1.1                          A bill for an act 
  1.2             relating to children; providing for measures to 
  1.3             improve child support collection and enforcement; 
  1.4             providing civil penalties; amending Minnesota Statutes 
  1.5             2000, sections 13B.06, subdivision 7; 256.01, 
  1.6             subdivision 2; 256.741, subdivisions 1, 5, and 8; 
  1.7             256.979, subdivisions 5 and 6; 393.07, by adding a 
  1.8             subdivision; 518.551, subdivision 13; 518.5513, 
  1.9             subdivision 5; 518.575, subdivision 1; 518.5851, by 
  1.10            adding a subdivision; 518.5853, by adding a 
  1.11            subdivision; 518.6195; 518.64, subdivision 2; 518.641, 
  1.12            subdivisions 1, 2, 3, and by adding a subdivision; and 
  1.13            548.091, subdivision 1a; repealing Minnesota Statutes 
  1.14            2000, section 518.641, subdivisions 4 and 5. 
  1.15  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.16     Section 1.  Minnesota Statutes 2000, section 13B.06, 
  1.17  subdivision 7, is amended to read: 
  1.18     Subd. 7.  [FEES.] A financial institution may charge and 
  1.19  collect a fee from the public authority for providing account 
  1.20  information to the public authority.  The commissioner may pay a 
  1.21  financial institution up to $150 each quarter if the 
  1.22  commissioner and the financial institution have entered into a 
  1.23  signed agreement that complies with federal law.  The 
  1.24  commissioner shall develop procedures for the financial 
  1.25  institutions to charge and collect the fee.  Payment of the fee 
  1.26  is limited by the amount of the appropriation for this purpose.  
  1.27  If the appropriation is insufficient, or if fund availability in 
  1.28  the fourth quarter would allow payments for actual costs in 
  1.29  excess of $150, the commissioner shall prorate the available 
  1.30  funds among the financial institutions that have submitted a 
  2.1   claim for the fee.  No financial institution shall charge or 
  2.2   collect a fee that exceeds its actual costs of complying with 
  2.3   this section.  The commissioner, together with an advisory group 
  2.4   consisting of representatives of the financial institutions in 
  2.5   the state, shall determine a fee structure that minimizes the 
  2.6   cost to the state and reasonably meets the needs of the 
  2.7   financial institutions, and shall report to the chairs of the 
  2.8   judiciary committees in the house of representatives and the 
  2.9   senate by February 1, 1998, a recommended fee structure for 
  2.10  inclusion in this section evaluate whether the fee paid to 
  2.11  financial institutions compensates them for their actual costs, 
  2.12  including start-up costs, of complying with this section and 
  2.13  shall submit a report to the legislature by July 1, 2002, with a 
  2.14  recommendation for retaining or modifying the fee. 
  2.15     Sec. 2.  Minnesota Statutes 2000, section 256.01, 
  2.16  subdivision 2, is amended to read: 
  2.17     Subd. 2.  [SPECIFIC POWERS.] Subject to the provisions of 
  2.18  section 241.021, subdivision 2, the commissioner of human 
  2.19  services shall: 
  2.20     (1) Administer and supervise all forms of public assistance 
  2.21  provided for by state law and other welfare activities or 
  2.22  services as are vested in the commissioner.  Administration and 
  2.23  supervision of human services activities or services includes, 
  2.24  but is not limited to, assuring timely and accurate distribution 
  2.25  of benefits, completeness of service, and quality program 
  2.26  management.  In addition to administering and supervising human 
  2.27  services activities vested by law in the department, the 
  2.28  commissioner shall have the authority to: 
  2.29     (a) require county agency participation in training and 
  2.30  technical assistance programs to promote compliance with 
  2.31  statutes, rules, federal laws, regulations, and policies 
  2.32  governing human services; 
  2.33     (b) monitor, on an ongoing basis, the performance of county 
  2.34  agencies in the operation and administration of human services, 
  2.35  enforce compliance with statutes, rules, federal laws, 
  2.36  regulations, and policies governing welfare services and promote 
  3.1   excellence of administration and program operation; 
  3.2      (c) develop a quality control program or other monitoring 
  3.3   program to review county performance and accuracy of benefit 
  3.4   determinations; 
  3.5      (d) require county agencies to make an adjustment to the 
  3.6   public assistance benefits issued to any individual consistent 
  3.7   with federal law and regulation and state law and rule and to 
  3.8   issue or recover benefits as appropriate; 
  3.9      (e) delay or deny payment of all or part of the state and 
  3.10  federal share of benefits and administrative reimbursement 
  3.11  according to the procedures set forth in section 256.017; 
  3.12     (f) make contracts with and grants to public and private 
  3.13  agencies and organizations, both profit and nonprofit, and 
  3.14  individuals, using appropriated funds; and 
  3.15     (g) enter into contractual agreements with federally 
  3.16  recognized Indian tribes with a reservation in Minnesota to the 
  3.17  extent necessary for the tribe to operate a federally approved 
  3.18  family assistance program or any other program under the 
  3.19  supervision of the commissioner.  The commissioner shall consult 
  3.20  with the affected county or counties in the contractual 
  3.21  agreement negotiations, if the county or counties wish to be 
  3.22  included, in order to avoid the duplication of county and tribal 
  3.23  assistance program services.  The commissioner may establish 
  3.24  necessary accounts for the purposes of receiving and disbursing 
  3.25  funds as necessary for the operation of the programs. 
  3.26     (2) Inform county agencies, on a timely basis, of changes 
  3.27  in statute, rule, federal law, regulation, and policy necessary 
  3.28  to county agency administration of the programs. 
  3.29     (3) Administer and supervise all child welfare activities; 
  3.30  promote the enforcement of laws protecting handicapped, 
  3.31  dependent, neglected and delinquent children, and children born 
  3.32  to mothers who were not married to the children's fathers at the 
  3.33  times of the conception nor at the births of the children; 
  3.34  license and supervise child-caring and child-placing agencies 
  3.35  and institutions; supervise the care of children in boarding and 
  3.36  foster homes or in private institutions; and generally perform 
  4.1   all functions relating to the field of child welfare now vested 
  4.2   in the state board of control. 
  4.3      (4) Administer and supervise all noninstitutional service 
  4.4   to handicapped persons, including those who are visually 
  4.5   impaired, hearing impaired, or physically impaired or otherwise 
  4.6   handicapped.  The commissioner may provide and contract for the 
  4.7   care and treatment of qualified indigent children in facilities 
  4.8   other than those located and available at state hospitals when 
  4.9   it is not feasible to provide the service in state hospitals. 
  4.10     (5) Assist and actively cooperate with other departments, 
  4.11  agencies and institutions, local, state, and federal, by 
  4.12  performing services in conformity with the purposes of Laws 
  4.13  1939, chapter 431. 
  4.14     (6) Act as the agent of and cooperate with the federal 
  4.15  government in matters of mutual concern relative to and in 
  4.16  conformity with the provisions of Laws 1939, chapter 431, 
  4.17  including the administration of any federal funds granted to the 
  4.18  state to aid in the performance of any functions of the 
  4.19  commissioner as specified in Laws 1939, chapter 431, and 
  4.20  including the promulgation of rules making uniformly available 
  4.21  medical care benefits to all recipients of public assistance, at 
  4.22  such times as the federal government increases its participation 
  4.23  in assistance expenditures for medical care to recipients of 
  4.24  public assistance, the cost thereof to be borne in the same 
  4.25  proportion as are grants of aid to said recipients. 
  4.26     (7) Establish and maintain any administrative units 
  4.27  reasonably necessary for the performance of administrative 
  4.28  functions common to all divisions of the department. 
  4.29     (8) Act as designated guardian of both the estate and the 
  4.30  person of all the wards of the state of Minnesota, whether by 
  4.31  operation of law or by an order of court, without any further 
  4.32  act or proceeding whatever, except as to persons committed as 
  4.33  mentally retarded.  For children under the guardianship of the 
  4.34  commissioner whose interests would be best served by adoptive 
  4.35  placement, the commissioner may contract with a licensed 
  4.36  child-placing agency to provide adoption services.  A contract 
  5.1   with a licensed child-placing agency must be designed to 
  5.2   supplement existing county efforts and may not replace existing 
  5.3   county programs, unless the replacement is agreed to by the 
  5.4   county board and the appropriate exclusive bargaining 
  5.5   representative or the commissioner has evidence that child 
  5.6   placements of the county continue to be substantially below that 
  5.7   of other counties.  Funds encumbered and obligated under an 
  5.8   agreement for a specific child shall remain available until the 
  5.9   terms of the agreement are fulfilled or the agreement is 
  5.10  terminated. 
