1.1                          A bill for an act 
  1.2             relating to higher education; allocating money for 
  1.3             educational and related purposes with certain 
  1.4             conditions; modifying various loan, grant, and 
  1.5             financial aid provisions; requiring institutions to 
  1.6             provide certain data; permitting disclosure of certain 
  1.7             data to determine eligibility; amending various 
  1.8             reciprocity provisions; providing definitions; 
  1.9             directing the Board of Trustees to designate centers 
  1.10            of excellence; amending the Minnesota college savings 
  1.11            plan; authorizing transfer of certain bonding 
  1.12            authority; amending provisions related to private 
  1.13            career schools; establishing fees; providing for 
  1.14            merger with the Higher Education Facilities Authority; 
  1.15            establishing the Rochester University Development 
  1.16            Committee; appropriating money; amending Minnesota 
  1.17            Statutes 2004, sections 13.46, subdivision 2; 
  1.18            135A.031, subdivisions 3, 4; 135A.052, subdivision 1; 
  1.19            135A.30, subdivisions 3, 4, 5; 135A.52, subdivisions 
  1.20            1, 2; 136A.01, subdivision 2; 136A.031, subdivisions 
  1.21            2, 3, 4; 136A.08, by adding subdivisions; 136A.121, 
  1.22            subdivisions 2, 5, 6, 9, by adding a subdivision; 
  1.23            136A.125, subdivision 2; 136A.1701, by adding 
  1.24            subdivisions; 136F.04, subdivision 4; 136F.32, 
  1.25            subdivision 2; 136G.03, subdivisions 3, 21a, 22, 32; 
  1.26            136G.05, subdivision 8; 136G.09, subdivisions 11, 12; 
  1.27            136G.11, subdivisions 1, 2, 3, 13; 136G.13, 
  1.28            subdivisions 1, 5; 136G.14; 137.0245, subdivisions 1, 
  1.29            2, 4; 141.21, by adding a subdivision; 141.25, 
  1.30            subdivisions 3, 5, 8, 9, 12; 141.251; 141.26, 
  1.31            subdivision 5; 141.271, subdivisions 4, 7, 10, by 
  1.32            adding subdivisions; 141.28, subdivision 1, by adding 
  1.33            a subdivision; 141.29, subdivision 3; 141.30; 141.35; 
  1.34            192.502, subdivision 1; 299A.45, subdivisions 1, 4; 
  1.35            proposing coding for new law in Minnesota Statutes, 
  1.36            chapters 136A; 137; 141; repealing Minnesota Statutes 
  1.37            2004, sections 136A.011; 136A.031, subdivision 1; 
  1.38            Minnesota Rules, parts 4815.0100; 4815.0110; 
  1.39            4815.0120; 4815.0130; 4815.0140; 4815.0150; 4815.0160; 
  1.40            4830.8100; 4830.8110; 4830.8120; 4830.8130; 4830.8140; 
  1.41            4830.8150. 
  1.42  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.43                             ARTICLE 1
  2.1                            APPROPRIATIONS
  2.2   Section 1.  [HIGHER EDUCATION APPROPRIATIONS.] 
  2.3   The sums in the columns marked "APPROPRIATIONS" are appropriated 
  2.4   from the general fund, or other named fund, to the agencies and 
  2.5   for the purposes specified in this article.  The listing of an 
  2.6   amount under the figure "2006" or "2007" in this article 
  2.7   indicates that the amount is appropriated to be available for 
  2.8   the fiscal year ending June 30, 2006, or June 30, 2007, 
  2.9   respectively.  "The first year" is fiscal year 2006.  "The 
  2.10  second year" is fiscal year 2007.  "The biennium" is fiscal 
  2.11  years 2006 and 2007. 
  2.12                          SUMMARY BY FUND
  2.13                            2006          2007           TOTAL
  2.14  General           $1,363,389,000 $1,387,079,000 $2,750,468,000
  2.15  Health Care 
  2.16  Access                  2,157,000      2,157,000      4,314,000
  2.17                   SUMMARY BY AGENCY - ALL FUNDS
  2.18                            2006          2007           TOTAL
  2.19  Higher Education
  2.20  Services Office       167,662,000    179,952,000    347,614,000
  2.21  Board of Trustees
  2.22  of the Minnesota State
  2.23  Colleges and
  2.24  Universities          597,769,000    599,894,000  1,197,663,000
  2.25  Board of Regents
  2.26  of the University
  2.27  of Minnesota          598,724,000    607,999,000  1,206,723,000
  2.28  Mayo Medical
  2.29  Foundation              1,391,000      1,391,000      2,782,000
  2.30                                             APPROPRIATIONS 
  2.31                                         Available for the Year 
  2.32                                             Ending June 30 
  2.33                                            2006         2007 
  2.34  Sec. 2.  HIGHER EDUCATION     
  2.35  SERVICES OFFICE 
  2.36  Subdivision 1.  Total
  2.37  Appropriation                     $  167,662,000 $  179,952,000
  2.38  The amounts that may be spent from this 
  2.39  appropriation for each purpose are 
  2.40  specified in the following subdivisions.
  2.41  Subd. 2.  State Grants               132,775,000    148,375,000 
  2.42  If the appropriation in this 
  2.43  subdivision for either year is 
  2.44  insufficient, the appropriation for the 
  2.45  other year is available for it.  For 
  3.1   the biennium, the tuition and fee 
  3.2   maximum shall be $9,477 in the first 
  3.3   year and $9,998 in the second year for 
  3.4   students enrolled in four-year programs 
  3.5   and $4,316 in the first year and $4,597 
  3.6   in the second year for students 
  3.7   enrolled in two-year programs. 
  3.8   This appropriation sets the living and 
  3.9   miscellaneous expense allowance at 
  3.10  $5,205 in each year. 
  3.11  This appropriation contains money to 
  3.12  provide educational benefits to 
  3.13  dependent children under age 23 and the 
  3.14  spouses of public safety officers 
  3.15  killed in the line of duty under 
  3.16  Minnesota Statutes 2004, section 
  3.17  299A.45. 
  3.18  Subd. 3.  Interstate Tuition
  3.19  Reciprocity                            1,000,000      1,000,000 
  3.20  If the appropriation in this 
  3.21  subdivision for either year is 
  3.22  insufficient, the appropriation for the 
  3.23  other year is available to meet 
  3.24  reciprocity contract obligations. 
  3.25  Subd. 4.  State Work Study            12,444,000     12,444,000 
  3.26  Subd. 5.  Child Care Grants            4,743,000      4,743,000 
  3.27  Subd. 6.  Minitex                      4,381,000      4,381,000 
  3.28  Subd. 7.  MnLINK Gateway                 400,000        400,000 
  3.29  Subd. 8.  Learning Network  
  3.30  of Minnesota                           4,329,000      4,329,000 
  3.31  Subd. 9.  Minnesota College 
  3.32  Savings Plan                           1,120,000      1,120,000 
  3.33  Subd. 10.  Other Small      
  3.34  Programs                                 664,000        664,000 
  3.35  This appropriation includes funding for 
  3.36  Postsecondary Service Learning, Student 
  3.37  and Parent Information, Get Ready 
  3.38  Outreach, and Intervention for College 
  3.39  Access. 
  3.40  Of this appropriation, $100,000 each 
  3.41  year is for grants to increase 
  3.42  campus-community collaboration and 
  3.43  service learning statewide.  For each 
  3.44  $1 in state funding, grant recipients 
  3.45  must contribute $2 in campus or 
  3.46  community-based support. 
  3.47  Subd. 11.  Agency           
  3.48  Administration                         2,606,000      2,496,000 
  3.49  $100,000 in the first year and $300,000 
  3.50  in the second year is for the Higher 
  3.51  Education Services Office to develop 
  3.52  and implement a process to measure and 
  3.53  report on the effectiveness of 
  3.54  postsecondary institutions in the 
  3.55  state.  The funding base for this 
  3.56  initiative in fiscal years 2008 and 
  4.1   2009 is $300,000 per year. 
  4.2   $310,000 in the first year is for the 
  4.3   Higher Education Services Office to 
  4.4   upgrade computer program application 
  4.5   software related to state grant 
  4.6   awards.  This appropriation does not 
  4.7   cancel but is available until 
  4.8   expended.  This is a onetime 
  4.9   appropriation and is not added to the 
  4.10  agency's base. 
  4.11  Subd. 12.  Balances Forward 
  4.12  A balance in the first year under this 
  4.13  section does not cancel, but is 
  4.14  available for the second year. 
  4.15  Subd. 13.  Transfers 
  4.16  The Higher Education Services Office 
  4.17  may transfer unencumbered balances from 
  4.18  the appropriations in this section to 
  4.19  the state grant appropriation, the 
  4.20  interstate tuition reciprocity 
  4.21  appropriation, the child care 
  4.22  appropriation, and the state work study 
  4.23  appropriation. 
  4.24  Subd. 14.  Reporting 
  4.25  The Higher Education Services Office 
  4.26  shall collect data monthly from 
  4.27  institutions disbursing state financial 
  4.28  aid.  The data collected must include, 
  4.29  but is not limited to, expenditures by 
  4.30  type to date and unexpended balances.  
  4.31  The Higher Education Services Office 
  4.32  must evaluate and report quarterly 
  4.33  state financial aid expenditures and 
  4.34  unexpended balances to the chairs of 
  4.35  the Higher Education Finances 
  4.36  Committees of the senate and house of 
  4.37  representatives and the commissioner of 
  4.38  finance.  By November 1 and February 
  4.39  15, the Higher Education Services 
  4.40  Office must provide updated state grant 
  4.41  spending projections taking into 
  4.42  account the most current and projected 
  4.43  enrollment and tuition and fee 
  4.44  information, economic conditions, and 
  4.45  other relevant factors.  Before 
  4.46  submitting state grant spending 
  4.47  projections, the Higher Education 
  4.48  Services Office must meet and consult 
  4.49  with representatives of public and 
  4.50  private postsecondary education, the 
  4.51  Department of Finance, Governor's 
  4.52  Office, legislative staff, and 
  4.53  financial aid administrators. 
  4.54  Subd. 15.  Rochester University                       3,200,000 
  4.55  $200,000 is for implementation and 
  4.56  planning activities for a university in 
  4.57  Rochester under article 4, section 1.  
  4.58  This is a onetime appropriation. 
  4.59  $3,000,000 is a onetime appropriation 
  4.60  for deposit into the Rochester 
  4.61  University development account under 
  5.1   article 4, section 2 for the 
  5.2   implementation and development purposes 
  5.3   of article 4, section 3.  The Higher 
  5.4   Education Services Office must approve 
  5.5   the use of the money in the development 
  5.6   account.  
  5.7   This appropriation is available until 
  5.8   June 30, 2009, except that any portion 
  5.9   used for an endowment under article 4, 
  5.10  section 1, does not cancel but is 
  5.11  available until spent. 
  5.12  Sec. 3.  BOARD OF TRUSTEES OF THE MINNESOTA 
  5.13  STATE COLLEGES AND UNIVERSITIES
  5.14  Subdivision 1.  Total             
  5.15  Appropriation                        597,769,000    599,894,000 
  5.16  The amounts that may be spent from this 
  5.17  appropriation for each purpose are 
  5.18  specified in the following subdivisions.
  5.19  The legislature estimates that 
  5.20  instructional expenditures will be 
  5.21  $808,777,000 in the first year and 
  5.22  $811,653,000 in the second year.  The 
  5.23  legislature estimates that 
  5.24  noninstructional expenditures will be 
  5.25  $58,581,000 in the first year and 
  5.26  $58,790,000 in the second year. 
  5.27  Subd. 2.  General Appropriation      585,669,000    583,094,000 
  5.28  $2,500,000 the first year and 
  5.29  $2,500,000 the second year are to 
  5.30  develop additional courses for the 
  5.31  Minnesota online program. 
  5.32  $4,800,000 the first year and 
  5.33  $5,200,000 the second year are for the 
  5.34  board to increase its capacity for 
  5.35  training nurses. 
  5.36  $1,500,000 each year is for the board 
  5.37  to address the management education 
  5.38  needs of farm and small business owners.
  5.39  Subd. 3.  Centers of Excellence        7,500,000      7,500,000 
  5.40  This appropriation requires the board 
  5.41  to spend $2,000,000 from the central 
  5.42  reserves of the Minnesota State 
  5.43  Colleges and Universities in the 
  5.44  biennium ending June 30, 2007, on 
  5.45  administrative expenses of the office 
  5.46  of the chancellor related to the 
  5.47  implementation of the centers of 
  5.48  excellence under this subdivision. 
  5.49  The board must develop a process to 
  5.50  designate centers of excellence.  The 
  5.51  center designations may be made for the 
  5.52  fields of manufacturing technology, 
  5.53  science and engineering, health care, 
  5.54  information technology, business, and 
  5.55  teacher education.  A center of 
  5.56  excellence must include no more than 
  5.57  one state university working with up to 
  5.58  two community and technical colleges.  
  6.1   The board must select programs for 
  6.2   centers of excellence based on a 
  6.3   demonstration of:  (1) a comprehensive 
  6.4   academic plan with a continuum of 
  6.5   academic offerings and credentials in 
  6.6   the program area; (2) a development 
  6.7   plan with a goal of achieving 
  6.8   continuous improvement leading to 
  6.9   national recognition; (3) financial and 
  6.10  programmatic commitments from employers 
  6.11  who will benefit from the development 
  6.12  of a center; and (4) an institutional 
  6.13  commitment of support and assurance 
  6.14  that designated funding will not 
  6.15  supplant current budgets.  A center of 
  6.16  excellence may create an advisory 
  6.17  committee representing local, 
  6.18  statewide, and national leaders in the 
  6.19  field.  
  6.20  By January 15 of each odd-numbered 
  6.21  year, each designated center must 
  6.22  report to the Board of Trustees.  The 
  6.23  Board of Trustees must then report on 
  6.24  the centers of excellence to the 
  6.25  governor and the chairs of the 
  6.26  committees in the legislature with 
  6.27  responsibility for higher education 
  6.28  finance on program outcomes, including 
  6.29  the use of any funds made available by 
  6.30  a legislative appropriation for 
  6.31  incentive payments to faculty or staff. 
  6.32  Subd. 4.  Competitive Salaries         4,600,000      9,300,000 
  6.33  For the board to make incentive 
  6.34  payments to faculty or staff for 
  6.35  initiatives that promote excellence in 
  6.36  student learning.  To the extent 
  6.37  practicable, the board must make 
  6.38  payments under this paragraph available 
  6.39  first to faculty or staff associated 
  6.40  with a designated center of excellence. 
  6.41  Sec. 4.  BOARD OF REGENTS OF THE 
  6.42  UNIVERSITY OF MINNESOTA
  6.43  Subdivision 1.  Total      
  6.44  Appropriation                        598,724,000    607,999,000 
  6.45  The amounts that may be spent from this 
  6.46  appropriation for each purpose are 
  6.47  specified in the following subdivisions.
  6.48  Subd. 2.  Operations and    
  6.49  Maintenance                          518,200,000    542,475,000 
  6.50  The legislature estimates that 
  6.51  instructional expenditures will be 
  6.52  $456,371,000 in the first year and 
  6.53  $463,467,000 in the second year.  The 
  6.54  legislature estimates that 
  6.55  noninstructional expenditures will be 
  6.56  $292,318,000 in the first year and 
  6.57  $296,863,000 in the second year. 
  6.58  $17,775,000 the second year is for 
  6.59  academic initiatives that are part of 
  6.60  the board's biosciences for a healthy 
  6.61  society initiative. 
  7.1   $5,000,000 the first year and 
  7.2   $10,000,000 the second year is to award 
  7.3   faculty compensation increases 
  7.4   differentially. 
  7.5   $20,000,000 the first year and 
  7.6   $15,000,000 the second year is for 
  7.7   research support.  The funding base for 
  7.8   this initiative in fiscal years 2008 
  7.9   and 2009 is $15,000,000 per year. 
  7.10  $6,500,000 the first year and 
  7.11  $13,000,000 the second year is for 
  7.12  initiatives to attract and retain 
  7.13  students. 
  7.14  $15,000,000 the first year is for the 
  7.15  direct and indirect expenses of the 
  7.16  collaborative research partnership 
  7.17  between the University of Minnesota and 
  7.18  the Mayo Foundation for research in 
  7.19  biotechnology and medical genomics.  
