1.1                          A bill for an act
  1.2             relating to child care assistance; preventing fraud; 
  1.3             amending Minnesota Statutes 2002, sections 119B.011, 
  1.4             subdivisions 19, 21, by adding a subdivision; 119B.11, 
  1.5             subdivision 2a; 119B.13, subdivision 6; 119B.16, 
  1.6             subdivision 2, by adding subdivisions; 256.046, 
  1.7             subdivision 1; 256.0471, subdivision 1; 256.98, 
  1.8             subdivision 8; proposing coding for new law in 
  1.9             Minnesota Statutes, chapter 119B. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 2002, section 119B.011, 
  1.12  subdivision 19, is amended to read: 
  1.13     Subd. 19.  [PROVIDER.] "Provider" means:  (1) an individual 
  1.14  or child care center or facility, either licensed or unlicensed, 
  1.15  providing legal child care services as defined under section 
  1.16  245A.03; or (2) an individual or child care center or facility 
  1.17  holding a valid child care license issued by another state or a 
  1.18  tribe providing child care services in the licensing state or in 
  1.19  the area under the licensing tribe's jurisdiction.  A legally 
  1.20  unlicensed registered family child care provider must be at 
  1.21  least 18 years of age, and not a member of the MFIP assistance 
  1.22  unit or a member of the family receiving child care 
  1.23  assistance to be authorized under this chapter.  
  1.24     Sec. 2.  Minnesota Statutes 2002, section 119B.011, is 
  1.25  amended by adding a subdivision to read: 
  1.26     Subd. 19a.  [REGISTRATION.] "Registration" means the 
  1.27  process used by a county to determine whether the provider 
  2.1   selected by a family applying for or receiving child care 
  2.2   assistance to care for that family's children meets the 
  2.3   requirements necessary for payment of child care assistance for 
  2.4   care provided by that provider. 
  2.5      Sec. 3.  Minnesota Statutes 2002, section 119B.011, 
  2.6   subdivision 21, is amended to read: 
  2.7      Subd. 21.  [RECOUPMENT OF OVERPAYMENTS.] "Recoupment of 
  2.8   overpayments" means the reduction of child care assistance 
  2.9   payments to an eligible family or a child care provider in order 
  2.10  to correct an overpayment to the family even when the 
  2.11  overpayment is due to agency error or other circumstances 
  2.12  outside the responsibility or control of the family. 
  2.13     Sec. 4.  [119B.025] [DUTIES OF COUNTIES.] 
  2.14     Subdivision 1.  [FACTORS WHICH MUST BE VERIFIED.] The 
  2.15  county shall use the universal application at the initial 
  2.16  application or at a redetermination if a universal application 
  2.17  has not been previously completed.  When using the universal 
  2.18  application, the county shall verify the following: 
  2.19     (1) identity of adults; 
  2.20     (2) presence of the minor child in the home, if 
  2.21  questionable; 
  2.22     (3) age; 
  2.23     (4) immigration status, if related to eligibility; 
  2.24     (5) social security number, if given; 
  2.25     (6) income; 
  2.26     (7) spousal support and child support payments made to 
  2.27  persons outside the household; 
  2.28     (8) residence; and 
  2.29     (9) inconsistent information, if related to eligibility.  
  2.30     Subd. 2.  [SOCIAL SECURITY NUMBERS.] The county must 
  2.31  request social security numbers from all applicants for child 
  2.32  care assistance under this chapter.  A county may not deny child 
  2.33  care assistance solely on the basis of failure of an applicant 
  2.34  to report a social security number. 
  2.35     Sec. 5.  Minnesota Statutes 2002, section 119B.11, 
  2.36  subdivision 2a, is amended to read: 
  3.1      Subd. 2a.  [RECOVERY OF OVERPAYMENTS.] (a) An amount of 
  3.2   child care assistance paid to a recipient in excess of the 
  3.3   payment due is recoverable by the county agency under paragraphs 
  3.4   (b) and (c), even when the overpayment was caused by agency 
  3.5   error or circumstances outside the responsibility and control of 
  3.6   the family or provider.  