  5.11     (9) Act as coordinating referral and informational center 
  5.12  on requests for service for newly arrived immigrants coming to 
  5.13  Minnesota. 
  5.14     (10) The specific enumeration of powers and duties as 
  5.15  hereinabove set forth shall in no way be construed to be a 
  5.16  limitation upon the general transfer of powers herein contained. 
  5.17     (11) Establish county, regional, or statewide schedules of 
  5.18  maximum fees and charges which may be paid by county agencies 
  5.19  for medical, dental, surgical, hospital, nursing and nursing 
  5.20  home care and medicine and medical supplies under all programs 
  5.21  of medical care provided by the state and for congregate living 
  5.22  care under the income maintenance programs. 
  5.23     (12) Have the authority to conduct and administer 
  5.24  experimental projects to test methods and procedures of 
  5.25  administering assistance and services to recipients or potential 
  5.26  recipients of public welfare.  To carry out such experimental 
  5.27  projects, it is further provided that the commissioner of human 
  5.28  services is authorized to waive the enforcement of existing 
  5.29  specific statutory program requirements, rules, and standards in 
  5.30  one or more counties.  The order establishing the waiver shall 
  5.31  provide alternative methods and procedures of administration, 
  5.32  shall not be in conflict with the basic purposes, coverage, or 
  5.33  benefits provided by law, and in no event shall the duration of 
  5.34  a project exceed four years.  It is further provided that no 
  5.35  order establishing an experimental project as authorized by the 
  5.36  provisions of this section shall become effective until the 
  6.1   following conditions have been met: 
  6.2      (a) The secretary of health and human services of the 
  6.3   United States has agreed, for the same project, to waive state 
  6.4   plan requirements relative to statewide uniformity. 
  6.5      (b) A comprehensive plan, including estimated project 
  6.6   costs, shall be approved by the legislative advisory commission 
  6.7   and filed with the commissioner of administration.  
  6.8      (13) According to federal requirements, establish 
  6.9   procedures to be followed by local welfare boards in creating 
  6.10  citizen advisory committees, including procedures for selection 
  6.11  of committee members. 
  6.12     (14) Allocate federal fiscal disallowances or sanctions 
  6.13  which are based on quality control error rates for the aid to 
  6.14  families with dependent children program formerly codified in 
  6.15  sections 256.72 to 256.87, medical assistance, or food stamp 
  6.16  program in the following manner:  
  6.17     (a) One-half of the total amount of the disallowance shall 
  6.18  be borne by the county boards responsible for administering the 
  6.19  programs.  For the medical assistance and the AFDC program 
  6.20  formerly codified in sections 256.72 to 256.87, disallowances 
  6.21  shall be shared by each county board in the same proportion as 
  6.22  that county's expenditures for the sanctioned program are to the 
  6.23  total of all counties' expenditures for the AFDC program 
  6.24  formerly codified in sections 256.72 to 256.87, and medical 
  6.25  assistance programs.  For the food stamp program, sanctions 
  6.26  shall be shared by each county board, with 50 percent of the 
  6.27  sanction being distributed to each county in the same proportion 
  6.28  as that county's administrative costs for food stamps are to the 
  6.29  total of all food stamp administrative costs for all counties, 
  6.30  and 50 percent of the sanctions being distributed to each county 
  6.31  in the same proportion as that county's value of food stamp 
  6.32  benefits issued are to the total of all benefits issued for all 
  6.33  counties.  Each county shall pay its share of the disallowance 
  6.34  to the state of Minnesota.  When a county fails to pay the 
  6.35  amount due hereunder, the commissioner may deduct the amount 
  6.36  from reimbursement otherwise due the county, or the attorney 
  7.1   general, upon the request of the commissioner, may institute 
  7.2   civil action to recover the amount due. 
  7.3      (b) Notwithstanding the provisions of paragraph (a), if the 
  7.4   disallowance results from knowing noncompliance by one or more 
  7.5   counties with a specific program instruction, and that knowing 
  7.6   noncompliance is a matter of official county board record, the 
  7.7   commissioner may require payment or recover from the county or 
  7.8   counties, in the manner prescribed in paragraph (a), an amount 
  7.9   equal to the portion of the total disallowance which resulted 
  7.10  from the noncompliance, and may distribute the balance of the 
  7.11  disallowance according to paragraph (a).  
  7.12     (15) Develop and implement special projects that maximize 
  7.13  reimbursements and result in the recovery of money to the 
  7.14  state.  For the purpose of recovering state money, the 
  7.15  commissioner may enter into contracts with third parties.  Any 
  7.16  recoveries that result from projects or contracts entered into 
  7.17  under this paragraph shall be deposited in the state treasury 
  7.18  and credited to a special account until the balance in the 
  7.19  account reaches $1,000,000.  When the balance in the account 
  7.20  exceeds $1,000,000, the excess shall be transferred and credited 
  7.21  to the general fund.  All money in the account is appropriated 
  7.22  to the commissioner for the purposes of this paragraph. 
  7.23     (16) Have the authority to make direct payments to 
  7.24  facilities providing shelter to women and their children 
  7.25  according to section 256D.05, subdivision 3.  Upon the written 
  7.26  request of a shelter facility that has been denied payments 
  7.27  under section 256D.05, subdivision 3, the commissioner shall 
  7.28  review all relevant evidence and make a determination within 30 
  7.29  days of the request for review regarding issuance of direct 
  7.30  payments to the shelter facility.  Failure to act within 30 days 
  7.31  shall be considered a determination not to issue direct payments.
  7.32     (17) Have the authority to establish and enforce the 
  7.33  following county reporting requirements:  
  7.34     (a) The commissioner shall establish fiscal and statistical 
  7.35  reporting requirements necessary to account for the expenditure 
  7.36  of funds allocated to counties for human services programs.  
  8.1   When establishing financial and statistical reporting 
  8.2   requirements, the commissioner shall evaluate all reports, in 
  8.3   consultation with the counties, to determine if the reports can 
  8.4   be simplified or the number of reports can be reduced. 
  8.5      (b) The county board shall submit monthly or quarterly 
  8.6   reports to the department as required by the commissioner.  
  8.7   Monthly reports are due no later than 15 working days after the 
  8.8   end of the month.  Quarterly reports are due no later than 30 
  8.9   calendar days after the end of the quarter, unless the 
  8.10  commissioner determines that the deadline must be shortened to 
  8.11  20 calendar days to avoid jeopardizing compliance with federal 
  8.12  deadlines or risking a loss of federal funding.  Only reports 
  8.13  that are complete, legible, and in the required format shall be 
  8.14  accepted by the commissioner.  
  8.15     (c) If the required reports are not received by the 
  8.16  deadlines established in clause (b), the commissioner may delay 
  8.17  payments and withhold funds from the county board until the next 
  8.18  reporting period.  When the report is needed to account for the 
  8.19  use of federal funds and the late report results in a reduction 
  8.20  in federal funding, the commissioner shall withhold from the 
  8.21  county boards with late reports an amount equal to the reduction 
  8.22  in federal funding until full federal funding is received.  
  8.23     (d) A county board that submits reports that are late, 
  8.24  illegible, incomplete, or not in the required format for two out 
  8.25  of three consecutive reporting periods is considered 
  8.26  noncompliant.  When a county board is found to be noncompliant, 
  8.27  the commissioner shall notify the county board of the reason the 
  8.28  county board is considered noncompliant and request that the 
  8.29  county board develop a corrective action plan stating how the 
  8.30  county board plans to correct the problem.  The corrective 
  8.31  action plan must be submitted to the commissioner within 45 days 
  8.32  after the date the county board received notice of noncompliance.
  8.33     (e) The final deadline for fiscal reports or amendments to 
  8.34  fiscal reports is one year after the date the report was 
  8.35  originally due.  If the commissioner does not receive a report 
  8.36  by the final deadline, the county board forfeits the funding 
  9.1   associated with the report for that reporting period and the 
  9.2   county board must repay any funds associated with the report 
  9.3   received for that reporting period. 
  9.4      (f) The commissioner may not delay payments, withhold 
  9.5   funds, or require repayment under paragraph (c) or (e) if the 
  9.6   county demonstrates that the commissioner failed to provide 
  9.7   appropriate forms, guidelines, and technical assistance to 
  9.8   enable the county to comply with the requirements.  If the 
  9.9   county board disagrees with an action taken by the commissioner 
  9.10  under paragraph (c) or (e), the county board may appeal the 
  9.11  action according to sections 14.57 to 14.69. 
