs populations" includes, but is not limited to, recipients 
111.3   of medical assistance, general assistance medical care, and 
111.4   MinnesotaCare; persons with chronic conditions or disabilities; 
111.5   individuals within certain racial, cultural, and ethnic 
111.6   communities; individuals and families with low income; 
111.7   adolescents; the elderly; individuals with limited or no English 
111.8   language proficiency; persons with high-cost preexisting 
111.9   conditions; homeless persons; chemically dependent persons; 
111.10  persons with serious and persistent mental illness; children 
111.11  with severe emotional disturbance; and persons who are at high 
111.12  risk of requiring treatment.  For purposes of this paragraph, 
111.13  "provider" has the meaning given in section 62J.03, subdivision 
111.14  8. 
111.15     (f) An action plan must include a general description of 
111.16  any action the health plan company has taken and those it 
111.17  intends to take to offer health coverage options to rural 
111.18  communities and other communities not currently served by the 
111.19  health plan company. 
111.20     (g) A health plan company other than a large managed care 
111.21  plan company may satisfy any of the requirements of the action 
111.22  plan in paragraphs (a) to (f) by stating that it has no 
111.23  policies, procedures, practices, or requirements, either written 
111.24  or unwritten, or formal or informal, and has undertaken no 
111.25  activities or plans on the issues required to be addressed in 
111.26  the action plan, provided that the statement is truthful and not 
111.27  misleading.  For purposes of this paragraph, "large managed care 
111.28  plan company" means a health maintenance organization or other 
111.29  health plan company that employs or contracts with health care 
111.30  providers, that has more than 50,000 enrollees in this state.  
111.31  If a health plan company employs or contracts with providers for 
111.32  some of its health plans and does not do so for other health 
111.33  plans that it offers, the health plan company is a large managed 
111.34  care plan company if it has more than 50,000 enrollees in this 
111.35  state in health plans for which it does employ or contract with 
111.36  providers. 
112.1      Sec. 17.  Minnesota Statutes 1998, section 62Q.075, 
112.2   subdivision 4, is amended to read: 
112.3      Subd. 4.  [REVIEW.] Upon receipt of the plan, the 
112.4   appropriate commissioner shall provide a copy to the regional 
112.5   coordinating boards, local community health boards, and other 
112.6   relevant community organizations within the managed care 
112.7   organization's service area.  After reviewing the plan, these 
112.8   community groups may submit written comments on the plan to 
112.9   either the commissioner of health or commerce, as applicable, 
112.10  and may advise the commissioner of the managed care 
112.11  organization's effectiveness in assisting to achieve regional 
112.12  public health goals.  The plan may be reviewed by the county 
112.13  boards, or city councils acting as a local board of health in 
112.14  accordance with chapter 145A, within the managed care 
112.15  organization's service area to determine whether the plan is 
112.16  consistent with the goals and objectives of the plans required 
112.17  under chapters 145A and 256E and whether the plan meets the 
112.18  needs of the community.  The county board, or applicable city 
112.19  council, may also review and make recommendations on the 
112.20  availability and accessibility of services provided by the 
112.21  managed care organization.  The county board, or applicable city 
112.22  council, may submit written comments to the appropriate 
112.23  commissioner, and may advise the commissioner of the managed 
112.24  care organization's effectiveness in assisting to meet the needs 
112.25  and goals as defined under the responsibilities of chapters 145A 
112.26  and 256E.  The commissioner of health shall develop 
112.27  recommendations to utilize the written comments submitted as 
112.28  part of the licensure process to ensure local public 
112.29  accountability.  These recommendations shall be reported to the 
112.30  legislative commission on health care access by January 15, 
112.31  1996.  Copies of these written comments must be provided to the 
112.32  managed care organization.  The plan and any comments submitted 
112.33  must be filed with the information clearinghouse to be 
112.34  distributed to the public. 
112.35     Sec. 18.  Minnesota Statutes 1998, section 62Q.105, 
112.36  subdivision 6, is amended to read: 
113.1      Subd. 6.  [RECORDKEEPING.] Health plan companies shall 
113.2   maintain records of all enrollee complaints and their 
113.3   resolutions.  These records must be retained for five years, and 
113.4   must be made available to the appropriate commissioner upon 
113.5   request. 
113.6      Sec. 19.  Minnesota Statutes 1998, section 62Q.105, 
113.7   subdivision 7, is amended to read: 
113.8      Subd. 7.  [REPORTING.] Each health plan company shall 
113.9   submit to the appropriate commissioner, as part of the company's 
113.10  annual filing, data on the number and type of complaints that 
113.11  are not resolved within 30 days.  A health plan company shall 
113.12  also make this information available to the public upon request. 