  3.7      (b) An overpayment must be recouped or recovered from the 
  3.8   family if the overpayment benefited the family by causing the 
  3.9   family to pay less for child care expenses than the family 
  3.10  otherwise would have been required to pay under child care 
  3.11  assistance program requirements.  If the family remains eligible 
  3.12  for child care assistance, the overpayment must be recovered 
  3.13  through recoupment as identified in Minnesota Rules, 
  3.14  part 3400.0140, subpart 19 3400.0187.  If the family no longer 
  3.15  remains eligible for child care assistance, the county may 
  3.16  choose to initiate efforts to recover overpayments from the 
  3.17  family for overpayment less than $50.  If the overpayment is 
  3.18  greater than or equal to $50, the county shall seek voluntary 
  3.19  repayment of the overpayment from the family.  If the county is 
  3.20  unable to recoup the overpayment through voluntary repayment, 
  3.21  the county shall initiate civil court proceedings to recover the 
  3.22  overpayment unless the county's costs to recover the overpayment 
  3.23  will exceed the amount of the overpayment.  A family with an 
  3.24  outstanding debt under this subdivision is not eligible for 
  3.25  child care assistance until:  (1) the debt is paid in full; or 
  3.26  (2) satisfactory arrangements are made with the county to retire 
  3.27  the debt consistent with the requirements of this chapter and 
  3.28  Minnesota Rules, chapter 3400, and the family is in compliance 
  3.29  with the arrangements. 
  3.30     (c) The county must recover an overpayment from a provider 
  3.31  if the overpayment did not benefit the family by causing the 
  3.32  family to receive more child care assistance or to pay less for 
  3.33  child care expenses than the family otherwise would have been 
  3.34  eligible to receive or required to pay under child care 
  3.35  assistance program requirements, but benefited the provider by 
  3.36  causing the provider to receive more child care assistance than 
  4.1   otherwise would have been paid on the family's behalf under 
  4.2   child care assistance program requirements.  If the provider 
  4.3   continues to care for children receiving child care assistance, 
  4.4   the overpayment must be recovered through reductions in child 
  4.5   care assistance payments for services as described in an 
  4.6   agreement with the county.  The provider may not charge families 
  4.7   using that provider more to cover the cost of recouping the 
  4.8   overpayment.  If the provider no longer cares for children 
  4.9   receiving child care assistance, the county may choose to 
  4.10  initiate efforts to recover overpayments of less than $50 from 
  4.11  the provider.  If the overpayment is greater than or equal to 
  4.12  $50, the county shall seek voluntary repayment of the 
  4.13  overpayment from the provider.  If the county is unable to 
  4.14  recoup the overpayment through voluntary repayment, the county 
  4.15  shall initiate civil court proceedings to recover the 
  4.16  overpayment unless the county's costs to recover the overpayment 
  4.17  will exceed the amount of the overpayment.  A provider with an 
  4.18  outstanding debt under this subdivision is not eligible to care 
  4.19  for children receiving child care assistance until:  (1) the 
  4.20  debt is paid in full; or (2) satisfactory arrangements are made 
  4.21  with the county to retire the debt consistent with the 
  4.22  requirements of this chapter and Minnesota Rules, chapter 3400, 
  4.23  and the provider is in compliance with the arrangements. 
  4.24     (d) When both the family and the provider acted together to 
  4.25  intentionally cause the overpayment, both the family and the 
  4.26  provider are jointly liable for the overpayment regardless of 
  4.27  who benefited from the overpayment.  The county must recover the 
  4.28  overpayment as provided in paragraphs (b) and (c).  When the 
  4.29  family or the provider is in compliance with a repayment 
  4.30  agreement, the party in compliance is eligible to receive child 
  4.31  care assistance or to care for children receiving child care 
  4.32  assistance despite the other party's noncompliance with 
  4.33  repayment arrangements. 