  7.20  This is a onetime appropriation.  The 
  7.21  Board of Regents must submit an annual 
  7.22  report on the expenditure of these 
  7.23  funds to the governor and the chairs of 
  7.24  senate Higher Education Budget 
  7.25  Division; the house Higher Education 
  7.26  Finance Committee; the senate 
  7.27  Environment, Agriculture and Economic 
  7.28  Development Budget Division; and the 
  7.29  house Jobs and Economic Opportunity 
  7.30  Policy and Finance Committee by June 30 
  7.31  of each fiscal year until the research 
  7.32  funding is expended. 
  7.33  Subd. 2a.  Base Funding 
  7.34  The university's base for fiscal years 
  7.35  2008 and 2009 shall be increased by 
  7.36  $6,250,000 each year. 
  7.37  Subd. 3.  Health Care Access Fund      2,157,000      2,157,000 
  7.38  This appropriation is from the health 
  7.39  care access fund and is for primary 
  7.40  care education initiatives. 
  7.41  Subd. 4.  Special          
  7.42  Appropriation                         63,367,000     63,367,000 
  7.43  (a) Agriculture and Extension Service
  7.44      50,625,000     50,625,000
  7.45  For the Agricultural Experiment 
  7.46  Station, Minnesota Extension Service. 
  7.47  (b) Health Sciences
  7.48       4,929,000      4,929,000 
  7.49  For the rural physicians associates 
  7.50  program, the Veterinary Diagnostic 
  7.51  Laboratory, health sciences research, 
  7.52  dental care, and the Biomedical 
  7.53  Engineering Center. 
  7.54  (c) Institute of Technology  
  7.55       1,387,000      1,387,000 
  8.1   For the Geological Survey and the 
  8.2   Talented Youth Mathematics Program. 
  8.3   (d) System Specials          
  8.4        6,426,000      6,426,000 
  8.5   For general research, student loans 
  8.6   matching money, industrial relations 
  8.7   education, Natural Resources Research 
  8.8   Institute, Center for Urban and 
  8.9   Regional Affairs, Bell Museum of 
  8.10  Natural History, and the Humphrey 
  8.11  exhibit. 
  8.12  Subd. 5.  Academic Health Center
  8.13  The appropriation to the Academic 
  8.14  Health Center under Minnesota Statutes, 
  8.15  section 297F.10, is anticipated to be 
  8.16  $20,890,000 in the first year and 
  8.17  $20,474,000 in the second year. 
  8.18  Subd. 6.  Deaf Students 
  8.19  The Board of Regents is encouraged to 
  8.20  provide the same benefit to any 
  8.21  Minnesota resident student who 
  8.22  graduates from the Minnesota State 
  8.23  Academy for the Deaf as the Board 
  8.24  provides to students who graduate from 
  8.25  the Minnesota State Academy for the 
  8.26  Blind under Minnesota Statutes, section 
  8.27  248.03.  To be eligible for this 
  8.28  benefit, the student must comply with 
  8.29  all requirements of the University of 
  8.30  Minnesota.  
  8.31  Sec. 5.  MAYO MEDICAL FOUNDATION                                
  8.32  Subdivision 1.  Total             
  8.33  Appropriation                          1,391,000      1,391,000 
  8.34  The amounts that may be spent from this 
  8.35  appropriation for each purpose are 
  8.36  specified in the following subdivisions.
  8.37  Subd. 2.  Medical School                 514,000        514,000 
  8.38  The state of Minnesota must pay a 
  8.39  capitation each year for each student 
  8.40  who is a resident of Minnesota.  The 
  8.41  appropriation may be transferred 
  8.42  between years of the biennium to 
  8.43  accommodate enrollment fluctuations. 
  8.44  It is intended that during the biennium 
  8.45  the Mayo Foundation use the capitation 
  8.46  money to increase the number of doctors 
  8.47  practicing in rural areas in need of 
  8.48  doctors. 
  8.49  Subd. 3.  Family Practice and 
  8.50  Graduate Residency Program               531,000        531,000 
  8.51  The state of Minnesota must pay a 
  8.52  capitation of up to 27 residents each 
  8.53  year. 
  8.54  Subd. 4.  St. Cloud Hospital-Mayo Family
  8.55  Practice Residency Program  
  9.1          346,000        346,000 
  9.2   This appropriation is to the Mayo 
  9.3   Foundation to support 12 resident 
  9.4   physicians each year in the St. Cloud 
  9.5   Hospital-Mayo family practice residency 
  9.6   program.  The program must prepare 
  9.7   doctors to practice primary care 
  9.8   medicine in the rural areas of the 
  9.9   state.  It is intended that this 
  9.10  program will improve health care in 
  9.11  rural communities, provide affordable 
  9.12  access to appropriate medical care, and 
  9.13  manage the treatment of patients in a 
  9.14  more cost-effective manner. 
  9.15                             ARTICLE 2 
  9.16                         RELATED PROVISIONS 
  9.17     Section 1.  Minnesota Statutes 2004, section 13.46, 
  9.18  subdivision 2, is amended to read: 
  9.19     Subd. 2.  [GENERAL.] (a) Unless the data is summary data or 
  9.20  a statute specifically provides a different classification, data 
  9.21  on individuals collected, maintained, used, or disseminated by 
  9.22  the welfare system is private data on individuals, and shall not 
  9.23  be disclosed except:  
  9.24     (1) according to section 13.05; 
  9.25     (2) according to court order; 
  9.26     (3) according to a statute specifically authorizing access 
  9.27  to the private data; 
  9.28     (4) to an agent of the welfare system, including a law 
  9.29  enforcement person, attorney, or investigator acting for it in 
  9.30  the investigation or prosecution of a criminal or civil 
  9.31  proceeding relating to the administration of a program; 
  9.32     (5) to personnel of the welfare system who require the data 
  9.33  to verify an individual's identity; determine eligibility, 
  9.34  amount of assistance, and the need to provide services to an 
  9.35  individual or family across programs; evaluate the effectiveness 
  9.36  of programs; and investigate suspected fraud; 
  9.37     (6) to administer federal funds or programs; 
  9.38     (7) between personnel of the welfare system working in the 
  9.39  same program; 
  9.40     (8) to the Department of Revenue to administer and evaluate 
  9.41  tax refund or tax credit programs and to identify individuals 
 10.1   who may benefit from these programs.  The following information 
 10.2   may be disclosed under this paragraph:  an individual's and 
 10.3   their dependent's names, dates of birth, Social Security 
 10.4   numbers, income, addresses, and other data as required, upon 
 10.5   request by the Department of Revenue.  Disclosures by the 
 10.6   commissioner of human services for the purposes described in 
 10.7   this clause are governed by section 270B.14, subdivision 1.  Tax 
 10.8   refund or tax credit programs include, but are not limited to, 
 10.9   the dependent care credit under section 290.067, the Minnesota 
 10.10  working family credit under section 290.0671, the property tax 
 10.11  refund and rental credit under section 290A.04, and the 
 10.12  Minnesota education credit under section 290.0674; 
 10.13     (9) between the Department of Human Services, the 
 10.14  Department of Education, and the Department of Employment and 
 10.15  Economic Development for the purpose of monitoring the 
 10.16  eligibility of the data subject for unemployment benefits, for 
 10.17  any employment or training program administered, supervised, or 
 10.18  certified by that agency, for the purpose of administering any 
 10.19  rehabilitation program or child care assistance program, whether 
 10.20  alone or in conjunction with the welfare system, or to monitor 
 10.21  and evaluate the Minnesota family investment program by 
 10.22  exchanging data on recipients and former recipients of food 
 10.23  support, cash assistance under chapter 256, 256D, 256J, or 256K, 
 10.24  child care assistance under chapter 119B, or medical programs 
 10.25  under chapter 256B, 256D, or 256L; 
 10.26     (10) to appropriate parties in connection with an emergency 
 10.27  if knowledge of the information is necessary to protect the 
 10.28  health or safety of the individual or other individuals or 
 10.29  persons; 
 10.30     (11) data maintained by residential programs as defined in 
 10.31  section 245A.02 may be disclosed to the protection and advocacy 
 10.32  system established in this state according to Part C of Public 
 10.33  Law 98-527 to protect the legal and human rights of persons with 
 10.34  mental retardation or other related conditions who live in 
 10.35  residential facilities for these persons if the protection and 
 10.36  advocacy system receives a complaint by or on behalf of that 
 11.1   person and the person does not have a legal guardian or the 
 11.2   state or a designee of the state is the legal guardian of the 
 11.3   person; 
 11.4      (12) to the county medical examiner or the county coroner 
 11.5   for identifying or locating relatives or friends of a deceased 
 11.6   person; 
 11.7      (13) data on a child support obligor who makes payments to 
 11.8   the public agency may be disclosed to the Higher Education 
 11.9   Services Office to the extent necessary to determine eligibility 
 11.10  under section sections 136A.121, subdivision 2, clause (5), and 
 11.11  136A.125, subdivision 2, clause (8); 
 11.12     (14) participant Social Security numbers and names 
 11.13  collected by the telephone assistance program may be disclosed 
 11.14  to the Department of Revenue to conduct an electronic data match 
 11.15  with the property tax refund database to determine eligibility 
 11.16  under section 237.70, subdivision 4a; 
 11.17     (15) the current address of a Minnesota family investment 
 11.18  program participant may be disclosed to law enforcement officers 
 11.19  who provide the name of the participant and notify the agency 
 11.20  that: 
 11.21     (i) the participant: 
 11.22     (A) is a fugitive felon fleeing to avoid prosecution, or 
 11.23  custody or confinement after conviction, for a crime or attempt 
 11.24  to commit a crime that is a felony under the laws of the 
 11.25  jurisdiction from which the individual is fleeing; or 
 11.26     (B) is violating a condition of probation or parole imposed 
 11.27  under state or federal law; 
 11.28     (ii) the location or apprehension of the felon is within 
 11.29  the law enforcement officer's official duties; and 
 11.30     (iii) the request is made in writing and in the proper 
 11.31  exercise of those duties; 
 11.32     (16) the current address of a recipient of general 
 11.33  assistance or general assistance medical care may be disclosed 
 11.34  to probation officers and corrections agents who are supervising 
 11.35  the recipient and to law enforcement officers who are 
 11.36  investigating the recipient in connection with a felony level 
 12.1   offense; 
 12.2      (17) information obtained from food support applicant or 
 12.3   recipient households may be disclosed to local, state, or 
 12.4   federal law enforcement officials, upon their written request, 
 12.5   for the purpose of investigating an alleged violation of the 
 12.6   Food Stamp Act, according to Code of Federal Regulations, title 
 12.7   7, section 272.1(c); 
 12.8      (18) the address, Social Security number, and, if 
 12.9   available, photograph of any member of a household receiving 
 12.10  food support shall be made available, on request, to a local, 
 12.11  state, or federal law enforcement officer if the officer 
 12.12  furnishes the agency with the name of the member and notifies 
 12.13  the agency that:  
 12.14     (i) the member: 
 12.15     (A) is fleeing to avoid prosecution, or custody or 
 12.16  confinement after conviction, for a crime or attempt to commit a 
 12.17  crime that is a felony in the jurisdiction the member is 
 12.18  fleeing; 
 12.19     (B) is violating a condition of probation or parole imposed 
 12.20  under state or federal law; or 
 12.21     (C) has information that is necessary for the officer to 
 12.22  conduct an official duty related to conduct described in subitem 
 12.23  (A) or (B); 
 12.24     (ii) locating or apprehending the member is within the 
 12.25  officer's official duties; and 
 12.26     (iii) the request is made in writing and in the proper 
 12.27  exercise of the officer's official duty; 
 12.28     (19) the current address of a recipient of Minnesota family 
 12.29  investment program, general assistance, general assistance 
 12.30  medical care, or food support may be disclosed to law 
 12.31  enforcement officers who, in writing, provide the name of the 
 12.32  recipient and notify the agency that the recipient is a person 
 12.33  required to register under section 243.166, but is not residing 
 12.34  at the address at which the recipient is registered under 
 12.35  section 243.166; 
 12.36     (20) certain information regarding child support obligors 
 13.1   who are in arrears may be made public according to section 
 13.2   518.575; 
 13.3      (21) data on child support payments made by a child support 
 13.4   obligor and data on the distribution of those payments excluding 
 13.5   identifying information on obligees may be disclosed to all 
 13.6   obligees to whom the obligor owes support, and data on the 
 13.7   enforcement actions undertaken by the public authority, the 
 13.8   status of those actions, and data on the income of the obligor 
 13.9   or obligee may be disclosed to the other party; 
 13.10     (22) data in the work reporting system may be disclosed 
 13.11  under section 256.998, subdivision 7; 
 13.12     (23) to the Department of Education for the purpose of 
 13.13  matching Department of Education student data with public 
 13.14  assistance data to determine students eligible for free and 
 13.15  reduced price meals, meal supplements, and free milk according 
 13.16  to United States Code, title 42, sections 1758, 1761, 1766, 
 13.17  1766a, 1772, and 1773; to allocate federal and state funds that 
 13.18  are distributed based on income of the student's family; and to 
 13.19  verify receipt of energy assistance for the telephone assistance 
 13.20  plan; 
 13.21     (24) the current address and telephone number of program 
 13.22  recipients and emergency contacts may be released to the 
 13.23  commissioner of health or a local board of health as defined in 
 13.24  section 145A.02, subdivision 2, when the commissioner or local 
 13.25  board of health has reason to believe that a program recipient 
 13.26  is a disease case, carrier, suspect case, or at risk of illness, 
 13.27  and the data are necessary to locate the person; 
 13.28     (25) to other state agencies, statewide systems, and 
 13.29  political subdivisions of this state, including the attorney 
 13.30  general, and agencies of other states, interstate information 
 13.31  networks, federal agencies, and other entities as required by 
 13.32  federal regulation or law for the administration of the child 
 13.33  support enforcement program; 
 13.34     (26) to personnel of public assistance programs as defined 
 13.35  in section 256.741, for access to the child support system 
 13.36  database for the purpose of administration, including monitoring 
 14.1   and evaluation of those public assistance programs; 
 14.2      (27) to monitor and evaluate the Minnesota family 
 14.3   investment program by exchanging data between the Departments of 
 14.4   Human Services and Education, on recipients and former 
 14.5   recipients of food support, cash assistance under chapter 256, 
 14.6   256D, 256J, or 256K, child care assistance under chapter 119B, 
 14.7   or medical programs under chapter 256B, 256D, or 256L; 
 14.8      (28) to evaluate child support program performance and to 
 14.9   identify and prevent fraud in the child support program by 
 14.10  exchanging data between the Department of Human Services, 
 14.11  Department of Revenue under section 270B.14, subdivision 1, 
 14.12  paragraphs (a) and (b), without regard to the limitation of use 
 14.13  in paragraph (c), Department of Health, Department of Employment 
 14.14  and Economic Development, and other state agencies as is 
 14.15  reasonably necessary to perform these functions; or 
 14.16     (29) counties operating child care assistance programs 
 14.17  under chapter 119B may disseminate data on program participants, 
 14.18  applicants, and providers to the commissioner of education. 
 14.19     (b) Information on persons who have been treated for drug 
 14.20  or alcohol abuse may only be disclosed according to the 
 14.21  requirements of Code of Federal Regulations, title 42, sections 
 14.22  2.1 to 2.67. 
 14.23     (c) Data provided to law enforcement agencies under 
 14.24  paragraph (a), clause (15), (16), (17), or (18), or paragraph 
 14.25  (b), are investigative data and are confidential or protected 
 14.26  nonpublic while the investigation is active.  The data are 
 14.27  private after the investigation becomes inactive under section 
 14.28  13.82, subdivision 5, paragraph (a) or (b). 
 14.29     (d) Mental health data shall be treated as provided in 
 14.30  subdivisions 7, 8, and 9, but is not subject to the access 
 14.31  provisions of subdivision 10, paragraph (b). 
 14.32     For the purposes of this subdivision, a request will be 
 14.33  deemed to be made in writing if made through a computer 
 14.34  interface system. 
 14.35     Sec. 2.  Minnesota Statutes 2004, section 135A.031, 
 14.36  subdivision 3, is amended to read: 
 15.1      Subd. 3.  [DETERMINATION OF INSTRUCTIONAL SERVICES BASE.] 
 15.2   The instructional services base for each public postsecondary 
 15.3   system is the sum of:  (1) the state share; and (2) the 
 15.4   legislatively estimated tuition for the second year of the most 
 15.5   recent biennium; and (3) adjustments for inflation, enrollment 
 15.6   changes as calculated in subdivision 4, and performance as 
 15.7   calculated in subdivision 5.  