  9.12     (g) Counties subject to withholding of funds under 
  9.13  paragraph (c) or forfeiture or repayment of funds under 
  9.14  paragraph (e) shall not reduce or withhold benefits or services 
  9.15  to clients to cover costs incurred due to actions taken by the 
  9.16  commissioner under paragraph (c) or (e). 
  9.17     (18) Allocate federal fiscal disallowances or sanctions for 
  9.18  audit exceptions when federal fiscal disallowances or sanctions 
  9.19  are based on a statewide random sample for the foster care 
  9.20  program under title IV-E of the Social Security Act, United 
  9.21  States Code, title 42, in direct proportion to each county's 
  9.22  title IV-E foster care maintenance claim for that period. 
  9.23     (19) Be responsible for ensuring the detection, prevention, 
  9.24  investigation, and resolution of fraudulent activities or 
  9.25  behavior by applicants, recipients, and other participants in 
  9.26  the human services programs administered by the department. 
  9.27     (20) Require county agencies to identify overpayments, 
  9.28  establish claims, and utilize all available and cost-beneficial 
  9.29  methodologies to collect and recover these overpayments in the 
  9.30  human services programs administered by the department. 
  9.31     (21) Have the authority to administer a drug rebate program 
  9.32  for drugs purchased pursuant to the prescription drug program 
  9.33  established under section 256.955 after the beneficiary's 
  9.34  satisfaction of any deductible established in the program.  The 
  9.35  commissioner shall require a rebate agreement from all 
  9.36  manufacturers of covered drugs as defined in section 256B.0625, 
 10.1   subdivision 13.  Rebate agreements for prescription drugs 
 10.2   delivered on or after July 1, 2002, must include rebates for 
 10.3   individuals covered under the prescription drug program who are 
 10.4   under 65 years of age.  For each drug, the amount of the rebate 
 10.5   shall be equal to the basic rebate as defined for purposes of 
 10.6   the federal rebate program in United States Code, title 42, 
 10.7   section 1396r-8(c)(1).  This basic rebate shall be applied to 
 10.8   single-source and multiple-source drugs.  The manufacturers must 
 10.9   provide full payment within 30 days of receipt of the state 
 10.10  invoice for the rebate within the terms and conditions used for 
 10.11  the federal rebate program established pursuant to section 1927 
 10.12  of title XIX of the Social Security Act.  The manufacturers must 
 10.13  provide the commissioner with any information necessary to 
 10.14  verify the rebate determined per drug.  The rebate program shall 
 10.15  utilize the terms and conditions used for the federal rebate 
 10.16  program established pursuant to section 1927 of title XIX of the 
 10.17  Social Security Act. 
 10.18     (22) Operate the department's communication systems account 
 10.19  established in Laws 1993, First Special Session chapter 1, 
 10.20  article 1, section 2, subdivision 2, to manage shared 
 10.21  communication costs necessary for the operation of the programs 
 10.22  the commissioner supervises.  A communications account may also 
 10.23  be established for each regional treatment center which operates 
 10.24  communications systems.  Each account must be used to manage 
 10.25  shared communication costs necessary for the operations of the 
 10.26  programs the commissioner supervises.  The commissioner may 
 10.27  distribute the costs of operating and maintaining communication 
 10.28  systems to participants in a manner that reflects actual usage. 
 10.29  Costs may include acquisition, licensing, insurance, 
 10.30  maintenance, repair, staff time and other costs as determined by 
 10.31  the commissioner.  Nonprofit organizations and state, county, 
 10.32  and local government agencies involved in the operation of 
 10.33  programs the commissioner supervises may participate in the use 
 10.34  of the department's communications technology and share in the 
 10.35  cost of operation.  The commissioner may accept on behalf of the 
 10.36  state any gift, bequest, devise or personal property of any 
 11.1   kind, or money tendered to the state for any lawful purpose 
 11.2   pertaining to the communication activities of the department.  
 11.3   Any money received for this purpose must be deposited in the 
 11.4   department's communication systems accounts.  Money collected by 
 11.5   the commissioner for the use of communication systems must be 
 11.6   deposited in the state communication systems account and is 
 11.7   appropriated to the commissioner for purposes of this section. 
 11.8      (23) Receive any federal matching money that is made 
 11.9   available through the medical assistance program for the 
 11.10  consumer satisfaction survey.  Any federal money received for 
 11.11  the survey is appropriated to the commissioner for this 
 11.12  purpose.  The commissioner may expend the federal money received 
 11.13  for the consumer satisfaction survey in either year of the 
 11.14  biennium. 
 11.15     (24) Incorporate cost reimbursement claims from First Call 
 11.16  Minnesota into the federal cost reimbursement claiming processes 
 11.17  of the department according to federal law, rule, and 
 11.18  regulations.  Any reimbursement received is appropriated to the 
 11.19  commissioner and shall be disbursed to First Call Minnesota 
 11.20  according to normal department payment schedules. 
 11.21     (25) Develop recommended standards for foster care homes 
 11.22  that address the components of specialized therapeutic services 
 11.23  to be provided by foster care homes with those services. 
 11.24     (26) In consultation with county child support 
 11.25  representatives and county attorneys, adopt rules, in accordance 
 11.26  with chapter 14, that are necessary for the operation of a 
 11.27  statewide child support county performance management program. 
 11.28     Sec. 3.  Minnesota Statutes 2000, section 256.741, 
 11.29  subdivision 1, is amended to read: 
 11.30     Subdivision 1.  [PUBLIC ASSISTANCE.] (a) The term "direct 
 11.31  support" as used in this chapter and chapters 257, 518, and 518C 
 11.32  refers to an assigned support payment from an obligor which is 
 11.33  paid directly to a recipient of TANF or MFIP. 
 11.34     (b) The term "public assistance" as used in this chapter 
 11.35  and chapters 257, 518, and 518C, includes any form of assistance 
 11.36  provided under the AFDC program formerly codified in sections 
 12.1   256.72 to 256.87, MFIP and MFIP-R formerly codified under 
 12.2   chapter 256, MFIP under chapter 256J, work first program under 
 12.3   chapter 256K; child care assistance provided through the child 
 12.4   care fund under chapter 119B; any form of medical assistance 
 12.5   under chapter 256B; MinnesotaCare under chapter 256L; and foster 
 12.6   care as provided under title IV-E of the Social Security Act. 
 12.7      (b) (c) The term "child support agency" as used in this 
 12.8   section refers to the public authority responsible for child 
 12.9   support enforcement. 
 12.10     (c) (d) The term "public assistance agency" as used in this 
 12.11  section refers to a public authority providing public assistance 
 12.12  to an individual. 
 12.13     Sec. 4.  Minnesota Statutes 2000, section 256.741, 
 12.14  subdivision 5, is amended to read: 
 12.15     Subd. 5.  [COOPERATION WITH CHILD SUPPORT ENFORCEMENT.] 
 12.16  After notification from a public assistance agency that an 
 12.17  individual has applied for or is receiving any form of public 
 12.18  assistance, the child support agency shall determine whether the 
 12.19  party is cooperating with the agency in establishing paternity, 
 12.20  child support, modification of an existing child support order, 
 12.21  or enforcement of an existing child support order.  The public 
 12.22  assistance agency shall notify each applicant or recipient in 
 12.23  writing of the right to claim a good cause exemption from 
 12.24  cooperating with the requirements in this section.  A copy of 
 12.25  the notice must be furnished to the applicant or recipient, and 
 12.26  the applicant or recipient and a representative from the public 
 12.27  authority shall acknowledge receipt of the notice by signing and 
 12.28  dating a copy of the notice.  The individual shall cooperate 
 12.29  with the child support agency by: 
 12.30     (1) providing all known information regarding the alleged 
 12.31  father or obligor, including name, address, social security 
 12.32  number, telephone number, place of employment or school, and the 
 12.33  names and addresses of any relatives; 
 12.34     (2) appearing at interviews, hearings and legal 
 12.35  proceedings; 
 12.36     (3) submitting to genetic tests including genetic testing 
 13.1   of the child, under a judicial or administrative order; and 
 13.2      (4) providing additional information known by the 
 13.3   individual as necessary for cooperating in good faith with the 
 13.4   child support agency. 