  4.34     Sec. 6.  [119B.125] [PROVIDER REQUIREMENTS.] 
  4.35     Subdivision 1.  [AUTHORIZATION.] Except as provided in 
  4.36  subdivision 5, a county must authorize a provider to receive 
  5.1   child care assistance payments before the county makes payment 
  5.2   for care provided by that provider.  The commissioner must 
  5.3   establish the requirements necessary for authorization of 
  5.4   providers. 
  5.5      Subd. 2.  [PERSONS WHO CANNOT BE AUTHORIZED.] (a) A person 
  5.6   who meets any of the conditions under paragraphs (b) to (n) must 
  5.7   not be authorized as a legal nonlicensed family child care 
  5.8   provider.  For purposes of this subdivision, a finding that a 
  5.9   delinquency petition is proven in juvenile court must be 
  5.10  considered a conviction in state district court. 
  5.11     (b) The person has been convicted of one of the following 
  5.12  offenses or has admitted to committing or a preponderance of the 
  5.13  evidence indicates that the person has committed an act that 
  5.14  meets the definition of one of the following offenses:  sections 
  5.15  609.185 to 609.195, murder in the first, second, or third 
  5.16  degree; 609.2661 to 609.2663, murder of an unborn child in the 
  5.17  first, second, or third degree; 609.322, solicitation, 
  5.18  inducement, or promotion of prostitution; 609.323, receiving 
  5.19  profit from prostitution; 609.342 to 609.345, criminal sexual 
  5.20  conduct in the first, second, third, or fourth degree; 609.352, 
  5.21  solicitation of children to engage in sexual conduct; 609.365, 
  5.22  incest; 609.377, felony malicious punishment of a child; 
  5.23  617.246, use of minors in sexual performance; 617.247, 
  5.24  possession of pictorial representation of a minor; 609.2242 to 
  5.25  609.2243, felony domestic assault; a felony offense of spousal 
  5.26  abuse; a felony offense of child abuse or neglect; a felony 
  5.27  offense of a crime against children; or an attempt or conspiracy 
  5.28  to commit any of these offenses as defined in Minnesota 
  5.29  Statutes; or an offense in any other state or country where the 
  5.30  elements are substantially similar to any of the offenses listed 
  5.31  in this paragraph. 
  5.32     (c) Less than 15 years have passed since the discharge of 
  5.33  the sentence imposed for the offense and the person has received 
  5.34  a felony conviction for one of the following offenses, or the 
  5.35  person has admitted to committing or a preponderance of the 
  5.36  evidence indicates that the person has committed an act that 
  6.1   meets the definition of a felony conviction for one of the 
  6.2   following offenses:  sections 609.20 to 609.205, manslaughter in 
  6.3   the first or second degree; 609.21, criminal vehicular homicide; 
  6.4   609.215, aiding suicide or aiding attempted suicide; 609.221 to 
  6.5   609.2231, assault in the first, second, third, or fourth degree; 
  6.6   609.224, repeat offenses of fifth degree assault; 609.228, great 
  6.7   bodily harm caused by distribution of drugs; 609.2325, criminal 
  6.8   abuse of a vulnerable adult; 609.2335, financial exploitation of 
  6.9   a vulnerable adult; 609.235, use of drugs to injure or 
  6.10  facilitate a crime; 609.24, simple robbery; 617.241, repeat 
  6.11  offenses of obscene materials and performances; 609.245, 
  6.12  aggravated robbery; 609.25, kidnapping; 609.255, false 
  6.13  imprisonment; 609.2664 to 609.2665, manslaughter of an unborn 
  6.14  child in the first or second degree; 609.267 to 609.2672, 
  6.15  assault of an unborn child in the first, second, or third 
  6.16  degree; 609.268, injury or death of an unborn child in the 
  6.17  commission of a crime; 609.27, coercion; 609.275, attempt to 
  6.18  coerce; 609.324, subdivision 1, other prohibited acts, minor 
