1.1                          A bill for an act 
  1.2             relating to education; providing for prekindergarten 
  1.3             through grade 12 education including general 
  1.4             education; education excellence; special programs; 
  1.5             technology, facilities, and accounting; nutrition; 
  1.6             state agencies; technical and conforming amendments; 
  1.7             authorizing rulemaking; providing for reports; 
  1.8             appropriating money; amending Minnesota Statutes 2004, 
  1.9             sections 13.321, by adding a subdivision; 120A.05, by 
  1.10            adding a subdivision; 120B.02; 120B.021, subdivision 
  1.11            1, by adding a subdivision; 120B.024; 120B.11, 
  1.12            subdivisions 1, 2, 3, 4, 5, 8; 120B.22, subdivision 1; 
  1.13            120B.30, subdivisions 1, 1a, by adding a subdivision; 
  1.14            120B.31, subdivision 4; 121A.06, subdivisions 2, 3; 
  1.15            121A.41, subdivision 10; 121A.53; 121A.66, subdivision 
  1.16            5, by adding subdivisions; 121A.67; 122A.06, 
  1.17            subdivision 4; 122A.12, subdivision 2; 122A.15, by 
  1.18            adding a subdivision; 122A.18, subdivision 2a; 
  1.19            122A.40, subdivision 5; 122A.41, subdivisions 2, 5a, 
  1.20            14; 122A.413; 122A.60, subdivision 1, by adding 
  1.21            subdivisions; 122A.61, subdivision 1; 123A.05, 
  1.22            subdivision 2; 123B.02, by adding subdivisions; 
  1.23            123B.04, subdivisions 1, 2; 123B.42, by adding a 
  1.24            subdivision; 123B.49, subdivision 4; 123B.492; 
  1.25            123B.53, subdivision 1; 123B.54, as amended; 123B.75, 
  1.26            by adding a subdivision; 123B.76, subdivision 3; 
  1.27            123B.79, subdivision 6; 123B.81, subdivision 1; 
  1.28            123B.82; 123B.83, subdivision 2; 123B.88, by adding a 
  1.29            subdivision; 123B.92, subdivisions 1, 5; 124D.081; 
  1.30            124D.09, subdivision 12; 124D.095, subdivisions 2, 4, 
  1.31            8, by adding a subdivision; 124D.10, subdivision 8; 
  1.32            124D.11, subdivisions 1, 2, 5, 6; 124D.111, 
  1.33            subdivision 1; 124D.118, subdivision 4; 124D.40; 
  1.34            124D.59, subdivision 2; 124D.66, subdivision 3; 
  1.35            124D.68, subdivision 9; 124D.69, subdivision 1; 
  1.36            124D.74, subdivision 1; 124D.81, subdivision 1; 
  1.37            124D.84, subdivision 1; 125A.11, subdivision 1; 
  1.38            125A.24; 125A.28; 125A.51; 125A.76, subdivisions 1, 3, 
  1.39            4; 125A.79, subdivisions 1, 6; 126C.01, subdivision 
  1.40            11; 126C.05, by adding subdivisions; 126C.10, 
  1.41            subdivisions 1, 2, 13, 13a, 13b, 18, 24, 29, 30, 31, 
  1.42            32, 33; 126C.13, subdivision 4, by adding 
  1.43            subdivisions; 126C.17, subdivisions 1, 2, 5, 9, 11, 
  1.44            13; 126C.21, subdivision 4; 126C.40, subdivision 1; 
  1.45            126C.457; 126C.48, subdivisions 2, 8; 126C.63, 
  1.46            subdivisions 5, 8; 127A.41, subdivision 8; 127A.45, 
  2.1             subdivisions 11, 12; 127A.47, subdivisions 7, 8; 
  2.2             127A.49, subdivisions 2, 3; 128C.12, subdivisions 1, 
  2.3             3; 128D.11, subdivision 9; 134.31, by adding a 
  2.4             subdivision; 179A.03, subdivision 14; 260C.201, 
  2.5             subdivision 1; 275.14; 275.16; 469.177, subdivision 9; 
  2.6             475.61, subdivision 4; 2005 S.F. No. 1879, article 3, 
  2.7             section 3, subdivisions 2, 3, 7, 8, 24, 25, 26, 27, 
  2.8             29, 31, 32, 35, 36, 41, 43, 44, 50, if enacted; 2005 
  2.9             S.F. No. 1879, article 3, section 4, if enacted; 2005 
  2.10            S.F. No. 1879, article 3, section 5, if enacted; Laws 
  2.11            1996, chapter 412, article 5, section 24; Laws 2003, 
  2.12            First Special Session chapter 9, article 4, section 
  2.13            29, as amended; proposing coding for new law in 
  2.14            Minnesota Statutes, chapters 120A; 120B; 121A; 122A; 
  2.15            123B; 124D; 125A; 125B; 127A; 129C; repealing 
  2.16            Minnesota Statutes 2004, sections 121A.23; 122A.414; 
  2.17            122A.415; 123B.83, subdivision 1; 125A.75, subdivision 
  2.18            8; 126C.10, subdivisions 13a, 13b, 29, 30, 31, 32, 33; 
  2.19            126C.42, subdivisions 1, 4; 126C.44; 128C.12, 
  2.20            subdivision 4. 
  2.21  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.22                             ARTICLE 1 
  2.23                         GENERAL EDUCATION 
  2.24     Section 1.  Minnesota Statutes 2004, section 120A.05, is 
  2.25  amended by adding a subdivision to read: 
  2.26     Subd. 18.  [KINDERGARTEN.] "Kindergarten" means a program 
  2.27  designed for pupils five years of age on September 1 of the 
  2.28  calendar year in which the school year commences that prepares 
  2.29  pupils to enter first grade the following school year.  A 
  2.30  program designed for pupils younger than five years of age on 
  2.31  September 1 of the calendar year in which the school year 
  2.32  commences that prepares pupils to enter kindergarten the 
  2.33  following school year is a prekindergarten program. 
  2.34     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
  2.35  following final enactment. 
  2.36     Sec. 2.  [121A.24] [SAFE SCHOOLS; RESERVED REVENUE.] 
  2.37     School districts must reserve an amount of the basic 
  2.38  revenue under section 126C.10, subdivision 2, equal to $27 per 
  2.39  adjusted marginal cost pupil unit in fiscal year 2007 and 
  2.40  later.  The amount reserved under this section must be used for 
  2.41  the purposes allowed under Minnesota Statutes 2004, section 
  2.42  126C.44, including to pay for school counselors, school social 
  2.43  workers, school nurses, and school psychologists. 
  2.44     Sec. 3.  Minnesota Statutes 2004, section 123A.05, 
  2.45  subdivision 2, is amended to read: 
  3.1      Subd. 2.  [RESERVE REVENUE.] Each district that is a member 
  3.2   of an area learning center must reserve revenue in an amount 
  3.3   equal to the sum of (1) at least 90 percent of the district 
  3.4   average general education revenue per pupil unit minus an amount 
  3.5   equal to the product of the formula allowance according to 
  3.6   section 126C.10, subdivision 2, times .0485 for fiscal year 2006 
  3.7   and .0458 for fiscal year 2007 and later, calculated without 
  3.8   basic skills revenue, and transportation sparsity revenue, and 
  3.9   the transportation portion of the transition revenue adjustment, 
  3.10  times the number of pupil units attending an area learning 
  3.11  center program under this section, plus (2) the amount of basic 
  3.12  skills revenue generated by pupils attending the area learning 
  3.13  center.  The amount of reserved revenue under this subdivision 
  3.14  may only be spent on program costs associated with the area 
  3.15  learning center.  Compensatory revenue must be allocated 
  3.16  according to section 126C.15, subdivision 2.  
  3.17     <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
  3.18  fiscal year 2007. 
  3.19     Sec. 4.  Minnesota Statutes 2004, section 123B.49, 
  3.20  subdivision 4, is amended to read: 
  3.21     Subd. 4.  [BOARD CONTROL OF EXTRACURRICULAR ACTIVITIES.] 
  3.22  (a) The board may take charge of and control all extracurricular 
  3.23  activities of the teachers and children of the public schools in 
  3.24  the district.  Extracurricular activities means all direct and 
  3.25  personal services for pupils for their enjoyment that are 
  3.26  managed and operated under the guidance of an adult or staff 
  3.27  member.  The board shall allow all resident pupils receiving 
  3.28  instruction in a home school as defined in section 123B.36, 
  3.29  subdivision 1, paragraph (a), to be eligible to fully 
  3.30  participate in extracurricular activities on the same basis as 
  3.31  public school students. 
  3.32     (b) Extracurricular activities have all of the following 
  3.33  characteristics: 
  3.34     (1) they are not offered for school credit nor required for 
  3.35  graduation; 
  3.36     (2) they are generally conducted outside school hours, or 
  4.1   if partly during school hours, at times agreed by the 
  4.2   participants, and approved by school authorities; 
  4.3      (3) the content of the activities is determined primarily 
  4.4   by the pupil participants under the guidance of a staff member 
  4.5   or other adult. 
  4.6      (c) If the board does not take charge of and control 
  4.7   extracurricular activities, these activities shall be 
  4.8   self-sustaining with all expenses, except direct salary costs 
  4.9   and indirect costs of the use of school facilities, met by dues, 
  4.10  admissions, or other student fund-raising events.  The general 
  4.11  fund must reflect only those salaries directly related to and 
  4.12  readily identified with the activity and paid by public funds.  
  4.13  Other revenues and expenditures for extra curricular activities 
  4.14  must be recorded according to the "Manual of Instruction for 
  4.15  Uniform Student Activities Accounting for Minnesota School 
  4.16  Districts and Area Vocational-Technical Colleges." Manual for 
  4.17  Activity Fund Accounting.  Extracurricular activities not under 
  4.18  board control must have an annual financial audit and must also 
  4.19  be audited annually for compliance with this section. 
  4.20     (d) If the board takes charge of and controls 
  4.21  extracurricular activities, any or all costs of these activities 
  4.22  may be provided from school revenues and all revenues and 
  4.23  expenditures for these activities shall be recorded in the same 
  4.24  manner as other revenues and expenditures of the district.  
  4.25     (e) If the board takes charge of and controls 
  4.26  extracurricular activities, the teachers or pupils in the 
  4.27  district must not participate in such activity, nor shall the 
  4.28  school name or any allied name be used in connection therewith, 
  4.29  except by consent and direction of the board. 
  4.30     Sec. 5.  Minnesota Statutes 2004, section 123B.53, 
  4.31  subdivision 1, is amended to read: 
  4.32     Subdivision 1.  [DEFINITIONS.] (a) For purposes of this 
  4.33  section, the eligible debt service revenue of a district is 
  4.34  defined as follows: 
  4.35     (1) the amount needed to produce between five and six 
  4.36  percent in excess of the amount needed to meet when due the 
  5.1   principal and interest payments on the obligations of the 
  5.2   district for eligible projects according to subdivision 2, 
  5.3   including the amounts necessary for repayment of energy loans 
  5.4   according to section 216C.37 or sections 298.292 to 298.298, 
  5.5   debt service loans and capital loans, lease purchase payments 
  5.6   under section 126C.40, subdivision 2, alternative facilities 
  5.7   levies under section 123B.59, subdivision 5, minus 
  5.8      (2) the amount of debt service excess levy reduction for 
  5.9   that school year calculated according to the procedure 
  5.10  established by the commissioner. 
  5.11     (b) The obligations in this paragraph are excluded from 
  5.12  eligible debt service revenue: 
  5.13     (1) obligations under section 123B.61; 
  5.14     (2) the part of debt service principal and interest paid 
  5.15  from the taconite environmental protection fund or northeast 
  5.16  Minnesota economic protection trust; 
  5.17     (3) obligations issued under Laws 1991, chapter 265, 
  5.18  article 5, section 18, as amended by Laws 1992, chapter 499, 
  5.19  article 5, section 24; and 
  5.20     (4) obligations under section 123B.62. 
  5.21     (c) For purposes of this section, if a preexisting school 
  5.22  district reorganized under sections 123A.35 to 123A.43, 123A.46, 
  5.23  and 123A.48 is solely responsible for retirement of the 
  5.24  preexisting district's bonded indebtedness, capital loans or 
  5.25  debt service loans, debt service equalization aid must be 
  5.26  computed separately for each of the preexisting districts. 
  5.27     (d) For purposes of this section, the adjusted net tax 
  5.28  capacity determined according to section 127A.48 shall be 
  5.29  adjusted to include a portion of the tax capacity of property 
  5.30  generally exempted from ad valorem taxes under section 272.02, 
  5.31  subdivisions 64 and 65, equal to the product of that tax 
  5.32  capacity times the ratio of the eligible debt service revenue 
  5.33  attributed to general obligation bonds to the total eligible 
  5.34  debt service revenue of the district.  
  5.35     Sec. 6.  Minnesota Statutes 2004, section 123B.75, is 
  5.36  amended by adding a subdivision to read: 
  6.1      Subd. 4a.  [TACONITE REVENUE.] Taconite revenue received in 
  6.2   a calendar year by a school district under section 298.28, 
  6.3   subdivisions 4, paragraphs (b) and (c), and 11, paragraph (d), 
  6.4   is fully recognized in the fiscal year in which the February 
  6.5   payment falls. 
  6.6      Sec. 7.  Minnesota Statutes 2004, section 123B.76, 
  6.7   subdivision 3, is amended to read: 
  6.8      Subd. 3.  [EXPENDITURES BY BUILDING.] (a) For the purposes 
  6.9   of this section, "building" means education site as defined in 
  6.10  section 123B.04, subdivision 1.  
  6.11     (b) Each district shall maintain separate accounts to 
  6.12  identify general fund expenditures, excluding capital 
  6.13  expenditures and pupil transportation, for each building.  All 
  6.14  expenditures for regular instruction, secondary vocational 
  6.15  instruction, and school administration must be reported to the 
  6.16  department separately for each building.  All expenditures for 
  6.17  special education instruction, instructional support services, 
  6.18  and pupil support services provided within a specific building 
  6.19  must be reported to the department separately for each 
  6.20  building.  Salary expenditures reported by building must reflect 
  6.21  actual salaries for staff at the building and must not be based 
  6.22  on districtwide averages.  All other general fund expenditures 
  6.23  may be reported by building or on a districtwide basis. 
  6.24     (c) The department must annually report information showing 
  6.25  school district general fund expenditures per pupil by program 
  6.26  category for each building and estimated school district general 
  6.27  fund revenue generated by pupils attending each building on its 
  6.28  Web site.  For purposes of this report: 
  6.29     (1) expenditures not required to be reported by building 
  6.30  shall be allocated among buildings on a uniform per pupil basis; 
  6.31     (2) basic skills revenue shall be allocated according to 
  6.32  section 126C.10, subdivision 4; 
  6.33     (3) secondary sparsity revenue and elementary sparsity 
  6.34  revenue shall be allocated according to section 126C.10, 
  6.35  subdivisions 7 and 8; 
  6.36     (4) other general education revenue shall be allocated on a 
  7.1   uniform per pupil unit basis; 
  7.2      (5) first grade preparedness aid shall be allocated 
  7.3   according to section 124D.081; 
  7.4      (6) state and federal special education aid and Title I aid 
  7.5   shall be allocated in proportion to district expenditures for 
  7.6   these programs by building; and 
  7.7      (7) other general fund revenues shall be allocated on a 
  7.8   uniform per pupil basis, except that the department may allocate 
  7.9   other revenues attributable to specific buildings directly to 
  7.10  those buildings. 
  7.11     Sec. 8.  Minnesota Statutes 2004, section 123B.79, 
  7.12  subdivision 6, is amended to read: 
  7.13     Subd. 6.  [ACCOUNT TRANSFER FOR STATUTORY OPERATING DEBT.] 
  7.14  On June 30 of each year, a district may make a permanent 
  7.15  transfer from the general fund account entitled "undesignated 
  7.16  net unreserved general fund balance since statutory operating 
  7.17  debt" to the account entitled "reserved fund balance reserve 
  7.18  account for purposes of statutory operating debt reduction."  
  7.19  The amount of the transfer is limited to the lesser of (a) the 
  7.20  net undesignated operating unreserved general fund balance, or 
  7.21  (b) the sum of the remaining statutory operating debt levies 
  7.22  authorized for all future years according to section 126C.42, 
  7.23  subdivision 1.  If the net undesignated operating unreserved 
  7.24  general fund balance is less than zero, the district may not 
  7.25  make a transfer.  
  7.26     Sec. 9.  Minnesota Statutes 2004, section 123B.81, 
  7.27  subdivision 1, is amended to read: 
  7.28     Subdivision 1.  [OPERATING DEBT.] The "operating debt" of a 
  7.29  school district means the net negative undesignated unreserved 
  7.30  general fund balance in all school district funds, other than 
  7.31  capital expenditure, building construction, debt service, and 
  7.32  trust and agency, calculated as of June 30 of each year in 
  7.33  accordance with the uniform financial accounting and reporting 
  7.34  standards for Minnesota school districts. 
  7.35     Sec. 10.  Minnesota Statutes 2004, section 123B.82, is 
  7.36  amended to read: 
  8.1      123B.82 [REORGANIZATION OPERATING DEBT.] 
  8.2      The "reorganization operating debt" of a school district 
  8.3   means the net negative undesignated unreserved general fund 
  8.4   balance balances in all school district funds, other than 
  8.5   building construction, debt redemption, and trust and agency, 
  8.6   calculated in accordance with the uniform financial accounting 
  8.7   and reporting standards for Minnesota school districts as of: 
  8.8      (1) June 30 of the fiscal year before the first year that a 
  8.9   district receives revenue according to section 123A.39, 
  8.10  subdivision 3; or 
  8.11     (2) June 30 of the fiscal year before the effective date of 
  8.12  reorganization according to section 123A.46 or 123A.48. 
  8.13     Sec. 11.  Minnesota Statutes 2004, section 123B.83, 
  8.14  subdivision 2, is amended to read: 
  8.15     Subd. 2.  [UNDESIGNATED NET UNRESERVED GENERAL FUND 
  8.16  BALANCES.] Beginning in fiscal year 1978 and each year 
  8.17  thereafter, any A school district not subject to the provisions 
  8.18  of subdivision 1 must limit its expenditures so that 
  8.19  its undesignated net unreserved general fund balances do balance 
  8.20  does not constitute statutory operating debt as defined in 
  8.21  section 126C.42. 
  8.22     Sec. 12.  Minnesota Statutes 2004, section 123B.92, 
  8.23  subdivision 5, is amended to read: 
  8.24     Subd. 5.  [DISTRICT REPORTS.] (a) Each district must report 
  8.25  data to the department as required by the department to account 
  8.26  for transportation expenditures.  
  8.27     (b) Salaries and fringe benefits of district employees 
  8.28  whose primary duties are other than transportation, including 
  8.29  central office administrators and staff, building administrators 
  8.30  and staff, teachers, social workers, school nurses, and 
  8.31  instructional aides, must not be included in a district's 
  8.32  transportation expenditures, except that a district may include 
  8.33  salaries and benefits according to paragraph (c) for (1) an 
  8.34  employee designated as the district transportation director, (2) 
  8.35  an employee providing direct support to the transportation 
  8.36  director, or (3) an employee providing direct transportation 
  9.1   services such as a bus driver or bus aide. 
  9.2      (c) Salaries and fringe benefits of other district 
  9.3   employees who work part-time in transportation and part-time in 
  9.4   other areas must not be included in a district's transportation 
  9.5   expenditures unless the district maintains documentation of the 
  9.6   employee's time spent on pupil transportation matters in the 
  9.7   form and manner prescribed by the department. 
  9.8      (d) Pupil transportation expenditures, excluding 
  9.9   expenditures for capital outlay, leased buses, student board and 
  9.10  lodging, crossing guards, and aides on buses, must be allocated 
  9.11  among transportation categories based on a cost per mile, cost 
  9.12  per student, cost per hour, or cost per route, regardless of 
  9.13  whether the transportation services are provided on 
  9.14  district-owned or contractor-owned school buses.  Expenditures 
  9.15  for school bus driver salaries and fringe benefits may either be 
  9.16  directly charged to the appropriate transportation category or 
  9.17  may be allocated among transportation categories on a cost per 
  9.18  mile, cost per student basis, cost per hour, or cost per route.  
  9.19  Expenditures by private contractors or individuals who provide 
  9.20  transportation exclusively in one transportation category must 
  9.21  be charged directly to the appropriate transportation category.  
  9.22  Transportation services provided by contractor-owned school bus 
  9.23  companies incorporated under different names but owned by the 
  9.24  same individual or group of individuals must be treated as the 
  9.25  same company for cost allocation purposes. 
  9.26     <b>[EFFECTIVE DATE.]</b> This section is effective for expenditure 
  9.27  reporting for fiscal year 2006 and later. 
  9.28     Sec. 13.  Minnesota Statutes 2004, section 124D.11, 
  9.29  subdivision 1, is amended to read: 
  9.30     Subdivision 1.  [GENERAL EDUCATION REVENUE.] (a) For fiscal 
  9.31  year 2006, general education revenue must be paid to a charter 
  9.32  school as though it were a district.  The general education 
  9.33  revenue for each adjusted marginal cost pupil unit is the state 
  9.34  average general education revenue per pupil unit, plus the 
  9.35  referendum equalization aid allowance in the pupil's district of 
  9.36  residence, minus an amount equal to the product of the formula 
 10.1   allowance according to section 126C.10, subdivision 2, times 
 10.2   .0485, calculated without basic skills revenue, extended time 
 10.3   revenue, transition revenue, and transportation sparsity 
 10.4   revenue, plus basic skills revenue, extended time revenue, and 
 10.5   transition revenue as though the school were a school district.  
 10.6   The general education revenue for each extended time marginal 
 10.7   cost pupil unit equals $4,378. 
 10.8      (b) For fiscal year 2007 and later, general education 
 10.9   revenue must be paid to a charter school as though it were a 
 10.10  district.  The general education revenue for each adjusted 
 10.11  marginal cost pupil unit is the state average general education 
 10.12  revenue per pupil unit, plus the referendum equalization aid 
 10.13  allowance in the pupil's district of residence, minus an amount 
 10.14  equal to the product of the formula allowance according to 
 10.15  section 126C.10, subdivision 2, times .0458, calculated without 
 10.16  basic skills revenue, extended time revenue, and transportation 
 10.17  sparsity revenue, plus basic skills revenue and extended time 
 10.18  revenue as though the school were a school district.  The 
 10.19  general education revenue for each extended time marginal cost 
 10.20  pupil unit equals $4,391.  Each year, a charter school must also 
 10.21  be paid an amount equal to its 2004 transition revenue allowance 
 10.22  multiplied times its adjusted marginal cost pupil units for the 
 10.23  current year. 
 10.24     (c) Notwithstanding paragraph paragraphs (a) and (b), for 
 10.25  charter schools in the first year of operation, general 
 10.26  education revenue shall be computed using the number of adjusted 
 10.27  pupil units in the current fiscal year.  