 15.8      Sec. 3.  Minnesota Statutes 2004, section 135A.031, 
 15.9   subdivision 4, is amended to read: 
 15.10     Subd. 4.  [ADJUSTMENT FOR ENROLLMENTS FOR BUDGETING.] (a) 
 15.11  Each public postsecondary system's instructional services base 
 15.12  shall be adjusted for estimated changes in enrollments.  For 
 15.13  each two percent change in estimated full-year equivalent 
 15.14  enrollment, an adjustment shall be made to 65 percent of the 
 15.15  instructional services base.  The remaining 35 percent of the 
 15.16  instructional services base is not subject to the adjustment in 
 15.17  this subdivision. 
 15.18     (b) For all purposes where student enrollment is used for 
 15.19  budgeting purposes, student enrollment shall be measured in 
 15.20  full-year equivalents and shall include only enrollments in 
 15.21  courses that award credit or otherwise satisfy any of the 
 15.22  requirements of an academic or vocational program. 
 15.23     (c) The enrollment adjustment shall be made for each year 
 15.24  of the subsequent biennium.  The base enrollment year is the 
 15.25  1995 fiscal year enrollment.  The base enrollment shall be 
 15.26  updated for each two percent change in estimated full-year 
 15.27  equivalent enrollment.  If the actual enrollment differs from 
 15.28  the estimated enrollment, an adjustment shall be made in the 
 15.29  next biennium. 
 15.30     Sec. 4.  Minnesota Statutes 2004, section 135A.052, 
 15.31  subdivision 1, is amended to read: 
 15.32     Subdivision 1.  [STATEMENT OF MISSIONS.] The legislature 
 15.33  recognizes each type of public postsecondary institution to have 
 15.34  a distinctive mission within the overall provision of public 
 15.35  higher education in the state and a responsibility to cooperate 
 15.36  with each other.  These missions are as follows: 
 16.1      (1) the technical colleges shall offer vocational training 
 16.2   and education to prepare students for skilled occupations that 
 16.3   do not require a baccalaureate degree; 
 16.4      (2) the community colleges shall offer lower division 
 16.5   instruction in academic programs, occupational programs in which 
 16.6   all credits earned will be accepted for transfer to a 
 16.7   baccalaureate degree in the same field of study, and remedial 
 16.8   studies, for students transferring to baccalaureate institutions 
 16.9   and for those seeking associate degrees; 
 16.10     (3) consolidated community technical colleges shall offer 
 16.11  the same types of instruction, programs, certificates, diplomas, 
 16.12  and degrees as the technical colleges and community colleges 
 16.13  offer; 
 16.14     (4) the state universities shall offer undergraduate and 
 16.15  graduate instruction through the master's degree, including 
 16.16  specialist certificates, in the liberal arts and sciences and 
 16.17  professional education, and may offer applied doctoral degrees 
 16.18  in professional fields including education, psychology, physical 
 16.19  therapy, audiology, and nursing; and 
 16.20     (5) the University of Minnesota shall offer undergraduate, 
 16.21  graduate, and professional instruction through the doctoral 
 16.22  degree, and shall be the primary state supported academic agency 
 16.23  for research and extension services. 
 16.24     It is part of the mission of each system that within the 
 16.25  system's resources the system's governing board and chancellor 
 16.26  or president shall endeavor to: 
 16.27     (a) prevent the waste or unnecessary spending of public 
 16.28  money; 
 16.29     (b) use innovative fiscal and human resource practices to 
 16.30  manage the state's resources and operate the system as 
 16.31  efficiently as possible; 
 16.32     (c) coordinate the system's activities wherever appropriate 
 16.33  with the activities of the other system and governmental 
 16.34  agencies; 
 16.35     (d) use technology where appropriate to increase system 
 16.36  productivity, improve customer service, increase public access 
 17.1   to information about the system, and increase public 
 17.2   participation in the business of the system; 
 17.3      (e) utilize constructive and cooperative labor-management 
 17.4   practices to the extent otherwise required by chapters 43A and 
 17.5   179A; and 
 17.6      (f) recommend to the legislature appropriate changes in law 
 17.7   necessary to carry out the mission of the system. 
 17.8      Sec. 5.  Minnesota Statutes 2004, section 135A.30, 
 17.9   subdivision 3, is amended to read: 
 17.10     Subd. 3.  [SELECTION OF RECIPIENTS.] The governing board of 
 17.11  an eligible institution shall determine, in consultation with 
 17.12  its campuses, application dates and procedures, criteria to be 
 17.13  considered, and methods of selecting students to receive 
 17.14  scholarships.  A campus, with the approval of its governing 
 17.15  board, may award a scholarship in any of the specified 
 17.16  fields field of study (1) in which the campus offers a program 
 17.17  that is of the quality and rigor to meet the needs of the 
 17.18  talented student, and (2) that is pertinent to the mission of 
 17.19  the campus.  
 17.20     Sec. 6.  Minnesota Statutes 2004, section 135A.30, 
 17.21  subdivision 4, is amended to read: 
 17.22     Subd. 4.  [AMOUNT OF SCHOLARSHIP.] The amount of the 
 17.23  scholarship must may be (1) at public institutions, up to the 
 17.24  cost of tuition and fees for full-time attendance for one 
 17.25  academic year, or (2) at private institutions, an amount equal 
 17.26  to the lesser of the actual tuition and fees charged by the 
 17.27  institution or the tuition and fees in comparable public 
 17.28  institutions.  Scholarships awarded under this section must not 
 17.29  be considered in determining a student's financial need as 
 17.30  provided in section 136A.101, subdivision 5. 
 17.31     Sec. 7.  Minnesota Statutes 2004, section 135A.30, 
 17.32  subdivision 5, is amended to read: 
 17.33     Subd. 5.  [RENEWALS.] The scholarship shall may be renewed 
 17.34  yearly, for up to three additional academic years, if the 
 17.35  student: 
 17.36     (1) maintains full-time enrollment with a grade point 
 18.1   average of at least 3.0 on a four point scale; 
 18.2      (2) pursues studies and continues to demonstrate 
 18.3   outstanding ability, achievement, and potential in the field for 
 18.4   which the award was made; and 
 18.5      (3) is achieving satisfactory progress toward a degree.  
 18.6      Sec. 8.  Minnesota Statutes 2004, section 135A.52, 
 18.7   subdivision 1, is amended to read: 
 18.8      Subdivision 1.  [FEES AND TUITION.] Except for an 
 18.9   administration fee established by the governing board at a level 
 18.10  to recover costs, to be collected only when a course is taken 
 18.11  for credit, a senior citizen who is a legal resident of 
 18.12  Minnesota is entitled without payment of tuition or activity 
 18.13  fees to attend courses offered for credit, audit any courses 
 18.14  offered for credit, or enroll in any noncredit adult vocational 
 18.15  education courses in any state supported institution of higher 
 18.16  education in Minnesota when space is available after all 
 18.17  tuition-paying students have been accommodated.  A senior 
 18.18  citizen enrolled under this section must pay any materials, 
 18.19  personal property, or service charges for the course.  In 
 18.20  addition, a senior citizen who is enrolled in a course for 
 18.21  credit must pay an administrative fee in an amount established 
 18.22  by the governing board of the institution to recover the course 
 18.23  costs.  There shall be no administrative fee charges to a senior 
 18.24  citizen auditing a course.  For the purposes of this section and 
 18.25  section 135A.51, the term "noncredit adult vocational education 
 18.26  courses" shall not include those adult vocational education 
 18.27  courses designed and offered specifically and exclusively for 
 18.28  senior citizens.  
 18.29     The provisions of this section and section 135A.51 do not 
 18.30  apply to noncredit courses designed and offered by the 
 18.31  University of Minnesota, and the Minnesota State Colleges and 
 18.32  Universities specifically and exclusively for senior citizens.  
 18.33  Senior citizens enrolled under the provisions of this section 
 18.34  and section 135A.51 shall not be included by such institutions 
 18.35  in their computation of full-time equivalent students when 
 18.36  requesting staff or appropriations.  The enrollee shall pay 
 19.1   laboratory or material fees. 
 19.2      Sec. 9.  Minnesota Statutes 2004, section 135A.52, 
 19.3   subdivision 2, is amended to read: 
 19.4      Subd. 2.  [TERM; INCOME OF SENIOR CITIZENS.] (a) Except 
 19.5   under paragraph (b), there shall be no limit to the number of 
 19.6   terms, quarters or semesters a senior citizen may attend 
 19.7   courses, nor income limitation imposed in determining 
 19.8   eligibility.  
 19.9      (b) A senior citizen enrolled in a closed enrollment 
 19.10  contract training or professional continuing education program 
 19.11  is not eligible for benefits under subdivision 1. 
 19.12     Sec. 10.  Minnesota Statutes 2004, section 136A.01, 
 19.13  subdivision 2, is amended to read: 
 19.14     Subd. 2.  [RESPONSIBILITIES.] The Higher Education Services 
 19.15  Office is responsible for: 
 19.16     (1) necessary state level administration of financial aid 
 19.17  programs, including accounting, auditing, and disbursing state 
 19.18  and federal financial aid funds, and reporting on financial aid 
 19.19  programs to the governor and the legislature; 
 19.20     (2) approval, registration, licensing, and financial aid 
 19.21  eligibility of private collegiate and career schools, under 
 19.22  sections 136A.61 to 136A.71 and chapter 141; 
 19.23     (3) administering the Telecommunications Council under Laws 
 19.24  1993, First Special Session chapter 2, article 5, section 2, the 
 19.25  Learning Network of Minnesota, and the Statewide Library Task 
 19.26  Force; 
 19.27     (4) negotiating and administering reciprocity agreements; 
 19.28     (5) publishing and distributing financial aid information 
 19.29  and materials, and other information and materials under section 
 19.30  136A.87, to students and parents; 
 19.31     (6) collecting and maintaining student enrollment and 
 19.32  financial aid data and reporting data on students and 
 19.33  postsecondary institutions to measure progress in student 
 19.34  learning and the effective use of public resources; 
 19.35     (7) administering the federal programs that affect students 
 19.36  and institutions on a statewide basis; and 
 20.1      (8) prescribing policies, procedures, and rules under 
 20.2   chapter 14 necessary to administer the programs under its 
 20.3   supervision. 
 20.4      Sec. 11.  Minnesota Statutes 2004, section 136A.031, 
 20.5   subdivision 2, is amended to read: 
 20.6      Subd. 2.  [HIGHER EDUCATION ADVISORY COUNCIL.] A Higher 
 20.7   Education Advisory Council (HEAC) is established.  The HEAC is 
 20.8   composed of the president of the University of Minnesota or 
 20.9   designee; the chancellor of the Minnesota State Colleges and 
 20.10  Universities or designee; the commissioner of education; the 
 20.11  president of the Private College Council; a representative from 
 20.12  the Minnesota Association of Private Postsecondary Schools; and 
 20.13  a member appointed by the governor.  The HEAC shall (1) bring to 
 20.14  the attention of the Higher Education Services Council Office 
 20.15  any matters that the HEAC deems necessary, and (2) review and 
 20.16  comment upon matters before the council.  The council shall 
 20.17  refer all proposals to the HEAC before submitting 
 20.18  recommendations to the governor and the legislature.  The 
 20.19  council shall provide time for a report from the HEAC at each 
 20.20  meeting of the council. 
 20.21     Sec. 12.  Minnesota Statutes 2004, section 136A.031, 
 20.22  subdivision 3, is amended to read: 
 20.23     Subd. 3.  [STUDENT ADVISORY COUNCIL.] A Student Advisory 
 20.24  Council (SAC) to the Higher Education Services Council Office is 
 20.25  established.  The members of SAC shall include:  the chair of 
 20.26  the University of Minnesota student senate; the state chair of 
 20.27  the Minnesota State University Student Association; the 
 20.28  president of the Minnesota State College Student Association and 
 20.29  an officer of the Minnesota State College Student Association, 
 20.30  one in a community college course of study and one in a 
 20.31  technical college course of study; the president of the 
 20.32  Minnesota Association of Private College Students; and a student 
 20.33  who is enrolled in a private vocational school, to be appointed 
 20.34  by the Minnesota Association of Private Postsecondary Schools 
 20.35  Career College Association.  A member may be represented by a 
 20.36  student designee who attends an institution from the same system 
 21.1   that the absent member represents.  The SAC shall select one of 
 21.2   its members to serve as chair. 
 21.3      The Higher Education Services Council shall inform the SAC 
 21.4   of all matters related to student issues under consideration and 
 21.5   shall refer all proposals to the SAC before taking action or 
 21.6   sending the proposals to the governor or legislature.  The SAC 
 21.7   shall report to the Higher Education Services Council Office 
 21.8   quarterly and at other times that the SAC considers desirable.  
 21.9   The SAC shall determine its meeting times, but it shall also 
 21.10  meet with the council office within 30 days after the director's 
 21.11  request for a meeting. 
 21.12     The SAC shall: 
 21.13     (1) bring to the attention of the Higher Education Services 
 21.14  Council Office any matter that the SAC believes needs the 
 21.15  attention of the council office; and 
 21.16     (2) make recommendations to the Higher Education Services 
 21.17  Council Office as it finds appropriate; 
 21.18     (3) appoint student members to the Higher Education 
 21.19  Services Council advisory groups as provided in subdivision 4; 
 21.20  and 
 21.21     (4) provide any reasonable assistance to the council. 
 21.22     Sec. 13.  Minnesota Statutes 2004, section 136A.031, 
 21.23  subdivision 4, is amended to read: 
 21.24     Subd. 4.  [STUDENT REPRESENTATION.] If requested by the 
 21.25  SAC, the director must place at least one student from an 
 21.26  affected educational system on any task force created under 
 21.27  subdivision 1.  The student member or members shall be appointed 
 21.28  by the SAC. 
 21.29     Sec. 14.  Minnesota Statutes 2004, section 136A.08, is 
 21.30  amended by adding a subdivision to read: 
 21.31     Subd. 7.  [REPORTING.] The Higher Education Services Office 
 21.32  must annually, before the last day in January, submit a report 
 21.33  to the committees in the house of representatives and the senate 
 21.34  with responsibility for higher education on: 
 21.35     (1) participation in the tuition reciprocity program by 
 21.36  Minnesota students, and students from other states attending 
 22.1   Minnesota postsecondary institutions; 
 22.2      (2) reciprocity and resident tuition rates at each 
 22.3   institution; and 
 22.4      (3) interstate payments and obligations for each state 
 22.5   participating in the tuition reciprocity program in the prior 
 22.6   year. 
 22.7      Sec. 15.  Minnesota Statutes 2004, section 136A.08, is 
 22.8   amended by adding a subdivision to read: 
 22.9      Subd. 8.  [DATA SHARING.] (a) The Higher Education Services 
 22.10  Office must consider developing data collection procedures and 
 22.11  agreements to monitor the extent to which students who attend 
 22.12  Minnesota postsecondary institutions under reciprocity 
 22.13  agreements are employed in Minnesota after graduation.  These 
 22.14  procedures must include matching Social Security numbers of 
 22.15  reciprocity students for purposes of tracking the migration and 
 22.16  employment of students who receive associate, baccalaureate, or 
 22.17  graduate degrees through a tuition reciprocity program.  State 
 22.18  agencies must share wage and earnings data under section 268.19 
 22.19  for the purpose of evaluating the tuition reciprocity program.  
 22.20     (b) The reciprocity application must request the use of 
 22.21  student Social Security numbers for the purposes of this 
 22.22  subdivision.  Reciprocity students must be informed that Social 
 22.23  Security numbers will be used only to evaluate the reciprocity 
 22.24  program by sharing information with Minnesota agencies and 
 22.25  departments responsible for the administration of covered wage 
 22.26  data and revenue collections.  Social Security numbers will not 
 22.27  be used for any other purpose or reported to any other 
 22.28  government entity. 
 22.29     (c) The office must include summary data on the migration 
 22.30  and earnings of reciprocity graduates in the reciprocity report 
 22.31  to the legislature.  This report must include summary statistics 
 22.32  on number of graduates by institution, degree granted and year 
 22.33  of graduation, total number of reciprocity students employed in 
 22.34  the state, and total earnings of graduates. 