 13.5      The caregiver of a minor child must cooperate with the 
 13.6   efforts of the public authority to collect support according to 
 13.7   this subdivision.  A caregiver must forward to notify the public 
 13.8   authority of all support the caregiver receives during the 
 13.9   period the assignment of support required under subdivision 2 is 
 13.10  in effect.  Support received by a caregiver and not forwarded to 
 13.11  the public authority must be repaid to the child support 
 13.12  enforcement unit for any month following the date on which 
 13.13  initial eligibility is determined Direct support retained by a 
 13.14  caregiver must be counted as unearned income when determining 
 13.15  the amount of the assistance payment, except as provided under 
 13.16  subdivision 8, paragraph (b), clause (4) and repaid to the child 
 13.17  support agency for any month when the direct support retained is 
 13.18  greater than the court-ordered child support and the assistance 
 13.19  payment and the obligor owes support arrears. 
 13.20     Sec. 5.  Minnesota Statutes 2000, section 256.741, 
 13.21  subdivision 8, is amended to read: 
 13.22     Subd. 8.  [REFUSAL TO COOPERATE WITH SUPPORT REQUIREMENTS.] 
 13.23  (a) Failure by a caregiver to satisfy any of the requirements of 
 13.24  subdivision 5 constitutes refusal to cooperate, and the 
 13.25  sanctions under paragraph (b) apply.  The IV-D agency must 
 13.26  determine whether a caregiver has refused to cooperate according 
 13.27  to subdivision 5. 
 13.28     (b) Determination by the IV-D agency that a caregiver has 
 13.29  refused to cooperate has the following effects: 
 13.30     (1) a caregiver is subject to the applicable sanctions 
 13.31  under section 256J.46; 
 13.32     (2) a caregiver who is not a parent of a minor child in an 
 13.33  assistance unit may choose to remove the child from the 
 13.34  assistance unit unless the child is required to be in the 
 13.35  assistance unit; and 
 13.36     (3) a parental caregiver who refuses to cooperate is 
 14.1   ineligible for medical assistance; and 
 14.2      (4) direct support retained by a caregiver must be counted 
 14.3   as unearned income when determining the amount of the assistance 
 14.4   payment. 
 14.5      Sec. 6.  Minnesota Statutes 2000, section 256.979, 
 14.6   subdivision 5, is amended to read: 
 14.7      Subd. 5.  [PATERNITY ESTABLISHMENT AND CHILD SUPPORT ORDER 
 14.8   ESTABLISHMENT AND MODIFICATION BONUS INCENTIVES.] (a) A bonus 
 14.9   incentive program is created to increase the number of paternity 
 14.10  establishments and establishment and modifications of child 
 14.11  support orders done by county child support enforcement agencies.
 14.12     (b) A bonus must be awarded to a county child support 
 14.13  agency for each case child for which the agency completes a 
 14.14  paternity or child support order establishment or modification 
 14.15  through judicial or administrative processes. 
 14.16     (c) The rate of bonus incentive is $100 per child for each 
 14.17  paternity or child support order establishment and modification 
 14.18  set in a specific dollar amount. 
 14.19     (d) No bonus shall be paid for a modification that is a 
 14.20  result of a termination of child care costs according to section 
 14.21  518.551, subdivision 5, paragraph (b), or due solely to a 
 14.22  reduction of child care expenses. 
 14.23     Sec. 7.  Minnesota Statutes 2000, section 256.979, 
 14.24  subdivision 6, is amended to read: 
 14.25     Subd. 6.  [CLAIMS FOR BONUS INCENTIVE.] (a) The 
 14.26  commissioner of human services and the county agency shall 
 14.27  develop procedures for the claims process and criteria using 
 14.28  automated systems where possible. 
 14.29     (b) Only one county agency may receive a bonus per 
 14.30  paternity establishment or child support order establishment or 
 14.31  modification for each case child.  The county agency completing 
 14.32  the action or procedure needed to establish paternity or a child 
 14.33  support order or modify an order is the county agency entitled 
 14.34  to claim the bonus incentive. 
 14.35     (c) Disputed claims must be submitted to the commissioner 
 14.36  of human services and the commissioner's decision is final. 
 15.1      (d) For purposes of this section, "case" means a family 
 15.2   unit for whom the county agency is providing child support 
 15.3   enforcement services.  
 15.4      Sec. 8.  Minnesota Statutes 2000, section 393.07, is 
 15.5   amended by adding a subdivision to read: 
 15.6      Subd. 9a.  [ADMINISTRATIVE PENALTIES.] (a) The public 
 15.7   authority, as defined in section 518.54, may sanction an 
 15.8   employer or payor of funds up to $700 for failing to comply with 
 15.9   section 518.5513, subdivision 5, paragraph (a), clauses (5) and 
 15.10  (8), if: 
 15.11     (1) the public authority mails the employer or payor of 
 15.12  funds a notice of an administrative sanction, at the employer's 
 15.13  or payor's of funds last known address, which includes the date 
 15.14  the sanction will take effect, the amount of the sanction, the 
 15.15  reason for imposing the sanction, and the corrective action that 
 15.16  must be taken to avoid the sanction; and 
 15.17     (2) the employer or payor of funds fails to correct the 
 15.18  violation before the effective date of the sanction. 
 15.19     (b) The public authority shall include with the sanction 
 15.20  notice an additional notice of the right to appeal the sanction 
 15.21  and the process for making the appeal.  
 15.22     (c) Unless an appeal is made, the administrative 
 15.23  determination of the sanction is final and binding. 
 15.24     Sec. 9.  Minnesota Statutes 2000, section 518.551, 
 15.25  subdivision 13, is amended to read: 
 15.26     Subd. 13.  [DRIVER'S LICENSE SUSPENSION.] (a) Upon motion 
 15.27  of an obligee, which has been properly served on the obligor and 
 15.28  upon which there has been an opportunity for hearing, if a court 
 15.29  finds that the obligor has been or may be issued a driver's 
 15.30  license by the commissioner of public safety and the obligor is 
 15.31  in arrears in court-ordered child support or maintenance 
 15.32  payments, or both, in an amount equal to or greater than three 
 15.33  times the obligor's total monthly support and maintenance 
 15.34  payments and is not in compliance with a written payment 
 15.35  agreement regarding both current support and arrearages approved 
 15.36  by the court, a child support magistrate, or the public 
 16.1   authority, the court shall order the commissioner of public 
 16.2   safety to suspend the obligor's driver's license.  The court's 
 16.3   order must be stayed for 90 days in order to allow the obligor 
 16.4   to execute a written payment agreement regarding both current 
 16.5   support and arrearages, which payment agreement must be approved 
 16.6   by either the court or the public authority responsible for 
 16.7   child support enforcement.  If the obligor has not executed or 
 16.8   is not in compliance with a written payment agreement regarding 
 16.9   both current support and arrearages after the 90 days expires, 
 16.10  the court's order becomes effective and the commissioner of 
 16.11  public safety shall suspend the obligor's driver's license.  The 
 16.12  remedy under this subdivision is in addition to any other 
 16.13  enforcement remedy available to the court.  An obligee may not 
 16.14  bring a motion under this paragraph within 12 months of a denial 
 16.15  of a previous motion under this paragraph. 
 16.16     (b) If a public authority responsible for child support 
 16.17  enforcement determines that the obligor has been or may be 
 16.18  issued a driver's license by the commissioner of public safety 
 16.19  and the obligor is in arrears in court-ordered child support or 
 16.20  maintenance payments or both in an amount equal to or greater 
 16.21  than three times the obligor's total monthly support and 
 16.22  maintenance payments and not in compliance with a written 
 16.23  payment agreement regarding both current support and arrearages 
 16.24  approved by the court, a child support magistrate, or the public 
 16.25  authority, the public authority shall direct the commissioner of 
 16.26  public safety to suspend the obligor's driver's license.  The 
 16.27  remedy under this subdivision is in addition to any other 
 16.28  enforcement remedy available to the public authority. 
 16.29     (c) At least 90 days prior to notifying the commissioner of 
 16.30  public safety according to paragraph (b), the public authority 
 16.31  must mail a written notice to the obligor at the obligor's last 
 16.32  known address, that it intends to seek suspension of the 
 16.33  obligor's driver's license and that the obligor must request a 
 16.34  hearing within 30 days in order to contest the suspension.  If 
 16.35  the obligor makes a written request for a hearing within 30 days 
 16.36  of the date of the notice, a court hearing must be held.  