 10.28     Sec. 14.  Minnesota Statutes 2004, section 124D.11, 
 10.29  subdivision 2, is amended to read: 
 10.30     Subd. 2.  [TRANSPORTATION REVENUE.] Transportation revenue 
 10.31  must be paid to a charter school that provides transportation 
 10.32  services according to section 124D.10, subdivision 16, according 
 10.33  to this subdivision.  Transportation aid shall equal 
 10.34  transportation revenue.  
 10.35     In addition to the revenue under subdivision 1, for fiscal 
 10.36  year 2006 a charter school providing transportation services 
 11.1   must receive general education aid for each pupil unit equal to 
 11.2   the sum of the product of (1) an amount equal to the product of 
 11.3   the formula allowance according to section 126C.10, subdivision 
 11.4   2, times .0485 in fiscal years 2005 and 2006 and .0458 in fiscal 
 11.5   years 2007 and later, plus the transportation sparsity allowance 
 11.6   for the school district in which the charter school is located, 
 11.7   times (2) the adjusted marginal cost pupil units, plus the 
 11.8   product of $223 times the extended time marginal cost pupil 
 11.9   units. 
 11.10     In addition to the revenue under subdivision 1, for fiscal 
 11.11  year 2007 and later, a charter school providing transportation 
 11.12  services must receive general education aid equal to the sum of 
 11.13  the product of (1) the formula allowance according to section 
 11.14  126C.10, subdivision 2, times .0458, plus the transportation 
 11.15  sparsity allowance for the school district in which the charter 
 11.16  school is located, times (2) the adjusted marginal cost pupil 
 11.17  units, plus the product of $210 times the extended time marginal 
 11.18  cost pupil units. 
 11.19     Sec. 15.  Minnesota Statutes 2004, section 124D.11, 
 11.20  subdivision 6, is amended to read: 
 11.21     Subd. 6.  [OTHER AID, GRANTS, REVENUE.] (a) A charter 
 11.22  school is eligible to receive other aids, grants, and revenue 
 11.23  according to chapters 120A to 129C, as though it were a district.
 11.24     (b) Notwithstanding paragraph (a), a charter school may not 
 11.25  receive aid, a grant, or revenue other than general education 
 11.26  revenue if a levy is required to obtain the money, except as 
 11.27  otherwise provided in this section.  
 11.28     (c) Federal aid received by the state must be paid to the 
 11.29  school, if it qualifies for the aid as though it were a school 
 11.30  district. 
 11.31     (d) A charter school may receive money from any source for 
 11.32  capital facilities needs.  In the year-end report to the 
 11.33  commissioner of education, the charter school shall report the 
 11.34  total amount of funds received from grants and other outside 
 11.35  sources. 
 11.36     Sec. 16.  Minnesota Statutes 2004, section 124D.68, 
 12.1   subdivision 9, is amended to read: 
 12.2      Subd. 9.  [ENROLLMENT VERIFICATION.] (a) For a pupil 
 12.3   attending an eligible program full time under subdivision 3, 
 12.4   paragraph (d), the department must pay 90 percent of the 
 12.5   district's average general education revenue less basic skills 
 12.6   revenue to the eligible program and ten percent of the 
 12.7   district's average general education revenue less basic skills 
 12.8   revenue to the contracting district within 30 days after the 
 12.9   eligible program verifies enrollment using the form provided by 
 12.10  the department.  For a pupil attending an eligible program part 
 12.11  time, revenue, excluding compensatory revenue, shall be reduced 
 12.12  proportionately, according to the amount of time the pupil 
 12.13  attends the program, and the payments to the eligible program 
 12.14  and the contracting district shall be reduced accordingly.  A 
 12.15  pupil for whom payment is made according to this section may not 
 12.16  be counted by any district for any purpose other than 
 12.17  computation of general education revenue.  If payment is made 
 12.18  for a pupil under this subdivision, a district shall not 
 12.19  reimburse a program under section 124D.69 for the same 
 12.20  pupil.  The basic skills revenue shall be paid generated by 
 12.21  pupils attending the eligible program according to section 
 12.22  126C.10, subdivision 4, shall be paid to the eligible program. 
 12.23     (b) The department must pay up to 100 percent of the 
 12.24  revenue to the eligible program if there is an agreement to that 
 12.25  effect between the school district and the eligible program. 
 12.26     (c) Notwithstanding paragraphs (a) and (b), for an eligible 
 12.27  program that provides chemical treatment services to students, 
 12.28  the department must pay 100 percent of the revenue to the 
 12.29  eligible program. 
 12.30     Sec. 17.  Minnesota Statutes 2004, section 124D.69, 
 12.31  subdivision 1, is amended to read: 
 12.32     Subdivision 1.  [AID.] If a pupil enrolls in an alternative 
 12.33  program, eligible under section 124D.68, subdivision 3, 
 12.34  paragraph (d), or subdivision 4, operated by a private 
 12.35  organization that has contracted with a school district to 
 12.36  provide educational services for eligible pupils under section 
 13.1   124D.68, subdivision 2, the district contracting with the 
 13.2   private organization must reimburse the provider an amount equal 
 13.3   to the sum of (1) at least 95 percent of the district's average 
 13.4   general education less basic skills revenue per pupil unit times 
 13.5   the number of pupil units for pupils attending the program., and 
 13.6   (2) the amount of basic skills revenue shall be paid generated 
 13.7   by pupils attending the program according to section 126C.10, 
 13.8   subdivision 4.  Compensatory revenue must be allocated according 
 13.9   to section 126C.15, subdivision 2.  For a pupil attending the 
 13.10  program part time, the revenue paid to the program, excluding 
 13.11  compensatory revenue, must be reduced proportionately, according 
 13.12  to the amount of time the pupil attends the program, and revenue 
 13.13  paid to the district shall be reduced accordingly.  Pupils for 
 13.14  whom a district provides reimbursement may not be counted by the 
 13.15  district for any purpose other than computation of general 
 13.16  education revenue.  If payment is made to a district or program 
 13.17  for a pupil under this section, the department must not make a 
 13.18  payment for the same pupil under section 124D.68, subdivision 9. 
 13.19  Notwithstanding sections 125A.15, 125A.51, and 125A.515, general 
 13.20  education revenue for a student who receives educational 
 13.21  services under this section shall be paid according to this 
 13.22  section. 
 13.23     Sec. 18.  Minnesota Statutes 2004, section 126C.01, 
 13.24  subdivision 11, is amended to read: 
 13.25     Subd. 11.  [NET UNAPPROPRIATED OPERATING UNRESERVED GENERAL 
 13.26  FUND BALANCE.] "Net unappropriated operating unreserved general 
 13.27  fund balance" means the sum of the unreserved general fund 
 13.28  balances in the general, food service, and community service 
 13.29  funds minus the balances reserved for statutory operating debt 
 13.30  reduction, bus purchase, severance pay, taconite, unemployment 
 13.31  benefits, maintenance levy reduction, operating capital, 
 13.32  disabled access, health and safety, balance and encumbrances, 
 13.33  computed as of June 30 each year. 
 13.34     Sec. 19.  Minnesota Statutes 2004, section 126C.05, is 
 13.35  amended by adding a subdivision to read: 
 13.36     Subd. 5a.  [EXTENDED TIME PUPIL UNITS.] (a) "Extended time 
 14.1   average daily membership for a district or charter school" means 
 14.2   the sum of the average daily membership according to subdivision 
 14.3   8, paragraph (a), minus the sum of the average daily membership 
 14.4   according to subdivision 8, paragraph (b), for pupils enrolled 
 14.5   in a learning year program under section 124D.128; an area 
 14.6   learning center under sections 123A.05 and 123A.06; an 
 14.7   alternative program under section 124D.68, subdivision 3, 
 14.8   paragraph (d); or section 124D.69. 
 14.9      (b) "Extended time pupil units for a district or charter 
 14.10  school" means the sum of the average daily membership in 
 14.11  paragraph (a) weighted according to subdivision 1 for pupils 
 14.12  included in the pupil unit calculations under subdivision 5, 
 14.13  paragraph (a). 
 14.14     (c) "Extended time marginal cost pupil units" means the 
 14.15  greater of: 
 14.16     (1) the sum of .77 times the pupil units defined in 
 14.17  paragraph (b) for the current school year and .23 times the 
 14.18  pupil units defined in paragraph (b) for the previous school 
 14.19  year; or 
 14.20     (2) the number of extended time pupil units defined in 
 14.21  paragraph (b) for the current school year. 
 14.22     Sec. 20.  Minnesota Statutes 2004, section 126C.05, is 
 14.23  amended by adding a subdivision to read: 
 14.24     Subd. 20.  [PROJECT-BASED AVERAGE DAILY MEMBERSHIP.] (a) To 
 14.25  receive general education revenue for a pupil enrolled in a 
 14.26  public school with a project-based program, a school must meet 
 14.27  the requirements in this paragraph.  The school must: 
 14.28     (1) register with the commissioner as a project-based 
 14.29  program by May 30 of the preceding fiscal year; 
 14.30     (2) provide a minimum teacher contact of no less than one 
 14.31  hour per week per project-based credit for each pupil; 
 14.32     (3) maintain a record system that shows when each credit or 
 14.33  portion thereof was reported for membership for each pupil; and 
 14.34     (4) report pupil membership consistent with paragraph (b). 
 14.35     (b) The commissioner must develop a formula for reporting 
 14.36  pupil membership to compute average daily membership for each 
 15.1   registered project-based school.  Average daily membership for a 
 15.2   pupil in a registered project-based program is the lesser of: 
 15.3      (1) 1.0; or 
 15.4      (2) the ratio of (i) the number of membership hours 
 15.5   generated by project-based credits completed during the school 
 15.6   year plus membership hours generated by credits completed in a 
 15.7   seat-based setting to (ii) the annual required instructional 
 15.8   hours at that grade level.  Membership hours for a partially 
 15.9   completed project-based credit must be prorated. 
 15.10     Sec. 21.  Minnesota Statutes 2004, section 126C.10, 
 15.11  subdivision 1, is amended to read: 
 15.12     Subdivision 1.  [GENERAL EDUCATION REVENUE.] (a) For fiscal 
 15.13  year 2003, the general education revenue for each district 
 15.14  equals the sum of the district's basic revenue, basic skills 
 15.15  revenue, training and experience revenue, secondary sparsity 
 15.16  revenue, elementary sparsity revenue, transportation sparsity 
 15.17  revenue, total operating capital revenue, and equity revenue. 
 15.18     (b) For fiscal year 2004 and later 2006, the general 
 15.19  education revenue for each district equals the sum of the 
 15.20  district's basic revenue, extended time revenue, basic skills 
 15.21  revenue, training and experience revenue, secondary sparsity 
 15.22  revenue, elementary sparsity revenue, transportation sparsity 
 15.23  revenue, total operating capital revenue, equity revenue, and 
 15.24  transition revenue. 
 15.25     (b) For fiscal year 2007 and later, the general education 
 15.26  revenue for each district equals the sum of the district's basic 
 15.27  revenue, extended time revenue, basic skills revenue, training 
 15.28  and experience revenue, secondary sparsity revenue, elementary 
 15.29  sparsity revenue, transportation sparsity revenue, total 
 15.30  operating capital revenue, and equity revenue. 
 15.31     Sec. 22.  Minnesota Statutes 2004, section 126C.10, 
 15.32  subdivision 2, is amended to read: 
 15.33     Subd. 2.  [BASIC REVENUE.] The basic revenue for each 
 15.34  district equals the formula allowance times the adjusted 
 15.35  marginal cost pupil units for the school year.  The formula 
 15.36  allowance for fiscal year 2001 2005 is $3,964 $4,601.  The 
 16.1   formula allowance for fiscal year 2002 2006 is $4,068 $4,832. 
 16.2   The formula allowance for fiscal year 2003 2007 and subsequent 
 16.3   years is $4,601 $5,053. 
 16.4      Sec. 23.  Minnesota Statutes 2004, section 126C.10, 
 16.5   subdivision 13, is amended to read: 
 16.6      Subd. 13.  [TOTAL OPERATING CAPITAL REVENUE.] (a) For 
 16.7   fiscal year 2000 and thereafter, total operating capital revenue 
 16.8   for a district equals the amount determined under paragraph (b) 
 16.9   or (c), plus $73 times the adjusted marginal cost pupil units 
 16.10  for the school year.  The revenue must be placed in a reserved 
 16.11  account in the general fund and may only be used according to 
 16.12  paragraph (d) or subdivision 14. 
 16.13     (b) For fiscal years 2000 and later, capital revenue for a 
 16.14  district equals $100 times the district's maintenance cost index 
 16.15  times its adjusted marginal cost pupil units for the school year.
 16.16     (c) For fiscal years 2000 and later, the revenue for a 
 16.17  district that operates a program under section 124D.128, is 
 16.18  increased by an amount equal to $30 times the number of marginal 
 16.19  cost pupil units served at the site where the program is 
 16.20  implemented. 
 16.21     (d) For fiscal years 2001, 2002, and 2003, the district 
 16.22  must reserve an amount equal to $5 per adjusted marginal cost 
 16.23  pupil unit for telecommunication access costs.  Reserve revenue 
 16.24  under this paragraph must first be used to pay for ongoing or 
 16.25  recurring telecommunication access costs, including access to 
 16.26  data and video connections, including Internet access.  Any 
 16.27  revenue remaining after covering all ongoing or recurring access 
 16.28  costs may be used for computer hardware or equipment. 
 16.29     Sec. 24.  Minnesota Statutes 2004, section 126C.10, 
 16.30  subdivision 13a, is amended to read: 
 16.31     Subd. 13a.  [OPERATING CAPITAL LEVY.] To obtain operating 
 16.32  capital revenue for fiscal year years 2005 and later 2006, a 
 16.33  district may levy an amount not more than the product of its 
 16.34  operating capital revenue for the fiscal year times the lesser 
 16.35  of one or the ratio of its adjusted net tax capacity per 
 16.36  adjusted marginal cost pupil unit to $22,222. 
 17.1      Sec. 25.  Minnesota Statutes 2004, section 126C.10, 
 17.2   subdivision 13b, is amended to read: 
 17.3      Subd. 13b.  [OPERATING CAPITAL AID.] For fiscal years 2005 
 17.4   and 2006, a district's operating capital aid equals its 
 17.5   operating capital revenue minus its operating capital levy times 
 17.6   the ratio of the actual amount levied to the permitted levy. 
 17.7      Sec. 26.  Minnesota Statutes 2004, section 126C.10, 
 17.8   subdivision 18, is amended to read: 
 17.9      Subd. 18.  [TRANSPORTATION SPARSITY REVENUE ALLOWANCE.] (a) 
 17.10  For fiscal year 2006, a district's transportation sparsity 
 17.11  allowance equals the greater of zero or the result of the 
 17.12  following computation: 
 17.13     (i) (1) multiply the formula allowance according to 
 17.14  subdivision 2, by .1469.; 
 17.15     (ii) (2) multiply the result in clause (i) (1) by the 
 17.16  district's sparsity index raised to the 26/100 power.; 
 17.17     (iii) (3) multiply the result in clause (ii) (2) by the 
 17.18  district's density index raised to the 13/100 power.; 
 17.19     (iv) (4) multiply the formula allowance according to 
 17.20  subdivision 2, by .0485.; and 
 17.21     (v) (5) subtract the result in clause (iv) (4) from the 
 17.22  result in clause (iii) (3). 
 17.23     (b) For fiscal year 2007 and later, a district's 
 17.24  transportation sparsity allowance equals the greater of zero or 
 17.25  the result of the following computation: 
 17.26     (1) multiply the formula allowance according to subdivision 
 17.27  2 by .1469; 
 17.28     (2) multiply the result in clause (1) by the district's 
 17.29  sparsity index raised to the 28/100 power; 
 17.30     (3) multiply the result in clause (2) by the district's 
 17.31  density index raised to the 13/100 power; 
 17.32     (4) multiply the formula allowance according to subdivision 
 17.33  2 by .0458; and 
 17.34     (5) subtract the result in clause (4) from the result in 
 17.35  clause (3). 
 17.36     (c) Transportation sparsity revenue is equal to the 
 18.1   transportation sparsity allowance times the adjusted marginal 
 18.2   cost pupil units. 
 18.3      (d) Transportation sparsity revenue is equal to the 
 18.4   transportation sparsity allowance times the adjusted marginal 
 18.5   cost pupil units. 
 18.6      Sec. 27.  Minnesota Statutes 2004, section 126C.10, 
 18.7   subdivision 24, is amended to read: 
 18.8      Subd. 24.  [EQUITY REVENUE.] (a) A school district 
 18.9   qualifies for equity revenue if: 
 18.10     (1) the school district's adjusted marginal cost pupil unit 
 18.11  amount of basic revenue, supplemental revenue, transition 
 18.12  revenue, and referendum revenue is less than the value of the 
 18.13  school district at or immediately above the 95th percentile of 
 18.14  school districts in its equity region for those revenue 
 18.15  categories; and 
 18.16     (2) the school district's administrative offices are not 
 18.17  located in a city of the first class on July 1, 1999. 
 18.18     (b) Equity revenue for a qualifying district that receives 
 18.19  referendum revenue under section 126C.17, subdivision 4, equals 
 18.20  the product of (1) the district's adjusted marginal cost pupil 
 18.21  units for that year; times (2) the sum of (i) $13, plus (ii) 
 18.22  $75, times the school district's equity index computed under 
 18.23  subdivision 27. 
 18.24     (c) Equity revenue for a qualifying district that does not 
 18.25  receive referendum revenue under section 126C.17, subdivision 4, 
 18.26  equals the product of the district's adjusted marginal cost 
 18.27  pupil units for that year times $13. 
 18.28     (d) For fiscal year 2007 and later, referendum revenue for 
 18.29  the purpose of this section does not include referendum 
 18.30  conversion allowance authority transferred to the referendum 
 18.31  allowance in fiscal year 2007 under section 126C.17, subdivision 
 18.32  13, by the vote of a school board.  Referendum conversion 
 18.33  allowance authority added to the referendum allowance under 
 18.34  section 126C.17, subdivision 1, shall be included in the 
 18.35  referendum for the purposes of this section if a school district 
 18.36  reauthorizes the revenue at an election according to section 
 19.1   126C.17, subdivision 9. 
 19.2      Sec. 28.  Minnesota Statutes 2004, section 126C.10, 
 19.3   subdivision 29, is amended to read: 
 19.4      Subd. 29.  [EQUITY LEVY.] To obtain equity revenue for 
 19.5   fiscal year years 2005 and later 2006, a district may levy an 
 19.6   amount not more than the product of its equity revenue for the 
 19.7   fiscal year times the lesser of one or the ratio of its 
 19.8   referendum market value per resident marginal cost pupil unit to 
 19.9   $476,000. 
 19.10     Sec. 29.  Minnesota Statutes 2004, section 126C.10, 
 19.11  subdivision 30, is amended to read: 
 19.12     Subd. 30.  [EQUITY AID.] For fiscal years 2005 and 2006, a 
 19.13  district's equity aid equals its equity revenue minus its equity 
 19.14  levy times the ratio of the actual amount levied to the 
 19.15  permitted levy. 
 19.16     Sec. 30.  Minnesota Statutes 2004, section 126C.10, 
 19.17  subdivision 31, is amended to read: 
 19.18     Subd. 31.  [TRANSITION REVENUE.] (a) A district's 
 19.19  transition allowance for fiscal years 2004 through 2008 2006 
 19.20  equals the greater of zero or the product of the ratio of the 
 19.21  number of adjusted marginal cost pupil units the district would 
 19.22  have counted for fiscal year 2004 under Minnesota Statutes 2002 
 19.23  to the district's adjusted marginal cost pupil units for fiscal 
 19.24  year 2004, times the difference between:  (1) the lesser of the 
 19.25  district's general education revenue per adjusted marginal cost 
 19.26  pupil unit for fiscal year 2003 or the amount of general 
 19.27  education revenue the district would have received per adjusted 
 19.28  marginal cost pupil unit for fiscal year 2004 according to 
 19.29  Minnesota Statutes 2002, and (2) the district's general 
 19.30  education revenue for fiscal year 2004 excluding transition 
 19.31  revenue divided by the number of adjusted marginal cost pupil 
 19.32  units the district would have counted for fiscal year 2004 under 
 19.33  Minnesota Statutes 2002.  A district's transition allowance for 
 19.34  fiscal year 2009 2007 and later is zero. 
 19.35     (b) A district's transition revenue for fiscal year years 
 19.36  2004 and later 2005 equals the product of the district's 
 20.1   transition allowance times the district's adjusted marginal cost 
 20.2   pupil units. 
 20.3      (c) A district's transition revenue for fiscal year 2006 
 20.4   equals the sum of (1) the product of the district's transition 
 20.5   allowance times the district's adjusted marginal cost pupil 
 20.6   units, plus (2) the amount of referendum revenue under section 
 20.7   126C.17 and general education revenue, excluding transition 
 20.8   revenue, for fiscal year 2004 attributable to pupils four or 
 20.9   five years of age on September 1, 2003, enrolled in a 
 20.10  prekindergarten program implemented by the district before July 
 20.11  1, 2003, and reported as kindergarten pupils under section 
 20.12  126C.05, subdivision 1, for fiscal year 2004 multiplied times 
 20.13  0.01, plus (3) the amount of compensatory education revenue 
 20.14  under subdivision 3 for fiscal year 2005 attributable to pupils 
 20.15  four years of age on September 1, 2003, enrolled in a 
 20.16  prekindergarten program implemented by the district before July 
 20.17  1, 2003, and reported as kindergarten pupils under section 
 20.18  126C.05, subdivision 1, for fiscal year 2004 multiplied times 
 20.19  0.01. 
 20.20     Sec. 31.  Minnesota Statutes 2004, section 126C.10, 
 20.21  subdivision 32, is amended to read: 
 20.22     Subd. 32.  [TRANSITION LEVY.] To obtain transition revenue 
 20.23  for fiscal year years 2005 and later 2006, a district may levy 
 20.24  an amount not more than the product of its transition revenue 
 20.25  for the fiscal year times the lesser of one or the ratio of its 
 20.26  referendum market value per resident marginal cost pupil unit to 
 20.27  $476,000. 
 20.28     Sec. 32.  Minnesota Statutes 2004, section 126C.10, 
 20.29  subdivision 33, is amended to read: 
 20.30     Subd. 33.  [TRANSITION AID.] (a) For fiscal year 2004, a 
 20.31  district's transition aid equals its transition revenue. 
 20.32     (b) For fiscal year years 2005 and later 2006, a district's 
 20.33  transition aid equals its transition revenue minus its 
 20.34  transition levy times the ratio of the actual amount levied to 
 20.35  the permitted levy. 