 22.35     Sec. 16.  Minnesota Statutes 2004, section 136A.121, 
 22.36  subdivision 2, is amended to read: 
 23.1      Subd. 2.  [ELIGIBILITY FOR GRANTS.] An applicant is 
 23.2   eligible to be considered for a grant, regardless of the 
 23.3   applicant's sex, creed, race, color, national origin, or 
 23.4   ancestry, under sections 136A.095 to 136A.131 if the office 
 23.5   finds that the applicant: 
 23.6      (1) is a resident of the state of Minnesota; 
 23.7      (2) is a graduate of a secondary school or its equivalent, 
 23.8   or is 17 years of age or over, and has met all requirements for 
 23.9   admission as a student to an eligible college or technical 
 23.10  college of choice as defined in sections 136A.095 to 136A.131; 
 23.11     (3) has met the financial need criteria established in 
 23.12  Minnesota Rules; 
 23.13     (4) is not in default, as defined by the office, of any 
 23.14  federal or state student educational loan; and 
 23.15     (5) is not more than 30 days in arrears for any in 
 23.16  court-ordered child support payments owed to a that is collected 
 23.17  or enforced by the public agency authority responsible for child 
 23.18  support enforcement or, if the applicant is more than 30 days in 
 23.19  arrears in court-ordered child support that is collected or 
 23.20  enforced by the public authority responsible for child support 
 23.21  enforcement, but is complying with a written payment 
 23.22  agreement under section 518.553 or order for arrearages.  An 
 23.23  agreement must provide for a repayment of arrearages at no less 
 23.24  than 20 percent per month of the amount of the monthly child 
 23.25  support obligation or no less than $30 per month if there is no 
 23.26  current monthly child support obligation.  Compliance means that 
 23.27  payments are made by the payment date. 
 23.28     The director and the commissioner of human services shall 
 23.29  develop procedures to implement clause (5).  
 23.30     Sec. 17.  Minnesota Statutes 2004, section 136A.121, 
 23.31  subdivision 5, is amended to read: 
 23.32     Subd. 5.  [GRANT STIPENDS.] The grant stipend shall be 
 23.33  based on a sharing of responsibility for covering the recognized 
 23.34  cost of attendance by the applicant, the applicant's family, and 
 23.35  the government.  The amount of a financial stipend must not 
 23.36  exceed a grant applicant's recognized cost of attendance, as 
 24.1   defined in subdivision 6, after deducting the following:  
 24.2      (1) the assigned student responsibility of at least 46 45 
 24.3   percent of the cost of attending the institution of the 
 24.4   applicant's choosing; 
 24.5      (2) the assigned family responsibility as defined in 
 24.6   section 136A.101; and 
 24.7      (3) the amount of a federal Pell grant award for which the 
 24.8   grant applicant is eligible. 
 24.9      The minimum financial stipend is $100 per academic year. 
 24.10     Sec. 18.  Minnesota Statutes 2004, section 136A.121, 
 24.11  subdivision 6, is amended to read: 
 24.12     Subd. 6.  [COST OF ATTENDANCE.] (a) The recognized cost of 
 24.13  attendance consists of allowances specified in law for living 
 24.14  and miscellaneous expenses, and an allowance for tuition and 
 24.15  fees equal to the lesser of the average tuition and fees charged 
 24.16  by the institution, or the tuition and fee maximums established 
 24.17  in law. 
 24.18     (b) For a student registering for less than full time, the 
 24.19  office shall prorate the cost of attendance to the actual number 
 24.20  of credits for which the student is enrolled. 
 24.21     The recognized cost of attendance for a student who is 
 24.22  confined to a Minnesota correctional institution shall consist 
 24.23  of the tuition and fee component in paragraph (a), with no 
 24.24  allowance for living and miscellaneous expenses. 
 24.25     For the purpose of this subdivision, "fees" include only 
 24.26  those fees that are mandatory and charged to full-time resident 
 24.27  students attending the institution.  Fees do not include charges 
 24.28  for tools, equipment, computers, or other similar materials 
 24.29  where the student retains ownership.  Fees include charges for 
 24.30  these materials if the institution retains ownership.  Fees do 
 24.31  not include optional or punitive fees. 
 24.32     Sec. 19.  Minnesota Statutes 2004, section 136A.121, 
 24.33  subdivision 9, is amended to read: 
 24.34     Subd. 9.  [AWARDS.] An undergraduate student who meets the 
 24.35  office's requirements is eligible to apply for and receive a 
 24.36  grant in any year of undergraduate study unless the student has 
 25.1   obtained a baccalaureate degree or previously has been enrolled 
 25.2   full time or the equivalent for eight nine semesters or the 
 25.3   equivalent, excluding courses taken from a Minnesota school or 
 25.4   postsecondary institution which is not participating in the 
 25.5   state grant program and from which a student transferred no 
 25.6   credit.  A student who withdraws from enrollment for active 
 25.7   military service is entitled to an additional semester or the 
 25.8   equivalent of grant eligibility.  A student enrolled in a 
 25.9   two-year program at a four-year institution is only eligible for 
 25.10  the tuition and fee maximums established by law for two-year 
 25.11  institutions. 
 25.12     Sec. 20.  Minnesota Statutes 2004, section 136A.121, is 
 25.13  amended by adding a subdivision to read: 
 25.14     Subd. 18.  [DATA.] An eligible institution must provide to 
 25.15  the office student enrollment, financial aid, financial, and 
 25.16  other data as determined by the director, to enable the office 
 25.17  to carry out its responsibilities under chapter 136A. 
 25.18     Sec. 21.  Minnesota Statutes 2004, section 136A.125, 
 25.19  subdivision 2, is amended to read: 
 25.20     Subd. 2.  [ELIGIBLE STUDENTS.] (a) An applicant is eligible 
 25.21  for a child care grant if the applicant: 
 25.22     (1) is a resident of the state of Minnesota; 
 25.23     (2) has a child 12 years of age or younger, or 14 years of 
 25.24  age or younger who is handicapped as defined in section 125A.02, 
 25.25  and who is receiving or will receive care on a regular basis 
 25.26  from a licensed or legal, nonlicensed caregiver; 
 25.27     (3) is income eligible as determined by the office's 
 25.28  policies and rules, but is not a recipient of assistance from 
 25.29  the Minnesota family investment program; 
 25.30     (4) has not earned a baccalaureate degree and has been 
 25.31  enrolled full time less than eight nine semesters or the 
 25.32  equivalent; 
 25.33     (5) is pursuing a nonsectarian program or course of study 
 25.34  that applies to an undergraduate degree, diploma, or 
 25.35  certificate; 
 25.36     (6) is enrolled at least half time in an eligible 
 26.1   institution; and 
 26.2      (7) is in good academic standing and making satisfactory 
 26.3   academic progress; and 
 26.4      (8) is not more than 30 days in arrears in court-ordered 
 26.5   child support that is collected or enforced by the public 
 26.6   authority responsible for child support enforcement or, if the 
 26.7   applicant is more than 30 days in arrears in court-ordered child 
 26.8   support that is collected or enforced by the public authority 
 26.9   responsible for child support enforcement, but is complying with 
 26.10  a written payment agreement under section 518.553 or order for 
 26.11  arrearages.  
 26.12     (b) A student who withdraws from enrollment for active 
 26.13  military service is entitled to an additional semester or the 
 26.14  equivalent of grant eligibility. 
 26.15     Sec. 22.  Minnesota Statutes 2004, section 136A.1701, is 
 26.16  amended by adding a subdivision to read: 
 26.17     Subd. 11.  [DATA.] An eligible institution must provide to 
 26.18  the office student enrollment, financial aid, financial, and 
 26.19  other data as determined by the director, to enable the office 
 26.20  to carry out its responsibilities under chapter 136A. 
 26.21     Sec. 23.  Minnesota Statutes 2004, section 136A.1701, is 
 26.22  amended by adding a subdivision to read: 
 26.23     Subd. 12.  [ELIGIBLE STUDENT.] "Eligible student" means a 
 26.24  student who is a Minnesota resident who is enrolled or accepted 
 26.25  for enrollment at an eligible institution in Minnesota or in 
 26.26  another state or province.  Non-Minnesota residents are eligible 
 26.27  students if they are enrolled or accepted for enrollment in a 
 26.28  minimum of one course of at least 30 days in length during the 
 26.29  academic year that requires physical attendance at an eligible 
 26.30  institution located in Minnesota.  Non-Minnesota resident 
 26.31  students enrolled exclusively during the academic year in 
 26.32  correspondence courses or courses offered over the Internet are 
 26.33  not eligible students.  Non-Minnesota resident students not 
 26.34  physically attending classes in Minnesota due to enrollment in a 
 26.35  study abroad program for 12 months or less are eligible students.
 26.36  Non-Minnesota residents enrolled in study abroad programs 
 27.1   exceeding 12 months are not eligible students.  For purposes of 
 27.2   this section, an "eligible student" must also meet the 
 27.3   eligibility requirements of section 136A.15, subdivision 8.  
 27.4      Sec. 24.  [136A.1703] [INCOME-CONTINGENT LOANS.] 
 27.5      The office shall administer an income-contingent loan 
 27.6   repayment program to assist graduates of Minnesota schools in 
 27.7   medicine, dentistry, pharmacy, chiropractic medicine, public 
 27.8   health, and veterinary medicine, and Minnesota residents 
 27.9   graduating from optometry and osteopathy programs.  Applicant 
 27.10  data collected by the office for this program may be disclosed 
 27.11  to a consumer credit reporting agency under the same conditions 
 27.12  as those that apply to the supplemental loan program under 
 27.13  section 136A.162.  No new applicants may be accepted after June 
 27.14  30, 1995. 
 27.15     Sec. 25.  [136A.1785] [LOAN CAPITAL FUND.] 
 27.16     The office may deposit and hold assets derived from the 
 27.17  operation of its student loan programs authorized by this 
 27.18  chapter in a fund known as the loan capital fund.  Assets in the 
 27.19  loan capital fund are available to the office solely for 
 27.20  carrying out the purposes and terms of sections 136A.15 to 
 27.21  136A.1703, including, but not limited to, making student loans 
 27.22  authorized by this chapter, paying administrative expenses 
 27.23  associated with the operation of its student loan programs, 
 27.24  repurchasing defaulted student loans, and paying expenses in 
 27.25  connection with the issuance of revenue bonds authorized under 
 27.26  this chapter.  Assets in the loan capital fund may be invested 
 27.27  as provided in sections 11A.24 and 136A.16, subdivision 8.  All 
 27.28  interest and earnings from the investment of the loan capital 
 27.29  fund inure to the benefit of the fund and are deposited into the 
 27.30  fund. 
 27.31     Sec. 26.  Minnesota Statutes 2004, section 136F.04, 
 27.32  subdivision 4, is amended to read: 
 27.33     Subd. 4.  [RECOMMENDATIONS.] Each student association shall 
 27.34  recommend at least two and not more than four candidates for its 
 27.35  student member.  By January 2 April 15 of the year in which its 
 27.36  members' term expires, each student association shall submit its 
 28.1   recommendations to the governor.  The governor is not bound by 
 28.2   these recommendations. 
 28.3      Sec. 27.  Minnesota Statutes 2004, section 136F.32, 
 28.4   subdivision 2, is amended to read: 
 28.5      Subd. 2.  [TECHNICAL AND CONSOLIDATED TECHNICAL COLLEGES.] 
 28.6   (a) A technical college or consolidated technical community 
 28.7   college shall offer students the option of pursuing diplomas and 
 28.8   or certificates in each technical education program, unless the 
 28.9   board determines that a degree is the only acceptable credential 
 28.10  for career entry in a specific field.  All vocational and 
 28.11  technical credits earned for a diploma or certificate shall be 
 28.12  applicable toward any available degree in the same program.  
 28.13     (b) Certificates and diplomas are credentials that 
 28.14  demonstrate competence in a vocational or technical area and, 
 28.15  therefore, may include a general education component only as 
 28.16  part of an articulation agreement or to meet occupational 
 28.17  requirements as established by the trade or profession, or by 
 28.18  the program advisory committee.  Students shall be provided with 
 28.19  applied training in general studies as necessary for competence 
 28.20  in the program area.  Students who have earned a certificate or 
 28.21  diploma may earn a degree in the same field if they complete the 
 28.22  general education and other degree requirements. 
 28.23     Sec. 28.  Minnesota Statutes 2004, section 136G.03, 
 28.24  subdivision 3, is amended to read: 
 28.25     Subd. 3.  [ACCOUNT OWNER.] "Account owner" means a person 
 28.26  who enters into a participation agreement and is entitled 
 28.27  to select or change conduct transactions on the account, 
 28.28  including selecting and changing the beneficiary of an account 
 28.29  or to receive and receiving distributions from the account for 
 28.30  other than payment of qualified higher education expenses. 
 28.31     Sec. 29.  Minnesota Statutes 2004, section 136G.03, 
 28.32  subdivision 21a, is amended to read: 
 28.33     Subd. 21a.  [MINOR TRUST ACCOUNT.] "Minor trust account" 
 28.34  means a Uniform Gift to Minors Act account, or a Uniform 
 28.35  Transfers to Minors Act account, or a trust instrument naming a 
 28.36  minor person as beneficiary, created and operating under the 
 29.1   laws of Minnesota or another state. 
 29.2      Sec. 30.  Minnesota Statutes 2004, section 136G.03, 
 29.3   subdivision 22, is amended to read: 
 29.4      Subd. 22.  [NONQUALIFIED DISTRIBUTION.] "Nonqualified 
 29.5   distribution" means a distribution made from an account other 
 29.6   than (1) a qualified distribution; or (2) a distribution due to 
 29.7   the death or disability of, or scholarship to, or attendance at 
 29.8   a United States military academy by, a beneficiary. 
 29.9      Sec. 31.  Minnesota Statutes 2004, section 136G.03, 
 29.10  subdivision 32, is amended to read: 
 29.11     Subd. 32.  [SCHOLARSHIP.] "Scholarship" means a 
 29.12  scholarship, or educational assistance allowance, or payment 
 29.13  under section 529(b)(3)(C) of the Internal Revenue Code. 
 29.14     Sec. 32.  Minnesota Statutes 2004, section 136G.05, 
 29.15  subdivision 8, is amended to read: 
 29.16     Subd. 8.  [ADMINISTRATION.] The director shall administer 
 29.17  the program, including accepting and processing applications, 
 29.18  maintaining account records, making payments, making matching 
 29.19  grants under section 136G.11, and undertaking any other 
 29.20  necessary tasks to administer the program.  The office may 
 29.21  contract with one or more third parties to carry out some or all 
 29.22  of these administrative duties, including promotion providing 
 29.23  incentives and marketing of the program.  The office and the 
 29.24  board may jointly contract with third-party providers, if the 
 29.25  office and board determine that it is desirable to contract with 
 29.26  the same entity or entities for administration and investment 
 29.27  management. 
 29.28     Sec. 33.  Minnesota Statutes 2004, section 136G.09, 
 29.29  subdivision 11, is amended to read: 
 29.30     Subd. 11.  [EFFECT OF PLAN CHANGES ON PARTICIPATION 
 29.31  AGREEMENT.] Amendments to sections 136G.01 to 136G.13 
 29.32  automatically amend the participation agreement.  Any amendments 
 29.33  to the operating procedures and policies of the plan shall 
 29.34  automatically amend the participation agreement 30 days after 
 29.35  adoption by the office or the board. 
 29.36     Sec. 34.  Minnesota Statutes 2004, section 136G.09, 
 30.1   subdivision 12, is amended to read: 
 30.2      Subd. 12.  [SPECIAL ACCOUNT TO HOLD PLAN ASSETS IN TRUST.] 
 30.3   All assets of the plan, including contributions to accounts and 
 30.4   matching grant accounts and earnings, are held in trust for the 
 30.5   exclusive benefit of account owners and beneficiaries.  Assets 
 30.6   must be held in a separate account in the state treasury to be 
 30.7   known as the Minnesota college savings plan account or in 
 30.8   accounts with the third party provider selected pursuant to 
 30.9   section 136G.05, subdivision 8.  Plan assets are not subject to 
 30.10  claims by creditors of the state, are not part of the general 
 30.11  fund, and are not subject to appropriation by the state.  
 30.12  Payments from the Minnesota college savings plan account shall 
 30.13  be made under sections 136G.01 to 136G.13. 