  6.19  engaged in prostitution; 609.3451, repeat offenses of criminal 
  6.20  sexual conduct in the fifth degree; 609.378, neglect or 
  6.21  endangerment of a child; 609.52, theft; 609.521, possession of 
  6.22  shoplifting gear; 609.561 to 609.563, arson in the first, 
  6.23  second, or third degree; 609.582, burglary in the first, second, 
  6.24  third, or fourth degree; 609.625, aggravated forgery; 609.63, 
  6.25  forgery; 609.631, check forgery, offering a forged check; 
  6.26  609.635, obtaining signature by false pretenses; 609.66, 
  6.27  dangerous weapon; 609.665, setting a spring gun; 609.67, 
  6.28  unlawfully owning, possessing, or operating a machine gun; 
  6.29  609.687, adulteration; 609.71, riot; 609.713, terrorist threats; 
  6.30  609.749, harassment, stalking; 260.221, grounds for termination 
  6.31  of parental rights; 152.021 to 152.022, controlled substance 
  6.32  crime in the first or second degree; 152.023, subdivision 1, 
  6.33  clause (3) or (4), or 152.023, subdivision 2, clause (4), 
  6.34  controlled substance crime in third degree; 152.024, subdivision 
  6.35  1, clause (2), (3), or (4), controlled substance crime in fourth 
  6.36  degree; 617.23, repeat offenses of indecent exposure; an attempt 
  7.1   or conspiracy to commit any of these offenses as defined in 
  7.2   Minnesota Statutes; or an offense in any other state or country 
  7.3   where the elements are substantially similar to any of the 
  7.4   offenses listed in this paragraph. 
  7.5      (d) Less than ten years have passed since the discharge of 
  7.6   the sentence imposed for the offense and the person has received 
  7.7   a gross misdemeanor conviction for one of the following offenses 
  7.8   or the person has admitted to committing or a preponderance of 
  7.9   the evidence indicates that the person has committed an act that 
  7.10  meets the definition of a gross misdemeanor conviction for one 
  7.11  of the following offenses:  sections 609.224, fifth degree 
  7.12  assault; 609.2242 to 609.2243, domestic assault; 518B.01, 
  7.13  subdivision 14, violation of an order for protection; 609.3451, 
  7.14  fifth degree criminal sexual conduct; 609.746, repeat offenses 
  7.15  of interference with privacy; 617.23, repeat offenses of 
  7.16  indecent exposure; 617.241, obscene materials and performances; 
  7.17  617.243, indecent literature, distribution; 617.293, 
  7.18  disseminating or displaying harmful material to minors; 609.71, 
  7.19  riot; 609.66, dangerous weapons; 609.749, harassment, stalking; 
  7.20  609.224, subdivision 2, paragraph (c), fifth degree assault 
  7.21  against a vulnerable adult by a caregiver; 609.23, mistreatment 
  7.22  of persons confined; 609.231, mistreatment of residents or 
  7.23  patients; 609.2325, criminal abuse of a vulnerable adult; 
  7.24  609.2335, financial exploitation of a vulnerable adult; 609.233, 
  7.25  criminal neglect of a vulnerable adult; 609.234, failure to 
  7.26  report maltreatment of a vulnerable adult; 609.72, subdivision 
  7.27  3, disorderly conduct against a vulnerable adult; 609.265, 
  7.28  abduction; 609.378, neglect or endangerment of a child; 609.377, 
  7.29  malicious punishment of a child; 609.324, subdivision 1a, other 
  7.30  prohibited acts, minor engaged in prostitution; 609.33, 
  7.31  disorderly house; 609.52, theft; 609.582, burglary in the first, 
  7.32  second, third, or fourth degree; 609.631, check forgery, 
  7.33  offering a forged check; 609.275, attempt to coerce; an attempt 
  7.34  or conspiracy to commit any of these offenses as defined in 
  7.35  Minnesota Statutes; or an offense in any other state or country 
  7.36  where the elements are substantially similar to any of the 
  8.1   offenses listed in this paragraph. 