 20.36     Sec. 33.  Minnesota Statutes 2004, section 126C.13, is 
 21.1   amended by adding a subdivision to read: 
 21.2      Subd. 3a.  [CONSOLIDATED TAX RATE.] The commissioner must 
 21.3   establish the consolidated tax rate by July 1 of each year for 
 21.4   levies payable in the following year.  The consolidated tax 
 21.5   capacity rate must be a rate, rounded up to the nearest 
 21.6   hundredth of a percent, that, when applied to the adjusted net 
 21.7   tax capacity for all districts, raises the amount specified in 
 21.8   this subdivision.  The consolidated tax rate must be the rate 
 21.9   that raises $99,172,300 for fiscal year 2007, $110,770,300 for 
 21.10  fiscal year 2008, and $122,380,100 for fiscal year 2009 and 
 21.11  later years.  The consolidated tax rate may not be changed due 
 21.12  to changes or corrections made to a district's adjusted net tax 
 21.13  capacity after the tax rate has been established. 
 21.14     Sec. 34.  Minnesota Statutes 2004, section 126C.13, is 
 21.15  amended by adding a subdivision to read: 
 21.16     Subd. 3b.  [CONSOLIDATED LEVY.] To obtain general education 
 21.17  revenue, a district may levy an amount not to exceed the 
 21.18  consolidated tax rate times the adjusted net tax capacity of the 
 21.19  district for the preceding year.  If the amount of the 
 21.20  consolidated levy would exceed the general education revenue, 
 21.21  the consolidated levy must be determined according to 
 21.22  subdivision 3c. 
 21.23     Sec. 35.  Minnesota Statutes 2004, section 126C.13, is 
 21.24  amended by adding a subdivision to read: 
 21.25     Subd. 3c.  [CONSOLIDATED LEVY; DISTRICTS OFF THE 
 21.26  FORMULA.] If the amount of the consolidated levy for a district 
 21.27  exceeds the district's general education revenue, the amount of 
 21.28  the consolidated levy must be limited to the following: 
 21.29     (1) the district's general education revenue; minus 
 21.30     (2) payments made for the same school year according to 
 21.31  section 126C.21, subdivision 3. 
 21.32     For purposes of statutory cross-reference, a levy made 
 21.33  according to this subdivision shall be construed to be the levy 
 21.34  made according to subdivision 3b. 
 21.35     Sec. 36.  Minnesota Statutes 2004, section 126C.13, 
 21.36  subdivision 4, is amended to read: 
 22.1      Subd. 4.  [GENERAL EDUCATION AID.] (a) For fiscal year 
 22.2   2004, a district's general education aid is the sum of the 
 22.3   following amounts:  
 22.4      (1) general education revenue; 
 22.5      (2) shared time aid according to section 126C.01, 
 22.6   subdivision 7; 
 22.7      (3) referendum aid according to section 126C.17; and 
 22.8      (4) online learning aid according to section 126C.24. 
 22.9      (b) For fiscal year years 2005 and later 2006, a 
 22.10  district's general education aid is the sum of the following 
 22.11  amounts: 
 22.12     (1) general education revenue, excluding equity revenue, 
 22.13  total operating capital, and transition revenue; 
 22.14     (2) operating capital aid according to section 126C.10, 
 22.15  subdivision 13b; 
 22.16     (3) equity aid according to section 126C.10, subdivision 
 22.17  30; 
 22.18     (4) transition aid according to section 126C.10, 
 22.19  subdivision 33; 
 22.20     (5) shared time aid according to section 126C.01, 
 22.21  subdivision 7; 
 22.22     (6) referendum aid according to section 126C.17; and 
 22.23     (7) online learning aid according to section 126C.24 
 22.24  124D.0962. 
 22.25     (b) For fiscal year 2007 and later, a district's general 
 22.26  education aid is the sum of the following amounts: 
 22.27     (1) the product of: 
 22.28     (i) the difference between the general education revenue 
 22.29  and the consolidated levy; times 
 22.30     (ii) the ratio of the actual amount levied to the permitted 
 22.31  levy; 
 22.32     (2) shared time aid according to section 126C.01, 
 22.33  subdivision 7; 
 22.34     (3) referendum aid according to section 126C.17; and 
 22.35     (4) online learning aid according to section 126C.24. 
 22.36     Sec. 37.  Minnesota Statutes 2004, section 126C.17, 
 23.1   subdivision 1, is amended to read: 
 23.2      Subdivision 1.  [REFERENDUM ALLOWANCE.] (a) For fiscal year 
 23.3   2003 2006 and later, a district's initial referendum revenue 
 23.4   allowance equals the sum of the allowance under section 126C.16, 
 23.5   subdivision 2, plus any additional allowance per resident 
 23.6   marginal cost pupil unit authorized under subdivision 9 before 
 23.7   May 1, 2001, for fiscal year 2002 and later, plus the referendum 
 23.8   conversion allowance approved under subdivision 13, minus $415.  
 23.9   For districts with more than one referendum authority, the 
 23.10  reduction must be computed separately for each authority.  The 
 23.11  reduction must be applied first to the referendum conversion 
 23.12  allowance and next to the authority with the earliest expiration 
 23.13  date.  A district's initial referendum revenue allowance may not 
 23.14  be less than zero. 
 23.15     (b) For fiscal year 2003, a district's referendum revenue 
 23.16  allowance equals the initial referendum allowance plus any 
 23.17  additional allowance per resident marginal cost pupil unit 
 23.18  authorized under subdivision 9 between April 30, 2001, and 
 23.19  December 30, 2001, for fiscal year 2003 and later. 
 23.20     (c) For fiscal year 2004 and later 2006, a district's 
 23.21  referendum revenue allowance equals the sum of: 
 23.22     (1) the product of (i) the ratio of the resident marginal 
 23.23  cost pupil units the district would have counted for fiscal year 
 23.24  2004 under Minnesota Statutes 2002, section 126C.05, to the 
 23.25  district's resident marginal cost pupil units for fiscal year 
 23.26  2004, times (ii) the initial referendum allowance plus any 
 23.27  additional allowance per resident marginal cost pupil unit 
 23.28  authorized under subdivision 9 between April 30, 2001, and May 
 23.29  30, 2003, for fiscal year 2003 and later, plus 
 23.30     (2) any additional allowance per resident marginal cost 
 23.31  pupil unit authorized under subdivision 9 after May 30, 2003, 
 23.32  for fiscal year 2005 and later. 
 23.33     (c) For fiscal year 2007 and later, a district's referendum 
 23.34  revenue allowance equals the sum of:  (1) the referendum 
 23.35  allowance the district would have received for fiscal year 2007 
 23.36  and later under Minnesota Statutes 2004, section 126C.17, 
 24.1   subdivision 1, paragraph (c), based on elections held under 
 24.2   subdivision 9, before May 30, 2005, plus any additional 
 24.3   allowance per resident pupil unit authorized under subdivision 9 
 24.4   after May 30, 2005, plus the referendum conversion allowance 
 24.5   approved under subdivision 13. 
 24.6      Sec. 38.  Minnesota Statutes 2004, section 126C.17, 
 24.7   subdivision 2, is amended to read: 
 24.8      Subd. 2.  [REFERENDUM ALLOWANCE LIMIT.] (a) Notwithstanding 
 24.9   subdivision 1, for fiscal year 2003, a district's referendum 
 24.10  allowance must not exceed the greater of: 
 24.11     (1) the sum of a district's referendum allowance for fiscal 
 24.12  year 1994 times 1.162 plus its referendum conversion allowance 
 24.13  for fiscal year 2003, minus $415; 
 24.14     (2) 18.2 percent of the formula allowance; 
 24.15     (3) for a newly reorganized district created on July 1, 
 24.16  2002, the referendum revenue authority for each reorganizing 
 24.17  district in the year preceding reorganization divided by its 
 24.18  resident marginal cost pupil units for the year preceding 
 24.19  reorganization, minus $415; or 
 24.20     (4) for a newly reorganized district created after July 1, 
 24.21  2002, the referendum revenue authority for each reorganizing 
 24.22  district in the year preceding reorganization divided by its 
 24.23  resident marginal cost pupil units for the year preceding 
 24.24  reorganization. 
 24.25     (b) Notwithstanding subdivision 1, for fiscal year 2004 and 
 24.26  later, a district's referendum allowance must not exceed the 
 24.27  greater of: 
 24.28     (1) the sum of:  (i) a district's referendum allowance for 
 24.29  fiscal year 1994 times 1.177 times the annual inflationary 
 24.30  increase as calculated under paragraph (c) (b) plus (ii) its 
 24.31  referendum conversion allowance for fiscal year 2003, minus 
 24.32  (iii) $415; 
 24.33     (2) the greater of (i) 18.6 percent of the formula 
 24.34  allowance or (ii) $855.79 times the annual inflationary increase 
 24.35  as calculated under paragraph (c) (b); or 
 24.36     (3) for a newly reorganized district created after July 1, 
 25.1   2002, the referendum revenue authority for each reorganizing 
 25.2   district in the year preceding reorganization divided by its 
 25.3   resident marginal cost pupil units for the year preceding 
 25.4   reorganization. 
 25.5      (c) (b) For purposes of this subdivision, for fiscal year 
 25.6   2005 and later, "inflationary increase" means one plus the 
 25.7   percentage change in the Consumer Price Index for urban 
 25.8   consumers, as prepared by the United States Bureau of Labor 
 25.9   Standards, for the current fiscal year to fiscal year 2004.  For 
 25.10  fiscal years 2009 and later, for purposes of paragraph (b), 
 25.11  clause (1), the inflationary increase equals the inflationary 
 25.12  increase for fiscal year 2008 plus one-fourth of the percentage 
 25.13  increase in the formula allowance for that year compared with 
 25.14  the formula allowance for fiscal year 2008. 
 25.15     Sec. 39.  Minnesota Statutes 2004, section 126C.17, 
 25.16  subdivision 5, is amended to read: 
 25.17     Subd. 5.  [REFERENDUM EQUALIZATION REVENUE.] (a) For fiscal 
 25.18  year 2003 and later, a district's referendum equalization 
 25.19  revenue equals the sum of the first tier referendum equalization 
 25.20  revenue and the second tier referendum equalization revenue. 
 25.21     (b) A district's first tier referendum equalization revenue 
 25.22  equals the district's first tier referendum equalization 
 25.23  allowance times the district's resident marginal cost pupil 
 25.24  units for that year.  
 25.25     (c) For fiscal years 2003 and 2004, a district's first tier 
 25.26  referendum equalization allowance equals the lesser of the 
 25.27  district's referendum allowance under subdivision 1 or $126.  
 25.28  For fiscal year 2005, a district's first tier referendum 
 25.29  equalization allowance equals the lesser of the district's 
 25.30  referendum allowance under subdivision 1 or $405.  For fiscal 
 25.31  year 2006 and later, a district's first tier referendum 
 25.32  equalization allowance equals the lesser of the district's 
 25.33  referendum allowance under subdivision 1 or $500.  For fiscal 
 25.34  year 2007 and later, a district's first tier referendum 
 25.35  equalization allowance equals the lesser of the district's 
 25.36  referendum allowance under subdivision 1 or $524. 
 26.1      (d) A district's second tier referendum equalization 
 26.2   revenue equals the district's second tier referendum 
 26.3   equalization allowance times the district's resident marginal 
 26.4   cost pupil units for that year. 
 26.5      (e) A district's second tier referendum equalization 
 26.6   allowance equals the lesser of the district's referendum 
 26.7   allowance under subdivision 1 or 18.6 percent of the formula 
 26.8   allowance, minus the district's first tier referendum 
 26.9   equalization allowance. 
 26.10     (f) Notwithstanding paragraph (e), the second tier 
 26.11  referendum allowance for a district qualifying for secondary 
 26.12  sparsity revenue under section 126C.10, subdivision 7, or 
 26.13  elementary sparsity revenue under section 126C.10, subdivision 
 26.14  8, equals the district's referendum allowance under subdivision 
 26.15  1 minus the district's first tier referendum equalization 
 26.16  allowance. 
 26.17     Sec. 40.  Minnesota Statutes 2004, section 126C.17, 
 26.18  subdivision 9, is amended to read: 
 26.19     Subd. 9.  [REFERENDUM REVENUE.] (a) The revenue authorized 
 26.20  by section 126C.10, subdivision 1, may be increased in the 
 26.21  amount approved by the voters of the district at a referendum 
 26.22  called for the purpose.  The referendum may be called by the 
 26.23  board or shall be called by the board upon written petition of 
 26.24  qualified voters of the district.  The referendum must be 
 26.25  conducted one or two calendar years before the increased levy 
 26.26  authority, if approved, first becomes payable.  Only one 
 26.27  election to approve an increase may be held in a calendar year.  
 26.28  Unless the referendum is conducted by mail under paragraph (g), 
 26.29  the referendum must be held on the first Tuesday after the first 
 26.30  Monday in November.  The ballot must state the maximum amount of 
 26.31  the increased revenue per resident marginal cost pupil unit, the 
 26.32  estimated referendum tax rate as a percentage of referendum 
 26.33  market value in the first year it is to be levied, and that the 
 26.34  revenue must be used to finance school operations.  The ballot 
 26.35  may state a schedule, determined by the board, of increased 
 26.36  revenue per resident marginal cost pupil unit that differs from 
 27.1   year to year over the number of years for which the increased 
 27.2   revenue is authorized.  If the ballot contains a schedule 
 27.3   showing different amounts, it must also indicate the estimated 
 27.4   referendum tax rate as a percent of referendum market value for 
 27.5   the amount specified for the first year and for the maximum 
 27.6   amount specified in the schedule.  The ballot may state that 
 27.7   existing referendum levy authority is expiring.  In this case, 
 27.8   the ballot may also compare the proposed levy authority to the 
 27.9   existing expiring levy authority, and express the proposed 
 27.10  increase as the amount, if any, over the expiring referendum 
 27.11  levy authority.  The ballot must designate the specific number 
 27.12  of years, not to exceed ten, for which the referendum 
 27.13  authorization applies.  The ballot, including a ballot on the 
 27.14  question to revoke or reduce the increased revenue amount under 
 27.15  paragraph (c), must abbreviate the term "per resident marginal 
 27.16  cost pupil unit" as "per pupil."  The notice required under 
 27.17  section 275.60 may be modified to read, in cases of renewing 
 27.18  existing levies: 
 27.19     "BY VOTING "YES" ON THIS BALLOT QUESTION, YOU MAY BE VOTING 
 27.20     FOR A PROPERTY TAX INCREASE." 
 27.21     The ballot may contain a textual portion with the 
 27.22  information required in this subdivision and a question stating 
 27.23  substantially the following:  
 27.24     "Shall the increase in the revenue proposed by (petition 
 27.25  to) the board of ........., School District No. .., be approved?"
 27.26     If approved, an amount equal to the approved revenue per 
 27.27  resident marginal cost pupil unit times the resident marginal 
 27.28  cost pupil units for the school year beginning in the year after 
 27.29  the levy is certified shall be authorized for certification for 
 27.30  the number of years approved, if applicable, or until revoked or 
 27.31  reduced by the voters of the district at a subsequent referendum.
 27.32     (b) The board must prepare and deliver by first class mail 
 27.33  at least 15 days but no more than 30 days before the day of the 
 27.34  referendum to each taxpayer a notice of the referendum and the 
 27.35  proposed revenue increase.  The board need not mail more than 
 27.36  one notice to any taxpayer.  For the purpose of giving mailed 
 28.1   notice under this subdivision, owners must be those shown to be 
 28.2   owners on the records of the county auditor or, in any county 
 28.3   where tax statements are mailed by the county treasurer, on the 
 28.4   records of the county treasurer.  Every property owner whose 
 28.5   name does not appear on the records of the county auditor or the 
 28.6   county treasurer is deemed to have waived this mailed notice 
 28.7   unless the owner has requested in writing that the county 
 28.8   auditor or county treasurer, as the case may be, include the 
 28.9   name on the records for this purpose.  The notice must project 
 28.10  the anticipated amount of tax increase in annual dollars and 
 28.11  annual percentage for typical residential homesteads, 
 28.12  agricultural homesteads, apartments, and commercial-industrial 
 28.13  property within the school district. 
 28.14     The notice for a referendum may state that an existing 
 28.15  referendum levy is expiring and project the anticipated amount 
 28.16  of increase over the existing referendum levy in the first year, 
 28.17  if any, in annual dollars and annual percentage for typical 
 28.18  residential homesteads, agricultural homesteads, apartments, and 
 28.19  commercial-industrial property within the district. 
 28.20     The notice must include the following statement:  "Passage 
 28.21  of this referendum will result in an increase in your property 
 28.22  taxes."  However, in cases of renewing existing levies, the 
 28.23  notice may include the following statement:  "Passage of this 
 28.24  referendum may result in an increase in your property taxes." 
 28.25     (c) A referendum on the question of revoking or reducing 
 28.26  the increased revenue amount authorized pursuant to paragraph 
 28.27  (a) may be called by the board and shall be called by the board 
 28.28  upon the written petition of qualified voters of the district.  
 28.29  A referendum to revoke or reduce the revenue amount must state 
 28.30  the amount per resident marginal cost pupil unit by which the 
 28.31  authority is to be reduced.  Revenue authority approved by the 
 28.32  voters of the district pursuant to paragraph (a) must be 
 28.33  available to the school district at least once before it is 
 28.34  subject to a referendum on its revocation or reduction for 
 28.35  subsequent years.  Only one revocation or reduction referendum 
 28.36  may be held to revoke or reduce referendum revenue for any 
 29.1   specific year and for years thereafter. 
 29.2      (d) A petition authorized by paragraph (a) or (c) is 
 29.3   effective if signed by a number of qualified voters in excess of 
 29.4   15 percent of the registered voters of the district on the day 
 29.5   the petition is filed with the board.  A referendum invoked by 
 29.6   petition must be held on the date specified in paragraph (a). 
 29.7      (e) The approval of 50 percent plus one of those voting on 
 29.8   the question is required to pass a referendum authorized by this 
 29.9   subdivision. 
 29.10     (f) At least 15 days before the day of the referendum, the 
 29.11  district must submit a copy of the notice required under 
 29.12  paragraph (b) to the commissioner and to the county auditor of 
 29.13  each county in which the district is located.  Within 15 days 
 29.14  after the results of the referendum have been certified by the 
 29.15  board, or in the case of a recount, the certification of the 
 29.16  results of the recount by the canvassing board, the district 
 29.17  must notify the commissioner of the results of the referendum. 
 29.18     Sec. 41.  Minnesota Statutes 2004, section 126C.17, 
 29.19  subdivision 13, is amended to read: 
 29.20     Subd. 13.  [REFERENDUM CONVERSION ALLOWANCE.] (a) A school 
 29.21  district that received supplemental or transition revenue in 
 29.22  fiscal year 2002 may convert its supplemental revenue conversion 
 29.23  allowance and transition revenue conversion allowance to 
 29.24  additional referendum allowance under subdivision 1 for fiscal 
 29.25  year 2003 and thereafter.  A majority of the school board must 
 29.26  approve the conversion at a public meeting before November 1, 
 29.27  2001.  For a district with other referendum authority, the 
 29.28  referendum conversion allowance approved by the board continues 
 29.29  until the portion of the district's other referendum authority 
 29.30  with the earliest expiration date after June 30, 2006, expires.  
 29.31  For a district with no other referendum authority, the 
 29.32  referendum conversion allowance approved by the board continues 
 29.33  until June 30, 2012. 
 29.34     (b) A school district that received transition revenue in 
 29.35  fiscal year 2004 may convert all or part of its transition 
 29.36  revenue to referendum revenue with voter approval in a 
 30.1   referendum called for the purpose.  The referendum must be held 
 30.2   in accordance with subdivision 9, except that the ballot may 
 30.3   state that existing transition revenue authority is being 
 30.4   canceled or is expiring.  In this case, the ballot shall compare 
 30.5   the proposed referendum allowance to the canceled or expiring 
 30.6   transition revenue allowance.  For purposes of this comparison, 
 30.7   the canceled or expiring transition revenue allowance per 
 30.8   adjusted marginal cost pupil unit shall be converted to an 
 30.9   allowance per resident marginal cost pupil unit based on the 
 30.10  district's ratio of adjusted marginal cost pupil units to 
 30.11  resident marginal cost pupil units for the preceding fiscal 
 30.12  year.  The referendum must be held on the first Tuesday after 
 30.13  the first Monday in November.  The notice required under section 
 30.14  275.60 may be modified to read:  "BY VOTING 'YES' ON THIS BALLOT 
 30.15  QUESTION, YOU MAY BE VOTING FOR A PROPERTY TAX INCREASE."  
 30.16  Elections under this paragraph must be held in 2007 or 
 30.17  earlier. its transition revenue 2004 conversion allowance to 
 30.18  additional referendum allowance under subdivision 1 for fiscal 
 30.19  year 2007 and thereafter.  A majority of the school board must 
 30.20  approve the conversion at a public meeting before November 1, 
 30.21  2005.  For a district with other referendum authority, as of 
 30.22  July 1, 2005, that extends beyond June 30, 2010, the referendum 
 30.23  conversion allowance approved by the board under this paragraph 
 30.24  continues until the portion of the district's other referendum 
 30.25  authority, as of July 1, 2005, with the earliest expiration date 
 30.26  after June 30, 2010, expires.  For a district with no other 
 30.27  referendum authority, as of July 1, 2005, that extends beyond 
 30.28  June 30, 2010, the referendum conversion allowance approved by 
 30.29  the board continues until June 30, 2016.  
 30.30     Sec. 42.  Minnesota Statutes 2004, section 126C.21, 
 30.31  subdivision 4, is amended to read: 
 30.32     Subd. 4.  [TACONITE DEDUCTIONS.] (1) Notwithstanding any 
 30.33  provisions of any other law to the contrary, the adjusted net 
 30.34  tax capacity used in calculating general education aid may 
 30.35  include only that property that is currently taxable in the 
 30.36  district.  
 31.1      (2) For districts that received payments have revenue under 
 31.2   sections 298.018; 298.225; 229.24 to 298.28, excluding 298.26 
 31.3   and 298.28, subdivision 4, paragraph (d); 298.34 to 298.39; 
 31.4   298.391 to 298.396; and 298.405; and 477A.15, any law imposing a 
 31.5   tax upon severed mineral values; or recognized revenue under 
 31.6   section 477A.15; the general education aid must be reduced in 
 31.7   the final adjustment payment by (1) the difference between the 
 31.8   dollar amount of the payments received revenue recognized 
 31.9   pursuant to those sections, or revenue recognized under section 
 31.10  477A.15 in for the fiscal year to which the final adjustment is 
 31.11  attributable and, less (2) the amount that was calculated, 
 31.12  pursuant to section 126C.48, subdivision 8, as a reduction of 
 31.13  the levy attributable to the fiscal year to which the final 
 31.14  adjustment is attributable.  If the final adjustment of a 
 31.15  district's general education aid for a fiscal year is a negative 
 31.16  amount because of this clause subdivision, the next fiscal 
 31.17  year's general education aid to that district must be reduced by 
 31.18  this negative amount in the following manner:  there must be 
 31.19  withheld from each scheduled general education aid payment due 
 31.20  the district in such fiscal year, 15 percent of the total 
 31.21  negative amount, until the total negative amount has been 
 31.22  withheld.  The amount reduced from general education aid 
 31.23  pursuant to this clause subdivision must be recognized as reduce 
 31.24  revenue in the fiscal year to which the final adjustment payment 
 31.25  is attributable. 