 30.14     Sec. 35.  Minnesota Statutes 2004, section 136G.11, 
 30.15  subdivision 1, is amended to read: 
 30.16     Subdivision 1.  [MATCHING GRANT QUALIFICATION.] By June 30 
 30.17  of each year, a state matching grant must be added to each 
 30.18  account established under the program if the following 
 30.19  conditions are met: 
 30.20     (1) the contributor applies, in writing in a form 
 30.21  prescribed by the director, for a matching grant; 
 30.22     (2) a minimum contribution of $200 was made during the 
 30.23  preceding calendar year; and 
 30.24     (3) the beneficiary's family meets Minnesota college 
 30.25  savings plan residency requirements; and 
 30.26     (4) the family income of the beneficiary did not exceed 
 30.27  $80,000. 
 30.28     Sec. 36.  Minnesota Statutes 2004, section 136G.11, 
 30.29  subdivision 2, is amended to read: 
 30.30     Subd. 2.  [FAMILY INCOME.] (a) For purposes of this 
 30.31  section, "family income" means: 
 30.32     (1) if the beneficiary is under age 25, the combined 
 30.33  adjusted gross income of the beneficiary's parents or legal 
 30.34  guardians as reported on the federal tax return or returns for 
 30.35  the calendar year in which contributions were made.  If the 
 30.36  beneficiary's parents or legal guardians are divorced, the 
 31.1   income of the parent claiming the beneficiary as a dependent on 
 31.2   the federal individual income tax return and the income of that 
 31.3   parent's spouse, if any, is used to determine family income; or 
 31.4      (2) if the beneficiary is age 25 or older, the combined 
 31.5   adjusted gross income of the beneficiary and spouse, if any. 
 31.6      (b) For a parent or legal guardian of beneficiaries under 
 31.7   age 25 and for beneficiaries age 25 or older who resided in 
 31.8   Minnesota and filed a federal individual income tax return, the 
 31.9   matching grant must be based on family income from the calendar 
 31.10  year in which contributions were made. 
 31.11     Sec. 37.  Minnesota Statutes 2004, section 136G.11, 
 31.12  subdivision 3, is amended to read: 
 31.13     Subd. 3.  [RESIDENCY REQUIREMENT.] (a) If the beneficiary 
 31.14  is under age 25, the beneficiary's parents or legal guardians 
 31.15  must be Minnesota residents to qualify for a matching grant.  If 
 31.16  the beneficiary is age 25 or older, the beneficiary must be a 
 31.17  Minnesota resident to qualify for a matching grant. 
 31.18     (b) To meet the residency requirements, the parent or legal 
 31.19  guardian of beneficiaries under age 25 must have filed a 
 31.20  Minnesota individual income tax return as a Minnesota resident 
 31.21  and claimed the beneficiary as a dependent on the parent or 
 31.22  legal guardian's federal tax return for the calendar year in 
 31.23  which contributions were made.  If the beneficiary's parents are 
 31.24  divorced, the parent or legal guardian claiming the beneficiary 
 31.25  as a dependent on the federal individual income tax return must 
 31.26  be a Minnesota resident.  For beneficiaries age 25 or older, the 
 31.27  beneficiary, and a spouse, if any, must have filed a Minnesota 
 31.28  and a federal individual income tax return as a Minnesota 
 31.29  resident for the calendar year in which contributions were made. 
 31.30     (c) A parent of beneficiaries under age 25 and 
 31.31  beneficiaries age 25 or older who did not reside in Minnesota in 
 31.32  the calendar year in which contributions were made are not 
 31.33  eligible for a matching grant. 
 31.34     Sec. 38.  Minnesota Statutes 2004, section 136G.11, 
 31.35  subdivision 13, is amended to read: 
 31.36     Subd. 13.  [FORFEITURE OF MATCHING GRANTS.] (a) Matching 
 32.1   grants are forfeited if: 
 32.2      (1) the account owner transfers the total account balance 
 32.3   of an account to another account or to another qualified tuition 
 32.4   program; 
 32.5      (2) the beneficiary receives a full tuition scholarship or 
 32.6   admission to is attending a United States service academy; 
 32.7      (3) the beneficiary dies or becomes disabled; 
 32.8      (4) the account owner changes the beneficiary of the 
 32.9   account; or 
 32.10     (5) the account owner closes the account with a 
 32.11  nonqualified withdrawal. 
 32.12     (b) Matching grants must be proportionally forfeited if: 
 32.13     (1) the account owner transfers a portion of an account to 
 32.14  another account or to another qualified tuition program; 
 32.15     (2) the beneficiary receives a scholarship covering a 
 32.16  portion of qualified higher education expenses; or 
 32.17     (3) the account owner makes a partial nonqualified 
 32.18  withdrawal. 
 32.19     (c) If the account owner makes a misrepresentation in a 
 32.20  participation agreement or an application for a matching grant 
 32.21  that results in a matching grant, the matching grant associated 
 32.22  with the misrepresentation is forfeited.  The office and the 
 32.23  board must instruct the plan administrator as to the amount to 
 32.24  be forfeited from the matching grant account.  The office and 
 32.25  the board must withdraw the matching grant or the proportion of 
 32.26  the matching grant that is related to the misrepresentation. 
 32.27     Sec. 39.  Minnesota Statutes 2004, section 136G.13, 
 32.28  subdivision 1, is amended to read: 
 32.29     Subdivision 1.  [QUALIFIED DISTRIBUTION METHODS.] (a) 
 32.30  Qualified distributions may be made: 
 32.31     (1) directly to participating eligible educational 
 32.32  institutions on behalf of the beneficiary; or 
 32.33     (2) in the form of a check payable to both the beneficiary 
 32.34  and the eligible educational institution; or 
 32.35     (3) directly to the account owner or beneficiary if the 
 32.36  account owner or beneficiary has already paid qualified higher 
 33.1   education expenses. 
 33.2      (b) Qualified distributions must be withdrawn 
 33.3   proportionally from contributions and earnings in an account 
 33.4   owner's account on the date of distribution as provided in 
 33.5   section 529 of the Internal Revenue Code. 
 33.6      Sec. 40.  Minnesota Statutes 2004, section 136G.13, 
 33.7   subdivision 5, is amended to read: 
 33.8      Subd. 5.  [DISTRIBUTIONS DUE TO DEATH OR DISABILITY OF, OR 
 33.9   SCHOLARSHIP TO, OR ATTENDANCE AT A UNITED STATES MILITARY 
 33.10  ACADEMY BY, A BENEFICIARY.] An account owner may request a 
 33.11  distribution due to the death or disability of, or scholarship 
 33.12  to, or attendance at a United States military academy by, a 
 33.13  beneficiary from an account by submitting a completed request to 
 33.14  the plan.  Prior to distribution, the account owner shall 
 33.15  certify the reason for the distribution and provide written 
 33.16  confirmation from a third party that the beneficiary has died, 
 33.17  become disabled, or received a scholarship for attendance at an 
 33.18  eligible educational institution, or is attending a United 
 33.19  States military academy.  The plan must not consider a request 
 33.20  to make a distribution until a third-party written confirmation 
 33.21  is received by the plan.  For purposes of this subdivision, a 
 33.22  third-party written confirmation consists of the following: 
 33.23     (1) for death of the beneficiary, a certified copy of the 
 33.24  beneficiary's death record; 
 33.25     (2) for disability of the beneficiary, a certification by a 
 33.26  physician who is a doctor of medicine or osteopathy stating that 
 33.27  the doctor is legally authorized to practice in a state of the 
 33.28  United States and that the beneficiary is unable to attend any 
 33.29  eligible educational institution because of an injury or illness 
 33.30  that is expected to continue indefinitely or result in death.  
 33.31  Certification must be on a form approved by the plan; or 
 33.32     (3) for a scholarship award to the beneficiary, a letter 
 33.33  from the grantor of the scholarship or from the eligible 
 33.34  educational institution receiving or administering the 
 33.35  scholarship, that identifies the beneficiary by name and Social 
 33.36  Security number or taxpayer identification number as the 
 34.1   recipient of the scholarship and states the amount of the 
 34.2   scholarship, the period of time or number of credits or units to 
 34.3   which it applies, the date of the scholarship, and, if 
 34.4   applicable, the eligible educational institution to which the 
 34.5   scholarship is to be applied; or 
 34.6      (4) for attendance by the beneficiary at a United States 
 34.7   military academy, a letter from the military academy indicating 
 34.8   the beneficiary's enrollment and attendance. 
 34.9      Sec. 41.  Minnesota Statutes 2004, section 136G.14, is 
 34.10  amended to read: 
 34.11     136G.14 [MINOR TRUST ACCOUNTS.] 
 34.12     (a) This section applies to a plan account in which funds 
 34.13  of a minor trust account are invested. 
 34.14     (b) The account owner may not be changed to any person 
 34.15  other than a successor custodian or the beneficiary unless a 
 34.16  court order directing the change of ownership is provided to the 
 34.17  plan administrator.  The custodian must sign all forms and 
 34.18  requests submitted to the plan administrator in the custodian's 
 34.19  representative capacity.  The custodian must notify the plan 
 34.20  administrator in writing when the beneficiary becomes legally 
 34.21  entitled to be the account owner.  An account owner under this 
 34.22  section may not select a contingent account owner. 
 34.23     (c) The beneficiary of an account under this section may 
 34.24  not be changed.  If the beneficiary dies, assets in a plan 
 34.25  account become the property of the beneficiary's estate.  Funds 
 34.26  in an account must not be transferred or rolled over to another 
 34.27  account owner or to an account for another beneficiary.  A 
 34.28  nonqualified distribution from an account, or a distribution due 
 34.29  to the disability or scholarship award to the beneficiary, or 
 34.30  made on account of the beneficiary's attendance at a United 
 34.31  States military academy, must be used for the benefit of the 
 34.32  beneficiary. 
 34.33     Sec. 42.  Minnesota Statutes 2004, section 137.0245, 
 34.34  subdivision 1, is amended to read: 
 34.35     Subdivision 1.  [ESTABLISHMENT.] A Regent Candidate 
 34.36  Advisory Council is established to assist the legislature in 
 35.1   determining criteria for, and identifying and recruiting 
 35.2   qualified candidates for membership on the Board of Regents and 
 35.3   making recommendations to the governor. 
 35.4      Sec. 43.  Minnesota Statutes 2004, section 137.0245, 
 35.5   subdivision 2, is amended to read: 
 35.6      Subd. 2.  [MEMBERSHIP.] (a) The Regent Candidate Advisory 
 35.7   Council shall consist of 24 members, appointed as provided in 
 35.8   this subdivision.  
 35.9      (b) Twelve Ten members shall be appointed by the 
 35.10  Subcommittee on Committees of the Committee on Rules and 
 35.11  Administration of the senate.  Twelve Ten members shall be 
 35.12  appointed by the speaker of the house of representatives.  Each 
 35.13  of these appointing authority authorities must appoint one 
 35.14  member who is a student enrolled in a degree program at the 
 35.15  University of Minnesota at the time of appointment.  No more 
 35.16  than one-third one-fourth of the members appointed by each of 
 35.17  these appointing authority authorities may be current or former 
 35.18  legislators.  No more than two-thirds three-fourths of the 
 35.19  members appointed by each of these appointing authority 
 35.20  authorities may belong to the same political party; however, 
 35.21  political activity or affiliation is not required for the 
 35.22  appointment of any member.  
 35.23     (c) Two members shall be appointed by the University of 
 35.24  Minnesota Alumni Association.  Two members shall be appointed by 
 35.25  the University of Minnesota Foundation. 
 35.26     (d) Geographical representation must be taken into 
 35.27  consideration when making appointments.  Political activity or 
 35.28  affiliation is not required for appointment of any member of the 
 35.29  advisory council.  Section 15.0575 shall govern the advisory 
 35.30  council, except that: 
 35.31     (1) the members shall be appointed to six-year terms with 
 35.32  one-third appointed each even-numbered year; and 
 35.33     (2) student members are appointed to two-year terms with 
 35.34  two students appointed each even-numbered year.  
 35.35     Sec. 44.  Minnesota Statutes 2004, section 137.0245, 
 35.36  subdivision 4, is amended to read: 
 36.1      Subd. 4.  [RECOMMENDATIONS.] The advisory council shall 
 36.2   recommend at least two and not more than four candidates.  By 
 36.3   March 15 February 1 of each odd-numbered year, the advisory 
 36.4   council shall submit its recommendations to the president of the 
 36.5   senate and the speaker of the house of representatives.  The 
 36.6   legislature shall not be bound by these recommendations governor 
 36.7   who must nominate a slate of candidates and present it to the 
 36.8   legislature under section 137.0247. 
 36.9      Sec. 45.  [137.0247] [LEGISLATIVE ELECTION OF REGENTS.] 
 36.10     Subdivision 1.  [GOVERNOR NOMINATION.] Within 30 days of 
 36.11  receiving the recommendations of the Regent Candidate Advisory 
 36.12  Council, the governor must submit a slate of regent candidates 
 36.13  to the legislature that names one candidate for each vacancy.  
 36.14  The governor may name candidates from the recommendations of the 
 36.15  advisory council, or may select a candidate without regard to 
 36.16  the recommendations but according to sections 137.023 and 
 36.17  137.024.  In selecting candidates, the governor must consider 
 36.18  the needs of the board of regents and the balance of the board 
 36.19  membership with respect to gender, racial, and ethnic 
 36.20  composition.  
 36.21     Subd. 2.  [ELECTION BY THE LEGISLATURE.] In each 
 36.22  odd-numbered year, the legislature must elect regents as 
 36.23  required under the Minnesota Constitution, article XII, section 
 36.24  3, from a slate of candidates submitted by the governor under 
 36.25  this section.  If the legislature fails to fill one or more of 
 36.26  the open positions, the governor has 15 days from the date of 
 36.27  the joint convention to submit a new slate of candidates for the 
 36.28  open regent positions.  The legislature must meet in joint 
 36.29  convention to act on the second slate of candidates.  The 
 36.30  nomination and election process under this section continues 
 36.31  until regents have been elected for all positions scheduled for 
 36.32  the current election cycle. 
 36.33     Sec. 46.  Minnesota Statutes 2004, section 192.502, 
 36.34  subdivision 1, is amended to read: 
 36.35     Subdivision 1.  [POSTSECONDARY STUDENTS.] (a) A member of 
 36.36  the Minnesota National Guard or any other military reserve 
 37.1   component who is a As used in this subdivision, the terms 
 37.2   "qualified person" and "qualified student" have the same meaning 
 37.3   and include: 
 37.4      (1) any student at a postsecondary education educational 
 37.5   institution and who is called or ordered to state into active 
 37.6   military service in the Minnesota National Guard, as defined in 
 37.7   section 190.05, subdivision 5, or who is called or ordered to 
 37.8   federal active military service; and 
 37.9      (2) a veteran, as defined in section 197.447, who has a 
 37.10  service connected disability as certified by the United States 
 37.11  Department of Veterans Affairs, who is a student at a 
 37.12  postsecondary educational institution, and whose medical 
 37.13  condition or medical treatment requirements reasonably prevent 
 37.14  the person's attendance at or progress in part or all of the 
 37.15  person's higher educational training or studies at any given 
 37.16  time. 
 37.17     (b) A qualified person or qualified student has the 
 37.18  following rights: 
 37.19     (1) with regard to courses in which the person is enrolled, 
 37.20  the person may: 
 37.21     (i) withdraw from one or more courses for which tuition and 
 37.22  fees have been paid that are attributable to the courses.  The 
 37.23  tuition and fees must be credited to the person's account at the 
 37.24  postsecondary institution.  Any refunds are subject to the 
 37.25  requirements of the state or federal financial aid programs of 
 37.26  origination.  In such a case, the student must not receive 
 37.27  credit for the courses and must not receive a failing grade, an 
 37.28  incomplete, or other negative annotation on the student's 
 37.29  record, and the student's grade point average must not be 
 37.30  altered or affected in any manner because of action under this 
 37.31  item; 
 37.32     (ii) be given a grade of incomplete and be allowed to 
 37.33  complete the course upon release from active duty service, upon 
 37.34  completion of medical treatment, or upon sufficient medical 
 37.35  recovery under the postsecondary institution's standard practice 
 37.36  for completion of incompletes; or 
 38.1      (iii) continue and complete the course for full credit.  