  8.2      (e) Less than seven years have passed since the discharge 
  8.3   of the sentence imposed for the offense and the person has 
  8.4   received a misdemeanor conviction for one of the following 
  8.5   offenses or the person has admitted to committing or a 
  8.6   preponderance of the evidence indicates that the person has 
  8.7   committed an act that meets the definition of a misdemeanor 
  8.8   conviction for one of the following offenses:  sections 609.224, 
  8.9   fifth degree assault; 609.2242, domestic assault; 518B.01, 
  8.10  violation of an order for protection; 609.3232, violation of an 
  8.11  order for protection; 609.746, interference with privacy; 
  8.12  609.79, obscene or harassing telephone calls; 609.795, letter, 
  8.13  telegram, or package, opening, harassment; 617.23, indecent 
  8.14  exposure; 609.2672, assault of an unborn child, third degree; 
  8.15  617.293, dissemination and display of harmful materials to 
  8.16  minors; 609.66, dangerous weapons; 609.665, spring guns; an 
  8.17  attempt or conspiracy to commit any of these offenses as defined 
  8.18  in Minnesota Statutes; or an offense in any other state or 
  8.19  country where the elements are substantially similar to any of 
  8.20  the offenses listed in this paragraph. 
  8.21     (f) The person has been identified by the county's child 
  8.22  protection agency or by the statewide child protection database 
  8.23  as the person responsible for physical or sexual abuse of a 
  8.24  child within the last seven years. 
  8.25     (g) The person has been identified by the county's adult 
  8.26  protection agency or by the statewide adult protection database 
  8.27  as the person responsible for abuse or neglect of a vulnerable 
  8.28  adult within the last seven years. 
  8.29     (h) The person has refused to give written consent for 
  8.30  disclosure of criminal history records. 
  8.31     (i) The person has been denied a family child care license 
  8.32  or has received a fine or a sanction as a licensed child care 
  8.33  provider that has not been reversed on appeal. 
  8.34     (j) The person has a family child care licensing 
  8.35  disqualification that has not been set aside. 
  8.36     (k) The person has admitted or a county has found that 
  9.1   there is a preponderance of evidence that fraudulent information 
  9.2   was given to the county for application purposes or was used in 
  9.3   submitting bills for payment. 
  9.4      (l) The person has been convicted or there is a 
  9.5   preponderance of evidence of the crime of theft by wrongfully 
  9.6   obtaining public assistance. 
  9.7      (m) The person has a household member age 13 or older who 
  9.8   has access to children during the hours that care is provided 
  9.9   and who meets one of the conditions listed in paragraphs (b) to 
  9.10  (l). 
  9.11     (n) The person has a household member ages ten to 12 who 
  9.12  has access to children during the hours that care is provided; 
  9.13  information or circumstances exist which provide the county with 
  9.14  articulable suspicion that further pertinent information may 
  9.15  exist showing the household member meets one of the conditions 
  9.16  listed in paragraphs (b) to (l); and the household member 
  9.17  actually meets one of the conditions listed in paragraphs (b) to 
  9.18  (l). 
  9.19     Subd. 3.  [AUTHORIZATION EXCEPTION.] When a county denies a 
  9.20  person authorization as a legal nonlicensed family child care 
  9.21  provider under subdivision 2, the county later may authorize 
  9.22  that person as a provider if the following conditions are met: 
  9.23     (1) after receiving notice of the denial of the 
  9.24  authorization, the person applies for and obtains a valid child 
  9.25  care license issued under chapter 245A, issued by a tribe, or 
  9.26  issued by another state; 
  9.27     (2) the person maintains the valid child care license; and 
  9.28     (3) the person is providing child care in the state of 
  9.29  licensure or in the area under the jurisdiction of the licensing 
  9.30  tribe. 
  9.31     Subd. 4.  [UNSAFE CARE.] A county may deny authorization as 
  9.32  a child care provider to any applicant or rescind authorization 
  9.33  of any provider when the county knows or has reason to believe 
  9.34  that the provider is unsafe or that the circumstances of the 
  9.35  chosen child care arrangement are unsafe, even when the grounds 
  9.36  supporting this determination are not listed in subdivision 2. 
 10.1   The county must include in the county's child care fund plan 
 10.2   under section 119B.08, subdivision 3, the standards used to 
 10.3   determine whether a provider or care arrangement is unsafe. 