 31.26     Sec. 43.  Minnesota Statutes 2004, section 126C.48, 
 31.27  subdivision 2, is amended to read: 
 31.28     Subd. 2.  [NOTICE TO COMMISSIONER; FORMS.] By October 7 of 
 31.29  each year each district must notify the commissioner of the 
 31.30  proposed levies in compliance with the levy limitations of this 
 31.31  chapter and chapters 120B, 122A, 123A, 123B, 124D, 125A, 127A, 
 31.32  and 136D.  By January 15 7 of each year each district must 
 31.33  notify the commissioner of the final levies certified.  The 
 31.34  commissioner shall prescribe the form of these notifications and 
 31.35  may request any additional information necessary to compute 
 31.36  certified levy amounts. 
 32.1      Sec. 44.  Minnesota Statutes 2004, section 126C.48, 
 32.2   subdivision 8, is amended to read: 
 32.3      Subd. 8.  [TACONITE PAYMENT AND OTHER REDUCTIONS.] (1) 
 32.4   Reductions in levies pursuant to subdivision 1 must be made 
 32.5   prior to the reductions in clause (2). 
 32.6      (2) Notwithstanding any other law to the contrary, 
 32.7   districts which received payments that have revenue pursuant to 
 32.8   sections 298.018; 298.225; 298.24 to 298.28, except an amount 
 32.9   distributed under section sections 298.26; 298.28, subdivision 
 32.10  4, paragraph paragraphs (c), clause (ii), and (d); 298.34 to 
 32.11  298.39; 298.391 to 298.396; 298.405; 477A.15; and any law 
 32.12  imposing a tax upon severed mineral values; or recognized 
 32.13  revenue under section 477A.15 must not include a portion of 
 32.14  these aids in their permissible levies pursuant to those 
 32.15  sections, but instead must reduce the permissible levies 
 32.16  authorized by this chapter and chapters 120B, 122A, 123A, 123B, 
 32.17  124A, 124D, 125A, and 127A by the greater of the following: 95 
 32.18  percent of the previous year's revenue specified under this 
 32.19  clause. 
 32.20     (a) an amount equal to 50 percent of the total dollar 
 32.21  amount of the payments received pursuant to those sections or 
 32.22  revenue recognized under section 477A.15 in the previous fiscal 
 32.23  year; or 
 32.24     (b) an amount equal to the total dollar amount of the 
 32.25  payments received pursuant to those sections or revenue 
 32.26  recognized under section 477A.15 in the previous fiscal year 
 32.27  less the product of the same dollar amount of payments or 
 32.28  revenue times five percent. 
 32.29     For levy year 2002 only, 77 percent of the amounts 
 32.30  distributed under section 298.225 and 298.28, and 100 percent of 
 32.31  the amounts distributed under sections 298.018; 298.34 to 
 32.32  298.39; 298.391 to 298.396; 298.405; and any law imposing a tax 
 32.33  upon severed mineral values, or recognized revenue under section 
 32.34  477A.15, shall be used for purposes of the calculations under 
 32.35  this paragraph.  For levy year 2003 only, the levy reductions 
 32.36  under this subdivision must be calculated as if section 298.28, 
 33.1   subdivision 4, paragraph (f), did not apply for the 2003 
 33.2   distribution. 
 33.3      (3) The amount of any voter approved referendum, facilities 
 33.4   down payment, and debt levies shall not be reduced by more than 
 33.5   50 percent under this subdivision.  In administering this 
 33.6   paragraph, the commissioner shall first reduce the nonvoter 
 33.7   approved levies of a district; then, if any payments, severed 
 33.8   mineral value tax revenue or recognized revenue under paragraph 
 33.9   (2) remains, the commissioner shall reduce any voter approved 
 33.10  referendum levies authorized under section 126C.17; then, if any 
 33.11  payments, severed mineral value tax revenue or recognized 
 33.12  revenue under paragraph (2) remains, the commissioner shall 
 33.13  reduce any voter approved facilities down payment levies 
 33.14  authorized under section 123B.63 and then, if any payments, 
 33.15  severed mineral value tax revenue or recognized revenue under 
 33.16  paragraph (2) remains, the commissioner shall reduce any voter 
 33.17  approved debt levies.  
 33.18     (4) Before computing the reduction pursuant to this 
 33.19  subdivision of the health and safety levy authorized by sections 
 33.20  123B.57 and 126C.40, subdivision 5, the commissioner shall 
 33.21  ascertain from each affected school district the amount it 
 33.22  proposes to levy under each section or subdivision.  The 
 33.23  reduction shall be computed on the basis of the amount so 
 33.24  ascertained. 
 33.25     (5) To the extent the levy reduction calculated under 
 33.26  paragraph (2) exceeds the limitation in paragraph (3), an amount 
 33.27  equal to the excess must be distributed from the school 
 33.28  district's distribution under sections 298.225, 298.28, and 
 33.29  477A.15 in the following year to the cities and townships within 
 33.30  the school district in the proportion that their taxable net tax 
 33.31  capacity within the school district bears to the taxable net tax 
 33.32  capacity of the school district for property taxes payable in 
 33.33  the year prior to distribution.  No city or township shall 
 33.34  receive a distribution greater than its levy for taxes payable 
 33.35  in the year prior to distribution.  The commissioner of revenue 
 33.36  shall certify the distributions of cities and towns under this 
 34.1   paragraph to the county auditor by September 30 of the year 
 34.2   preceding distribution.  The county auditor shall reduce the 
 34.3   proposed and final levies of cities and towns receiving 
 34.4   distributions by the amount of their distribution.  
 34.5   Distributions to the cities and towns shall be made at the times 
 34.6   provided under section 298.27. 
 34.7      Sec. 45.  Minnesota Statutes 2004, section 127A.45, 
 34.8   subdivision 11, is amended to read: 
 34.9      Subd. 11.  [PAYMENT PERCENTAGE FOR REIMBURSEMENT AIDS.] One 
 34.10  hundred percent of the aid for the previous fiscal year must be 
 34.11  paid in the current year for the following aids:  
 34.12  telecommunications/Internet access equity aid according to 
 34.13  section 125B.26, special education special pupil aid according 
 34.14  to section 125A.75, subdivision 3, aid for litigation costs 
 34.15  according to section 125A.75, subdivision 8, aid for 
 34.16  court-placed special education expenses according to section 
 34.17  125A.79, subdivision 4, and aid for special education 
 34.18  out-of-state tuition according to section 125A.79, subdivision 8 
 34.19  and shared time aid according to section 126C.01, subdivision 7. 
 34.20     Sec. 46.  Minnesota Statutes 2004, section 127A.47, 
 34.21  subdivision 8, is amended to read: 
 34.22     Subd. 8.  [CHARTER SCHOOLS.] (a) The general education aid 
 34.23  for districts must be adjusted for each pupil attending a 
 34.24  charter school under section 124D.10.  The adjustments must be 
 34.25  made according to this subdivision. 
 34.26     (b) General education aid paid to a district in which a 
 34.27  charter school not providing transportation according to section 
 34.28  124D.10, subdivision 16, is located must be increased by an 
 34.29  amount equal to the product of:  (1) the sum of an amount equal 
 34.30  to the product of the formula allowance according to section 
 34.31  126C.10, subdivision 2, times .0485 for fiscal years 2005 and 
 34.32  2006 and times .0458 for fiscal year 2007 and later, plus the 
 34.33  transportation sparsity allowance for the district; times (2) 
 34.34  the pupil units attributable to the pupil.  
 34.35     Sec. 47.  Minnesota Statutes 2004, section 127A.49, 
 34.36  subdivision 2, is amended to read: 
 35.1      Subd. 2.  [ABATEMENTS.] Whenever by virtue of chapter 278, 
 35.2   sections 270.07, 375.192, or otherwise, the net tax capacity of 
 35.3   any district for any taxable year is changed after the taxes for 
 35.4   that year have been spread by the county auditor and the local 
 35.5   tax rate as determined by the county auditor based upon the 
 35.6   original net tax capacity is applied upon the changed net tax 
 35.7   capacities, the county auditor shall, prior to February 1 of 
 35.8   each year, certify to the commissioner of education the amount 
 35.9   of any resulting net revenue loss that accrued to the district 
 35.10  during the preceding year.  Each year, the commissioner shall 
 35.11  pay an abatement adjustment to the district in an amount 
 35.12  calculated according to the provisions of this subdivision.  
 35.13  This amount shall be deducted from the amount of the levy 
 35.14  authorized by section 126C.46.  The amount of the abatement 
 35.15  adjustment must be the product of:  
 35.16     (1) the net revenue loss as certified by the county 
 35.17  auditor, times 
 35.18     (2) the ratio of:  
 35.19     (i) the sum of the amounts of the district's certified levy 
 35.20  in the third preceding year according to the following:  
 35.21     (A) section 123B.57, if the district received health and 
 35.22  safety aid according to that section for the second preceding 
 35.23  year; 
 35.24     (B) section 124D.20, if the district received aid for 
 35.25  community education programs according to that section for the 
 35.26  second preceding year; 
 35.27     (C) section 124D.135, subdivision 3, if the district 
 35.28  received early childhood family education aid according to 
 35.29  section 124D.135 for the second preceding year; and 
 35.30     (D) section 126C.17, subdivision 6, if the district 
 35.31  received referendum equalization aid according to that section 
 35.32  for the second preceding year; to 
 35.33     (ii) the total amount of the district's certified levy in 
 35.34  the third preceding December, plus or minus auditor's 
 35.35  adjustments. 
 35.36     Sec. 48.  Minnesota Statutes 2004, section 127A.49, 
 36.1   subdivision 3, is amended to read: 
 36.2      Subd. 3.  [EXCESS TAX INCREMENT.] (a) If a return of excess 
 36.3   tax increment is made to a district pursuant to section sections 
 36.4   469.176, subdivision 2, and 469.177, subdivision 9, or upon 
 36.5   decertification of a tax increment district, the school 
 36.6   district's aid and levy limitations must be adjusted for the 
 36.7   fiscal year in which the excess tax increment is paid under the 
 36.8   provisions of this subdivision. 
 36.9      (b) An amount must be subtracted from the district's aid 
 36.10  for the current fiscal year equal to the product of: 
 36.11     (1) the amount of the payment of excess tax increment to 
 36.12  the district, times 
 36.13     (2) the ratio of: 
 36.14     (i) the sum of the amounts of the district's certified levy 
 36.15  for the fiscal year in which the excess tax increment is paid 
 36.16  according to the following: 
 36.17     (A) section 123B.57, if the district received health and 
 36.18  safety aid according to that section for the second preceding 
 36.19  year; 
 36.20     (B) section 124D.20, if the district received aid for 
 36.21  community education programs according to that section for the 
 36.22  second preceding year; 
 36.23     (C) section 124D.135, subdivision 3, if the district 
 36.24  received early childhood family education aid according to 
 36.25  section 124D.135 for the second preceding year; and 
 36.26     (D) section 126C.17, subdivision 6, if the district 
 36.27  received referendum equalization aid according to that section 
 36.28  for the second preceding year; to 
 36.29     (ii) the total amount of the district's certified levy for 
 36.30  the fiscal year, plus or minus auditor's adjustments. 
 36.31     (c) An amount must be subtracted from the school district's 
 36.32  levy limitation for the next levy certified equal to the 
 36.33  difference between: 
 36.34     (1) the amount of the distribution of excess increment; and 
 36.35     (2) the amount subtracted from aid pursuant to clause (a). 
 36.36     If the aid and levy reductions required by this subdivision 
 37.1   cannot be made to the aid for the fiscal year specified or to 
 37.2   the levy specified, the reductions must be made from aid for 
 37.3   subsequent fiscal years, and from subsequent levies.  The school 
 37.4   district must use the payment of excess tax increment to replace 
 37.5   the aid and levy revenue reduced under this subdivision. 
 37.6      (d) This subdivision applies only to the total amount of 
 37.7   excess increments received by a district for a calendar year 
 37.8   that exceeds $25,000. 
 37.9      Sec. 49.  Minnesota Statutes 2004, section 275.14, is 
 37.10  amended to read: 
 37.11     275.14 [CENSUS.] 
 37.12     For the purposes of sections 275.124 to 275.16, the 
 37.13  population of a city shall be that established by the last 
 37.14  federal census, by a special census taken by the United States 
 37.15  Bureau of the Census, by an estimate made by the Metropolitan 
 37.16  Council, or by the state demographer made according to section 
 37.17  4A.02, whichever has the latest stated date of count or 
 37.18  estimate, before July 2 of the current levy year.  The 
 37.19  population of a school district must be as certified by the 
 37.20  Department of Education from the most recent federal census.  In 
 37.21  any year in which no federal census is taken pursuant to law in 
 37.22  any school district affected by sections 275.124 to 
 37.23  275.16 124D.20 and 124D.531 a population estimate may be made 
 37.24  and submitted to the state demographer for approval as 
 37.25  hereinafter provided.  The school board of a school district, in 
 37.26  case it desires a population estimate, shall pass a resolution 
 37.27  by July 1 containing a current estimate of the population of the 
 37.28  school district and shall submit the resolution to the state 
 37.29  demographer.  The resolution shall describe the criteria on 
 37.30  which the estimate is based and shall be in a form and 
 37.31  accompanied by the data prescribed by the state demographer.  
 37.32  The state demographer shall determine whether or not the 
 37.33  criteria and process described in the resolution provide a 
 37.34  reasonable basis for the population estimate and shall inform 
 37.35  the school district of that determination within 30 days of 
 37.36  receipt of the resolution.  If the state demographer determines 
 38.1   that the criteria and process described in the resolution do not 
 38.2   provide a reasonable basis for the population estimate, the 
 38.3   resolution shall be of no effect.  If the state demographer 
 38.4   determines that the criteria and process do provide a reasonable 
 38.5   basis for the population estimate, the estimate shall be treated 
 38.6   as the population of the school district for the purposes of 
 38.7   sections 275.124 to 275.16 124D.20 and 124D.531 until the 
 38.8   population of the school district has been established by the 
 38.9   next federal census or until a more current population estimate 
 38.10  is prepared and approved as provided herein, whichever occurs 
 38.11  first.  The state demographer shall establish guidelines for 
 38.12  acceptable population estimation criteria and processes.  The 
 38.13  state demographer shall issue advisory opinions upon request in 
 38.14  writing to cities or school districts as to proposed criteria 
 38.15  and processes prior to their implementation in an estimation.  
 38.16  The advisory opinion shall be final and binding upon the 
 38.17  demographer unless the demographer can show cause why it should 
 38.18  not be final and binding.  
 38.19     In the event that a census tract employed in taking a 
 38.20  federal or local census overlaps two or more school districts, 
 38.21  the county auditor shall, on the basis of the best information 
 38.22  available, allocate the population of said census tract to the 
 38.23  school districts involved.  
 38.24     The term "council," as used in sections 275.124 to 275.16, 
 38.25  means any board or body, whether composed of one or more 
 38.26  branches, authorized to make ordinances for the government of a 
 38.27  city within this state.  
 38.28     Sec. 50.  Minnesota Statutes 2004, section 275.16, is 
 38.29  amended to read: 
 38.30     275.16 [COUNTY AUDITOR TO FIX AMOUNT OF LEVY.] 
 38.31     If any such municipality shall return to the county auditor 
 38.32  a levy greater than permitted by chapters 123A, 123B, 124D, 
 38.33  126C, and 136C, and 136D, sections 275.124 to 275.16, and 275.70 
 38.34  to 275.74, such county auditor shall extend only such amount of 
 38.35  taxes as the limitations herein prescribed will permit; 
 38.36  provided, if such levy shall include any levy for the payment of 
 39.1   bonded indebtedness or judgments, such levies for bonded 
 39.2   indebtedness or judgments shall be extended in full, and the 
 39.3   remainder of the levies shall be reduced so that the total 
 39.4   thereof, including levies for bonds and judgments, shall not 
 39.5   exceed such amount as the limitations herein prescribed will 
 39.6   permit. 
 39.7      Sec. 51.  Minnesota Statutes 2004, section 469.177, 
 39.8   subdivision 9, is amended to read: 
 39.9      Subd. 9.  [DISTRIBUTIONS OF EXCESS TAXES ON CAPTURED NET 
 39.10  TAX CAPACITY.] (a) If the amount of tax paid on captured net tax 
 39.11  capacity exceeds the amount of tax increment, the county auditor 
 39.12  shall distribute the excess to the municipality, county, and 
 39.13  school district as follows:  each governmental unit's share of 
 39.14  the excess equals 
 39.15     (1) the total amount of the excess for the tax increment 
 39.16  financing district, multiplied by 
 39.17     (2) a fraction, the numerator of which is the current local 
 39.18  tax rate of the governmental unit less the governmental unit's 
 39.19  local tax rate for the year the original local tax rate for the 
 39.20  district was certified (in no case may this amount be less than 
 39.21  zero) and the denominator of which is the sum of the numerators 
 39.22  for the municipality, county, and school district. 
 39.23  If the entire increase in the local tax rate is attributable to 
 39.24  a taxing district, other than the municipality, county, or 
 39.25  school district, then the excess must be distributed to the 
 39.26  municipality, county, and school district in proportion to their 
 39.27  respective local tax rates. 
 39.28     (b) The amounts distributed shall be deducted in computing 
 39.29  the levy limits of the taxing district for the succeeding 
 39.30  taxable year.  In the case of a school district, only the 
 39.31  proportion of the excess taxes attributable to unequalized 
 39.32  levies that are subject to a fixed dollar amount levy limit 
 39.33  shall be deducted from the levy limit. 
 39.34     (c) In the case of distributions to a school district that 
 39.35  are attributable to state equalized levies, the county auditor 
 39.36  shall report amounts distributed to the commissioner of 
 40.1   education in the same manner as provided for excess increments 
 40.2   under section 469.176, subdivision 2, and the distribution shall 
 40.3   be deducted from the school district's state aid payments and 
 40.4   levy limitation according to section 127A.49, subdivision 3. 
 40.5      Sec. 52.  2005 S.F. No. 1879, article 3, section 3, 
 40.6   subdivision 2, if enacted, is amended to read: 
 40.7      Subd. 2.  [GENERAL EDUCATION AID.] For general education 
 40.8   aid under Minnesota Statutes, section 126C.13, subdivision 4: 
 40.9       $5,012,148,000 5,215,775,000 .....     2006
 40.10      $5,007,512,000 5,419,253,000 .....     2007
 40.11     The 2006 appropriation includes $784,978,000 for 2005 and 
 40.12  $4,227,170,000 4,430,797,000 for 2006. 
 40.13     The 2007 appropriation includes $782,399,000 825,190,000 
 40.14  for 2006 and $4,225,113,000 4,594,063,000 for 2007.  
 40.15     Sec. 53.  2005 S.F. No. 1879, article 3, section 3, 
 40.16  subdivision 3, if enacted, is amended to read: 
 40.17     Subd. 3.  [REFERENDUM TAX BASE REPLACEMENT AID.] For 
 40.18  referendum tax base replacement aid under Minnesota Statutes, 
 40.19  section 126C.17, subdivision 7a: 
 40.20       $8,704,000    .....     2006 
 40.21       $8,704,000 8,706,000    .....     2007 
 40.22     The 2006 appropriation includes $1,366,000 for 2005 and 
 40.23  $7,338,000 for 2006.  
 40.24     The 2007 appropriation includes $1,366,000 for 2006 and 
 40.25  $7,338,000 7,340,000 for 2007. 
 40.26     Sec. 54.  2005 S.F. No. 1879, article 3, section 3, 
 40.27  subdivision 7, if enacted, is amended to read: 
 40.28     Subd. 7.  [NONPUBLIC PUPIL EDUCATION AID.] For nonpublic 
 40.29  pupil education aid under Minnesota Statutes, sections 123B.40 
 40.30  to 123B.43 and 123B.87: 
 40.31       $15,174,000 15,817,000    .....     2006 
 40.32       $15,976,000 17,426,000    .....     2007 
 40.33     The 2006 appropriation includes $2,305,000 for 2005 and 
 40.34  $12,869,000 13,512,000 for 2006. 
 40.35     The 2007 appropriation includes $2,396,000 2,516,000 for 
 40.36  2006 and $13,580,000 14,910,000 for 2007. 
 41.1      Sec. 55.  2005 S.F. No. 1879, article 3, section 3, 
 41.2   subdivision 8, if enacted, is amended to read: 
 41.3      Subd. 8.  [NONPUBLIC PUPIL TRANSPORTATION AID.] For 
 41.4   nonpublic pupil transportation aid under Minnesota Statutes, 
 41.5   section 123B.92, subdivision 9: 
 41.6        $20,758,000 21,633,000     .....     2006 
 41.7        $21,446,000 23,390,000     .....     2007 
 41.8      The 2006 appropriation includes $3,274,000 for 2005 and 
 41.9   $17,484,000 18,359,000 for 2006. 
 41.10     The 2007 appropriation includes $3,256,000 3,418,000 for 
 41.11  2006 and $18,190,000 19,972,000 for 2007. 
 41.12     Sec. 56.  [FOUR-YEAR OLD PREKINDERGARTEN ALLOWANCE.] 
 41.13     (a) A district's four-year old prekindergarten revenue 
 41.14  equals the sum of (1) the amount of referendum revenue under 
 41.15  Minnesota Statutes, section 126C.17, and general education 
 41.16  revenue, excluding transition revenue, for fiscal year 2004 
 41.17  attributable to pupils four or five years of age on September 1, 
 41.18  2003, enrolled in a prekindergarten program implemented by the 
 41.19  district before July 1, 2003, and reported as kindergarten 
 41.20  pupils under Minnesota Statutes, section 126C.05, subdivision 1, 
 41.21  for fiscal year 2004, plus (2) the amount of compensatory 
 41.22  education revenue under Minnesota Statutes, section 126C.05, 
 41.23  subdivision 3, for fiscal year 2005 attributable to pupils four 
 41.24  years of age on September 1, 2003, enrolled in a prekindergarten 
 41.25  program implemented by the district before July 1, 2003, and 
 41.26  reported as kindergarten pupils under Minnesota Statutes, 
 41.27  section 126C.05, subdivision 1, for 2004. 
 41.28     (b) A district's four-year old prekindergarten allowance 
 41.29  equals a district's four-year old prekindergarten revenue under 
 41.30  paragraph (a) divided by its 2007 resident marginal cost pupil 
 41.31  units. 
 41.32     Sec. 57.  [TRANSITION REVENUE 2004 CONVERSION ALLOWANCE.] 
 41.33     (a) A district's transition revenue 2004 conversion 
 41.34  allowance is equal to the sum of (1) the district's fiscal year 
 41.35  2004 transition revenue allowance multiplied by the ratio of its 
 41.36  adjusted marginal cost pupil units to its resident marginal cost 
 42.1   pupil units for the preceding fiscal year, plus (2) its 
 42.2   four-year old prekindergarten allowance multiplied by 0.01. 