113.13     Sec. 20.  Minnesota Statutes 1998, section 62Q.11, is 
113.14  amended to read: 
113.15     62Q.11 [DISPUTE RESOLUTION.] 
113.16     Subdivision 1.  [ESTABLISHED.] The commissioners of health 
113.17  and commerce commissioner shall make dispute resolution 
113.18  processes available to encourage early settlement of disputes in 
113.19  order to avoid the time and cost associated with litigation and 
113.20  other formal adversarial hearings.  For purposes of this 
113.21  section, "dispute resolution" means the use of negotiation, 
113.22  mediation, arbitration, mediation-arbitration, neutral fact 
113.23  finding, and minitrials.  These processes shall be nonbinding 
113.24  unless otherwise agreed to by all parties to the dispute. 
113.25     Subd. 2.  [REQUIREMENTS.] (a) If an enrollee, health care 
113.26  provider, or applicant for network provider status chooses to 
113.27  use a dispute resolution process prior to the filing of a formal 
113.28  claim or of a lawsuit, the health plan company must participate. 
113.29     (b) If an enrollee, health care provider, or applicant for 
113.30  network provider status chooses to use a dispute resolution 
113.31  process after the filing of a lawsuit, the health plan company 
113.32  must participate in dispute resolution, including, but not 
113.33  limited to, alternative dispute resolution under rule 114 of the 
113.34  Minnesota general rules of practice. 
113.35     (c) The commissioners of health and commerce commissioner 
113.36  shall inform and educate health plan companies' enrollees about 
114.1   dispute resolution and its benefits, and shall establish 
114.2   appropriate cost-sharing requirements for parties taking part in 
114.3   alternative dispute resolution. 
114.4      (d) A health plan company may encourage but not require an 
114.5   enrollee to submit a complaint to alternative dispute resolution.
114.6      Sec. 21.  Minnesota Statutes 1998, section 62Q.22, 
114.7   subdivision 2, is amended to read: 
114.8      Subd. 2.  [REGISTRATION.] A community health clinic that 
114.9   offers a prepaid option under this section must register on an 
114.10  annual basis with the commissioner of health. 
114.11     Sec. 22.  Minnesota Statutes 1998, section 62Q.22, 
114.12  subdivision 6, is amended to read: 
114.13     Subd. 6.  [INFORMATION TO BE PROVIDED.] (a) A community 
114.14  health clinic must provide an individual or family who purchases 
114.15  a prepaid option a clear and concise written statement that 
114.16  includes the following information: 
114.17     (1) the health care services that the prepaid option 
114.18  covers; 
114.19     (2) any exclusions or limitations on the health care 
114.20  services offered, including any preexisting condition 
114.21  limitations, cost-sharing arrangements, or prior authorization 
114.22  requirements; 
114.23     (3) where the health care services may be obtained; 
114.24     (4) a description of the clinic's method for resolving 
114.25  patient complaints, including a description of how a patient can 
114.26  file a complaint with the department of health commerce; and 
114.27     (5) a description of the conditions under which the prepaid 
114.28  option may be canceled or terminated. 
114.29     (b) The commissioner of health must approve a copy of the 
114.30  written statement before the community health clinic may offer 
114.31  the prepaid option described in this section.  
114.32     Sec. 23.  Minnesota Statutes 1998, section 62Q.22, 
114.33  subdivision 7, is amended to read: 
114.34     Subd. 7.  [COMPLAINT PROCESS.] (a) A community health 
114.35  clinic that offers a prepaid option under this section must 
114.36  establish a complaint resolution process.  As an alternative to 
115.1   establishing its own process, a community health clinic may use 
115.2   the complaint process of another organization.  
115.3      (b) A community health clinic must make reasonable efforts 
115.4   to resolve complaints and to inform complainants in writing of 
115.5   the clinic's decision within 60 days of receiving the complaint. 
115.6      (c) A community health clinic that offers a prepaid option 
115.7   under this section must report all complaints that are not 
115.8   resolved within 60 days to the commissioner of health. 
115.9      Sec. 24.  Minnesota Statutes 1998, section 62Q.32, is 
115.10  amended to read: 
115.11     62Q.32 [LOCAL OMBUDSPERSON.] 