 10.4      Subd. 5.  [PROVISIONAL PAYMENT.] After a county receives a 
 10.5   completed application from a provider, the county may issue 
 10.6   provisional authorization and payment to the provider during the 
 10.7   time needed to determine whether to give final authorization to 
 10.8   the provider. 
 10.9      Subd. 6.  [RECORD KEEPING REQUIREMENT.] All providers must 
 10.10  keep daily attendance records for children receiving child care 
 10.11  assistance and must make those records available immediately to 
 10.12  the county upon request.  The daily attendance records must be 
 10.13  retained for six years after the date of service.  A county may 
 10.14  deny authorization as a child care provider to any applicant or 
 10.15  rescind authorization of any provider when the county knows or 
 10.16  has reason to believe that the provider has not complied with 
 10.17  the record keeping requirement in this subdivision. 
 10.18     Sec. 7.  Minnesota Statutes 2002, section 119B.13, 
 10.19  subdivision 6, is amended to read: 
 10.20     Subd. 6.  [PROVIDER PAYMENTS.] (a) Counties or the state 
 10.21  shall make vendor payments to the child care provider or pay the 
 10.22  parent directly for eligible child care expenses.  
 10.23     (b) If payments for child care assistance are made to 
 10.24  providers, the provider shall bill the county for services 
 10.25  provided within ten days of the end of the month of 
 10.26  service period.  If bills are submitted in accordance with the 
 10.27  provisions of this subdivision within ten days of the end of the 
 10.28  service period, a county or the state shall issue payment to the 
 10.29  provider of child care under the child care fund within 30 days 
 10.30  of receiving an invoice a bill from the provider.  Counties or 
 10.31  the state may establish policies that make payments on a more 
 10.32  frequent basis.  
 10.33     (c) All bills must be submitted within 60 days of the last 
 10.34  date of service on the bill.  A county may pay a bill submitted 
 10.35  more than 60 days after the last date of service if the provider 
 10.36  shows good cause why the bill was not submitted within 60 days.  
 11.1   Good cause must be defined in the county's child care fund plan 
 11.2   under section 119B.08, subdivision 3, and the definition of good 
 11.3   cause must include county error.  A county may not pay any bill 
 11.4   submitted more than one year after the last date of service on 
 11.5   the bill. 
 11.6      (d) A county may stop payment issued to a provider or may 
 11.7   refuse to pay a bill submitted by a provider if: 
 11.8      (1) the provider admits to intentionally providing the 
 11.9   county with materially false information on the provider's 
 11.10  billing forms; or 
 11.11     (2) a county finds by a preponderance of the evidence that 
 11.12  the provider intentionally gave the county materially false 
 11.13  information on the provider's billing forms. 
 11.14     (e) A county's payment policies must be included in the 
 11.15  county's child care plan under section 119B.08, subdivision 3.  
 11.16  If payments are made by the state, in addition to being in 
 11.17  compliance with this subdivision, the payments must be made in 
 11.18  compliance with section 16A.124. 
 11.19     Sec. 8.  Minnesota Statutes 2002, section 119B.16, is 
 11.20  amended by adding a subdivision to read: 
 11.21     Subd. 1a.  [FAIR HEARING ALLOWED FOR PROVIDERS.] (a) This 
 11.22  subdivision applies to providers caring for children receiving 
 11.23  child care assistance. 
 11.24     (b) A provider to whom a county agency has assigned 
 11.25  responsibility for an overpayment may request a fair hearing in 
 11.26  accordance with section 256.045 for the limited purpose of 
 11.27  challenging the assignment of responsibility for the overpayment 
 11.28  and the amount of the overpayment.  The scope of the fair 
 11.29  hearing does not include the issues of whether the provider 
 11.30  wrongfully obtained public assistance in violation of section 
 11.31  256.98 or was properly disqualified under section 256.98, 
 11.32  subdivision 8, paragraph (c), unless the fair hearing has been 
 11.33  combined with an administrative disqualification hearing brought 
 11.34  against the provider under section 256.046. 