 17.1   Notwithstanding any law to the contrary, the obligor must be 
 17.2   served with 14 days' notice in writing specifying the time and 
 17.3   place of the hearing and the allegations against the obligor.  
 17.4   The notice may be served personally or by mail.  If the public 
 17.5   authority does not receive a request for a hearing within 30 
 17.6   days of the date of the notice, and the obligor does not execute 
 17.7   a written payment agreement regarding both current support and 
 17.8   arrearages approved by the public authority within 90 days of 
 17.9   the date of the notice, the public authority shall direct the 
 17.10  commissioner of public safety to suspend the obligor's driver's 
 17.11  license under paragraph (b). 
 17.12     (d) At a hearing requested by the obligor under paragraph 
 17.13  (c), and on finding that the obligor is in arrears in 
 17.14  court-ordered child support or maintenance payments or both in 
 17.15  an amount equal to or greater than three times the obligor's 
 17.16  total monthly support and maintenance payments, the district 
 17.17  court or child support magistrate shall order the commissioner 
 17.18  of public safety to suspend the obligor's driver's license or 
 17.19  operating privileges unless the court or child support 
 17.20  magistrate determines that the obligor has executed and is in 
 17.21  compliance with a written payment agreement regarding both 
 17.22  current support and arrearages approved by the court, a child 
 17.23  support magistrate, or the public authority. 
 17.24     (e) An obligor whose driver's license or operating 
 17.25  privileges are suspended may provide proof to the public 
 17.26  authority responsible for child support enforcement that the 
 17.27  obligor is in compliance with all written payment agreements 
 17.28  regarding both current support and arrearages.  Within 15 days 
 17.29  of the receipt of that proof, the public authority shall inform 
 17.30  the commissioner of public safety that the obligor's driver's 
 17.31  license or operating privileges should no longer be suspended. 
 17.32     (f) On January 15, 1997, and every two years after that, 
 17.33  the commissioner of human services shall submit a report to the 
 17.34  legislature that identifies the following information relevant 
 17.35  to the implementation of this section: 
 17.36     (1) the number of child support obligors notified of an 
 18.1   intent to suspend a driver's license; 
 18.2      (2) the amount collected in payments from the child support 
 18.3   obligors notified of an intent to suspend a driver's license; 
 18.4      (3) the number of cases paid in full and payment agreements 
 18.5   executed in response to notification of an intent to suspend a 
 18.6   driver's license; 
 18.7      (4) the number of cases in which there has been 
 18.8   notification and no payments or payment agreements; 
 18.9      (5) the number of driver's licenses suspended; and 
 18.10     (6) the cost of implementation and operation of the 
 18.11  requirements of this section. 
 18.12     (g) In addition to the criteria established under this 
 18.13  section for the suspension of an obligor's driver's license, a 
 18.14  court, a child support magistrate, or the public authority may 
 18.15  direct the commissioner of public safety to suspend the license 
 18.16  of a party who has failed, after receiving notice, to comply 
 18.17  with a subpoena relating to a paternity or child support 
 18.18  proceeding.  Notice to an obligor of intent to suspend must be 
 18.19  served by first class mail at the obligor's last known address.  
 18.20  The notice must inform the obligor of the right to request a 
 18.21  hearing.  If the obligor makes a written request within ten days 
 18.22  of the date of the hearing, a hearing must be held.  At the 
 18.23  hearing, the only issues to be considered are mistake of fact 
 18.24  and whether the obligor received the subpoena. 
 18.25     (h) The license of an obligor who fails to remain in 
 18.26  compliance with an approved payment agreement may be 
 18.27  suspended if the obligor misses one month's payment.  Notice to 
 18.28  the obligor of an intent to suspend under this paragraph must be 
 18.29  served by first class mail mailed to the obligor at the 
 18.30  obligor's last known address and must include a notice of 
 18.31  hearing.  This notice must inform the obligor that unless the 
 18.32  delinquency on the payment agreement is paid in full within 30 
 18.33  days of the date of notice or the obligor requests a hearing, 
 18.34  the public authority will direct the department of public safety 
 18.35  to suspend the obligor's license.  If the obligor does not pay 
 18.36  the delinquency in full or request a hearing within 30 days of 
 19.1   the date of notice, the public authority may direct the 
 19.2   department of public safety to suspend the obligor's license.  
 19.3   If the obligor requests a hearing to determine failure to comply 
 19.4   with the payment agreement, the notice of hearing must be served 
 19.5   upon mailed to the obligor at the obligor's last known address 
 19.6   not less than ten days before the date of the hearing.  If the 
 19.7   obligor appears at the hearing and the judge district court or 
 19.8   child support magistrate determines that the obligor has failed 
 19.9   to comply with an approved payment agreement, the judge district 
 19.10  court or child support magistrate shall notify order the 
 19.11  department of public safety to suspend the obligor's 
 19.12  license under paragraph (c).  If the obligor fails to appear at 
 19.13  the hearing, the public authority may notify direct the 
 19.14  department of public safety to suspend the obligor's 
 19.15  license under paragraph (c). 
 19.16     Sec. 10.  Minnesota Statutes 2000, section 518.5513, 
 19.17  subdivision 5, is amended to read: 
 19.18     Subd. 5.  [ADMINISTRATIVE AUTHORITY.] (a) The public 
 19.19  authority may take the following actions relating to 
 19.20  establishment of paternity or to establishment, modification, or 
 19.21  enforcement of support orders, without the necessity of 
 19.22  obtaining an order from any judicial or administrative tribunal: 
 19.23     (1) recognize and enforce orders of child support agencies 
 19.24  of other states; 
 19.25     (2) upon request for genetic testing by a child, parent, or 
 19.26  any alleged parent, and using the procedure in paragraph (b), 
 19.27  order the child, parent, or alleged parent to submit to blood or 
 19.28  genetic testing for the purpose of establishing paternity; 
 19.29     (3) subpoena financial or other information needed to 
 19.30  establish, modify, or enforce a child support order and request 
 19.31  sanctions sanction a party for failure to respond to a subpoena; 
 19.32     (4) upon notice to the obligor, obligee, and the 
 19.33  appropriate court, direct the obligor or other payor to change 
 19.34  the payee to the central collections unit under sections 
 19.35  518.5851 to 518.5853; 
 19.36     (5) order income withholding of child support under section 
 20.1   518.6111 and sanction an employer or payor of funds pursuant to 
 20.2   section 393.07, subdivision 9a, for failing to comply with an 
 20.3   income withholding notice; 
 20.4      (6) secure assets to satisfy the debt or arrearage in cases 
 20.5   in which there is a support debt or arrearage by: 
 20.6      (i) intercepting or seizing periodic or lump sum payments 
 20.7   from state or local agencies, including unemployment benefits, 
 20.8   workers' compensation payments, judgments, settlements, 
 20.9   lotteries, and other lump sum payments; 
 20.10     (ii) attaching and seizing assets of the obligor held in 
 20.11  financial institutions or public or private retirement funds; 
 20.12  and 
 20.13     (iii) imposing liens in accordance with section 548.091 
 20.14  and, in appropriate cases, forcing the sale of property and the 
 20.15  distribution of proceeds; 
 20.16     (7) for the purpose of securing overdue support, increase 
 20.17  the amount of the monthly support payments by an additional 
 20.18  amount equal to 20 percent of the monthly support payment to 
 20.19  include amounts for debts or arrearages; and 
 20.20     (8) subpoena an employer or payor of funds to provide 
 20.21  promptly information on the employment, compensation, and 
 20.22  benefits of an individual employed by that employer as an 
 20.23  employee or contractor, and to request sanctions sanction an 
 20.24  employer or payor of funds pursuant to section 393.07, 
 20.25  subdivision 9a, for failure to respond to the subpoena as 
 20.26  provided by law. 
 20.27     (b) A request for genetic testing by a child, parent, or 
 20.28  alleged parent must be supported by a sworn statement by the 
 20.29  person requesting genetic testing alleging paternity, which sets 
 20.30  forth facts establishing a reasonable possibility of the 
 20.31  requisite sexual contact between the parties, or denying 
 20.32  paternity, and setting forth facts establishing a reasonable 
 20.33  possibility of the nonexistence of sexual contact between the 
 20.34  alleged parties.  The order for genetic tests may be served 
 20.35  anywhere within the state and served outside the state in the 
 20.36  same manner as prescribed by law for service of subpoenas issued 
 21.1   by the district court of this state.  If the child, parent, or 
 21.2   alleged parent fails to comply with the genetic testing order, 
 21.3   the public authority may seek to enforce that order in district 
 21.4   court through a motion to compel testing.  No results obtained 
 21.5   through genetic testing done in response to an order issued 
 21.6   under this section may be used in any criminal proceeding. 