115.12     County board or community health service agencies may 
115.13  establish an office of ombudsperson to provide a system of 
115.14  consumer advocacy for persons receiving health care services 
115.15  through a health plan company.  The ombudsperson's functions may 
115.16  include, but are not limited to: 
115.17     (a) mediation or advocacy on behalf of a person accessing 
115.18  the complaint and appeal procedures to ensure that necessary 
115.19  medical services are provided by the health plan company; and 
115.20     (b) investigation of the quality of services provided to a 
115.21  person and determine the extent to which quality assurance 
115.22  mechanisms are needed or any other system change may be needed.  
115.23  The commissioner of health shall make recommendations for 
115.24  funding these functions including the amount of funding needed 
115.25  and a plan for distribution.  The commissioner shall submit 
115.26  these recommendations to the legislative commission on health 
115.27  care access by January 15, 1996. 
115.28     Sec. 25.  Minnesota Statutes 1998, section 62Q.51, 
115.29  subdivision 3, is amended to read: 
115.30     Subd. 3.  [RATE APPROVAL.] The premium rates and cost 
115.31  sharing requirements for each option must be submitted to the 
115.32  commissioner of health or the commissioner of commerce as 
115.33  required by law.  A health plan that includes lower enrollee 
115.34  cost sharing for services provided by network providers than for 
115.35  services provided by out-of-network providers, or lower enrollee 
115.36  cost sharing for services provided with prior authorization or 
116.1   second opinion than for services provided without prior 
116.2   authorization or second opinion, qualifies as a point-of-service 
116.3   option. 
116.4      Sec. 26.  Minnesota Statutes 1998, section 62Q.525, 
116.5   subdivision 3, is amended to read: 
116.6      Subd. 3.  [REQUIRED COVERAGE.] (a) Every type of coverage 
116.7   included in subdivision 1 that provides coverage for drugs may 
116.8   not exclude coverage of a drug for the treatment of cancer on 
116.9   the ground that the drug has not been approved by the federal 
116.10  Food and Drug Administration for the treatment of cancer if the 
116.11  drug is recognized for treatment of cancer in one of the 
116.12  standard reference compendia or in one article in the medical 
116.13  literature, as defined in subdivision 2.  
116.14     (b) Coverage of a drug required by this subdivision 
116.15  includes coverage of medically necessary services directly 
116.16  related to and required for appropriate administration of the 
116.17  drug.  
116.18     (c) Coverage required by this subdivision does not include 
116.19  coverage of a drug not listed on the formulary of the coverage 
116.20  included in subdivision 1. 
116.21     (d) Coverage of a drug required under this subdivision must 
116.22  not be subject to any copayment, coinsurance, deductible, or 
116.23  other enrollee cost-sharing greater than the coverage included 
116.24  in subdivision 1 applies to other drugs. 
116.25     (e) The commissioner of commerce or health, as appropriate, 
116.26  may direct a person that issues coverage included in subdivision 
116.27  1 to make payments required by this section. 
116.28     Sec. 27.  Minnesota Statutes 1998, section 72A.139, 
116.29  subdivision 2, is amended to read: 
116.30     Subd. 2.  [DEFINITIONS.] (a) As used in this section, 
116.31  "commissioner" means the commissioner of commerce for health 
116.32  plan companies and other insurers regulated by that commissioner 
116.33  and the commissioner of health for health plan companies 
116.34  regulated by that commissioner. 
116.35     (b) As used in this section, a "genetic test" means a 
116.36  presymptomatic test of a person's genes, gene products, or 
117.1   chromosomes for the purpose of determining the presence or 
117.2   absence of a gene or genes that exhibit abnormalities, defects, 
117.3   or deficiencies, including carrier status, that are known to be 
117.4   the cause of a disease or disorder, or are determined to be 
117.5   associated with a statistically increased risk of development of 
117.6   a disease or disorder.  "Genetic test" does not include a 
117.7   cholesterol test or other test not conducted for the purpose of 
117.8   determining the presence or absence of a person's gene or genes. 
117.9      (c) As used in this section, "health plan" has the meaning 
117.10  given in section 62Q.01, subdivision 3. 
117.11     (d) As used in this section, "health plan company" has the 
117.12  meaning given in section 62Q.01, subdivision 4. 
117.13     (e) As used in this section, "individual" means an 
117.14  applicant for coverage or a person already covered by the health 
117.15  plan company or other insurer. 
117.16     Sec. 28.  [REPEALER.] 
117.17     Minnesota Statutes 1998, sections 62L.11, subdivision 2; 
117.18  and 62Q.45, subdivision 1, are repealed. 
117.19     Sec. 29.  [EFFECTIVE DATE.] 
117.20     This article is effective July 1, 2000.