 11.35     Sec. 9.  Minnesota Statutes 2002, section 119B.16, is 
 11.36  amended by adding a subdivision to read: 
 12.1      Subd. 1b.  [JOINT FAIR HEARINGS.] When a provider requests 
 12.2   a fair hearing under subdivision 1a, the family in whose case 
 12.3   the overpayment was created must be made a party to the fair 
 12.4   hearing.  All other issues raised by the family must be resolved 
 12.5   in the same proceeding.  When a family requests a fair hearing 
 12.6   and claims that the county should have assigned responsibility 
 12.7   for an overpayment to a provider, the provider must be made a 
 12.8   party to the fair hearing.  The referee assigned to a fair 
 12.9   hearing may join a family or a provider as a party to the fair 
 12.10  hearing whenever joinder of that party is necessary to fully and 
 12.11  fairly resolve overpayment issues raised in the appeal. 
 12.12     Sec. 10.  Minnesota Statutes 2002, section 119B.16, 
 12.13  subdivision 2, is amended to read: 
 12.14     Subd. 2.  [INFORMAL CONFERENCE.] The county agency shall 
 12.15  offer an informal conference to applicants and recipients 
 12.16  adversely affected by an agency action to attempt to resolve the 
 12.17  dispute.  The county agency shall offer an informal conference 
 12.18  to providers to whom the county agency has assigned 
 12.19  responsibility for an overpayment in an attempt to resolve the 
 12.20  dispute.  The county agency or the provider may ask the family 
 12.21  in whose case the overpayment arose to participate in the 
 12.22  informal conference, but the family may refuse to do so.  The 
 12.23  county agency shall advise adversely affected applicants and, 
 12.24  recipients, and providers that a request for a conference with 
 12.25  the agency is optional and does not delay or replace the right 
 12.26  to a fair hearing. 
 12.27     Sec. 11.  Minnesota Statutes 2002, section 256.046, 
 12.28  subdivision 1, is amended to read: 
 12.29     Subdivision 1.  [HEARING AUTHORITY.] A local agency must 
 12.30  initiate an administrative fraud disqualification hearing for 
 12.31  individuals, including child care providers caring for children 
 12.32  receiving child care assistance, accused of wrongfully obtaining 
 12.33  assistance or intentional program violations, in lieu of a 
 12.34  criminal action when it has not been pursued, in the aid to 
 12.35  families with dependent children program formerly codified in 
 12.36  sections 256.72 to 256.87, MFIP, child care assistance programs, 
 13.1   general assistance, family general assistance program formerly 
 13.2   codified in section 256D.05, subdivision 1, clause (15), 
 13.3   Minnesota supplemental aid, medical care, or food stamp 
 13.4   programs.  The hearing is subject to the requirements of section 
 13.5   256.045 and the requirements in Code of Federal Regulations, 
 13.6   title 7, section 273.16, for the food stamp program and title 
 13.7   45, section 235.112, as of September 30, 1995, for the cash 
 13.8   grant and, medical care programs, and child care assistance 
 13.9   under chapter 119B. 
 13.10     Sec. 12.  Minnesota Statutes 2002, section 256.0471, 
 13.11  subdivision 1, is amended to read: 
 13.12     Subdivision 1.  [QUALIFYING OVERPAYMENT.] Any overpayment 
 13.13  for assistance granted under section 119B.05 chapter 119B, the 
 13.14  MFIP program formerly codified under sections 256.031 to 
 13.15  256.0361, and the AFDC program formerly codified under sections 
 13.16  256.72 to 256.871; chapters 256B, 256D, 256I, 256J, and 256K; 
 13.17  and the food stamp program, except agency error claims, become a 
 13.18  judgment by operation of law 90 days after the notice of 
 13.19  overpayment is personally served upon the recipient in a manner 
 13.20  that is sufficient under rule 4.03(a) of the Rules of Civil 
 13.21  Procedure for district courts, or by certified mail, return 
 13.22  receipt requested.  This judgment shall be entitled to full 
 13.23  faith and credit in this and any other state. 