 21.7      (c) Subpoenas may be served anywhere within the state and 
 21.8   served outside the state in the same manner as prescribed by law 
 21.9   for service of process of subpoenas issued by the district court 
 21.10  of this state.  When a subpoena under this subdivision is served 
 21.11  on a third-party recordkeeper, written notice of the subpoena 
 21.12  shall be mailed to the person who is the subject of the 
 21.13  subpoenaed material at the person's last known address within 
 21.14  three days of the day the subpoena is served.  This notice 
 21.15  provision does not apply if there is reasonable cause to believe 
 21.16  the giving of the notice may lead to interference with the 
 21.17  production of the subpoenaed documents. 
 21.18     (d) A person served with a subpoena may make a written 
 21.19  objection to the public authority or court before the time 
 21.20  specified in the subpoena for compliance.  The public authority 
 21.21  or the court shall cancel or modify the subpoena, if 
 21.22  appropriate.  The public authority shall pay the reasonable 
 21.23  costs of producing the documents, if requested. 
 21.24     (e) Subpoenas are enforceable in the same manner as 
 21.25  subpoenas of the district court.  Upon motion of the county 
 21.26  attorney, the court may issue an order directing the production 
 21.27  of the records.  Failure to comply with the court order may 
 21.28  subject the person who fails to comply to civil or criminal 
 21.29  contempt of court. 
 21.30     (f) The administrative actions under this subdivision are 
 21.31  subject to due process safeguards, including requirements for 
 21.32  notice, opportunity to contest the action, and opportunity to 
 21.33  appeal the order to the judge, judicial officer, or child 
 21.34  support magistrate. 
 21.35     Sec. 11.  Minnesota Statutes 2000, section 518.575, 
 21.36  subdivision 1, is amended to read: 
 22.1      Subdivision 1.  [MAKING NAMES PUBLIC.] At least once each 
 22.2   year, the commissioner of human services, in consultation with 
 22.3   the attorney general, shall may publish a list of the names and 
 22.4   other identifying information of no more than 25 persons who (1) 
 22.5   are child support obligors, (2) are at least $10,000 in arrears, 
 22.6   (3) are not in compliance with a written payment agreement 
 22.7   regarding both current support and arrearages approved by the 
 22.8   court, a child support magistrate, or the public authority, (4) 
 22.9   cannot currently be located by the public authority for the 
 22.10  purposes of enforcing a support order, and (5) have not made a 
 22.11  support payment except tax intercept payments, in the preceding 
 22.12  12 months. 
 22.13     Identifying information may include the obligor's name, 
 22.14  last known address, amount owed, date of birth, photograph, the 
 22.15  number of children for whom support is owed, and any additional 
 22.16  information about the obligor that would assist in identifying 
 22.17  or locating the obligor.  The commissioner and attorney general 
 22.18  may use posters, media presentations, electronic technology, and 
 22.19  other means that the commissioner and attorney general determine 
 22.20  are appropriate for dissemination of the information, including 
 22.21  publication on the Internet.  The commissioner and attorney 
 22.22  general may make any or all of the identifying information 
 22.23  regarding these persons public.  Information regarding an 
 22.24  obligor who meets the criteria in this subdivision will only be 
 22.25  made public subsequent to that person's selection by the 
 22.26  commissioner and attorney general. 
 22.27     Before making public the name of the obligor, the 
 22.28  department of human services shall send a notice to the 
 22.29  obligor's last known address which states the department's 
 22.30  intention to make public information on the obligor.  The notice 
 22.31  must also provide an opportunity to have the obligor's name 
 22.32  removed from the list by paying the arrearage or by entering 
 22.33  into an agreement to pay the arrearage, or by providing 
 22.34  information to the public authority that there is good cause not 
 22.35  to make the information public.  The notice must include the 
 22.36  final date when the payment or agreement can be accepted. 
 23.1      The department of human services shall obtain the written 
 23.2   consent of the obligee to make the name of the obligor public. 
 23.3      Sec. 12.  Minnesota Statutes 2000, section 518.5851, is 
 23.4   amended by adding a subdivision to read: 
 23.5      Subd. 7.  [UNCLAIMED SUPPORT FUNDS.] "Unclaimed support 
 23.6   funds" means any support payments collected by the public 
 23.7   authority from the obligor, which have not been disbursed to the 
 23.8   obligee or public authority. 
 23.9      Sec. 13.  Minnesota Statutes 2000, section 518.5853, is 
 23.10  amended by adding a subdivision to read: 
 23.11     Subd. 12.  [UNCLAIMED SUPPORT FUNDS.] (a) If support 
 23.12  payments have not been disbursed to an obligee because the 
 23.13  obligee is not located, the public authority shall continue 
 23.14  locate efforts for one year from the date the public authority 
 23.15  determines that the obligee is not located. 
 23.16     (b) If the public authority is unable to locate the obligee 
 23.17  after one year, the public authority shall mail a written notice 
 23.18  to the obligee at the obligee's last known address.  The notice 
 23.19  shall give the obligee 60 days to contact the public authority.  
 23.20  If the obligee does not contact the public authority within 60 
 23.21  days from the date of notice, the public authority shall: 
 23.22     (1) close the nonpublic assistance portion of the case; 
 23.23     (2) disburse unclaimed support funds to pay public 
 23.24  assistance arrears.  If public assistance arrears remain after 
 23.25  disbursing the unclaimed support funds, the public authority may 
 23.26  continue enforcement and collection of child support until all 
 23.27  public assistance arrears have been paid.  If there are no 
 23.28  public assistance arrears, or unclaimed support funds remain 
 23.29  after paying public assistance arrears, remaining unclaimed 
 23.30  support funds shall be returned to the obligor; and 
 23.31     (3) mail, when all public assistance arrears have been paid 
 23.32  the public authority, to the obligor at the obligor's last known 
 23.33  address a written notice of termination of income withholding 
 23.34  and case closure due to the public authority's inability to 
 23.35  locate the obligee. 
 23.36     (c) If the obligor is not located when attempting to return 
 24.1   unclaimed support funds, the public authority shall continue 
 24.2   locate efforts for one year from the date the public authority 
 24.3   determines that the obligor is not located.  If the public 
 24.4   authority is unable to locate the obligor after one year, the 
 24.5   funds shall be treated as unclaimed property according to 
 24.6   federal law and chapter 345. 
 24.7      Sec. 14.  Minnesota Statutes 2000, section 518.6195, is 
 24.8   amended to read: 
 24.9      518.6195 [COLLECTION; ARREARS ONLY.] 
 24.10     (a) Remedies available for the collection and enforcement 
 24.11  of support in this chapter and chapters 256, 257, and 518C also 
 24.12  apply to cases in which the child or children for whom support 
 24.13  is owed are emancipated and the obligor owes past support or has 
 24.14  an accumulated arrearage as of the date of the youngest child's 
 24.15  emancipation.  Child support arrearages under this section 
 24.16  include arrearages for child support, medical support, child 
 24.17  care, pregnancy and birth expenses, and unreimbursed medical 
 24.18  expenses as defined in section 518.171. 
 24.19     (b) This section applies retroactively to any support 
 24.20  arrearage that accrued on or before the date of enactment and to 
 24.21  all arrearages accruing after the date of enactment. 
 24.22     (c) Past support or pregnancy and confinement expenses 
 24.23  ordered for which the obligor has specific court ordered terms 
 24.24  for repayment may not be enforced using drivers' and 
 24.25  occupational or professional license suspension, credit bureau 
 24.26  reporting, and additional income withholding under section 
 24.27  518.6111, subdivision 10, paragraph (a), unless the obligor 
 24.28  fails to comply with the terms of the court order for repayment. 
 24.29     (d) If an arrearage exists at the time a support order 
 24.30  would otherwise terminate and section 518.6111, subdivision 10, 
 24.31  paragraph (c), does not apply to this section, the arrearage 
 24.32  shall be repaid in an amount equal to the current support order 
 24.33  plus an additional 20 percent of the monthly child support 
 24.34  obligation until all arrears have been paid in full, absent a 
 24.35  court order to the contrary. 