 38.2   Class sessions the student misses due to performance of state or 
 38.3   federal active military service or due to the person's medical 
 38.4   treatment or medical condition must be counted as excused 
 38.5   absences and must not be used in any way to adversely impact the 
 38.6   student's grade or standing in the class.  Any student who 
 38.7   selects this option is not, however, automatically excused from 
 38.8   completing assignments due during the period the student is 
 38.9   performing state or federal active military service or receiving 
 38.10  medical treatment or recovering from a medical condition.  A 
 38.11  letter grade or a grade of pass must only be awarded only if, in 
 38.12  the opinion of the faculty member teaching the course, the 
 38.13  student has completed sufficient work and has demonstrated 
 38.14  sufficient progress toward meeting course requirements to 
 38.15  justify the grade; 
 38.16     (2) to receive a refund of amounts paid for room, board, 
 38.17  and fees attributable to the time period during which the 
 38.18  student was serving in state or federal active military service 
 38.19  or receiving medical treatment or dealing with the person's 
 38.20  medical condition and did not use the facilities or services for 
 38.21  which the amounts were paid.  Any refund of room, board, and 
 38.22  fees is subject to the requirements of the state or federal 
 38.23  financial aid programs of origination; and 
 38.24     (3) if the student chooses to withdraw, the student has the 
 38.25  right to be readmitted and reenrolled as a student at the 
 38.26  postsecondary education institution, without penalty or 
 38.27  redetermination of admission eligibility, within one year two 
 38.28  years following release from the state or federal active 
 38.29  military service or following completion of medical treatment or 
 38.30  sufficient recovery from the person's medical condition. 
 38.31     (b) (c) The protections in this section may be invoked as 
 38.32  follows: 
 38.33     (1) the qualified person or qualified student, or an 
 38.34  appropriate officer from the military organization in which the 
 38.35  person will be serving, or an appropriate medical authority or 
 38.36  the person's authorized caregiver or family member, must give 
 39.1   advance verbal or written notice that the person is being called 
 39.2   or ordered to qualifying active military service or will be 
 39.3   undertaking medical treatment or a period of recovery for a 
 39.4   medical condition; 
 39.5      (2) advance notice is not required if the giving of notice 
 39.6   is precluded by military or medical necessity or, under all the 
 39.7   relevant circumstances, the giving of notice is impossible or 
 39.8   unreasonable; and 
 39.9      (3) upon written request from the postsecondary 
 39.10  institution, the person must provide written verification of the 
 39.11  order to active service or of the existence of the medical 
 39.12  condition or medical treatment. 
 39.13     (c) (d) This section provides minimum protections for 
 39.14  qualified students.  Nothing in this section prevents 
 39.15  postsecondary institutions from providing additional options or 
 39.16  protections to students who are called or ordered to state or 
 39.17  federal active military service or are undertaking medical 
 39.18  treatment or a period of recovery from a medical condition. 
 39.19     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 39.20  following final enactment. 
 39.21     Sec. 47.  Minnesota Statutes 2004, section 299A.45, 
 39.22  subdivision 1, is amended to read: 
 39.23     Subdivision 1.  [ELIGIBILITY.] Following certification 
 39.24  under section 299A.44 and compliance with this section and rules 
 39.25  of the commissioner of public safety and the higher education 
 39.26  services office, dependent children less than 23 years of age 
 39.27  and the surviving spouse of a public safety officer killed in 
 39.28  the line of duty on or after January 1, 1973, are eligible to 
 39.29  receive educational benefits under this section.  To qualify for 
 39.30  an award, they must be enrolled in undergraduate degree or 
 39.31  certificate programs after June 30, 1990, at an eligible 
 39.32  Minnesota institution as provided in section 136A.101, 
 39.33  subdivision 4.  A student who withdraws from enrollment for 
 39.34  active military service is entitled to an additional semester or 
 39.35  the equivalent of grant eligibility.  Persons who have received 
 39.36  a baccalaureate degree or have been enrolled full time or the 
 40.1   equivalent of ten semesters or the equivalent, whichever occurs 
 40.2   first, are no longer eligible. 
 40.3      Sec. 48.  Minnesota Statutes 2004, section 299A.45, 
 40.4   subdivision 4, is amended to read: 
 40.5      Subd. 4.  [RENEWAL.] Each award must be given for one 
 40.6   academic year and is renewable for a maximum of eight semesters 
 40.7   or the equivalent.  A student who withdraws from enrollment for 
 40.8   active military service is entitled to an additional semester or 
 40.9   the equivalent of grant eligibility.  An award must not be given 
 40.10  to a dependent child who is 23 years of age or older on the 
 40.11  first day of the academic year. 
 40.12     Sec. 49.  [RECIPROCITY NEGOTIATIONS.] 
 40.13     Subdivision 1.  [SOUTH DAKOTA.] The Higher Education 
 40.14  Services Office must examine the feasibility of reinstating 
 40.15  interstate payments in the Minnesota-South Dakota reciprocity 
 40.16  program while maintaining the tuition reciprocity agreement.  
 40.17  The office must examine the advantages and disadvantages of 
 40.18  computing interstate payments under the reciprocity agreement 
 40.19  and the impact of interstate payments on participating students, 
 40.20  institutions, and the general fund of the two states.  The 
 40.21  office must report on the feasibility and impacts of reciprocity 
 40.22  payments to the committees of the legislature with 
 40.23  responsibility for higher education by January 10, 2006. 
 40.24     Subd. 2.  [WISCONSIN.] The Higher Education Services Office 
 40.25  must, as soon as possible, commence negotiations with the state 
 40.26  of Wisconsin on the tuition reciprocity agreement.  The 
 40.27  negotiations must include the issue of the disparity between the 
 40.28  tuition paid by Wisconsin residents and Minnesota residents at 
 40.29  campuses of the University of Minnesota with a goal of reducing 
 40.30  or eliminating the disparity. 
 40.31     This section does not mandate the inclusion of any 
 40.32  particular term in a tuition reciprocity agreement. 
 40.33     Sec. 50.  [APPLICATION OF ELIGIBILITY.] 
 40.34     The additional semester or the equivalent of grant 
 40.35  eligibility under sections 19, 21, 47, and 48 applies to any 
 40.36  student who withdrew from enrollment in a postsecondary 
 41.1   institution after December 31, 2002, because the student was 
 41.2   ordered to active military service as defined in Minnesota 
 41.3   Statutes, section 190.05, subdivision 5b or 5c. 
 41.4      Sec. 51.  [ADVISORY TASK FORCE ON PUBLIC POSTSECONDARY 
 41.5   FUNDING.] 
 41.6      The Higher Education Services Office shall convene an 
 41.7   advisory task force to study the current postsecondary funding 
 41.8   policy under Minnesota Statutes, sections 135A.01 to 135A.034.  
 41.9   The task force must include the chief financial officers of the 
 41.10  University of Minnesota and the Minnesota State Colleges and 
 41.11  Universities and the commissioner of finance, or their 
 41.12  designees.  The task force may include other members as selected 
 41.13  by the Higher Education Services Office.  The task force must 
 41.14  study and make specific recommendations on alternatives to the 
 41.15  methods currently used by the postsecondary systems to implement 
 41.16  the provisions of Minnesota Statutes, section 135A.031, 
 41.17  subdivision 4.  The task force must submit its recommendations 
 41.18  to the legislature and the governor by January 15, 2006.  The 
 41.19  task force expires on June 30, 2007. 
 41.20     Sec. 52.  [TRANSITIONAL APPOINTMENTS TO THE REGENT 
 41.21  CANDIDATE ADVISORY COUNCIL.] 
 41.22     Notwithstanding Minnesota Statutes, section 137.0245, 
 41.23  subdivision 2, for appointments made in 2006 and 2008, 
 41.24  appointing authorities under section 43 shall make transitional 
 41.25  appointments to the regent candidate advisory council for terms 
 41.26  of varying lengths so that by 2010, and each even year 
 41.27  thereafter, the house of representatives and the senate shall 
 41.28  appoint a total of seven members, including one student and the 
 41.29  University of Minnesota Alumni Association or the University of 
 41.30  Minnesota Foundation shall alternately appoint one member, but 
 41.31  every third appointment cycle, each will appoint a member.  
 41.32  Beginning with appointments in 2010, one-third of the members 
 41.33  are appointed to six-year terms under Minnesota Statutes, 
 41.34  section 137.0245, subdivision 2. 
 41.35     Sec. 53.  [ALTERNATIVE FORMAT INSTRUCTIONAL MATERIAL 
 41.36  NETWORK.] 
 42.1      The Higher Education Services Office must convene a group 
 42.2   with representatives from the Minnesota State Colleges and 
 42.3   Universities, the University of Minnesota, and all sectors of 
 42.4   private postsecondary education to develop a network containing 
 42.5   postsecondary instructional material in an electronic format.  
 42.6   The material on the network must be made available to Minnesota 
 42.7   postsecondary institutions and to postsecondary students with 
 42.8   disabilities that require a reading accommodation.  The group 
 42.9   must establish standards for the instructional material that is 
 42.10  housed on the network.  Instructional material must be in a 
 42.11  format that is compatible with assistive technology used by 
 42.12  students who require a reading accommodation.  Instructional 
 42.13  material includes, but is not limited to, printed materials 
 42.14  published or produced primarily for use by students in 
 42.15  postsecondary educational courses.  It also includes 
 42.16  instructional materials that are produced by postsecondary 
 42.17  institutions for use in conjunction with a course of study.  The 
 42.18  Higher Education Services Office must report to the committees 
 42.19  in the house of representatives and senate with responsibility 
 42.20  for higher education by January 15, 2006, on progress in 
 42.21  developing the network and with recommendations on methods to 
 42.22  meet the needs of students for instructional materials in 
 42.23  alternative formats. 
 42.24     Sec. 54.  [REVISOR INSTRUCTION.] 
 42.25     The revisor of statutes shall change the terms "HESO" and 
 42.26  "Higher Education Services Office" to "Minnesota Office of 
 42.27  Higher Education" wherever in Minnesota Statutes and Minnesota 
 42.28  Rules the terms appear. 
 42.29     Sec. 55.  [REPEALER.] 
 42.30     (a) Minnesota Statutes 2004, sections 136A.011, and 
 42.31  136A.031, subdivision 1, are repealed. 
 42.32     (b) Minnesota Rules, parts 4815.0100; 4815.0110; 4815.0120; 
 42.33  4815.0130; 4815.0140; 4815.0150; 4815.0160; 4830.8100; 
 42.34  4830.8110; 4830.8120; 4830.8130; 4830.8140; and 4830.8150, are 
 42.35  repealed. 
 42.36                             ARTICLE 3 
 43.1                        PRIVATE CAREER SCHOOLS 
 43.2      Section 1.  Minnesota Statutes 2004, section 141.21, is 
 43.3   amended by adding a subdivision to read: 
 43.4      Subd. 6a.  [MULTIPLE LOCATION.] "Multiple location" means 
 43.5   any site where classes or administrative services are provided 
 43.6   to students and which has a street address that is different 
 43.7   than the street address found on the school's private career 
 43.8   school license. 
 43.9      Sec. 2.  Minnesota Statutes 2004, section 141.25, 
 43.10  subdivision 3, is amended to read: 
 43.11     Subd. 3.  [APPLICATION.] Application for a license shall be 
 43.12  on forms prepared and furnished by the office, and shall include 
 43.13  the following and other information as the office may require: 
 43.14     (1) the title or name of the school, ownership and 
 43.15  controlling officers, members, managing employees, and director; 
 43.16     (2) the specific programs which will be offered and the 
 43.17  specific purposes of the instruction; 
 43.18     (3) the place or places where the instruction will be 
 43.19  given; 
 43.20     (4) a listing of the equipment available for instruction in 
 43.21  each program; 
 43.22     (5) the maximum enrollment to be accommodated with 
 43.23  equipment available in each specified program; 
 43.24     (6) the qualifications of instructors and supervisors in 
 43.25  each specified program; 
 43.26     (7) a current balance sheet, income statement, and adequate 
 43.27  supporting documentation, prepared and certified by an 
 43.28  independent public accountant or CPA; 
 43.29     (8) copies of all media advertising and promotional 
 43.30  literature and brochures or electronic display currently used or 
 43.31  reasonably expected to be used by the school; 
 43.32     (9) copies of all Minnesota enrollment agreement forms and 
 43.33  contract forms and all enrollment agreement forms and contract 
 43.34  forms used in Minnesota; and 
 43.35     (10) gross income earned in the preceding year from student 
 43.36  tuition, fees, and other required institutional charges, unless 
 44.1   the school files with the office a surety bond equal to at least 
 44.2   $50,000 $250,000 as described in subdivision 5.  
 44.3      Sec. 3.  Minnesota Statutes 2004, section 141.25, 
 44.4   subdivision 5, is amended to read: 
 44.5      Subd. 5.  [BOND.] (a) No license shall be issued to any 
 44.6   school which maintains, conducts, solicits for, or advertises 
 44.7   within the state of Minnesota any program, unless the applicant 
 44.8   files with the office a continuous corporate surety bond written 
 44.9   by a company authorized to do business in Minnesota conditioned 
 44.10  upon the faithful performance of all contracts and agreements 
 44.11  with students made by the applicant.  
 44.12     (b) The amount of the surety bond shall be ten percent of 
 44.13  the preceding year's gross income from student tuition, fees, 
 44.14  and other required institutional charges, but in no event less 
 44.15  than $10,000 nor greater than $50,000 $250,000, except that a 
 44.16  school may deposit a greater amount at its own discretion.  A 
 44.17  school in each annual application for licensure must compute the 
 44.18  amount of the surety bond and verify that the amount of the 
 44.19  surety bond complies with this subdivision, unless the school 
 44.20  maintains a surety bond equal to at least $50,000 $250,000.  A 
 44.21  school that operates at two or more locations may combine gross 
 44.22  income from student tuition, fees, and other required 
 44.23  institutional charges for all locations for the purpose of 
 44.24  determining the annual surety bond requirement.  The gross 
 44.25  tuition and fees used to determine the amount of the surety bond 
 44.26  required for a school having a license for the sole purpose of 
 44.27  recruiting students in Minnesota shall be only that paid to the 
 44.28  school by the students recruited from Minnesota. 
 44.29     (c) The bond shall run to the state of Minnesota and to any 
 44.30  person who may have a cause of action against the applicant 
 44.31  arising at any time after the bond is filed and before it is 
 44.32  canceled for breach of any contract or agreement made by the 
 44.33  applicant with any student.  The aggregate liability of the 
 44.34  surety for all breaches of the conditions of the bond shall not 
 44.35  exceed the principal sum deposited by the school under paragraph 
 44.36  (b).  The surety of any bond may cancel it upon giving 60 days' 
 45.1   notice in writing to the office and shall be relieved of 
 45.2   liability for any breach of condition occurring after the 
 45.3   effective date of cancellation. 
 45.4      (d) In lieu of bond, the applicant may deposit with the 
 45.5   commissioner of finance a sum equal to the amount of the 
 45.6   required surety bond in cash, or securities as may be legally 
 45.7   purchased by savings banks or for trust funds in an aggregate 
 45.8   market value equal to the amount of the required surety bond.  
 45.9      (e) Failure of a school to post and maintain the required 
 45.10  surety bond or deposit under paragraph (d) may result in denial, 
 45.11  suspension, or revocation of the school's license.  
 45.12     Sec. 4.  Minnesota Statutes 2004, section 141.25, 
 45.13  subdivision 8, is amended to read: 
 45.14     Subd. 8.  [FEES AND TERMS OF LICENSE.] An application for 
 45.15  an initial license under sections 141.21 to 141.35 shall be 
 45.16  accompanied by a nonrefundable application fee established by 
 45.17  the office as provided in section 141.255 that is sufficient to 
 45.18  recover, but not exceed, its the administrative costs of the 
 45.19  office. 
 45.20     All licenses shall expire one year from the date issued by 
 45.21  the office, except as provided in section 141.251.  