 13.24     Sec. 13.  Minnesota Statutes 2002, section 256.98, 
 13.25  subdivision 8, is amended to read: 
 13.26     Subd. 8.  [DISQUALIFICATION FROM PROGRAM.] (a) Any person 
 13.27  found to be guilty of wrongfully obtaining assistance by a 
 13.28  federal or state court or by an administrative hearing 
 13.29  determination, or waiver thereof, through a disqualification 
 13.30  consent agreement, or as part of any approved diversion plan 
 13.31  under section 401.065, or any court-ordered stay which carries 
 13.32  with it any probationary or other conditions, in the Minnesota 
 13.33  family investment program, the food stamp program, the general 
 13.34  assistance program, the group residential housing program, or 
 13.35  the Minnesota supplemental aid program shall be disqualified 
 13.36  from that program.  In addition, any person disqualified from 
 14.1   the Minnesota family investment program shall also be 
 14.2   disqualified from the food stamp program.  The needs of that 
 14.3   individual shall not be taken into consideration in determining 
 14.4   the grant level for that assistance unit:  
 14.5      (1) for one year after the first offense; 
 14.6      (2) for two years after the second offense; and 
 14.7      (3) permanently after the third or subsequent offense.  
 14.8      The period of program disqualification shall begin on the 
 14.9   date stipulated on the advance notice of disqualification 
 14.10  without possibility of postponement for administrative stay or 
 14.11  administrative hearing and shall continue through completion 
 14.12  unless and until the findings upon which the sanctions were 
 14.13  imposed are reversed by a court of competent jurisdiction.  The 
 14.14  period for which sanctions are imposed is not subject to 
 14.15  review.  The sanctions provided under this subdivision are in 
 14.16  addition to, and not in substitution for, any other sanctions 
 14.17  that may be provided for by law for the offense involved.  A 
 14.18  disqualification established through hearing or waiver shall 
 14.19  result in the disqualification period beginning immediately 
 14.20  unless the person has become otherwise ineligible for 
 14.21  assistance.  If the person is ineligible for assistance, the 
 14.22  disqualification period begins when the person again meets the 
 14.23  eligibility criteria of the program from which they were 
 14.24  disqualified and makes application for that program. 
 14.25     (b) A family receiving assistance through child care 
 14.26  assistance programs under chapter 119B with a family member who 
 14.27  is found to be guilty of wrongfully obtaining child care 
 14.28  assistance by a federal court, state court, or an administrative 
 14.29  hearing determination or waiver, through a disqualification 
 14.30  consent agreement, as part of an approved diversion plan under 
 14.31  section 401.065, or a court-ordered stay with probationary or 
 14.32  other conditions, is disqualified from child care assistance 
 14.33  programs.  The disqualifications must be for periods of three 
 14.34  months, six months, and two years for the first, second, and 
 14.35  third offenses respectively.  Subsequent violations must result 
 14.36  in permanent disqualification.  During the disqualification 
 15.1   period, disqualification from any child care program must extend 
 15.2   to all child care programs and must be immediately applied. 
 15.3      (c) A provider caring for children receiving assistance 
 15.4   through child care assistance programs under chapter 119B is 
 15.5   disqualified from receiving payment for child care services from 
 15.6   the child care assistance program under chapter 119B when the 
 15.7   provider is found to have wrongfully obtained child care 
 15.8   assistance by a federal court, state court, or an administrative 
 15.9   hearing determination or waiver under section 256.046, through a 
 15.10  disqualification consent agreement, as part of an approved 
 15.11  diversion plan under section 401.065, or a court-ordered stay 
 15.12  with probationary or other conditions.  The disqualifications 
 15.13  must be for periods of one year and two years for the first and 
 15.14  second offenses respectively.  Any subsequent violation must 
 15.15  result in permanent disqualification.  The disqualification 
 15.16  period must be imposed immediately after a determination is made 
 15.17  under this paragraph.  During the disqualification period, the 
 15.18  provider is disqualified from receiving payment from any child 
 15.19  care assistance program under chapter 119B.