 24.36     (e) If an arrearage exists according to a support order 
 25.1   which fails to establish a monthly support obligation in a 
 25.2   specific dollar amount, the public authority, if it provides 
 25.3   child support services, or the obligee, may establish a payment 
 25.4   agreement which shall equal what the obligor would pay for 
 25.5   current support after application of section 518.551, plus an 
 25.6   additional 20 percent of the current support obligation, until 
 25.7   all arrears have been paid in full.  If the obligor fails to 
 25.8   enter into or comply with a payment agreement, the public 
 25.9   authority, if it provides child support services, or the 
 25.10  obligee, may move the district court or child support 
 25.11  magistrate, if section 484.702 applies, for an order 
 25.12  establishing repayment terms.  It shall be presumed that the 
 25.13  obligor is able to repay arrears at a rate which at a minimum 
 25.14  equals a current monthly obligation after application of section 
 25.15  518.551, plus an additional 20 percent of the current monthly 
 25.16  obligation. 
 25.17     Sec. 15.  Minnesota Statutes 2000, section 518.64, 
 25.18  subdivision 2, is amended to read: 
 25.19     Subd. 2.  [MODIFICATION.] (a) The terms of an order 
 25.20  respecting maintenance or support may be modified upon a showing 
 25.21  of one or more of the following:  (1) substantially increased or 
 25.22  decreased earnings of a party; (2) substantially increased or 
 25.23  decreased need of a party or the child or children that are the 
 25.24  subject of these proceedings; (3) receipt of assistance under 
 25.25  the AFDC program formerly codified under sections 256.72 to 
 25.26  256.87 or 256B.01 to 256B.40, or chapter 256J or 256K; (4) a 
 25.27  change in the cost of living for either party as measured by the 
 25.28  federal bureau of statistics, any of which makes the terms 
 25.29  unreasonable and unfair; (5) extraordinary medical expenses of 
 25.30  the child not provided for under section 518.171; or (6) the 
 25.31  addition of work-related or education-related child care 
 25.32  expenses of the obligee or a substantial increase or decrease in 
 25.33  existing work-related or education-related child care expenses.  
 25.34     On a motion to modify support, the needs of any child the 
 25.35  obligor has after the entry of the support order that is the 
 25.36  subject of a modification motion shall be considered as provided 
 26.1   by section 518.551, subdivision 5f. 
 26.2      (b) It is presumed that there has been a substantial change 
 26.3   in circumstances under paragraph (a) and the terms of a current 
 26.4   support order shall be rebuttably presumed to be unreasonable 
 26.5   and unfair if: 
 26.6      (1) the application of the child support guidelines in 
 26.7   section 518.551, subdivision 5, to the current circumstances of 
 26.8   the parties results in a calculated court order that is at least 
 26.9   20 percent and at least $50 per month higher or lower than the 
 26.10  current support order; 
 26.11     (2) the medical support provisions of the order established 
 26.12  under section 518.171 are not enforceable by the public 
 26.13  authority or the custodial parent; 
 26.14     (3) health coverage ordered under section 518.171 is not 
 26.15  available to the child for whom the order is established by the 
 26.16  parent ordered to provide; or 
 26.17     (4) the existing support obligation is in the form of a 
 26.18  statement of percentage and not a specific dollar amount.  
 26.19     (c) On a motion for modification of maintenance, including 
 26.20  a motion for the extension of the duration of a maintenance 
 26.21  award, the court shall apply, in addition to all other relevant 
 26.22  factors, the factors for an award of maintenance under section 
 26.23  518.552 that exist at the time of the motion.  On a motion for 
 26.24  modification of support, the court:  
 26.25     (1) shall apply section 518.551, subdivision 5, and shall 
 26.26  not consider the financial circumstances of each party's spouse, 
 26.27  if any; and 
 26.28     (2) shall not consider compensation received by a party for 
 26.29  employment in excess of a 40-hour work week, provided that the 
 26.30  party demonstrates, and the court finds, that: 
 26.31     (i) the excess employment began after entry of the existing 
 26.32  support order; 
 26.33     (ii) the excess employment is voluntary and not a condition 
 26.34  of employment; 
 26.35     (iii) the excess employment is in the nature of additional, 
 26.36  part-time employment, or overtime employment compensable by the 
 27.1   hour or fractions of an hour; 
 27.2      (iv) the party's compensation structure has not been 
 27.3   changed for the purpose of affecting a support or maintenance 
 27.4   obligation; 
 27.5      (v) in the case of an obligor, current child support 
 27.6   payments are at least equal to the guidelines amount based on 
 27.7   income not excluded under this clause; and 
 27.8      (vi) in the case of an obligor who is in arrears in child 
 27.9   support payments to the obligee, any net income from excess 
 27.10  employment must be used to pay the arrearages until the 
 27.11  arrearages are paid in full. 
 27.12     (d) A modification of support or maintenance, including 
 27.13  interest that accrued pursuant to section 548.091, may be made 
 27.14  retroactive only with respect to any period during which the 
 27.15  petitioning party has pending a motion for modification but only 
 27.16  from the date of service of notice of the motion on the 
 27.17  responding party and on the public authority if public 
 27.18  assistance is being furnished or the county attorney is the 
 27.19  attorney of record.  However, modification may be applied to an 
 27.20  earlier period if the court makes express findings that:  
 27.21     (1) the party seeking modification was precluded from 
 27.22  serving a motion by reason of a significant physical or mental 
 27.23  disability, a material misrepresentation of another party, or 
 27.24  fraud upon the court and that the party seeking modification, 
 27.25  when no longer precluded, promptly served a motion; 
 27.26     (2) the party seeking modification was a recipient of 
 27.27  federal Supplemental Security Income (SSI), Title II Older 
 27.28  Americans, Survivor's Disability Insurance (OASDI), other 
 27.29  disability benefits, or public assistance based upon need during 
 27.30  the period for which retroactive modification is sought; or 
 27.31     (3) the order for which the party seeks amendment was 
 27.32  entered by default, the party shows good cause for not 
 27.33  appearing, and the record contains no factual evidence, or 
 27.34  clearly erroneous evidence regarding the individual obligor's 
 27.35  ability to pay.; or 
 27.36     (4) the party seeking modification was institutionalized or 
 28.1   incarcerated for an offense other than nonsupport of a child 
 28.2   during the period for which retroactive modification is sought 
 28.3   and lacked the financial ability to pay the support ordered 
 28.4   during that time period.  In determining whether to allow the 
 28.5   retroactive modification, the court shall consider whether and 
 28.6   when a request was made to the public authority for support 
 28.7   modification.  
 28.8   The court may provide that a reduction in the amount allocated 
 28.9   for child care expenses based on a substantial decrease in the 
 28.10  expenses is effective as of the date the expenses decreased. 
 28.11     (e) Except for an award of the right of occupancy of the 
 28.12  homestead, provided in section 518.63, all divisions of real and 
 28.13  personal property provided by section 518.58 shall be final, and 
 28.14  may be revoked or modified only where the court finds the 
 28.15  existence of conditions that justify reopening a judgment under 
 28.16  the laws of this state, including motions under section 518.145, 
 28.17  subdivision 2.  The court may impose a lien or charge on the 
 28.18  divided property at any time while the property, or subsequently 
 28.19  acquired property, is owned by the parties or either of them, 
 28.20  for the payment of maintenance or support money, or may 
 28.21  sequester the property as is provided by section 518.24. 
 28.22     (f) The court need not hold an evidentiary hearing on a 
 28.23  motion for modification of maintenance or support. 
 28.24     (g) Section 518.14 shall govern the award of attorney fees 
 28.25  for motions brought under this subdivision. 
 28.26     Sec. 16.  Minnesota Statutes 2000, section 518.641, 
 28.27  subdivision 1, is amended to read: 
 28.28     Subdivision 1.  [REQUIREMENT.] (a) An order for 
 28.29  establishing, modifying, or enforcing maintenance or child 
 28.30  support shall provide for a biennial adjustment in the amount to 
 28.31  be paid based on a change in the cost of living.  An order that 
 28.32  provides for a cost-of-living adjustment shall specify the 
 28.33  cost-of-living index to be applied and the date on which the 
 28.34  cost-of-living adjustment shall become effective.  The court may 
 28.35  use the consumer price index for all urban consumers, 
 28.36  Minneapolis-St. Paul (CPI-U), the consumer price index for wage 
 29.1   earners and clerical, Minneapolis-St. Paul (CPI-W), or another 
 29.2   cost-of-living index published by the department of labor which 
 29.3   it specifically finds is more appropriate.  Cost-of-living 
 29.4   increases under this section shall be compounded.  The court may 
 29.5   also increase the amount by more than the cost-of-living 
 29.6   adjustment by agreement of the parties or by making further 
 29.7   findings.  