 42.3      (b) Notwithstanding Minnesota Statutes, section 126C.17, 
 42.4   subdivision 2, the transition revenue 2004 conversion allowance 
 42.5   is increased by $40 for any school district whose referendum 
 42.6   allowance limit under Minnesota Statutes, section 126C.17, 
 42.7   subdivision 2, does not increase in fiscal year 2007 as a result 
 42.8   of growth, excluding roll-ins, in the formula allowance under 
 42.9   Minnesota Statutes, section 126C.10, subdivision 2, and whose 
 42.10  referendum allowance under Minnesota Statutes, section 126C.17, 
 42.11  subdivision 1, is greater than the formula allowance multiplied 
 42.12  by 18.6 percent.  A district that is eligible for sparsity 
 42.13  revenue is not eligible for this additional transition allowance 
 42.14  adjustment. 
 42.15     Sec. 58.  [SCHOOL BUS LOAN; CARPENTER SCHOOL BUSES.] 
 42.16     Subdivision 1.  [BUS LOAN REVENUE.] In fiscal year 2006 
 42.17  only, a school district may receive bus loan revenue equal to up 
 42.18  to $30,000 times the number of Carpenter school buses in its 
 42.19  fleet between March 30, 2003, and March 30, 2004, that have been 
 42.20  determined to have potentially defective welds and are subject 
 42.21  to the limitations imposed by the Department of Public Safety.  
 42.22  A school district that is eligible to receive revenue under this 
 42.23  subdivision must approve a board resolution to receive revenue 
 42.24  according to this section.  
 42.25     Subd. 2.  [LEVY.] For taxes payable in 2006 through 2009, a 
 42.26  school district that receives revenue under subdivision 1 must 
 42.27  levy an amount equal to its bus loan revenue times .25.  
 42.28     Subd. 3.  [GENERAL EDUCATION REVENUE WITHHOLDING.] For 
 42.29  fiscal years 2007 through 2010, the Department of Education 
 42.30  shall reduce the general education aid under Minnesota Statutes, 
 42.31  section 126C.13, subdivision 4, for each district that receives 
 42.32  revenue under subdivision 1 in an amount equal to the district's 
 42.33  bus loan revenue times .25.  
 42.34     Sec. 59.  [RED LAKE FISCAL YEAR 2005 PUPIL UNITS.] 
 42.35     Notwithstanding Minnesota Statutes, section 126C.05, the 
 42.36  fiscal year 2005 average daily membership for Independent School 
 43.1   District No. 38, Red Lake, shall be the greater of the amount 
 43.2   that would have been computed if the district's school buildings 
 43.3   had not reopened after March 21, 2005, or the amount computed 
 43.4   using actual data for the entire school year.  Notwithstanding 
 43.5   Minnesota Statutes, section 126C.05, subdivision 15, for fiscal 
 43.6   year 2005, learning year pupil units for Independent School 
 43.7   District No. 38, Red Lake, must be calculated using the hours in 
 43.8   excess of the actual number of instructional hours in the 
 43.9   calendar year for the school attended by the student, instead of 
 43.10  the number of hours in excess of 1,020 for a secondary school 
 43.11  pupil. 
 43.12     Sec. 60.  [FISCAL YEARS 2006 AND 2007 DECLINING PUPIL UNIT 
 43.13  AID, RED LAKE.] 
 43.14     For fiscal years 2006 and 2007 only, Independent School 
 43.15  District No. 38, Red Lake, is eligible for declining pupil unit 
 43.16  aid equal to the greater of zero or the product of the general 
 43.17  education formula allowance times the difference between the 
 43.18  district's adjusted marginal cost pupil units for fiscal year 
 43.19  2005 and the district's adjusted marginal cost pupil units for 
 43.20  that fiscal year.  Notwithstanding Minnesota Statutes, section 
 43.21  126C.13, the declining pupil unit aid must be included in 
 43.22  calculating the district's general education aid. 
 43.23     Sec. 61.  [KINDERGARTEN REPORTING.] 
 43.24     Notwithstanding Minnesota Statutes, sections 120A.05, 
 43.25  subdivision 18; 120A.20, subdivision 1; and 124D.02, subdivision 
 43.26  1, pupils four or five years of age on September 1 of the 
 43.27  calendar year in which the school year commences and enrolled in 
 43.28  a prekindergarten program implemented by the district before 
 43.29  July 1, 2003, may be reported as kindergarten pupils under 
 43.30  Minnesota Statutes, section 126C.05, subdivision 1, for fiscal 
 43.31  year 2004 and earlier. 
 43.32     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 43.33  following final enactment and applies to fiscal year 2004 and 
 43.34  earlier. 
 43.35     Sec. 62.  [TRANSITION REVENUE ADJUSTMENTS.] 
 43.36     For taxes payable in 2006, a district may levy an amount 
 44.1   equal to the increase in the district's transition levy for 
 44.2   fiscal year 2006 under Minnesota Statutes, section 126C.10, 
 44.3   subdivision 31, paragraph (c). 
 44.4      Sec. 63.  [APPROPRIATIONS.] 
 44.5      Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
 44.6   indicated in this section are appropriated from the general fund 
 44.7   to the Department of Education for the fiscal years designated.  
 44.8      Subd. 2.  [SCHOOL BUS LOAN REVENUE.] For school bus loan 
 44.9   revenue under section 58: 
 44.10       $3,630,000     .....     2006 
 44.11     Sec. 64.  [REPEALER.] 
 44.12     (a) Minnesota Statutes 2004, sections 123B.83, subdivision 
 44.13  1; and 126C.42, subdivisions 1 and 4, are repealed. 
 44.14     (b) Minnesota Statutes 2004, sections 126C.10, subdivisions 
 44.15  13a, 13b, 29, 30, 31, 32, and 33; and 126C.44, are repealed for 
 44.16  revenue for fiscal year 2007. 
 44.17                             ARTICLE 2 
 44.18                        EDUCATION EXCELLENCE 
 44.19     Section 1.  Minnesota Statutes 2004, section 13.321, is 
 44.20  amended by adding a subdivision to read: 
 44.21     Subd. 10.  [TEACHER DATA FROM VALUE-ADDED ASSESSMENT 
 44.22  MODEL.] Data on individual teachers generated from a value-added 
 44.23  assessment model are governed under section 120B.362. 
 44.24     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 44.25  following final enactment. 
 44.26     Sec. 2.  [120A.38] [CLASSROOM PLACEMENT; PARENT 
 44.27  DISCRETION.] 
 44.28     (a) A parent or guardian of twins or higher order multiples 
 44.29  may request that the children be placed in the same classroom or 
 44.30  in separate classrooms if the children are in the same grade 
 44.31  level at the same school.  The school may recommend classroom 
 44.32  placement to the parents and provide professional education 
 44.33  advice to the parents to assist them in making the best decision 
 44.34  for their children's education.  A school must provide the 
 44.35  placement requested by the children's parent or guardian, unless 
 44.36  the school board makes a classroom placement determination 
 45.1   following the school principal's request according to this 
 45.2   section.  The parent or guardian must request the classroom 
 45.3   placement no later than 14 days after the first day of each 
 45.4   school year or 14 days after the first day of attendance of the 
 45.5   children during a school year if the children are enrolled in 
 45.6   the school after the school year commences.  At the end of the 
 45.7   initial grading period, if the school principal, in consultation 
 45.8   with the children's classroom teacher, determines that the 
 45.9   requested classroom placement is disruptive to the school, the 
 45.10  school principal may request that the school board determine the 
 45.11  children's classroom placement. 
 45.12     (b) For purposes of this section, "higher order multiples" 
 45.13  means triplets, quadruplets, quintuplets, or more. 
 45.14     <b>[EFFECTIVE DATE.]</b> This section is effective for the 
 45.15  2005-2006 school year and later. 
 45.16     Sec. 3.  Minnesota Statutes 2004, section 120B.02, is 
 45.17  amended to read: 
 45.18     120B.02 [EDUCATIONAL EXPECTATIONS FOR MINNESOTA'S 
 45.19  STUDENTS.] 
 45.20     (a) The legislature is committed to establishing rigorous 
 45.21  academic standards for Minnesota's public school students.  To 
 45.22  that end, the commissioner shall adopt in rule statewide 
 45.23  academic standards.  The commissioner shall not prescribe in 
 45.24  rule or otherwise the delivery system, classroom assessments, or 
 45.25  form of instruction that school sites must use.  For purposes of 
 45.26  this chapter, a school site is a separate facility, or a 
 45.27  separate program within a facility that a local school board 
 45.28  recognizes as a school site for funding purposes.  
 45.29     (b) All commissioner actions regarding the rule must be 
 45.30  premised on the following:  
 45.31     (1) the rule is intended to raise academic expectations for 
 45.32  students, teachers, and schools; 
 45.33     (2) any state action regarding the rule must evidence 
 45.34  consideration of school district autonomy; and 
 45.35     (3) the Department of Education, with the assistance of 
 45.36  school districts, must make available information about all 
 46.1   state initiatives related to the rule to students and parents, 
 46.2   teachers, and the general public in a timely format that is 
 46.3   appropriate, comprehensive, and readily understandable. 
 46.4      (c) When fully implemented, the requirements for high 
 46.5   school graduation in Minnesota must require students to pass the 
 46.6   basic skills test requirements and satisfactorily complete, as 
 46.7   determined by the school district, the course credit 
 46.8   requirements under section 120B.024 and: 
 46.9      (1) for students enrolled in grade 8 before the 2005-2006 
 46.10  school year, to pass the basic skills test requirements; or 
 46.11     (2) for students enrolled in grade 8 in the 2005-2006 
 46.12  school year and later, to pass the Minnesota Comprehensive 
 46.13  Assessments Second Edition (MCA-IIs). 
 46.14     (d) The commissioner shall periodically review and report 
 46.15  on the state's assessment process. 
 46.16     (e) School districts are not required to adopt specific 
 46.17  provisions of the Goals 2000 and the federal School-to-Work 
 46.18  programs. 
 46.19     Sec. 4.  Minnesota Statutes 2004, section 120B.021, 
 46.20  subdivision 1, is amended to read: 
 46.21     Subdivision 1.  [REQUIRED ACADEMIC STANDARDS.] The 
 46.22  following subject areas are required for statewide 
 46.23  accountability: 
 46.24     (1) language arts; 
 46.25     (2) mathematics; 
 46.26     (3) science; 
 46.27     (4) social studies, including history, geography, 
 46.28  economics, and government and citizenship; 
 46.29     (5) health and physical education, for which locally 
 46.30  developed academic standards apply; and 
 46.31     (6) the arts, for which statewide or locally developed 
 46.32  academic standards apply, as determined by the school district.  
 46.33  Public elementary and middle schools must offer at least three 
 46.34  and require at least two of the following four arts areas:  
 46.35  dance; music; theater; and visual arts.  Public high schools 
 46.36  must offer at least three and require at least one of the 
 47.1   following five arts areas:  media arts; dance; music; theater; 
 47.2   and visual arts.  
 47.3      The commissioner must submit proposed standards in science 
 47.4   and social studies to the legislature by February 1, 2004.  
 47.5   For purposes of applicable federal law, the academic standards 
 47.6   for language arts, mathematics, and science apply to all public 
 47.7   school students, except the very few students with extreme 
 47.8   cognitive or physical impairments for whom an individualized 
 47.9   education plan team has determined that the required academic 
 47.10  standards are inappropriate.  An individualized education plan 
 47.11  team that makes this determination must establish alternative 
 47.12  standards. 
 47.13     A school district, no later than the 2007-2008 school year, 
 47.14  must adopt graduation requirements that meet or exceed state 
 47.15  graduation requirements established in law or rule.  A school 
 47.16  district that incorporates these state graduation requirements 
 47.17  before the 2007-2008 school year must provide students who enter 
 47.18  the 9th grade in or before the 2003-2004 school year the 
 47.19  opportunity to earn a diploma based on existing locally 
 47.20  established graduation requirements in effect when the students 
 47.21  entered the 9th grade.  District efforts to develop, implement, 
 47.22  or improve instruction or curriculum as a result of the 
 47.23  provisions of this section must be consistent with sections 
 47.24  120B.10, 120B.11, and 120B.20.  
 47.25     At a minimum, school districts must maintain the same 
 47.26  physical education and health education requirements for 
 47.27  students in kindergarten through grade 8 adopted for the 
 47.28  2004-2005 school year through the 2007-2008 school year.  Before 
 47.29  a revision of the local health and physical education standards, 
 47.30  a school district must consult the grade-specific benchmarks 
 47.31  developed by the Department of Education's health and physical 
 47.32  education quality teaching network for the six national physical 
 47.33  education standards and the seven national health standards. 
 47.34     Sec. 5.  Minnesota Statutes 2004, section 120B.021, is 
 47.35  amended by adding a subdivision to read: 
 47.36     Subd. 1a.  [RIGOROUS COURSE OF STUDY; WAIVER.] (a) Upon 
 48.1   receiving a student's application signed by the student's parent 
 48.2   or guardian, a school district, area learning center, or charter 
 48.3   school must declare that a student meets or exceeds a specific 
 48.4   academic standard required for graduation under this section if 
 48.5   the local school board, the school board of the school district 
 48.6   in which the area learning center is located, or the charter 
 48.7   school board of directors determines that the student: 
 48.8      (1) is participating in a course of study, including an 
 48.9   advanced placement or international baccalaureate course or 
 48.10  program; a learning opportunity outside the curriculum of the 
 48.11  district, area learning center, or charter school; or an 
 48.12  approved preparatory program for employment or postsecondary 
 48.13  education that is equally or more rigorous than the 
 48.14  corresponding state or local academic standard required by the 
 48.15  district, area learning center, or charter school; 
 48.16     (2) would be precluded from participating in the rigorous 
 48.17  course of study, learning opportunity, or preparatory employment 
 48.18  or postsecondary education program if the student were required 
 48.19  to achieve the academic standard to be waived; and 
 48.20     (3) satisfactorily completes the requirements for the 
 48.21  rigorous course of study, learning opportunity, or preparatory 
 48.22  employment or postsecondary education program. 
 48.23  Consistent with the requirements of this section, the local 
 48.24  school board, the school board of the school district in which 
 48.25  the area learning center is located, or the charter school board 
 48.26  of directors also may formally determine other circumstances in 
 48.27  which to declare that a student meets or exceeds a specific 
 48.28  academic standard that the site requires for graduation under 
 48.29  this section. 
 48.30     (b) A student who satisfactorily completes a postsecondary 
 48.31  enrollment options course or program under section 124D.09 is 
 48.32  not required to complete other requirements of the academic 
 48.33  standards corresponding to that specific rigorous course of 
 48.34  study. 
 48.35     Sec. 6.  Minnesota Statutes 2004, section 120B.024, is 
 48.36  amended to read: 
 49.1      120B.024 [GRADUATION REQUIREMENTS; COURSE CREDITS.] 
 49.2      Students beginning 9th grade in the 2004-2005 school year 
 49.3   and later must successfully complete the following high school 
 49.4   level course credits for graduation: 
 49.5      (1) four credits of language arts; 
 49.6      (2) three credits of mathematics, encompassing at least the 
 49.7   mathematical reasoning, algebra, geometry, statistics, and 
 49.8   probability sufficient to satisfy the academic 
 49.9   standard identified in the mathematics grades 9, 10, and 11 
 49.10  standards documents; 
 49.11     (3) three credits of science, including at least one credit 
 49.12  in biology; 
 49.13     (4) three and one-half credits of social studies, 
 49.14  encompassing at least United States history, geography, 
 49.15  government and citizenship, world history, and economics or 
 49.16  three credits of social studies encompassing at least United 
 49.17  States history, geography, government and citizenship, and world 
 49.18  history, and one-half credit of economics taught in a school's 
 49.19  social studies or business department; 
 49.20     (5) one credit in the arts; and 
 49.21     (6) one-half credit in physical education and one-half 
 49.22  credit in health education; and 
 49.23     (7) a minimum of seven six elective course credits. 
 49.24     A course credit is equivalent to a student successfully 
 49.25  completing an academic year of study or a student mastering the 
 49.26  applicable subject matter, as determined by the local school 
 49.27  district. 
 49.28     Sec. 7.  Minnesota Statutes 2004, section 120B.11, 
 49.29  subdivision 1, is amended to read: 
 49.30     Subdivision 1.  [DEFINITIONS.] For the purposes of this 
 49.31  section and section 120B.10, the following terms have the 
 49.32  meanings given them. 
 49.33     (a) "Instruction" means methods of providing learning 
 49.34  experiences that enables enable a student to meet state and 
 49.35  district academic standards and graduation 
 49.36  standards requirements. 
 50.1      (b) "Curriculum" means district or school adopted programs 
 50.2   and written plans for providing students with learning 
 50.3   experiences that lead to expected knowledge, and skills, and 
 50.4   positive attitudes. 
 50.5      Sec. 8.  Minnesota Statutes 2004, section 120B.11, 
 50.6   subdivision 2, is amended to read: 
 50.7      Subd. 2.  [ADOPTING POLICIES.] (a) A school board shall 
 50.8   adopt annually a have in place an adopted written policy that 
 50.9   includes the following: 
 50.10     (1) district goals for instruction and including the use of 
 50.11  best practices, district and school curriculum, and achievement 
 50.12  for all student subgroups; 
 50.13     (2) a process for evaluating each student's progress toward 
 50.14  meeting graduation academic standards and identifying the 
 50.15  strengths and weaknesses of instruction and curriculum affecting 
 50.16  students' progress; 
 50.17     (3) a system for periodically reviewing and evaluating all 
 50.18  instruction and curriculum; 
 50.19     (4) a plan for improving instruction and, curriculum, and 
 50.20  student achievement; and 
 50.21     (5) an instruction plan that includes education 
 50.22  effectiveness processes developed under plan aligned with 
 50.23  section 122A.625 and that integrates instruction, curriculum, 
 50.24  and technology. 
 50.25     Sec. 9.  Minnesota Statutes 2004, section 120B.11, 
 50.26  subdivision 3, is amended to read: 
 50.27     Subd. 3.  [INSTRUCTION AND CURRICULUM DISTRICT ADVISORY 
 50.28  COMMITTEE.] Each school board shall establish an Instruction and 
 50.29  Curriculum advisory committee to ensure active community 
 50.30  participation in all phases of planning and improving the 
 50.31  instruction and curriculum affecting state graduation and 
 50.32  district academic standards.  A district advisory committee, to 
 50.33  the extent possible, shall reflect the diversity of the district 
 50.34  and its learning sites, and shall include teachers, parents, 
 50.35  support staff, pupils students, and other community residents.  
 50.36  The district may establish building teams as subcommittees of 
 51.1   the district advisory committee under subdivision 4.  The 
 51.2   district advisory committee shall recommend to the school 
 51.3   board districtwide education standards rigorous academic 
 51.4   standards, student achievement goals and measures, assessments, 
 51.5   and program evaluations.  Learning sites may expand upon 
 51.6   district evaluations of instruction, curriculum, assessments, or 
 51.7   programs.  Whenever possible, parents and other community 
 51.8   residents shall comprise at least two-thirds of advisory 
 51.9   committee members. 
 51.10     Sec. 10.  Minnesota Statutes 2004, section 120B.11, 
 51.11  subdivision 4, is amended to read: 
 51.12     Subd. 4.  [BUILDING TEAM.] A school may establish a 
 51.13  building team to develop and implement an education 
 51.14  effectiveness plan to improve instruction and, curriculum, and 
 51.15  student achievement.  The team shall advise the board and the 
 51.16  advisory committee about developing an instruction and 
 51.17  curriculum improvement plan that aligns curriculum, assessment 
 51.18  of student progress in meeting state graduation and district 
 51.19  academic standards, and instruction. 
 51.20     Sec. 11.  Minnesota Statutes 2004, section 120B.11, 
 51.21  subdivision 5, is amended to read: 
 51.22     Subd. 5.  [REPORT.] (a) By October 1 of each year, the 
 51.23  school board shall use standard statewide reporting procedures 
 51.24  the commissioner develops and adopt a report that includes the 
 51.25  following: 
 51.26     (1) student performance achievement goals for meeting state 
 51.27  graduation academic standards adopted for that year; 
 51.28     (2) results of local assessment data, and any additional 
 51.29  test data; 
 51.30     (3) the annual school district improvement plans including 
 51.31  staff development goals under section 122A.60; 
 51.32     (4) information about district and learning site progress 
 51.33  in realizing previously adopted improvement plans; and 
 51.34     (5) the amount and type of revenue attributed to each 
 51.35  education site as defined in section 123B.04. 
 51.36     (b) The school board shall publish the report in the local 
 52.1   newspaper with the largest circulation in the district or, by 
 52.2   mail, or by electronic means such as the district Web site.  If 
 52.3   electronic means are used, copies of the report must be made 
 52.4   available to the public on request.  The board shall make a copy 
 52.5   of the report available to the public for inspection.  The board 
 52.6   shall send a copy of the report to the commissioner of education 
 52.7   by October 15 of each year. 
 52.8      (c) The title of the report shall contain the name and 
 52.9   number of the school district and read "Annual Report on 
 52.10  Curriculum, Instruction, and Student Performance Achievement."  
 52.11  The report must include at least the following information about 
 52.12  advisory committee membership: 
 52.13     (1) the name of each committee member and the date when 
 52.14  that member's term expires; 
 52.15     (2) the method and criteria the school board uses to select 
 52.16  committee members; and 
 52.17     (3) the date by which a community resident must apply to 
 52.18  next serve on the committee. 
 52.19     Sec. 12.  Minnesota Statutes 2004, section 120B.11, 
 52.20  subdivision 8, is amended to read: 
 52.21     Subd. 8.  [BIENNIAL EVALUATION; ASSESSMENT PROGRAM.] At 
 52.22  least once every two years, the district report shall include an 
 52.23  evaluation of the district testing programs, according to the 
 52.24  following: 
 52.25     (1) written objectives of the assessment program; 
 52.26     (2) names of tests and grade levels tested; 
 52.27     (3) use of test results; and 
 52.28     (4) implementation of an assurance of mastery program 
 52.29  student achievement results compared to previous years. 
 52.30     Sec. 13.  [120B.15] [GIFTED AND TALENTED STUDENTS 
 52.31  PROGRAMS.] 
 52.32     Subdivision 1.  [GIFTED AND TALENTED STUDENTS.] School 
 52.33  districts must adopt guidelines for assessing and identifying 
 52.34  students for participation in gifted and talented programs.  The 
 52.35  guidelines should include the use of: 
 52.36     (1) multiple and objective criteria; and 
 53.1      (2) assessments and procedures that are valid and reliable, 
 53.2   fair, and based on current theory and research. 
 53.3      Subd. 2.  [STUDENT ACCESS; PROGRAM CONTENT AND 
 53.4   DEVELOPMENT.] (a) Gifted and talented programs may include: 
 53.5      (1) curriculum aligned with the cognitive, affective, 
 53.6   developmental, and physical needs of gifted and talented 
 53.7   students; 
 53.8      (2) articulated prekindergarten through grade 12 learning 
 53.9   experiences; 
 53.10     (3) flexible instructional pacing and subject and 
 53.11  grade-based opportunities to accelerate instruction; 
 53.12     (4) rigorous content consistent with students' abilities 
 53.13  and social and emotional development; 
 53.14     (5) challenging learning experiences focused on problem 
 53.15  solving and advanced reasoning; and 
 53.16     (6) differentiated guidance services to nurture students' 
 53.17  social and emotional development. 