 45.22     Sec. 5.  Minnesota Statutes 2004, section 141.25, 
 45.23  subdivision 9, is amended to read: 
 45.24     Subd. 9.  [CATALOG, BROCHURE, OR ELECTRONIC DISPLAY.] 
 45.25  Before a license is issued to a school, the school shall furnish 
 45.26  to the office a catalog, brochure, or electronic display 
 45.27  including: 
 45.28     (1) identifying data, such as volume number and date of 
 45.29  publication; 
 45.30     (2) name and address of the school and its governing body 
 45.31  and officials; 
 45.32     (3) a calendar of the school showing legal holidays, 
 45.33  beginning and ending dates of each course quarter, term, or 
 45.34  semester, and other important dates; 
 45.35     (4) the school policy and regulations on enrollment 
 45.36  including dates and specific entrance requirements for each 
 46.1   program; 
 46.2      (5) the school policy and regulations about leave, 
 46.3   absences, class cuts, make-up work, tardiness, and interruptions 
 46.4   for unsatisfactory attendance; 
 46.5      (6) the school policy and regulations about standards of 
 46.6   progress for the student including the grading system of the 
 46.7   school, the minimum grades considered satisfactory, conditions 
 46.8   for interruption for unsatisfactory grades or progress, a 
 46.9   description of any probationary period allowed by the school, 
 46.10  and conditions of reentrance for those dismissed for 
 46.11  unsatisfactory progress; 
 46.12     (7) the school policy and regulations about student conduct 
 46.13  and conditions for dismissal for unsatisfactory conduct; 
 46.14     (8) a detailed schedule of fees, charges for tuition, 
 46.15  books, supplies, tools, student activities, laboratory fees, 
 46.16  service charges, rentals, deposits, and all other charges; 
 46.17     (9) the school policy and regulations, including an 
 46.18  explanation of section 141.271, about refunding tuition, fees, 
 46.19  and other charges if the student does not enter the program, 
 46.20  withdraws from the program, or the program is discontinued; 
 46.21     (10) a description of the available facilities and 
 46.22  equipment; 
 46.23     (11) a course outline syllabus for each course offered 
 46.24  showing course objectives, subjects or units in the course, type 
 46.25  of work or skill to be learned, and approximate time, hours, or 
 46.26  credits to be spent on each subject or unit; 
 46.27     (12) the school policy and regulations about granting 
 46.28  credit for previous education and preparation; 
 46.29     (13) a procedure for investigating and resolving student 
 46.30  complaints; and 
 46.31     (14) the name and address of the Minnesota Higher Education 
 46.32  Services Office. 
 46.33     A school that is exclusively a distance education school is 
 46.34  exempt from clauses (3) and (5). 
 46.35     Sec. 6.  Minnesota Statutes 2004, section 141.25, 
 46.36  subdivision 12, is amended to read: 
 47.1      Subd. 12.  [PERMANENT RECORDS.] A school licensed under 
 47.2   this chapter and located in Minnesota shall maintain a permanent 
 47.3   record for each student for 50 years from the last date of the 
 47.4   student's attendance.  A school licensed under this chapter and 
 47.5   offering distance instruction to a student located in Minnesota 
 47.6   shall maintain a permanent record for each Minnesota student for 
 47.7   50 years from the last date of the student's attendance.  
 47.8   Records include school transcripts, documents, and files 
 47.9   containing student data about academic credits earned, courses 
 47.10  completed, grades awarded, degrees awarded, and periods of 
 47.11  attendance.  To preserve permanent records, a school shall 
 47.12  submit a plan that meets the following requirements: 
 47.13     (1) at least one copy of the records must be held in a 
 47.14  secure, fireproof depository; 
 47.15     (2) an appropriate official must be designated to provide a 
 47.16  student with copies of records or a transcript upon request; 
 47.17     (3) an alternative method, approved by the office, of 
 47.18  complying with clauses (1) and (2) must be established if the 
 47.19  school ceases to exist; and 
 47.20     (4) a continuous surety bond must be filed with the office 
 47.21  in an amount not to exceed $20,000 if the school has no binding 
 47.22  agreement for preserving student records or a trust must be 
 47.23  arranged if the school ceases to exist. 
 47.24     Sec. 7.  Minnesota Statutes 2004, section 141.251, is 
 47.25  amended to read: 
 47.26     141.251 [LICENSE RENEWAL.] 
 47.27     Subdivision 1.  [APPLICATION.] Application for renewal of a 
 47.28  license must be made at least 30 60 days before expiration of 
 47.29  the current license on a form provided by the office.  A renewal 
 47.30  application shall be accompanied by a nonrefundable fee 
 47.31  established by the office as provided in section 141.255 that is 
 47.32  sufficient to recover, but does not exceed, its the 
 47.33  administrative costs of the office. 
 47.34     Subd. 2.  [CONDITIONS.] The office shall adopt rules 
 47.35  establishing the conditions for renewal of a license.  The 
 47.36  conditions shall permit two levels of renewal based on the 
 48.1   record of the school.  A school that has demonstrated the 
 48.2   quality of its program and operation through longevity and 
 48.3   performance in the state may renew its license based on a 
 48.4   relaxed standard of scrutiny.  A school that has been in 
 48.5   operation in Minnesota for a limited period of time or that has 
 48.6   not performed adequately on performance indicators shall renew 
 48.7   its license based on a strict standard of scrutiny.  The office 
 48.8   shall specify minimum longevity standards and performance 
 48.9   indicators that must be met before a school may be permitted to 
 48.10  operate under the relaxed standard of scrutiny.  The performance 
 48.11  indicators used in this determination shall include, but not be 
 48.12  limited to:  degree granting status, regional or national 
 48.13  accreditation, loan default rates, placement rate of graduates, 
 48.14  student withdrawal rates, audit results, student complaints, and 
 48.15  school status with the United States Department of Education.  
 48.16  Schools that meet the requirements established in rule shall be 
 48.17  required to submit a full relicensure report once every four 
 48.18  years, and in the interim years will be exempt from the 
 48.19  requirements of section 141.25, subdivision 3, clauses (4), (5), 
 48.20  and (8), and Minnesota Rules, parts 4880.1700, subpart 6; and 
 48.21  4880.2100, subpart 4. 
 48.22     Sec. 8.  [141.255] [FEES.] 
 48.23     Subdivision 1.  [INITIAL LICENSURE FEE.] The office 
 48.24  processing fee for an initial licensure application is: 
 48.25     (1) $1,500 for a school that will offer no more than one 
 48.26  program during its first year of operation; 
 48.27     (2) $2,000 for a school that will offer two or more 
 48.28  nondegree level programs during its first year of operation; and 
 48.29     (3) $2,500 for a school that will offer two or more degree 
 48.30  level programs during its first year of operation. 
 48.31     Subd. 2.  [RENEWAL LICENSURE FEE; LATE FEE.] (a) The office 
 48.32  processing fee for a renewal licensure application is: 
 48.33     (1) for a category A school, as determined by the office, 
 48.34  the fee is $865 if the school offers one program or $1,150 if 
 48.35  the school offers two or more programs; and 
 48.36     (2) for a category B or C school, as determined by the 
 49.1   office, the fee is $430 if the school offers one program or $575 
 49.2   if the school offers two or more programs. 
 49.3      (b) If a license renewal application is not received by the 
 49.4   office by the close of business at least 60 days before the 
 49.5   expiration of the current license, a late fee of $100 per 
 49.6   business day shall be assessed. 
 49.7      Subd. 3.  [DEGREE LEVEL ADDITION FEE.] The office 
 49.8   processing fee for adding a degree level to an existing program 
 49.9   is $2,000 per program. 
 49.10     Subd. 4.  [PROGRAM ADDITION FEE.] The office processing fee 
 49.11  for adding a program that represents a significant departure in 
 49.12  the objectives, content, or method of delivery of programs that 
 49.13  are currently offered by the school is $500 per program. 
 49.14     Subd. 5.  [VISIT OR CONSULTING FEE.] If the office 
 49.15  determines that a fact-finding visit or outside consultant is 
 49.16  necessary to review or evaluate any new or revised program, the 
 49.17  office shall be reimbursed for the expenses incurred related to 
 49.18  the review as follows: 
 49.19     (1) $300 for the team base fee or for a paper review 
 49.20  conducted by a consultant if the office determines that a 
 49.21  fact-finding visit is not required; 
 49.22     (2) $300 for each day or part thereof on site per team 
 49.23  member; and 
 49.24     (3) the actual cost of customary meals, lodging, and 
 49.25  related travel expenses incurred by team members. 
 49.26     Subd. 6.  [MODIFICATION FEE.] The fee for modification of 
 49.27  any existing program is $100 and is due if there is: 
 49.28     (1) an increase or decrease of 25 percent or more, from the 
 49.29  original date of program approval, in clock hours, credit hours, 
 49.30  or calendar length of an existing program; 
 49.31     (2) a change in academic measurement from clock hours to 
 49.32  credit hours or vice versa; or 
 49.33     (3) an addition or alteration of courses that represent a 
 49.34  25 percent change or more in the objectives, content, or methods 
 49.35  of delivery. 
 49.36     Subd. 7.  [SOLICITOR PERMIT FEE.] The solicitor permit fee 
 50.1   is $350 and must be paid annually. 
 50.2      Subd. 8.  [MULTIPLE LOCATION FEE.] Schools wishing to 
 50.3   operate at multiple locations must pay: 
 50.4      (1) $250 per location, for two to five locations; and 
 50.5      (2) $50 per location, for six or more locations. 
 50.6      Subd. 9.  [STUDENT TRANSCRIPT FEE.] The fee for a student 
 50.7   transcript requested from a closed school whose records are held 
 50.8   by the office is $10, with a maximum of five transcripts per 
 50.9   request. 
 50.10     Subd. 10.  [PUBLIC OFFICE DOCUMENTS; COPIES.] The office 
 50.11  shall establish rates for copies of any public office document. 
 50.12     Sec. 9.  Minnesota Statutes 2004, section 141.26, 
 50.13  subdivision 5, is amended to read: 
 50.14     Subd. 5.  [FEE.] The initial and renewal application for 
 50.15  each permit shall be accompanied by a nonrefundable fee as 
 50.16  established by the office under section 141.255. 
 50.17     Sec. 10.  Minnesota Statutes 2004, section 141.271, is 
 50.18  amended by adding a subdivision to read: 
 50.19     Subd. 1b.  [SHORT-TERM PROGRAMS.] Licensed schools 
 50.20  conducting programs not exceeding 40 hours in length shall not 
 50.21  be required to make a full refund once the programs have 
 50.22  commenced and shall be allowed to prorate any refund based on 
 50.23  the actual length of the program as stated in the school catalog 
 50.24  or advertisements and the number of hours attended by the 
 50.25  student. 
 50.26     Sec. 11.  Minnesota Statutes 2004, section 141.271, 
 50.27  subdivision 4, is amended to read: 
 50.28     Subd. 4.  [RESIDENT SCHOOLS.] When a student has been 
 50.29  accepted by a school offering a resident program and gives 
 50.30  written notice of cancellation, or the school has actual notice 
 50.31  of a student's nonattendance after the start of the period of 
 50.32  instruction for which the student has been charged, but before 
 50.33  completion of 75 percent of the period of instruction, the 
 50.34  amount charged for tuition, fees, and all other charges shall be 
 50.35  prorated based on number of days in the term as a portion of the 
 50.36  total charges for tuition, fees, and all other charges.  An 
 51.1   additional 25 percent of the total cost of the period of 
 51.2   instruction may be added, but shall not exceed $100.  After 
 51.3   completion of 75 percent of the period of instruction for which 
 51.4   the student has been charged, no refunds are required.  
 51.5      Sec. 12.  Minnesota Statutes 2004, section 141.271, 
 51.6   subdivision 7, is amended to read: 
 51.7      Subd. 7.  [EQUIPMENT AND SUPPLIES.] The fair market retail 
 51.8   price, if separately stated in the catalog and contract or 
 51.9   enrollment agreement, of equipment or supplies furnished to the 
 51.10  student, which the student fails to return in condition suitable 
 51.11  for resale, and which may reasonably be resold, within ten 
 51.12  business days following cancellation may be retained by the 
 51.13  school and may be deducted from the total cost for tuition, fees 
 51.14  and all other charges when computing refunds.  
 51.15     An overstatement of the fair market retail price of any 
 51.16  equipment or supplies furnished the student shall be considered 
 51.17  inconsistent with this provision.  
 51.18     Sec. 13.  Minnesota Statutes 2004, section 141.271, 
 51.19  subdivision 10, is amended to read: 
 51.20     Subd. 10.  [CANCELLATION OCCURRENCE.] Written notice of 
 51.21  cancellation shall take place on the date the letter of 
 51.22  cancellation is postmarked or, in the cases where the notice is 
 51.23  hand carried, it shall occur on the date the notice is delivered 
 51.24  to the school.  If a student has not attended classes for a 
 51.25  period of 21 consecutive days, the student is considered to have 
 51.26  withdrawn from school for all purposes as of the student's last 
 51.27  documented date of attendance. 
 51.28     Sec. 14.  Minnesota Statutes 2004, section 141.271, is 
 51.29  amended by adding a subdivision to read: 
 51.30     Subd. 14.  [CLOSED SCHOOL.] In the event a school closes 
 51.31  for any reason during a term and interrupts and terminates 
 51.32  classes during that term, all tuition for the term shall be 
 51.33  refunded to the students or the appropriate state or federal 
 51.34  agency or private lender that had provided any funding for the 
 51.35  term and any outstanding obligation of the student for the term 
 51.36  is canceled. 
 52.1      Sec. 15.  Minnesota Statutes 2004, section 141.28, 
 52.2   subdivision 1, is amended to read: 
 52.3      Subdivision 1.  [NOT TO ADVERTISE STATE APPROVAL.] Schools, 
 52.4   agents of schools, and solicitors may not advertise or represent 
 52.5   in writing or orally that such school is approved or accredited 
 52.6   by the state of Minnesota, except that any school, agent, or 
 52.7   solicitor may advertise that the school and solicitor have been 
 52.8   duly licensed by the state. using the following language: 
 52.9   "(Name of school) is licensed as a private career school with 
 52.10  the Minnesota Higher Education Services Office.  Licensure is 
 52.11  not an endorsement of the institution.  Credits earned at the 
 52.12  institution may not transfer to all other institutions.  The 
 52.13  educational programs may not meet the needs of every student or 
 52.14  employer."  
 52.15     Sec. 16.  Minnesota Statutes 2004, section 141.28, is 
 52.16  amended by adding a subdivision to read: 
 52.17     Subd. 6.  [FINANCIAL AID PAYMENTS.] (a) All schools must 
 52.18  collect, assess, and distribute funds received from loans or 
 52.19  other financial aid as provided in this subdivision.  
 52.20     (b) Student loans or other financial aid funds received 
 52.21  from federal, state, or local governments or administered in 
 52.22  accordance with federal student financial assistance programs 
 52.23  under title IV of the Higher Education Act of 1965, as amended, 
 52.24  United States Code, title 20, chapter 28, must be collected and 
 52.25  applied as provided by applicable federal, state, or local law 
 52.26  or regulation. 
 52.27     (c) Student loans or other financial aid assistance 
 52.28  received from a bank, finance or credit card company, or other 
 52.29  private lender must be collected or disbursed as provided in 
 52.30  paragraphs (d) and (e). 
 52.31     (d) Loans or other financial aid payments for amounts 
 52.32  greater than $3,000 must be disbursed: 
 52.33     (1) in two equal disbursements, if the term length is more 
 52.34  than four months.  The loan or payment amounts may be disbursed 
 52.35  no earlier than the first day the student attends class with the 
 52.36  remainder to be disbursed halfway through the class or term; or 
 53.1      (2) in three equal disbursements, if the term length is 
 53.2   more than six months.  The loan or payment amounts may be 
 53.3   disbursed no earlier than the first day the student attends 
 53.4   class, one-third of the way through the class or term, and 
 53.5   two-thirds of the way through the class or term.  
 53.6      (e) Loans or other financial aid payments for amounts less 
 53.7   than $3,000 may be disbursed as a single disbursement on the 
 53.8   first day a student attends class, regardless of term length. 
 53.9      (f) No school may enter into a contract or agreement with, 
 53.10  or receive any money from, a bank, finance or credit card 
 53.11  company, or other private lender, unless the private lender 
 53.12  follows the requirements for disbursements provided in 
 53.13  paragraphs (d) and (e). 