 29.8      (b) The adjustment becomes effective on the first of May of 
 29.9   the year in which it is made, for cases in which payment is made 
 29.10  to the public authority.  For cases in which payment is not made 
 29.11  to the public authority, application for an adjustment may be 
 29.12  made in any month but no application for an adjustment may be 
 29.13  made sooner than two years after the date of the dissolution 
 29.14  decree.  A court may waive the requirement of the cost-of-living 
 29.15  clause if it expressly finds that the obligor's occupation or 
 29.16  income, or both, does not provide for cost-of-living adjustment 
 29.17  or that the order for maintenance or child support has a 
 29.18  provision such as a step increase that has the effect of a 
 29.19  cost-of-living clause.  The court may waive a cost-of-living 
 29.20  adjustment in a maintenance order if the parties so agree in 
 29.21  writing.  The commissioner of human services may promulgate 
 29.22  rules for child support adjustments under this section in 
 29.23  accordance with the rulemaking provisions of chapter 14.  Notice 
 29.24  of this statute must comply with section 518.68, subdivision 2. 
 29.25     Sec. 17.  Minnesota Statutes 2000, section 518.641, 
 29.26  subdivision 2, is amended to read: 
 29.27     Subd. 2.  [CONDITIONS NOTICE.] No adjustment under this 
 29.28  section may be made unless the order provides for it and until 
 29.29  the following conditions are met:  
 29.30     (a) the obligee serves notice of the application for 
 29.31  adjustment by mail on the obligor at the obligor's last known 
 29.32  address at least 20 days before the effective date of the 
 29.33  adjustment; 
 29.34     (b) the notice to the obligor informs the obligor of the 
 29.35  date on which the adjustment in payments will become effective; 
 29.36     (c) after receipt of notice and before the effective day of 
 30.1   the adjustment, the obligor fails to request a hearing on the 
 30.2   issue of whether the adjustment should take effect, and ex 
 30.3   parte, to stay imposition of the adjustment pending outcome of 
 30.4   the hearing; or 
 30.5      (d) the public authority the public authority or the 
 30.6   obligee, if the obligee is requesting the cost-of-living 
 30.7   adjustment, sends notice of its application for the intended 
 30.8   adjustment to the obligor at the obligor's last known address at 
 30.9   least 20 days before the effective date of the adjustment, and. 
 30.10  The notice informs shall inform the obligor of the date on which 
 30.11  the adjustment will become effective and the procedures for 
 30.12  contesting the adjustment according to section 484.702. 
 30.13     Sec. 18.  Minnesota Statutes 2000, section 518.641, is 
 30.14  amended by adding a subdivision to read: 
 30.15     Subd. 2a.  [PROCEDURES FOR CONTESTING ADJUSTMENT.] (a) To 
 30.16  contest cost-of-living adjustments initiated by the public 
 30.17  authority or an obligee who has applied for or is receiving 
 30.18  child support and maintenance collection services from the 
 30.19  public authority, other than income withholding only services, 
 30.20  the obligor, before the effective date of the adjustment, must: 
 30.21     (1) file a motion contesting the cost-of-living adjustment 
 30.22  with the court administrator; and 
 30.23     (2) serve the motion by first-class mail on the public 
 30.24  authority and the obligee. 
 30.25  The hearing shall take place in the expedited child support 
 30.26  process as governed by section 484.702. 
 30.27     (b) To contest cost-of-living adjustments initiated by an 
 30.28  obligee who is not receiving child support and maintenance 
 30.29  collection services from the public authority, or for an obligee 
 30.30  who receives income withholding only services from the public 
 30.31  authority, the obligor must, before the effective date of the 
 30.32  adjustment: 
 30.33     (1) file a motion contesting the cost-of-living adjustment 
 30.34  with the court administrator; and 
 30.35     (2) serve the motion by first-class mail on the obligee. 
 30.36  The hearing shall take place in district court. 
 31.1      (c) Upon receipt of a motion contesting the cost-of-living 
 31.2   adjustment, the cost-of-living adjustment shall be stayed 
 31.3   pending further order of the court. 
 31.4      (d) The court administrator shall make available pro se 
 31.5   motion forms for contesting a cost-of-living adjustment under 
 31.6   this subdivision. 
 31.7      Sec. 19.  Minnesota Statutes 2000, section 518.641, 
 31.8   subdivision 3, is amended to read: 
 31.9      Subd. 3.  [RESULT OF HEARING.] If, at a hearing pursuant to 
 31.10  this section, the obligor establishes an insufficient cost of 
 31.11  living or other increase in income that prevents fulfillment of 
 31.12  the adjusted maintenance or child support obligation, the 
 31.13  court or child support magistrate may direct that all or part of 
 31.14  the adjustment not take effect.  If, at the hearing, the obligor 
 31.15  does not establish this insufficient increase in income, the 
 31.16  adjustment shall take effect as of the date it would have become 
 31.17  effective had no hearing been requested. 
 31.18     Sec. 20.  Minnesota Statutes 2000, section 548.091, 
 31.19  subdivision 1a, is amended to read: 
 31.20     Subd. 1a.  [CHILD SUPPORT JUDGMENT BY OPERATION OF LAW.] 
 31.21  (a) Any payment or installment of support required by a judgment 
 31.22  or decree of dissolution or legal separation, determination of 
 31.23  parentage, an order under chapter 518C, an order under section 
 31.24  256.87, or an order under section 260B.331 or 260C.331, that is 
 31.25  not paid or withheld from the obligor's income as required under 
 31.26  section 518.6111, or which is ordered as child support by 
 31.27  judgment, decree, or order by a court in any other state, is a 
 31.28  judgment by operation of law on and after the date it is due, is 
 31.29  entitled to full faith and credit in this state and any other 
 31.30  state, and shall be entered and docketed by the court 
 31.31  administrator on the filing of affidavits as provided in 
 31.32  subdivision 2a.  Except as otherwise provided by paragraph (b), 
 31.33  interest accrues from the date the unpaid amount due is greater 
 31.34  than the current support due at the annual rate provided in 
 31.35  section 549.09, subdivision 1, plus two percent, not to exceed 
 31.36  an annual rate of 18 percent.  A payment or installment of 
 32.1   support that becomes a judgment by operation of law between the 
 32.2   date on which a party served notice of a motion for modification 
 32.3   under section 518.64, subdivision 2, and the date of the court's 
 32.4   order on modification may be modified under that subdivision. 
 32.5      (b) Notwithstanding the provisions of section 549.09, upon 
 32.6   motion to the court and upon proof by the obligor of 36 
 32.7   consecutive months of complete and timely payments of both 
 32.8   current support and court-ordered paybacks of a child support 
 32.9   debt or arrearage, the court may order interest on the remaining 
 32.10  debt or arrearage to stop accruing.  Timely payments are those 
 32.11  made in the month in which they are due.  If, after that time, 
 32.12  the obligor fails to make complete and timely payments of both 
 32.13  current support and court-ordered paybacks of child support debt 
 32.14  or arrearage, the public authority or the obligee may move the 
 32.15  court for the reinstatement of interest as of the month in which 
 32.16  the obligor ceased making complete and timely payments. 
 32.17     The court shall provide copies of all orders issued under 
 32.18  this section to the public authority.  The commissioner of human 
 32.19  services shall prepare and make available to the court and the 
 32.20  parties forms to be submitted by the parties in support of a 
 32.21  motion under this paragraph. 
 32.22     (c) Notwithstanding the provisions of section 549.09, upon 
 32.23  motion to the court, the court may order interest on a child 
 32.24  support debt to stop accruing where the court finds that the 
 32.25  obligor is: 
 32.26     (1) unable to pay support because of a significant physical 
 32.27  or mental disability; or 
 32.28     (2) a recipient of Supplemental Security Income (SSI), 
 32.29  Title II Older Americans Survivor's Disability Insurance 
 32.30  (OASDI), other disability benefits, or public assistance based 
 32.31  upon need; or 
 32.32     (3) institutionalized or incarcerated for at least 30 days 
 32.33  for an offense other than nonsupport of the child or children 
 32.34  involved, and is otherwise financially unable to pay support. 
 32.35     Sec. 21.  [REPEALER.] 
 32.36     Minnesota Statutes 2000, section 518.641, subdivisions 4 
 33.1   and 5, are repealed.