 53.18     (b) School districts, in collaboration with interested 
 53.19  community members and with technical assistance from the state 
 53.20  Department of Education, may offer gifted and talented programs. 
 53.21     <b>[EFFECTIVE DATE.]</b> This section is effective for the 
 53.22  2005-2006 school year and later. 
 53.23     Sec. 14.  Minnesota Statutes 2004, section 120B.22, 
 53.24  subdivision 1, is amended to read: 
 53.25     Subdivision 1.  [VIOLENCE PREVENTION CURRICULUM.] (a) The 
 53.26  commissioner of education, in consultation with the 
 53.27  commissioners of health and human services, state minority 
 53.28  councils, battered women's and domestic abuse programs, battered 
 53.29  women's shelters, sexual assault centers, representatives of 
 53.30  religious communities, and the assistant commissioner of the 
 53.31  Office of Drug Policy and Violence Prevention, shall assist 
 53.32  districts on request in developing or implementing a violence 
 53.33  prevention program for students in kindergarten to grade 12 that 
 53.34  can be integrated into existing curriculum.  The purpose of the 
 53.35  program is to help students learn how to resolve conflicts 
 53.36  within their families and communities in nonviolent, effective 
 54.1   ways.  
 54.2      (b) Each district is encouraged to integrate into its 
 54.3   existing curriculum a program for violence prevention that 
 54.4   includes at least: 
 54.5      (1) a comprehensive, accurate, and age appropriate 
 54.6   curriculum on violence prevention, nonviolent conflict 
 54.7   resolution, sexual, racial, and cultural 
 54.8   harassment, self-protection, and student hazing that promotes 
 54.9   equality, respect, understanding, effective communication, 
 54.10  individual responsibility, thoughtful decision making, positive 
 54.11  conflict resolution, useful coping skills, critical thinking, 
 54.12  listening and watching skills, and personal safety; 
 54.13     (2) planning materials, guidelines, and other accurate 
 54.14  information on preventing physical and emotional violence, 
 54.15  identifying and reducing the incidence of sexual, racial, and 
 54.16  cultural harassment, and reducing child abuse and neglect; 
 54.17     (3) a special parent education component of early childhood 
 54.18  family education programs to prevent child abuse and neglect and 
 54.19  to promote positive parenting skills, giving priority to 
 54.20  services and outreach programs for at-risk families; 
 54.21     (4) involvement of parents and other community members, 
 54.22  including the clergy, business representatives, civic leaders, 
 54.23  local elected officials, law enforcement officials, and the 
 54.24  county attorney; 
 54.25     (5) collaboration with local community services, agencies, 
 54.26  and organizations that assist in violence intervention or 
 54.27  prevention, including family-based services, crisis services, 
 54.28  life management skills services, case coordination services, 
 54.29  mental health services, and early intervention services; 
 54.30     (6) collaboration among districts and service cooperatives; 
 54.31     (7) targeting early adolescents for prevention efforts, 
 54.32  especially early adolescents whose personal circumstances may 
 54.33  lead to violent or harassing behavior; 
 54.34     (8) opportunities for teachers to receive in-service 
 54.35  training or attend other programs on strategies or curriculum 
 54.36  designed to assist students in intervening in or preventing 
 55.1   violence in school and at home; and 
 55.2      (9) administrative policies that reflect, and a staff that 
 55.3   models, nonviolent behaviors that do not display or condone 
 55.4   sexual, racial, or cultural harassment or student hazing. 
 55.5      (c) The department may provide assistance at a neutral site 
 55.6   to a nonpublic school participating in a district's program. 
 55.7      Sec. 15.  [120B.25] [AMERICAN HERITAGE EDUCATION.] 
 55.8      School districts shall permit grade-level instruction for 
 55.9   students to read and study America's founding documents, 
 55.10  including documents that contributed to the foundation or 
 55.11  maintenance of America's representative form of limited 
 55.12  government, the Bill of Rights, our free-market economic system, 
 55.13  and patriotism.  
 55.14     Sec. 16.  Minnesota Statutes 2004, section 120B.30, 
 55.15  subdivision 1, is amended to read: 
 55.16     Subdivision 1.  [STATEWIDE TESTING.] (a) The commissioner, 
 55.17  with advice from experts with appropriate technical 
 55.18  qualifications and experience and stakeholders, consistent with 
 55.19  subdivision 1a, shall include in the comprehensive assessment 
 55.20  system, for each grade level to be tested, state-constructed 
 55.21  tests developed from and aligned with the state's required 
 55.22  academic standards under section 120B.021 and administered 
 55.23  annually to all students in grades 3 through 8 and at the high 
 55.24  school level.  A state-developed test in a subject other than 
 55.25  writing, developed after the 2002-2003 school year, must include 
 55.26  both multiple choice machine-scoreable and constructed response 
 55.27  questions.  The commissioner shall establish one or more months 
 55.28  during which schools shall administer the tests to students each 
 55.29  school year.  For students enrolled in grade 8 before the 
 55.30  2005-2006 school year, only Minnesota basic skills tests in 
 55.31  reading, mathematics, and writing shall fulfill students' basic 
 55.32  skills testing requirements for a passing state notation.  The 
 55.33  passing scores of the state tests in reading and mathematics are 
 55.34  the equivalent of:  
 55.35     (1) 70 percent correct for students entering grade 9 in 
 55.36  1996; and 
 56.1      (2) 75 percent correct for students entering grade 9 in 
 56.2   1997 and thereafter, as based on the first uniform test 
 56.3   administration of February 1998.  
 56.4      For students enrolled in grade 8 in the 2005-2006 school 
 56.5   year and later, only the Minnesota Comprehensive Assessments 
 56.6   Second Edition (MCA-IIs) in reading, mathematics, and writing 
 56.7   shall fulfill students' academic standard requirements. 
 56.8      (b) The third through 8th grade and high school level test 
 56.9   results shall be available to districts for diagnostic purposes 
 56.10  affecting student learning and district instruction and 
 56.11  curriculum, and for establishing educational accountability.  
 56.12  The commissioner must disseminate to the public the test results 
 56.13  upon receiving those results. 
 56.14     (c) State tests must be constructed and aligned with state 
 56.15  academic standards.  The testing process and the order of 
 56.16  administration shall be determined by the commissioner.  The 
 56.17  statewide results shall be aggregated at the site and district 
 56.18  level, consistent with subdivision 1a.  
 56.19     (d) In addition to the testing and reporting requirements 
 56.20  under this section, the commissioner shall include the following 
 56.21  components in the statewide public reporting system: 
 56.22     (1) uniform statewide testing of all students in grades 3 
 56.23  through 8 and at the high school level that provides exemptions, 
 56.24  only with parent or guardian approval, for those very few 
 56.25  students for whom the student's individual education plan team 
 56.26  under sections 125A.05 and 125A.06, determines that the student 
 56.27  is incapable of taking a statewide test, or for a limited 
 56.28  English proficiency student under section 124D.59, subdivision 
 56.29  2, if the student has been in the United States for fewer than 
 56.30  three years; 
 56.31     (2) educational indicators that can be aggregated and 
 56.32  compared across school districts and across time on a statewide 
 56.33  basis, including average daily attendance, high school 
 56.34  graduation rates, and high school drop-out rates by age and 
 56.35  grade level; 
 56.36     (3) students' scores on the American College Test; and 
 57.1      (4) state results from participation in the National 
 57.2   Assessment of Educational Progress so that the state can 
 57.3   benchmark its performance against the nation and other states, 
 57.4   and, where possible, against other countries, and contribute to 
 57.5   the national effort to monitor achievement. 
 57.6      (e) Districts must report exemptions under paragraph (d), 
 57.7   clause (1), to the commissioner consistent with a format 
 57.8   provided by the commissioner. 
 57.9      Sec. 17.  Minnesota Statutes 2004, section 120B.30, 
 57.10  subdivision 1a, is amended to read: 
 57.11     Subd. 1a.  [STATEWIDE AND LOCAL ASSESSMENTS; RESULTS.] (a) 
 57.12  The commissioner must develop language arts reading, 
 57.13  mathematics, and science assessments aligned with state academic 
 57.14  standards that districts and sites must use to monitor student 
 57.15  growth toward achieving those standards.  The commissioner must 
 57.16  not develop statewide assessments for academic standards in 
 57.17  social studies, health and physical education, and the arts.  
 57.18  The commissioner must require: 
 57.19     (1) annual language arts reading and mathematics 
 57.20  assessments in grades 3 through 8 and at the high school level 
 57.21  for the 2005-2006 school year and later; and 
 57.22     (2) annual science assessments in one grade in the grades 3 
 57.23  through 5 span, the grades 6 through 9 span, and a life sciences 
 57.24  assessment in the grades 10 through 12 span for the 2007-2008 
 57.25  school year and later. 
 57.26     (b) The commissioner must ensure that all statewide tests 
 57.27  administered to elementary and secondary students measure 
 57.28  students' academic knowledge and skills and not students' 
 57.29  values, attitudes, and beliefs. 
 57.30     (c) Reporting of assessment results must: 
 57.31     (1) provide timely, useful, and understandable information 
 57.32  on the performance of individual students, schools, school 
 57.33  districts, and the state; 
 57.34     (2) include, by the 2006-2007 school year, a value-added 
 57.35  component to measure student achievement growth over time; and 
 57.36     (3)(i) for students enrolled in grade 8 before the 
 58.1   2005-2006 school year, determine whether students have met the 
 58.2   state's basic skills requirements; or 
 58.3      (ii) for students enrolled in grade 8 in the 2005-2006 
 58.4   school year and later, determine whether students have met the 
 58.5   state's academic standards. 
 58.6      (d) Consistent with applicable federal law and subdivision 
 58.7   1, paragraph (d), clause (1), the commissioner must include 
 58.8   alternative assessments for the very few students with 
 58.9   disabilities for whom statewide assessments are inappropriate 
 58.10  and for students with limited English proficiency. 
 58.11     (e) A school, school district, and charter school must 
 58.12  administer statewide assessments under this section, as the 
 58.13  assessments become available, to evaluate student progress in 
 58.14  achieving the academic standards.  If a state assessment is not 
 58.15  available, a school, school district, and charter school must 
 58.16  determine locally if a student has met the required academic 
 58.17  standards.  A school, school district, or charter school may use 
 58.18  a student's performance on a statewide assessment as one of 
 58.19  multiple criteria to determine grade promotion or retention.  A 
 58.20  school, school district, or charter school may use a high school 
 58.21  student's performance on a statewide assessment as a percentage 
 58.22  of the student's final grade in a course, or place a student's 
 58.23  assessment score on the student's transcript.  
 58.24     Sec. 18.  Minnesota Statutes 2004, section 120B.30, is 
 58.25  amended by adding a subdivision to read: 
 58.26     Subd. 4.  [ACCESS TO TESTS.] The commissioner must adopt 
 58.27  and publish a policy to provide public and parental access for 
 58.28  review of basic skills tests, Minnesota Comprehensive 
 58.29  Assessments, or any other such statewide test and assessment.  
 58.30  Upon receiving a written request, the commissioner must make 
 58.31  available to parents or guardians a copy of their student's 
 58.32  actual answer sheet to the test questions to be reviewed by the 
 58.33  parent.  
 58.34     Sec. 19.  [120B.361] [VALUE-ADDED ASSESSMENT PROGRAM.] 
 58.35     (a) The commissioner of education must implement a 
 58.36  value-added assessment program to assist school districts, 
 59.1   public schools, and charter schools in assessing and reporting 
 59.2   students' growth in academic achievement under section 120B.30, 
 59.3   subdivision 1a.  The program must use assessments consistent 
 59.4   with paragraph (d) of students' academic achievement to make 
 59.5   longitudinal comparisons of each student's academic growth over 
 59.6   time.  School districts, public schools, and charter schools may 
 59.7   apply to the commissioner to participate in the initial trial 
 59.8   program using a form and in the manner the commissioner 
 59.9   prescribes.  The commissioner must select program participants 
 59.10  from urban, suburban, and rural areas throughout the state.  
 59.11     (b) The commissioner may issue a request for a proposal to 
 59.12  contract with an organization that provides a value-added 
 59.13  assessment model that uses fully adaptive computer-based 
 59.14  assessments that reliably estimates school and school district 
 59.15  effects on students' academic achievement over time.  The model 
 59.16  the commissioner selects must use each student's test data 
 59.17  across grades. 
 59.18     (c) The contract under paragraph (b) must be consistent 
 59.19  with the definition of "best value" under section 16C.02, 
 59.20  subdivision 4, and may not be executed until the state has 
 59.21  authority to use the assessments described in paragraph (d) for 
 59.22  purposes of the No Child Left Behind Act, Public Law 107-110. 
 59.23     (d) In connection with implementation of the value-added 
 59.24  assessment program, the department must request and obtain from 
 59.25  the United States Department of Education authority to use fully 
 59.26  adaptive computer-based assessments that accurately measure 
 59.27  student achievement and growth over time.  The assessments must 
 59.28  be aligned with Minnesota standards, use a common scale score 
 59.29  over multiple grades or ages, and be capable of being used for 
 59.30  source data for a growth or value-added model of school 
 59.31  evaluation. 
 59.32     (e) In implementing the value-added assessment program, the 
 59.33  commissioner must report assessment result data in a way that 
 59.34  shows the growth trends over time for students in four groups: 
 59.35     (1) performing above grade level; 
 59.36     (2) performing at grade level; 
 60.1      (3) approaching grade-level performance; and 
 60.2      (4) performing significantly below grade level.  
 60.3      <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 60.4   following final enactment. 
 60.5      Sec. 20.  Minnesota Statutes 2004, section 121A.06, 
 60.6   subdivision 2, is amended to read: 
 60.7      Subd. 2.  [REPORTS; CONTENT.] By January 1, 1994, the 
 60.8   commissioner, in consultation with the criminal and juvenile 
 60.9   information policy group, shall develop a standardized form to 
 60.10  be used by schools to report incidents involving the use or 
 60.11  possession of a dangerous weapon in school zones.  School 
 60.12  districts must electronically report to the commissioner of 
 60.13  education incidents involving the use or possession of a 
 60.14  dangerous weapon in school zones.  The form shall must include 
 60.15  the following information: 
 60.16     (1) a description of each incident, including a description 
 60.17  of the dangerous weapon involved in the incident; 
 60.18     (2) where, at what time, and under what circumstances the 
 60.19  incident occurred; 
 60.20     (3) information about the offender, other than the 
 60.21  offender's name, including the offender's age; whether the 
 60.22  offender was a student and, if so, where the offender attended 
 60.23  school; and whether the offender was under school expulsion or 
 60.24  suspension at the time of the incident; 
 60.25     (4) information about the victim other than the victim's 
 60.26  name, if any, including the victim's age; whether the victim was 
 60.27  a student and, if so, where the victim attended school; and if 
 60.28  the victim was not a student, whether the victim was employed at 
 60.29  the school; 
 60.30     (5) the cost of the incident to the school and to the 
 60.31  victim; and 
 60.32     (6) the action taken by the school administration to 
 60.33  respond to the incident. 
 60.34     The commissioner also shall develop provide an alternative 
 60.35  electronic reporting format that allows school districts to 
 60.36  provide aggregate data, with an option to use computer 
 61.1   technology to report the data. 
 61.2      Sec. 21.  Minnesota Statutes 2004, section 121A.06, 
 61.3   subdivision 3, is amended to read: 
 61.4      Subd. 3.  [REPORTS; FILING REQUIREMENTS.] By February 1 and 
 61.5   July 1 31 of each year, each school, other than a home-school, 
 61.6   shall report incidents involving the use or possession of a 
 61.7   dangerous weapon in school zones to the commissioner.  The 
 61.8   reports by public schools must be made on the standardized forms 
 61.9   or using the alternative format submitted using the electronic 
 61.10  reporting system developed by the commissioner under subdivision 
 61.11  2.  The commissioner shall compile the information it receives 
 61.12  from the schools and report it annually to the commissioner of 
 61.13  public safety, the criminal and juvenile information policy 
 61.14  group, and the legislature. 
 61.15     Sec. 22.  [121A.0695] [SCHOOL BOARD POLICY; PROHIBITING 
 61.16  INTIMIDATION AND BULLYING.] 
 61.17     Subdivision 1.  [INTIMIDATION OR BULLYING 
 61.18  DEFINED.] "Intimidation or bullying" means an intentional 
 61.19  gesture or a written, oral, or physical act or threat that a 
 61.20  reasonable person under the circumstances knows or should know 
 61.21  has the effect of: 
 61.22     (1) harming a student; 
 61.23     (2) damaging a student's property; 
 61.24     (3) placing a student in reasonable fear of harm to the 
 61.25  student's person; 
 61.26     (4) placing a student in reasonable fear of damage to the 
 61.27  student's property; or 
 61.28     (5) creating a severe or persistent environment of 
 61.29  intimidation or abuse. 
 61.30     Subd. 2.  [MODEL POLICY.] The commissioner of education 
 61.31  shall maintain and make available to school boards and other 
 61.32  schools a model policy prohibiting intimidation and bullying 
 61.33  that addresses the requirements of subdivision 3. 
 61.34     Subd. 3.  [SCHOOL BOARD POLICY.] Each school board shall 
 61.35  adopt a written policy prohibiting intimidation and bullying of 
 61.36  any student, including, but not limited to, the acts defined in 
 62.1   subdivision 1.  The policy must describe the behavior expected 
 62.2   of each student and state the consequences for and the 
 62.3   appropriate remedial action to be taken against the person 
 62.4   acting to intimidate or bully.  The policy must include 
 62.5   reporting procedures, including, at a minimum, requiring school 
 62.6   personnel to report student intimidation or bullying incidents 
 62.7   and allowing persons to report incidents anonymously.  Each 
 62.8   district must integrate into its violence prevention program 
 62.9   under section 120B.22, if applicable, behavior and expectations 
 62.10  established under this section.  Each school must include the 
 62.11  policy in the student handbook on school policies. 
 62.12     <b>[EFFECTIVE DATE.]</b> This section is effective for the 
 62.13  2005-2006 school year and later. 
 62.14     Sec. 23.  [121A.222] [POSSESSION AND USE OF NONPRESCRIPTION 
 62.15  PAIN RELIEVERS BY SECONDARY STUDENTS.] 
 62.16     A secondary student may possess and use nonprescription 
 62.17  pain relief in a manner consistent with the labeling, if the 
 62.18  district has received a written authorization from the student's 
 62.19  parent permitting the student to self-administer the 
 62.20  medication.  The parent must submit written authorization for 
 62.21  the student to self-administer the medication each school year.  
 62.22  The district may revoke a student's privilege to possess and use 
 62.23  nonprescription pain relievers if the district determines that 
 62.24  the student is abusing the privilege. 
 62.25     Sec. 24.  [121A.231] [COMPREHENSIVE FAMILY LIFE AND 
 62.26  SEXUALITY EDUCATION PROGRAMS.] 
 62.27     Subdivision 1.  [DEFINITIONS.] (a) "Comprehensive family 
 62.28  life and sexuality education" means education in grades 7 
 62.29  through 12 that: 
 62.30     (1) respects community values and encourages family 
 62.31  communication; 
 62.32     (2) develops skills in communication, decision making, and 
 62.33  conflict resolution; 
 62.34     (3) contributes to healthy relations; 
 62.35     (4) provides human development and sexuality education that 
 62.36  is age appropriate and medically accurate; 
 63.1      (5) promotes responsible sexual behavior, including an 
 63.2   abstinence-first approach to delaying initiation to sexual 
 63.3   activity that emphasizes abstinence while also including 
 63.4   education about the use of protection and contraception; and 
 63.5      (6) promotes individual responsibility. 
 63.6      (b) "Age appropriate" refers to topics, messages, and 
 63.7   teaching methods suitable to particular ages or age groups of 
 63.8   children and adolescents, based on developing cognitive, 
 63.9   emotional, and behavioral capacity typical for the age or age 
 63.10  group. 
 63.11     (c) "Medically accurate" means verified or supported by 
 63.12  research conducted in compliance with scientific methods and 
 63.13  published in peer-reviewed journals, where appropriate, and 
 63.14  recognized as accurate and objective by professional 
 63.15  organizations and agencies in the relevant field, such as the 
 63.16  federal Centers for Disease Control and Prevention, the American 
 63.17  Public Health Association, the American Academy of Pediatrics, 
 63.18  or the American College of Obstetricians and Gynecologists. 
 63.19     Subd. 2.  [CURRICULUM REQUIREMENTS.] (a) A school district 
 63.20  may offer and may independently establish policies, procedures, 
 63.21  curriculum, and services for providing comprehensive family life 
 63.22  and sexuality education that is age appropriate and medically 
 63.23  accurate for kindergarten through grade 6. 
 63.24     (b) A school district must offer and may independently 
 63.25  establish policies, procedures, curriculum, and services for 
 63.26  providing comprehensive family life and sexuality education that 
 63.27  is age appropriate and medically accurate for grades 7 through 
 63.28  12. 
 63.29     Subd. 3.  [NOTICE AND PARENTAL OPTIONS.] (a) It is the 
 63.30  legislature's intent to encourage pupils to communicate with the 
 63.31  pupils' parents or guardians about human sexuality and to 
 63.32  respect rights of parents or guardians to supervise the parents' 
 63.33  or guardians' children's education on these subjects. 
 63.34     (b) Parents or guardians may excuse the parents' or 
 63.35  guardians' children from all or part of a comprehensive family 
 63.36  life and sexuality education program. 
 64.1      (c) A school district must establish procedures for 
 64.2   providing parents or guardians reasonable notice with the 
 64.3   following information: 
 64.4      (1) if the district is offering a comprehensive family life 
 64.5   and sexuality education program to the parents' or guardians' 
 64.6   child during the course of the year; 
 64.7      (2) how the parents or guardians may inspect the written 
 64.8   and audiovisual educational materials used in the program and 
 64.9   the process for inspection; 
 64.10     (3) if the program is presented by school district 
 64.11  personnel or outside consultants, and if outside consultants are 
 64.12  used, who they may be; and 
 64.13     (4) the right to choose not to have the parents' or 
 64.14  guardians' child participate in the program and the procedure 
 64.15  for exercising that right. 
 64.16     (d) A school district must establish procedures for 
 64.17  reasonably restricting the availability of written and 
 64.18  audiovisual educational materials from public view of students 
 64.19  who have been excused from all or part of a comprehensive family 
 64.20  life and sexuality education program at the request of a parent 
 64.21  or guardian. 
 64.22     Sec. 25.  Minnesota Statutes 2004, section 121A.53, is 
 64.23  amended to read: 
 64.24     121A.53 [REPORT TO COMMISSIONER OF EDUCATION.] 