 53.14     Sec. 17.  Minnesota Statutes 2004, section 141.29, 
 53.15  subdivision 3, is amended to read: 
 53.16     Subd. 3.  [POWERS AND DUTIES.] The office shall have (in 
 53.17  addition to the powers and duties now vested therein by law) the 
 53.18  following powers and duties: 
 53.19     (a) To negotiate and enter into interstate reciprocity 
 53.20  agreements with similar agencies in other states, if in the 
 53.21  judgment of the office such agreements are or will be helpful in 
 53.22  effectuating the purposes of Laws 1973, Chapter 714; 
 53.23     (b) To grant conditional school license for periods of less 
 53.24  than one year if in the judgment of the office correctable 
 53.25  deficiencies exist at the time of application and when refusal 
 53.26  to issue school license would adversely affect currently 
 53.27  enrolled students; 
 53.28     (c) The office may upon its own motion, and shall upon the 
 53.29  verified complaint in writing of any person setting forth fact 
 53.30  which, if proved, would constitute grounds for refusal or 
 53.31  revocation under Laws 1973, Chapter 714, investigate the actions 
 53.32  of any applicant or any person or persons holding or claiming to 
 53.33  hold a license or permit.  However, before proceeding to a 
 53.34  hearing on the question of whether a license or permit shall be 
 53.35  refused, revoked or suspended for any cause enumerated in 
 53.36  subdivision 1, the office may shall grant a reasonable time to 
 54.1   the holder of or applicant for a license or permit to correct 
 54.2   the situation.  If within such time the situation is corrected 
 54.3   and the school is in compliance with the provisions of this 
 54.4   chapter, no further action leading to refusal, revocation, or 
 54.5   suspension shall be taken.  
 54.6      Sec. 18.  Minnesota Statutes 2004, section 141.30, is 
 54.7   amended to read: 
 54.8      141.30 [INSPECTION.] 
 54.9      (a) The office or a delegate may inspect the instructional 
 54.10  books and records, classrooms, dormitories, tools, equipment and 
 54.11  classes of any school or applicant for license at any reasonable 
 54.12  time.  The office may require the submission of a certified 
 54.13  public audit, or if there is no such audit available the office 
 54.14  or a delegate may inspect the financial books and records of the 
 54.15  school.  In no event shall such financial information be used by 
 54.16  the office to regulate or set the tuition or fees charged by the 
 54.17  school.  
 54.18     (b) Data obtained from an inspection of the financial 
 54.19  records of a school or submitted to the office as part of a 
 54.20  license application or renewal are nonpublic data as defined in 
 54.21  section 13.02, subdivision 9.  Data obtained from inspections 
 54.22  may be disclosed to other members of the office, to law 
 54.23  enforcement officials, or in connection with a legal or 
 54.24  administrative proceeding commenced to enforce a requirement of 
 54.25  law. 
 54.26     Sec. 19.  Minnesota Statutes 2004, section 141.35, is 
 54.27  amended to read: 
 54.28     141.35 [EXEMPTIONS.] 
 54.29     Sections 141.21 to 141.35 shall not apply to the following: 
 54.30     (1) public postsecondary institutions; 
 54.31     (2) private postsecondary institutions registered under 
 54.32  sections 136A.61 to 136A.71 that are nonprofit, or that are for 
 54.33  profit and registered under sections 136A.61 to 136A.71 as of 
 54.34  December 31, 1998, or are approved to offer exclusively 
 54.35  baccalaureate or postbaccalaureate programs; 
 54.36     (3) schools of nursing accredited by the state Board of 
 55.1   Nursing or an equivalent public board of another state or 
 55.2   foreign country; 
 55.3      (4) private schools complying with the requirements of 
 55.4   section 120A.22, subdivision 4; 
 55.5      (5) courses taught to students in a valid apprenticeship 
 55.6   program taught by or required by a trade union; 
 55.7      (6) schools exclusively engaged in training physically or 
 55.8   mentally handicapped persons for the state of Minnesota; 
 55.9      (7) schools licensed by boards authorized under Minnesota 
 55.10  law to issue licenses; 
 55.11     (8) schools and educational programs, or training programs, 
 55.12  contracted for by persons, firms, corporations, government 
 55.13  agencies, or associations, for the training of their own 
 55.14  employees, for which no fee is charged the employee; 
 55.15     (9) schools engaged exclusively in the teaching of purely 
 55.16  avocational, recreational, or remedial subjects as determined by 
 55.17  the office; 
 55.18     (10) driver training schools and instructors as defined in 
 55.19  section 171.33, subdivisions 1 and 2; 
 55.20     (11) classes, courses, or programs conducted by a bona fide 
 55.21  trade, professional, or fraternal organization, solely for that 
 55.22  organization's membership; 
 55.23     (12) programs in the fine arts provided by organizations 
 55.24  exempt from taxation under section 290.05 and registered with 
 55.25  the attorney general under chapter 309.  For the purposes of 
 55.26  this clause, "fine arts" means activities resulting in artistic 
 55.27  creation or artistic performance of works of the imagination 
 55.28  which are engaged in for the primary purpose of creative 
 55.29  expression rather than commercial sale or employment.  In making 
 55.30  this determination the office may seek the advice and 
 55.31  recommendation of the Minnesota Board of the Arts; 
 55.32     (13) classes, courses, or programs intended to fulfill the 
 55.33  continuing education requirements for licensure or certification 
 55.34  in a profession, that have been approved by a legislatively or 
 55.35  judicially established board or agency responsible for 
 55.36  regulating the practice of the profession, and that are offered 
 56.1   primarily exclusively to an individual practicing the 
 56.2   profession; 
 56.3      (14) classes, courses, or programs intended to prepare 
 56.4   students to sit for undergraduate, graduate, postgraduate, or 
 56.5   occupational licensing and occupational entrance examinations; 
 56.6      (15) classes, courses, or programs providing 16 or fewer 
 56.7   clock hours of instruction that are not part of the curriculum 
 56.8   for an occupation or entry level employment; 
 56.9      (16) classes, courses, or programs providing instruction in 
 56.10  personal development, modeling, or acting; 
 56.11     (17) training or instructional programs, in which one 
 56.12  instructor teaches an individual student, that are not part of 
 56.13  the curriculum for an occupation or are not intended to prepare 
 56.14  a person for entry level employment; and 
 56.15     (18) schools with no physical presence in Minnesota, as 
 56.16  determined by the office, engaged exclusively in offering 
 56.17  distance instruction that are located in and regulated by other 
 56.18  states or jurisdictions. 
 56.19     Sec. 20.  [REGULATION OF PRIVATE AND OUT-OF-STATE 
 56.20  POSTSECONDARY INSTITUTIONS.] 
 56.21     The Higher Education Services Office must convene a working 
 56.22  group to develop recommendations to revise the regulation, under 
 56.23  Minnesota Statutes, sections 136A.61 to 136A.71, and chapter 
 56.24  141, of private and out-of-state postsecondary institutions that 
 56.25  offer instruction in Minnesota or to Minnesota residents who are 
 56.26  not required to leave the state.  Members of the working group 
 56.27  are appointed by the director of the Higher Education Services 
 56.28  Office and must include one or more representatives of the 
 56.29  Minnesota Private College Council, the Minnesota Career College 
 56.30  Association, and other interested institutions that are 
 56.31  registered or licensed under state law.  
 56.32     In developing recommendations, the working group must 
 56.33  consider the office's mission to protect both consumers of 
 56.34  postsecondary education and the state's interests.  The 
 56.35  recommendations must address the provision of degrees, 
 56.36  certificates, diplomas, and training offered by for-profit and 
 57.1   nonprofit institutions in Minnesota and outside of Minnesota, in 
 57.2   classrooms or online and regulatory issues under federal law.  
 57.3   The recommendations may include other relevant issues as 
 57.4   determined by the working group. 
 57.5      The office must provide preliminary recommendations to the 
 57.6   committees of the legislature with jurisdiction over higher 
 57.7   education policy by November 15, 2005, and must provide final 
 57.8   recommendations by January 15, 2006.  
 57.9                              ARTICLE 4 
 57.10                  ROCHESTER UNIVERSITY DEVELOPMENT 
 57.11     Section 1.  [ROCHESTER UNIVERSITY DEVELOPMENT COMMITTEE.] 
 57.12     Subdivision 1.  [ESTABLISHMENT.] The Rochester University 
 57.13  Development Committee is established to research and make 
 57.14  recommendations to the governor and legislature on the creation 
 57.15  of a mission-driven postsecondary educational institution in the 
 57.16  Rochester area that meets the educational needs of the region 
 57.17  and the state and that capitalizes on the unique opportunities 
 57.18  for educational partnerships presented in the Rochester area. 
 57.19     Subd. 2.  [MEMBERSHIP.] (a) The committee is composed of 11 
 57.20  members, to be appointed by the governor as follows: 
 57.21     (1) a trustee of the Minnesota State Colleges and 
 57.22  Universities, or the trustee's designee; 
 57.23     (2) a regent of the University of Minnesota, or the 
 57.24  regent's designee; 
 57.25     (3) six persons from the Rochester area representing 
 57.26  business, health and medical sciences, and technology; 
 57.27     (4) the commissioner of finance, or the commissioner's 
 57.28  designee; 
 57.29     (5) one person who by training or experience has special 
 57.30  expertise in postsecondary finance and planning; and 
 57.31     (6) one person who by training or experience has special 
 57.32  expertise in postsecondary academic planning and programming. 
 57.33     (b) Before the first meeting of the committee, the governor 
 57.34  shall select one person from the committee who shall serve as 
 57.35  chair. 
 57.36     Subd. 3.  [COMPENSATION AND REMOVAL.] Appointments to the 
 58.1   committee are not subject to Minnesota Statutes, section 15.0597.
 58.2   Members of the committee are not entitled to reimbursement under 
 58.3   Minnesota Statutes, section 15.059, subdivision 6.  Members may 
 58.4   be removed and vacancies filled pursuant to Minnesota Statutes, 
 58.5   section 15.059, subdivision 4.  The director of the Higher 
 58.6   Education Services Office may provide administrative support to 
 58.7   the committee.  
 58.8      Subd. 4.  [DUTIES.] (a) The committee shall develop a 
 58.9   proposal for establishment and implementation of the 
 58.10  university.  The committee's report must include recommendations 
 58.11  on:  
 58.12     (1) the mission and focus of the university; 
 58.13     (2) the nature of undergraduate and graduate programs to be 
 58.14  offered by the university; 
 58.15     (3) site and facility needs of the university; 
 58.16     (4) funding sources and opportunities for the university; 
 58.17     (5) operational needs of the university; 
 58.18     (6) alliances or other types of cooperative arrangements 
 58.19  with public and private institutions; 
 58.20     (7) governance structure of the university; and 
 58.21     (8) mechanisms to ensure that the university's programs are 
 58.22  aligned with the unique needs and opportunities of the Rochester 
 58.23  area, and that programs take advantage of opportunities 
 58.24  presented by regional business and industry.  
 58.25     (b) If the committee recommends any programmatic changes 
 58.26  that result in institutional realignments, the committee must 
 58.27  consult with the representatives of affected employees and 
 58.28  address the continuation of collective bargaining and 
 58.29  contractual rights and benefits including accumulated sick 
 58.30  leave, vacation time, seniority, time to tenure, separation or 
 58.31  retirement benefits, and pension plan coverage.  
 58.32     (c) The committee may also research and provide 
 58.33  recommendations on sites for the university facilities and 
 58.34  programs.  The committee shall recommend any changes to 
 58.35  Minnesota law required to implement recommendations of the 
 58.36  committee.  
 59.1      Subd. 5.  [ENDOWMENT.] The committee may establish an 
 59.2   endowment for the betterment and operation of the university.  
 59.3   The endowment shall be under the fiscal control of the Higher 
 59.4   Education Services Office and all money and earnings of the 
 59.5   endowment shall be held in the Rochester university development 
 59.6   account.  The endowment may be used to leverage private funds.  
 59.7   The committee may recommend:  (1) whether the principal of the 
 59.8   endowment fund should be maintained inviolate; (2) under what 
 59.9   conditions, if any, the principal may be used to make 
 59.10  expenditures for the university; and (3) the treatment of any 
 59.11  nonstate contributions to the endowment. 
 59.12     Subd. 6.  [REPORT.] The committee must issue a report with 
 59.13  recommendations to the governor and the legislature by January 
 59.14  15, 2006.  Data collected, created, or maintained by the 
 59.15  committee in preparing this report is protected nonpublic data 
 59.16  under Minnesota Statutes, section 13.02, subdivision 13.  
 59.17     Subd. 7.  [SUNSET.] The committee expires on December 31, 
 59.18  2007. 
 59.19     Sec. 2.  [ROCHESTER UNIVERSITY DEVELOPMENT ACCOUNT.] 
 59.20     A Rochester University development account is created in 
 59.21  the state treasury in the special revenue fund.  Money in this 
 59.22  account is appropriated to the Higher Education Services Office 
 59.23  for allocation to the committee established in section 1 and for 
 59.24  the development activities outlined in section 3.  The office 
 59.25  shall serve as fiscal agent for the committee established in 
 59.26  section 1. 
 59.27     Sec. 3.  [ROCHESTER UNIVERSITY DEVELOPMENT AND 
 59.28  IMPLEMENTATION.] 
 59.29     With the approval of the Higher Education Services Office, 
 59.30  money in the Rochester university development account may be 
 59.31  used to: 
 59.32     (1) provide additional planning and development funds, if 
 59.33  needed; 
 59.34     (2) provide initial funding for academic program 
 59.35  development; 
 59.36     (3) provide funding related to academic facilities, if 
 60.1   needed; or 
 60.2      (4) establish an endowment for the institution under 
 60.3   section 1, subdivision 5.  
 60.4      Sec. 4.  [EFFECTIVE DATE.] 
 60.5      This article is effective the day following final enactment.
 60.6                              ARTICLE 5 
 60.7                     SUPPLEMENTAL APPROPRIATIONS 
 60.8   Section 1.  [HIGHER EDUCATION SUPPLEMENTAL APPROPRIATIONS.] 
 60.9   The appropriations in this article are available after House 
 60.10  File No. 1664 is passed by the house of representatives and are 
 60.11  added to the appropriations in article 1. 
 60.12  The sums in the columns marked "APPROPRIATIONS" are appropriated 
 60.13  from the general fund, or other named fund, to the agencies and 
 60.14  for the purposes specified in this article.  The listing of an 
 60.15  amount under the figure "2006" or "2007" in this article 
 60.16  indicates that the amount is appropriated to be available for 
 60.17  the fiscal year ending June 30, 2006, or June 30, 2007, 
 60.18  respectively.  "The first year" is fiscal year 2006.  "The 
 60.19  second year" is fiscal year 2007.  "The biennium" is fiscal 
 60.20  years 2006 and 2007. 
 60.21  Sec. 2.  BOARD OF TRUSTEES OF THE MINNESOTA 
 60.22  STATE COLLEGES AND UNIVERSITIES
 60.23  Subdivision 1.  Total             
 60.24  Appropriation                         12,725,000    ...,...,... 
 60.25  The amounts that may be spent from this 
 60.26  appropriation for each purpose are 
 60.27  specified in the following subdivisions.
 60.28  The legislature estimates that 
 60.29  instructional expenditures will be 
 60.30  $825,994,000 in the first year and 
 60.31  $811,653,000 in the second year.  The 
 60.32  legislature estimates that 
 60.33  noninstructional expenditures will be 
 60.34  $59,828,000 in the first year and 
 60.35  $58,790,000 in the second year. 
 60.36  Subd. 2. General Appropriation        12,725,000    ...,...,... 
 60.37  Sec. 3.  BOARD OF REGENTS OF THE 
 60.38  UNIVERSITY OF MINNESOTA
 60.39  Subdivision 1.  Total       
 60.40  Appropriation                          9,500,000      3,225,000 
 60.41  The amounts that may be spent from this 
 60.42  appropriation for each purpose are 
 60.43  specified in the following subdivisions.
 61.1   Subd. 2.  Operations and    
 61.2   Maintenance                            9,500,000      3,225,000 
 61.3   The legislature estimates that 
 61.4   instructional expenditures will be 
 61.5   $461,344,000 in the first year and 
 61.6   $468,229,000 in the second year.  The 
 61.7   legislature estimates that 
 61.8   noninstructional expenditures will be 
 61.9   $295,503,000 in the first year and 
 61.10  $299,913,000 in the second year. 
 61.11  An additional $3,225,000 the second 
 61.12  year is for academic initiatives that 
 61.13  are part of the board's biosciences for 
 61.14  a healthy society initiative. 
 61.15  Subd. 3.  Base Funding 
 61.16  Notwithstanding article 1, section 4, 
 61.17  subdivision 2a, base funding for the 
 61.18  university shall be increased by 
 61.19  $3,000,000 each year.