 64.25     Subdivision 1.  [EXCLUSIONS AND EXPULSIONS.] The school 
 64.26  board shall must report through the department electronic 
 64.27  reporting system each exclusion or expulsion within 30 days of 
 64.28  the effective date of the action to the commissioner of 
 64.29  education.  This report shall must include a statement of 
 64.30  alternative educational services given the pupil and the reason 
 64.31  for, the effective date, and the duration of the exclusion or 
 64.32  expulsion.  The report must also include the student's age, 
 64.33  grade, gender, race, and special education status. 
 64.34     Subd. 2.  [REPORT.] The school board must include state 
 64.35  student identification numbers of affected pupils on all 
 64.36  dismissal reports required by the department.  The department 
 65.1   must report annually to the commissioner summary data on the 
 65.2   number of dismissals by age, grade, gender, race, and special 
 65.3   education status of the affected pupils.  All dismissal reports 
 65.4   must be submitted through the department electronic reporting 
 65.5   system. 
 65.6      Sec. 26.  Minnesota Statutes 2004, section 122A.06, 
 65.7   subdivision 4, is amended to read: 
 65.8      Subd. 4.  [COMPREHENSIVE, SCIENTIFICALLY BASED READING 
 65.9   INSTRUCTION.] "Comprehensive, scientifically based reading 
 65.10  instruction" includes instruction and practice in phonemic 
 65.11  awareness, phonics and other word-recognition skills, and guided 
 65.12  oral reading for beginning readers, as well as extensive silent 
 65.13  reading, vocabulary instruction, instruction in comprehension, 
 65.14  and instruction that fosters understanding and higher-order 
 65.15  thinking for readers of all ages and proficiency 
 65.16  levels.  "Comprehensive, scientifically based reading 
 65.17  instruction" includes a program or collection of instructional 
 65.18  practices with demonstrated success in instructing learners and 
 65.19  reliable and valid evidence to support the conclusion that when 
 65.20  these methods are used with learners, learners can be expected 
 65.21  to achieve, at a minimum, satisfactory progress in reading 
 65.22  achievement.  The program or collection of practices must 
 65.23  include, at a minimum, instruction in five areas of reading:  
 65.24  phonemic awareness, phonics, fluency, vocabulary, and text 
 65.25  comprehension. 
 65.26     Comprehensive, scientifically based reading instruction 
 65.27  also includes and integrates instructional strategies for 
 65.28  continuously assessing and evaluating the learner's reading 
 65.29  progress and needs in order to design and implement ongoing 
 65.30  interventions so that learners of all ages and proficiency 
 65.31  levels can read and comprehend text and apply higher-level 
 65.32  thinking skills. 
 65.33     Sec. 27.  Minnesota Statutes 2004, section 122A.12, 
 65.34  subdivision 2, is amended to read: 
 65.35     Subd. 2.  [TERMS; COMPENSATION; REMOVAL; ADMINISTRATION; 
 65.36  REIMBURSEMENT.] (a) Membership terms, removal of members, and 
 66.1   the filling of membership vacancies are as provided in section 
 66.2   214.09.  The terms of the initial board members must be 
 66.3   determined by lot as follows: 
 66.4      (1) three members must be appointed for terms that expire 
 66.5   August 1, 2002; 
 66.6      (2) three members must be appointed for terms that expire 
 66.7   August 1, 2003; and 
 66.8      (3) four members must be appointed for terms that expire 
 66.9   August 1, 2004. 
 66.10     Members shall not receive the daily payment under section 
 66.11  214.09, subdivision 3.  The public employer of a member shall 
 66.12  not reduce the member's compensation or benefits for the 
 66.13  member's absence from employment when engaging in the business 
 66.14  of the board.  The provision of staff, administrative services, 
 66.15  and office space; the review and processing of complaints; the 
 66.16  setting of fees; the selection and duties of an executive 
 66.17  secretary to serve the board; and other provisions relating to 
 66.18  board operations are as provided in chapter 214.  Fiscal year 
 66.19  and reporting requirements are as provided in sections 214.07 
 66.20  and 214.08. 
 66.21     (b) The board may reimburse local school districts for the 
 66.22  cost of a substitute teacher employed when a regular teacher is 
 66.23  providing professional assistance to the state by serving on the 
 66.24  board or on a committee or task force appointed by the board. 
 66.25     Sec. 28.  Minnesota Statutes 2004, section 122A.18, 
 66.26  subdivision 2a, is amended to read: 
 66.27     Subd. 2a.  [READING STRATEGIES.] (a) All colleges and 
 66.28  universities approved by the Board of Teaching to prepare 
 66.29  persons for classroom teacher licensure must include in their 
 66.30  teacher preparation programs reading best practices that enable 
 66.31  classroom teacher licensure candidates to know how to teach 
 66.32  reading, such as phonics or other research-based best practices 
 66.33  in reading, consistent with section 122A.06, subdivision 4, that 
 66.34  enable the licensure candidate to know how to teach reading in 
 66.35  the candidate's content areas. 
 66.36     (b) Board-approved teacher preparation programs for 
 67.1   teachers of elementary education must require instruction in the 
 67.2   application of comprehensive, scientifically based, and balanced 
 67.3   reading instruction programs. that: 
 67.4      (1) teach students to read using foundational knowledge, 
 67.5   practices, and strategies consistent with section 122A.06, 
 67.6   subdivision 4, so that all students will achieve continuous 
 67.7   progress in reading; and 
 67.8      (2) teach specialized instruction in reading strategies, 
 67.9   interventions, and remediations that enable students of all ages 
 67.10  and proficiency levels to become proficient readers. 
 67.11     Sec. 29.  Minnesota Statutes 2004, section 122A.40, 
 67.12  subdivision 5, is amended to read: 
 67.13     Subd. 5.  [PROBATIONARY PERIOD.] (a) The first three 
 67.14  consecutive years of a teacher's first teaching experience in 
 67.15  Minnesota in a single district is deemed to be a probationary 
 67.16  period of employment, and after completion thereof, the 
 67.17  probationary period in each district in which the teacher is 
 67.18  thereafter employed shall be one year.  The school board must 
 67.19  adopt a plan for written evaluation of teachers during the 
 67.20  probationary period.  Evaluation must occur at least three times 
 67.21  each year for a teacher performing services on 120 or more 
 67.22  school days, at least two times each year for a teacher 
 67.23  performing services on 60 to 119 school days, and at least one 
 67.24  time each year for a teacher performing services on fewer than 
 67.25  60 school days.  Days devoted to parent-teacher conferences, 
 67.26  teachers' workshops, and other staff development opportunities 
 67.27  and days on which a teacher is absent from school must not be 
 67.28  included in determining the number of school days on which a 
 67.29  teacher performs services.  Except as otherwise provided in 
 67.30  paragraph (b), during the probationary period any annual 
 67.31  contract with any teacher may or may not be renewed as the 
 67.32  school board shall see fit.  However, the board must give any 
 67.33  such teacher whose contract it declines to renew for the 
 67.34  following school year written notice to that effect before July 
 67.35  1.  If the teacher requests reasons for any nonrenewal of a 
 67.36  teaching contract, the board must give the teacher its reason in 
 68.1   writing, including a statement that appropriate supervision was 
 68.2   furnished describing the nature and the extent of such 
 68.3   supervision furnished the teacher during the employment by the 
 68.4   board, within ten days after receiving such request.  The school 
 68.5   board may, after a hearing held upon due notice, discharge a 
 68.6   teacher during the probationary period for cause, effective 
 68.7   immediately, under section 122A.44.  
 68.8      (b) A board must discharge a probationary teacher, 
 68.9   effective immediately, upon receipt of notice under section 
 68.10  122A.20, subdivision 1, paragraph (b), that the teacher's 
 68.11  license has been revoked due to a conviction for child abuse or 
 68.12  sexual abuse. 
 68.13     (c) A probationary teacher must complete at least 60 days 
 68.14  of teaching service each year during the probationary period.  
 68.15  Days devoted to parent-teacher conferences, teachers' workshops, 
 68.16  and other staff development opportunities and days on which a 
 68.17  teacher is absent from school do not count as days of teaching 
 68.18  service under this paragraph. 
 68.19     (d) A probationary teacher whose first three years of 
 68.20  consecutive employment is interrupted for active military 
 68.21  service and who promptly resumes teaching consistent with 
 68.22  federal reemployment timelines for uniformed service personnel 
 68.23  under United States Code, title 38, section 4312(e), is 
 68.24  considered to have a consecutive teaching experience for 
 68.25  purposes of paragraph (a). 
 68.26     <b>[EFFECTIVE DATE.]</b> Paragraph (c) of this section is 
 68.27  effective July 1, 2005.  Paragraph (d) of this section is 
 68.28  retroactively effective from September 10, 2001, and applies to 
 68.29  those probationary teachers absent for active military service 
 68.30  beginning on September 10, 2001, or later. 
 68.31     Sec. 30.  Minnesota Statutes 2004, section 122A.41, 
 68.32  subdivision 2, is amended to read: 
 68.33     Subd. 2.  [PROBATIONARY PERIOD; DISCHARGE OR DEMOTION.] (a) 
 68.34  All teachers in the public schools in cities of the first class 
 68.35  during the first three years of consecutive employment shall be 
 68.36  deemed to be in a probationary period of employment during which 
 69.1   period any annual contract with any teacher may, or may not, be 
 69.2   renewed as the school board, after consulting with the peer 
 69.3   review committee charged with evaluating the probationary 
 69.4   teachers under subdivision 3, shall see fit.  The school site 
 69.5   management team or the school board if there is no school site 
 69.6   management team, shall adopt a plan for a written evaluation of 
 69.7   teachers during the probationary period according to subdivision 
 69.8   3.  Evaluation by the peer review committee charged with 
 69.9   evaluating probationary teachers under subdivision 3 shall occur 
 69.10  at least three times each year for a teacher performing services 
 69.11  on 120 or more school days, at least two times each year for a 
 69.12  teacher performing services on 60 to 119 school days, and at 
 69.13  least one time each year for a teacher performing services on 
 69.14  fewer than 60 school days.  Days devoted to parent-teacher 
 69.15  conferences, teachers' workshops, and other staff development 
 69.16  opportunities and days on which a teacher is absent from school 
 69.17  shall not be included in determining the number of school days 
 69.18  on which a teacher performs services.  The school board may, 
 69.19  during such probationary period, discharge or demote a teacher 
 69.20  for any of the causes as specified in this code.  A written 
 69.21  statement of the cause of such discharge or demotion shall be 
 69.22  given to the teacher by the school board at least 30 days before 
 69.23  such removal or demotion shall become effective, and the teacher 
 69.24  so notified shall have no right of appeal therefrom. 
 69.25     (b) A probationary teacher must complete at least 60 days 
 69.26  of teaching service each year during the probationary period.  
 69.27  Days devoted to parent-teacher conferences, teachers' workshops, 
 69.28  and other staff development opportunities and days on which a 
 69.29  teacher is absent from school do not count as days of teaching 
 69.30  service under this paragraph. 
 69.31     (c) A probationary teacher whose first three years of 
 69.32  consecutive employment is interrupted for active military 
 69.33  service and who promptly resumes teaching consistent with 
 69.34  federal reemployment timelines for uniformed service personnel 
 69.35  under United States Code, title 38, section 4312(e), is 
 69.36  considered to have a consecutive teaching experience for 
 70.1   purposes of paragraph (a). 
 70.2      <b>[EFFECTIVE DATE.]</b> Paragraph (b) of this section is 
 70.3   effective July 1, 2005.  Paragraph (c) of this section is 
 70.4   retroactively effective from September 10, 2001, and applies to 
 70.5   those probationary teachers absent for active military service 
 70.6   beginning on September 10, 2001, or later. 
 70.7      Sec. 31.  Minnesota Statutes 2004, section 122A.41, 
 70.8   subdivision 5a, is amended to read: 
 70.9      Subd. 5a.  [PROBATIONARY PERIOD FOR PRINCIPALS HIRED 
 70.10  INTERNALLY.] A board and the exclusive representative of the 
 70.11  school principals in the district may negotiate a plan for a 
 70.12  probationary period of up to two school years for licensed 
 70.13  teachers employed by the board who are subsequently employed by 
 70.14  the board as a licensed school principal or assistant principal 
 70.15  and an additional probationary period of up to two years for 
 70.16  licensed assistant principals employed by the board who are 
 70.17  subsequently employed by the board as a licensed school 
 70.18  principal. 
 70.19     <b>[EFFECTIVE DATE.]</b> This section is effective August 1, 2005. 
 70.20     Sec. 32.  Minnesota Statutes 2004, section 122A.41, 
 70.21  subdivision 14, is amended to read: 
 70.22     Subd. 14.  [SERVICES TERMINATED BY DISCONTINUANCE OR LACK 
 70.23  OF PUPILS; PREFERENCE GIVEN.] (a) A teacher whose services are 
 70.24  terminated on account of discontinuance of position or lack of 
 70.25  pupils must receive first consideration for other positions in 
 70.26  the district for which that teacher is qualified.  In the event 
 70.27  it becomes necessary to discontinue one or more positions, in 
 70.28  making such discontinuance, teachers must be discontinued in any 
 70.29  department in the inverse order in which they were employed, 
 70.30  unless a board and the exclusive representative of teachers in 
 70.31  the district negotiate a plan providing otherwise. 
 70.32     (b) Notwithstanding the provisions of clause (a), a teacher 
 70.33  is not entitled to exercise any seniority when that exercise 
 70.34  results in that teacher being retained by the district in a 
 70.35  field for which the teacher holds only a provisional license, as 
 70.36  defined by the Board of Teaching, unless that exercise of 
 71.1   seniority results in the termination of services, on account of 
 71.2   discontinuance of position or lack of pupils, of another teacher 
 71.3   who also holds a provisional license in the same field.  The 
 71.4   provisions of this clause do not apply to vocational education 
 71.5   licenses.  
 71.6      (c) Notwithstanding the provisions of clause (a), a teacher 
 71.7   must not be reinstated to a position in a field in which the 
 71.8   teacher holds only a provisional license, other than a 
 71.9   vocational education license, while another teacher who holds a 
 71.10  nonprovisional license in the same field is available for 
 71.11  reinstatement. 
 71.12     <b>[EFFECTIVE DATE.]</b> This section is effective August 1, 2005. 
 71.13     Sec. 33.  Minnesota Statutes 2004, section 122A.413, is 
 71.14  amended to read: 
 71.15     122A.413 [EDUCATIONAL IMPROVEMENT PLAN.] 
 71.16     Subdivision 1.  [QUALIFYING PLAN.] A district may develop 
 71.17  an educational improvement plan for the purpose of qualifying 
 71.18  for alternative teacher compensation aid the professional 
 71.19  compensation initiative under sections 122A.414 and 
 71.20  122A.415 section 122A.4142.  The plan must include measures for 
 71.21  improving school district, school site, teacher, and individual 
 71.22  student performance.  
 71.23     Subd. 2.  [PLAN COMPONENTS.] The educational improvement 
 71.24  plan must be approved by the school board and have at least 
 71.25  these elements: 
 71.26     (1) assessment and evaluation tools to measure student 
 71.27  performance and progress; 
 71.28     (2) performance goals and benchmarks for improvement; 
 71.29     (3) measures of student attendance and completion rates; 
 71.30     (4) a rigorous professional development system, consistent 
 71.31  with section 122A.60, that is aligned with educational 
 71.32  improvement, designed to achieve teaching quality improvement, 
 71.33  and consistent with clearly defined research-based standards; 
 71.34     (5) measures of student, family, and community involvement 
 71.35  and satisfaction; 
 71.36     (6) a data system about students and their academic 
 72.1   progress that provides parents and the public with 
 72.2   understandable information; and 
 72.3      (7) a teacher induction and mentoring program for 
 72.4   probationary teachers that provides continuous learning and 
 72.5   sustained teacher support.  The process for developing the plan 
 72.6   must involve district teachers; and 
 72.7      (8) substantial teacher participation in developing the 
 72.8   plan, including teachers selected by the exclusive 
 72.9   representative of the teachers. 
 72.10     Subd. 3.  [SCHOOL SITE ACCOUNTABILITY.] A district that 
 72.11  develops a plan under subdivisions 1 and 2 must ensure that each 
 72.12  school site develops a board-approved educational improvement 
 72.13  plan that is aligned with the district educational improvement 
 72.14  plan under subdivision 2 and developed with teacher 
 72.15  participation consistent with subdivision 2, clause (8).  While 
 72.16  a site plan must be consistent with the district educational 
 72.17  improvement plan, it may establish performance goals and 
 72.18  benchmarks that meet or exceed those of the district.  The 
 72.19  process for developing the plan must involve site teachers.  
 72.20     Sec. 34.  [122A.4142] [PROFESSIONAL COMPENSATION 
 72.21  INITIATIVE.] 
 72.22     Subdivision 1.  [PROFESSIONAL COMPENSATION AGREEMENT.] A 
 72.23  school district and the exclusive representative of the teachers 
 72.24  may adopt, by agreement, professional compensation under 
 72.25  subdivision 2 to provide incentives to attract and retain 
 72.26  high-quality teachers and instructional staff, encourage 
 72.27  high-quality teachers to accept difficult assignments, encourage 
 72.28  teachers to improve their knowledge and skills, and support 
 72.29  teachers' roles in improving students' educational achievement. 
 72.30     Subd. 2.  [ELIGIBILITY.] (a) To be eligible to participate 
 72.31  in the professional compensation initiative in fiscal year 2006, 
 72.32  a school district must comply with the conditions stated in 
 72.33  paragraph (b) or with the following conditions: 
 72.34     (1) submit to the department a letter of intent executed by 
 72.35  the school district and the exclusive representative of the 
 72.36  teachers to complete planning for and satisfy the conditions for 
 73.1   participation in fiscal year 2007 and later; 
 73.2      (2) reserve at least two percent of basic revenue for staff 
 73.3   development purposes consistent with sections 122A.60 and 
 73.4   122A.61, subdivision 1; and 
 73.5      (3) commit to spending at least the additional one percent 
 73.6   of basic revenue available through participation in the 
 73.7   professional compensation initiative for staff development 
 73.8   supporting the development of a district educational improvement 
 73.9   plan and site-based educational improvement plan under section 
 73.10  122A.413 and for developing the professional compensation 
 73.11  agreement under this section. 
 73.12     (b) To be eligible to participate in the professional 
 73.13  compensation initiative in fiscal year 2007 and later, a school 
 73.14  district must submit to the department: 
 73.15     (1) a districtwide or site-based educational improvement 
 73.16  plan as described in section 122A.413; and 
 73.17     (2) an executed collective bargaining agreement that 
 73.18  contains at least the following elements: 
 73.19     (i) a description of the conditions or actions necessary 
 73.20  for career advancement and additional compensation; 
 73.21     (ii) compensation provisions that base at least 60 percent 
 73.22  of any increase in compensation on performance and not on years 
 73.23  of service or the attainment of additional education or 
 73.24  training; 
 73.25     (iii) career advancement options for teachers retaining 
 73.26  primary roles in student instruction, including staff 
 73.27  development activities, and for other members of the bargaining 
 73.28  unit; 
 73.29     (iv) incentives for teachers' continuous improvement in 
 73.30  content knowledge, pedagogy, and use of best practices; 
 73.31     (v) an objective evaluation program, including classroom or 
 73.32  performance observation, that is aligned with the district's or 
 73.33  site's educational improvement plan, and is a component of 
 73.34  determining performance; 
 73.35     (vi) provisions preventing any teacher's compensation from 
 73.36  being reduced as a result of implementing professional 
 74.1   compensation for teachers; 
 74.2      (vii) provisions enabling any teacher in the district, if 
 74.3   professional compensation for teachers is applied districtwide, 
 74.4   or at a site, if professional compensation for teachers applies 
 74.5   only to a site, to participate in professional compensation for 
 74.6   teachers without limitations by quota or other restrictions; 
 74.7      (viii) provisions encouraging collaboration among teachers 
 74.8   rather than competition; and 
 74.9      (ix) provisions for participation by all teachers in a 
 74.10  district, all teachers at a site, or at least 25 percent of the 
 74.11  teachers in a district. 
 74.12     (c) An agreement may contain different compensation 
 74.13  provisions for separate classifications of employees. 
 74.14     Subd. 3.  [COMMISSIONER APPROVAL.] (a) Before concluding a 
 74.15  collective bargaining agreement, a district may submit a 
 74.16  proposed agreement and educational improvement plan for review, 
 74.17  comment, and preliminary approval by the commissioner.  If the 
 74.18  plan and agreement are executed in the same form as 
 74.19  preliminarily approved by the commissioner, the plan and 
 74.20  agreement must be approved without further review. 
 74.21     (b) The application to the commissioner must contain a 
 74.22  formally adopted collective bargaining agreement, memorandum of 
 74.23  understanding, or other binding agreement that implements the 
 74.24  professional compensation initiative consistent with this 
 74.25  section. 
 74.26     (c) The commissioner's approval must be based on the 
 74.27  requirements established in subdivision 2.  If the commissioner 
 74.28  does not approve an application, the notice to the school 
 74.29  district must provide details regarding the commissioner's 
 74.30  reason for rejecting the application.  
 74.31     Subd. 4.  [PROFESSIONAL COMPENSATION REVENUE.] (a) 
 74.32  Professional compensation revenue for a school district that 
 74.33  qualifies for participation under subdivision 2, paragraph (a), 
 74.34  equals one percent of basic revenue. 
 74.35     (b) For participation in fiscal year 2007 and later, the 
 74.36  school district's application must be approved by the 
 75.1   commissioner under subdivision 3.  
 75.2      (c) Professional compensation revenue for a qualifying 
 75.3   school district, site, or portion of a district or school site 
 75.4   that qualifies for participation under subdivision 2, paragraph 
 75.5   (b), is as follows: 
 75.6      (1) for a school district in which the school board and the 
 75.7   exclusive representative of the teachers agree to place all 
 75.8   teachers in the district in the professional compensation for 
 75.9   teachers initiative, revenue equals one percent of the 
 75.10  district's basic revenue for the fiscal year; or if a site only 
 75.11  is participating, the portion of one percent attributable to the 
 75.12  site's number of pupils enrolled on October 1 of the previous 
 75.13  fiscal year; or 
 75.14     (2) for a district in which the school board and the 
 75.15  exclusive representative of the teachers agree that at least 25 
 75.16  percent of the district's licensed teachers will participate in 
 75.17  the professional compensation initiative revenue equals one 
 75.18  percent of basic revenue for the fiscal year multiplied by the 
 75.19  percentage of participating teachers. 
 75.20     Subd. 5.  [PERCENTAGE OF TEACHERS.] For purposes of 
 75.21  subdivision 4, the percentage of teachers participating in the 
 75.22  professional compensation initiative equals the ratio of the 
 75.23  number of licensed teachers who are working at least 60 percent 
 75.24  of a full-time teacher's hours and agree to participate in the 
 75.25  initiative to the total number of licensed teachers who are 
 75.26  working at least 60 percent of a full-time teacher's hours.  
 75.27     Subd. 6.  [REVENUE TIMING.] Districts or sites with 
 75.28  approved applications must receive professional compensation 
 75.29  revenue for each school year that the district or site 
 75.30  participates in the initiative and is in compliance with the 
 75.31  conditions for participation.  
 75.32     Subd. 7.  [BASIC REVENUE.] A school district that qualifies 
 75.33  for participation in the professional compensation initiative 
 75.34  under subdivision 2, paragraph (b), may use the two percent of 
 75.35  basic revenue that would otherwise be reserved under section 
 75.36  122A.61 for compliance with the professional compensation 
 76.1   agreement under this section.  If fewer than all of the licensed 
 76.2   teachers in the district participate in the initiative, the 
 76.3   amount of the two percent that may be used for the initiative 
 76.4   equals the two percent multiplied by the percentage of licensed 
 76.5   teachers participating in the initiative. 
 76.6      Subd. 8.  [PARTICIPATION.] If a district and bargaining 
 76.7   unit do not participate in the professional compensation 
 76.8   initiatives in fiscal year 2006, they may elect to participate 
 76.9   in subsequent years.  The requirements for participation in the 
 76.10  first year are the requirements described for fiscal year 2006. 
 76.11     <b>[EFFECTIVE DATE.]</b> This section is effective for fiscal year 
 76.12  2006 and thereafter. 
 76.13     Sec. 35.  [122A.4143] [CLOSED CONTRACT.] 
 76.14     A district and the exclusive representative of the teachers 
 76.15  may agree jointly to reopen a collective bargaining agreement 
 76.16  for the sole purpose of entering into a professional 
 76.17  compensation system consistent with section 122A.4142 and an 
 76.18  educational improvement plan under section 122A.413. 
 76.19     <b>[EFFECTIVE DATE.]</b> This section is effective for fiscal year 
 76.20  2006 and later. 
 76.21     Sec. 36.  [122A.4144] [PROFESSIONAL COMPENSATION PILOT SITE 
 76.22  AID.] 
 76.23     Subdivision 1.  [AID AMOUNT.] (a) A school district that 
 76.24  received revenue under Minnesota Statutes 2004, section 
 76.25  122A.415, or meets the eligibility conditions of section 
 76.26  122A.4142, subdivision 1, paragraph (b), and submits an 
 76.27  application approved by the commissioner is eligible for 
 76.28  professional compensation pilot site aid.  The commissioner must 
 76.29  consider only applications submitted jointly by a school 
 76.30  district and the exclusive representative of the teachers for 
 76.31  participation in the program.  The application must contain a 
 76.32  formally adopted collective bargaining agreement, memorandum of 
 76.33  understanding, or other binding agreement that implements a 
 76.34  professional compensation pay system consistent with the 
 76.35  eligibility conditions of section 122A.4142, subdivision 2, 
 76.36  paragraph (b), and includes all teachers in a district, all 
 77.1   teachers at a school site, or at least 25 percent of the 
 77.2   teachers in a district.  The commissioner, in approving 
 77.3   applications, may give preference to applications involving 
 77.4   entire districts or sites or to applications that align measures 
 77.5   of teacher performance with student academic achievement and 
 77.6   progress under section 122A.4142. 
 77.7      (b) Professional compensation aid for a qualifying school 
 77.8   district, site, or portion of a district or school site is as 
 77.9   follows: 
 77.10     (1) for a school district in which the school board and the 
 77.11  exclusive representative of the teachers agree to place all 
 77.12  teachers in the district or at the site on the alternative 
 77.13  compensation schedule, alternative compensation aid equals $150 
 77.14  times the district's or the site's number of pupils enrolled on 
 77.15  October 1 of the previous fiscal year; or 
 77.16     (2) for a district in which the school board and the 
 77.17  exclusive representative of the teachers agree that at least 25 
 77.18  percent of the district's licensed teachers will be paid on the 
 77.19  alternative compensation schedule, alternative compensation aid 
 77.20  equals $150 times the percentage of participating teachers times 
 77.21  the district's number of pupils enrolled as of October 1 of the 
 77.22  previous fiscal year. 
 77.23     Subd. 2.  [PERCENTAGE OF TEACHERS.] For purposes of this 
 77.24  section, the percentage of teachers participating in the teacher 
 77.25  professional pay system equals the ratio of the number of 
 77.26  licensed teachers who are working at least 60 percent of a 
 77.27  full-time teacher's hours and agree to participate in the 
 77.28  teacher professional pay system to the total number of licensed 
 77.29  teachers who are working at least 60 percent of a full-time 
 77.30  teacher's hours. 
 77.31     Subd. 3.  [AID TIMING.] (a) Districts or sites with 
 77.32  approved applications must receive alternative compensation aid 
 77.33  for each school year that the district or site participates in 
 77.34  the program as described in this subdivision.  Districts or 
 77.35  sites with applications received by the commissioner before June 
 77.36  1 of the first year of a two-year contract shall receive 
 78.1   alternative compensation aid for both years of the contract.  
 78.2   Districts or sites with applications received by the 
 78.3   commissioner after June 1 of the first year of a two-year 
 78.4   contract shall receive alternative compensation aid only for the 
 78.5   second year of the contract.  A qualifying district or site that 
 78.6   received alternative compensation aid for the previous fiscal 
 78.7   year must receive at least an amount equal to the lesser of the 
 78.8   amount it received for the previous fiscal year or its 
 78.9   proportionate share of the previous year's appropriation if the 
 78.10  district or site submits a timely application and the 
 78.11  commissioner determines that the district or site continues to 
 78.12  implement an alternative teacher professional pay system, 
 78.13  consistent with its application under this section.  The 
 78.14  commissioner must approve initial applications for school 
 78.15  districts qualifying under subdivision 1, paragraph (b), clause 
 78.16  (1), by January 15 of each year.  If any money remains, the 
 78.17  commissioner must approve aid amounts for school districts 
 78.18  qualifying under subdivision 1, paragraph (b), clause (2), by 
 78.19  February 15 of each year. 
 78.20     (b) The commissioner shall select applicants that qualify 
 78.21  for this program, notify school districts and school sites about 
 78.22  the program, develop and disseminate application materials, and 
 78.23  carry out other activities needed to implement this section. 
 78.24     <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
 78.25  fiscal year 2006 and later. 
 78.26     Sec. 37.  Minnesota Statutes 2004, section 122A.60, 
 78.27  subdivision 1, is amended to read: 
 78.28     Subdivision 1.  [STAFF DEVELOPMENT COMMITTEE.] A school 
 78.29  board must use the revenue authorized in section 122A.61 for 
 78.30  in-service education for programs under section 120B.22, 
 78.31  subdivision 2, or for staff development plans under this 
 78.32  section.  The board must establish an advisory staff development 
 78.33  committee to develop the plan, assist site professional 
 78.34  development teams in developing a site plan consistent with the 
 78.35  goals of the plan, and evaluate staff development efforts at the 
 78.36  site level.  A majority of the advisory committee and the site 
 79.1   professional development team must be teachers representing 
 79.2   various grade levels, subject areas, and special education.  The 
 79.3   advisory committee must also include nonteaching staff, parents, 
 79.4   and administrators.  Districts must report staff development 
 79.5   results and expenditures to the commissioner in the form and 
 79.6   manner determined by the commissioner.  The expenditure report 
 79.7   must include expenditures by the board for district level 
 79.8   activities and expenditures made by the staff.  The report must 
 79.9   provide a breakdown of expenditures for (1) curriculum 
 79.10  development and programs, (2) in-service education, workshops, 
 79.11  and conferences, and (3) the cost of teachers or substitute 
 79.12  teachers for staff development purposes.  Within each of these 
 79.13  categories, the report must also indicate whether the 
 79.14  expenditures were incurred at the district level or the school 
 79.15  site level, and whether the school site expenditures were made 
 79.16  possible by the grants to school sites that demonstrate 
 79.17  exemplary use of allocated staff development revenue.  These 
 79.18  expenditures are to be reported using the UFARS system.  The 
 79.19  commissioner shall report the staff development expenditure data 
 79.20  to the education committees of the legislature by February 15 
 79.21  each year.  
 79.22     Sec. 38.  Minnesota Statutes 2004, section 122A.60, is 
 79.23  amended by adding a subdivision to read: 
 79.24     Subd. 1a.  [EFFECTIVE STAFF DEVELOPMENT ACTIVITIES.] Staff 
 79.25  development activities must: 
 79.26     (1) focus on the school classroom and research-based 
 79.27  strategies that improve student learning; 
 79.28     (2) provide opportunities for teachers to practice and 
 79.29  improve their skills over time; 
 79.30     (3) provide opportunities for teachers to use data to 
 79.31  increase student achievement as part of their daily work; 
 79.32     (4) enhance teacher content knowledge and instructional 
 79.33  skills; 
 79.34     (5) align with state and local academic standards; and 
 79.35     (6) provide opportunities to build professional 
 79.36  relationships, foster collaboration among principals and staff 
 80.1   who provide instruction, and provide opportunities for 
 80.2   teacher-to-teacher mentoring. 
 80.3   Staff development activities may include curriculum development 
 80.4   and curriculum training programs, and activities that provide 
 80.5   teachers and other members of site-based teams training to 
 80.6   enhance team performance.  In addition, the school district may 
 80.7   implement other staff development activities as required by law 
 80.8   and those associated with professional teacher compensation 
 80.9   models.  Release time provided for teachers to supervise 
 80.10  students on field trips and school activities, or independent 
 80.11  tasks not associated with enhancing the teacher's knowledge and 
 80.12  skills, such as preparing report cards, calculating grades, or 
 80.13  organizing classroom materials, may not be counted as staff 
 80.14  development time that is financed with staff development 
 80.15  reserved revenue under section 122A.61. 
 80.16     Sec. 39.  Minnesota Statutes 2004, section 122A.60, is 
 80.17  amended by adding a subdivision to read: 
 80.18     Subd. 4.  [STAFF DEVELOPMENT REPORT.] (a) By October 15 of 
 80.19  each year, the district and site staff development committees 
 80.20  shall write and submit a report of staff development activities 
 80.21  and expenditures for the previous year, in the form and manner 
 80.22  determined by the commissioner.  The report must include 
 80.23  assessment and evaluation data indicating progress toward 
 80.24  district and site staff development goals based on teaching and 
 80.25  learning outcomes, including the percentage of teachers and 
 80.26  other staff involved in instruction participating in effective 
 80.27  staff development activities under subdivision 3. 
 80.28     (b) The report must provide a breakdown of expenditures for:
 80.29     (1) curriculum development and curriculum training 
 80.30  programs; and 
 80.31     (2) staff development training models, workshops, and 
 80.32  conferences, and the cost of releasing teachers or providing 
 80.33  substitute teachers for staff development purposes. 
 80.34     The report must also include whether the expenditures were 
 80.35  incurred at the district level or the school site level, and 
 80.36  whether the school site expenditures were made possible by 
 81.1   grants to school sites that demonstrate exemplary use of 
 81.2   allocated staff development revenue.  These expenditures must be 
 81.3   reported using the uniform financial and accounting and 
 81.4   reporting standards.  
 81.5      (c) The commissioner shall report the staff development 
 81.6   progress and expenditure data to the house of representatives 
 81.7   and senate committees having jurisdiction over education by 
 81.8   February 15 each year. 
 81.9      Sec. 40.  Minnesota Statutes 2004, section 122A.61, 
 81.10  subdivision 1, is amended to read: 
 81.11     Subdivision 1.  [STAFF DEVELOPMENT REVENUE.] A district is 
 81.12  required to reserve an amount equal to at least two percent of 
 81.13  the basic revenue under section 126C.10, subdivision 2, for 
 81.14  in-service education for programs under section 120B.22, 
 81.15  subdivision 2, for staff development plans, including plans for 
 81.16  challenging instructional activities and experiences under 
 81.17  section 122A.60, and for curriculum development and programs, 
 81.18  other in-service education, teachers' workshops, teacher 
 81.19  conferences, the cost of substitute teachers staff development 
 81.20  purposes, preservice and in-service education for special 
 81.21  education professionals and paraprofessionals, and other related 
 81.22  costs for staff development efforts.  A district may annually 
 81.23  waive the requirement to reserve their basic revenue under this 
 81.24  section if a majority vote of the licensed teachers in the 
 81.25  district and a majority vote of the school board agree to a 
 81.26  resolution to waive the requirement.  A district in statutory 
 81.27  operating debt is exempt from reserving basic revenue according 
 81.28  to this section.  Districts may expend an additional amount of 
 81.29  unreserved revenue for staff development based on their needs.  
 81.30  With the exception of amounts reserved for staff development 
 81.31  from revenues allocated directly to school sites, the board must 
 81.32  initially allocate 50 percent of the reserved revenue to each 
 81.33  school site in the district on a per teacher basis, which must 
 81.34  be retained by the school site until used.  The board may retain 
 81.35  25 percent to be used for district wide staff development 
 81.36  efforts.  The remaining 25 percent of the revenue must be used 
 82.1   to make grants to school sites for best practices methods.  A 
 82.2   grant may be used for any purpose authorized under section 
 82.3   120B.22, subdivision 2, 122A.60, or for the costs of curriculum 
 82.4   development and programs, other in-service education, teachers' 
 82.5   workshops, teacher conferences, substitute teachers for staff 
 82.6   development purposes, and other staff development efforts, and 
 82.7   determined by the site professional development team.  The site 
 82.8   professional development team must demonstrate to the school 
 82.9   board the extent to which staff at the site have met the 
 82.10  outcomes of the program.  The board may withhold a portion of 
 82.11  initial allocation of revenue if the staff development outcomes 
 82.12  are not being met.  A school district that participates in the 
 82.13  professional compensation initiative may, but is not required 
 82.14  to, reserve revenue under this section, except to the extent the 
 82.15  school district agrees to reserve or use revenue as a condition 
 82.16  of participation in the initiative. 
 82.17     Sec. 41.  [122A.74] [PRINCIPALS' LEADERSHIP INSTITUTE.] 
 82.18     Subdivision 1.  [ESTABLISHMENT.] (a) The commissioner of 
 82.19  education may contract with the regents of the University of 
 82.20  Minnesota to establish a Principals' Leadership Institute to 
 82.21  provide professional development to school principals by: 
 82.22     (1) creating a network of leaders in the educational and 
 82.23  business communities to communicate current and future trends in 
 82.24  leadership techniques; 
 82.25     (2) helping to create a vision for the school that is 
 82.26  aligned with the community and district priorities; and 
 82.27     (3) developing strategies to retain highly qualified 
 82.28  teachers. 
 82.29     (b) The University of Minnesota must cooperate with 
 82.30  participating members of the business community to provide 
 82.31  funding and content for the institute. 
 82.32     (c) Participants must agree to attend the Principals' 
 82.33  Leadership Institute for four weeks during the academic summer. 
 82.34     (d) The Principals' Leadership Institute must incorporate 
 82.35  program elements offered by leadership programs at the 
 82.36  University of Minnesota and program elements used by the 
 83.1   participating members of the business community to enhance 
 83.2   leadership within their businesses. 
 83.3      Subd. 2.  [METHOD OF SELECTION AND REQUIREMENTS.] (a) The 
 83.4   board of each school district in the state may select a 
 83.5   principal, upon the recommendation of the district's 
 83.6   superintendent and based on the principal's leadership 
 83.7   potential, to attend the institute. 
 83.8      (b) The school board shall forward its list of recommended 
 83.9   participants to the commissioner of education by February 1 each 
 83.10  year.  In addition, a principal may submit an application 
 83.11  directly to the commissioner by February 1.  The commissioner of 
 83.12  education shall notify the school board, the principal 
 83.13  candidates, and the University of Minnesota of the principals 
 83.14  selected to participate in the Principals' Leadership Institute 
 83.15  each year. 
 83.16     Sec. 42.  Minnesota Statutes 2004, section 123B.02, is 
 83.17  amended by adding a subdivision to read: 
 83.18     Subd. 14a.  [EMPLOYEE RECOGNITION.] A school board may 
 83.19  establish and operate an employee recognition program for 
 83.20  district employees, including teachers, and may expend funds as 
 83.21  necessary to achieve the objectives of the program.  The 
 83.22  employee recognition program shall not include monetary awards.  
 83.23     Sec. 43.  Minnesota Statutes 2004, section 123B.02, is 
 83.24  amended by adding a subdivision to read: 
 83.25     Subd. 22.  [REWARDS.] A school board may offer a reward to 
 83.26  persons who provide accurate and reliable information that leads 
 83.27  to the apprehension and arrest of a person who has committed a 
 83.28  crime against school district property, students, employees or 
 83.29  volunteers, or school board members. 
 83.30     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 83.31  following final enactment. 
 83.32     Sec. 44.  Minnesota Statutes 2004, section 123B.04, 
 83.33  subdivision 1, is amended to read: 
 83.34     Subdivision 1.  [DEFINITION.] "Education site" means a 
 83.35  separate facility.  A program within a facility or within a 
 83.36  district is an education site if the school board recognizes it 
 84.1   as a site.  
 84.2      Sec. 45.  Minnesota Statutes 2004, section 123B.04, 
 84.3   subdivision 2, is amended to read: 
 84.4      Subd. 2.  [AGREEMENT.] (a) Either the school board or the 
 84.5   school site decision-making team may request that the school 
 84.6   board enter into an agreement with a school site decision-making 
 84.7   team concerning Upon the request of 60 percent of the licensed 
 84.8   employees of a site or a school site decision-making team, the 
 84.9   school board shall enter into discussions to reach an agreement 
 84.10  concerning the governance, management, or control of the 
 84.11  school.  A school site decision-making team may include the 
 84.12  school principal, teachers in the school or their designee, 
 84.13  other employees in the school, parents of pupils in the school, 
 84.14  representatives of pupils in the school, or other members in the 
 84.15  community.  For purposes of formation of a new site, a school 
 84.16  site decision-making team may be a team of teachers that is 
 84.17  recognized by the board as a site.  The school site 
 84.18  decision-making team shall include the school principal or other 
 84.19  person having general control and supervision of the school.  
 84.20  The site decision-making team must reflect the diversity of the 
 84.21  education site.  No more than At least one-half of the members 
 84.22  shall be employees of the district, unless an employee is the 
 84.23  parent of a student enrolled in the school site, in which case 
 84.24  the employee may elect to serve as a parent member of the site 
 84.25  team. 
 84.26     (b) School site decision-making agreements must delegate 
 84.27  powers, duties, and broad management responsibilities to site 
 84.28  teams and involve staff members, students as appropriate, and 
 84.29  parents in decision making. 
 84.30     (c) An agreement shall include a statement of powers, 
 84.31  duties, responsibilities, and authority to be delegated to and 
 84.32  within the site. 
 84.33     (d) An agreement may include: 
 84.34     (1) an achievement contract according to subdivision 4; 
 84.35     (2) a mechanism to allow principals, a site leadership 
 84.36  team, or other persons having general control and supervision of 
 85.1   the school, to make decisions regarding how financial and 
 85.2   personnel resources are best allocated at the site and from whom 
 85.3   goods or services are purchased; 
 85.4      (3) a mechanism to implement parental involvement programs 
 85.5   under section 124D.895 and to provide for effective parental 
 85.6   communication and feedback on this involvement at the site 
 85.7   level; 
 85.8      (4) a provision that would allow the team to determine who 
 85.9   is hired into licensed and nonlicensed positions; 
 85.10     (5) a provision that would allow teachers to choose the 
 85.11  principal or other person having general control; 
 85.12     (6) an amount of revenue allocated to the site under 
 85.13  subdivision 3; and 
 85.14     (7) any other powers and duties determined appropriate by 
 85.15  the board. 
 85.16     The school board of the district remains the legal employer 
 85.17  under clauses (4) and (5). 
 85.18     (e) Any powers or duties not delegated to the school site 
 85.19  management team in the school site management agreement shall 
 85.20  remain with the school board. 
 85.21     (f) Approved agreements shall be filed with the 
 85.22  commissioner.  If a school board denies a request or the school 
 85.23  site and school board fail to reach an agreement to enter into a 
 85.24  school site management agreement, it the school board shall 
 85.25  provide a copy of the request and the reasons for its denial to 
 85.26  the commissioner. 
 85.27     Sec. 46.  Minnesota Statutes 2004, section 123B.88, is 
 85.28  amended by adding a subdivision to read: 
 85.29     Subd. 3a.  [PUPIL TRANSPORTATION SAFETY COMMITTEE.] (a) A 
 85.30  school board may establish a pupil transportation safety 
 85.31  committee.  The chair of the pupil transportation safety 
 85.32  committee is the district's school transportation safety 
 85.33  director.  The school board shall appoint the other members of 
 85.34  the pupil transportation safety committee.  Membership may 
 85.35  include parents, school bus drivers, representatives of school 
 85.36  bus companies, local law enforcement officials, other school 
 86.1   district staff, and representatives from other units of local 
 86.2   government. 
 86.3      (b) The duties of the pupil transportation safety committee 
 86.4   include:  (1) reviewing and recommending changes to the 
 86.5   district's pupil transportation safety policy required under 
 86.6   subdivision 1; and (2) developing a comprehensive plan for the 
 86.7   safe transportation of students who face hazardous 
 86.8   transportation conditions.  The comprehensive hazardous 
 86.9   transportation plan shall consider safety factors including the 
 86.10  types of roads that students must cross, the speed of traffic on 
 86.11  those roads, the age of the students, and any other factors as 
 86.12  determined by the committee. 
 86.13     (c) The pupil transportation safety committee must hold at 
 86.14  least one public meeting before adopting its comprehensive plan 
 86.15  for transporting students who face hazardous transportation 
 86.16  conditions. 
 86.17     (d) Any recommended changes to the district's pupil 
 86.18  transportation safety policy and the comprehensive plan for 
 86.19  hazardous transportation must be submitted to the school board. 
 86.20     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 86.21  following final enactment. 
 86.22     Sec. 47.  Minnesota Statutes 2004, section 124D.081, is 
 86.23  amended to read: 
 86.24     124D.081 [FIRST-GRADE PREPAREDNESS ALL-DAY KINDERGARTEN 
 86.25  PROGRAM.] 
 86.26     Subdivision 1.  [PURPOSE.] The purposes of the first-grade 
 86.27  preparedness all-day kindergarten program are to ensure that 
 86.28  every child has the opportunity before first grade to develop 
 86.29  the skills and abilities necessary to read and succeed in school 
 86.30  and to reduce the underlying causes that create a need for 
 86.31  compensatory revenue. 
 86.32     Subd. 2.  [QUALIFYING DISTRICT.] A school district may 
 86.33  receive first-grade preparedness all-day kindergarten revenue 
 86.34  for qualifying school sites if, consistent with subdivision 5, 
 86.35  the school board approves a resolution requiring the district to 
 86.36  provide services to all children located in a qualifying school 
 87.1   site attendance area. 
 87.2      Subd. 3.  [QUALIFYING SCHOOL SITE.] (a) The commissioner 
 87.3   shall rank all school sites with kindergarten programs that do 
 87.4   not exclusively serve students under sections 125A.03 to 
 87.5   125A.24, and 125A.65.  The ranking must be from highest to 
 87.6   lowest based on the site's free and reduced lunch count as a 
 87.7   percent of the fall enrollment using the preceding October 1 
 87.8   enrollment data.  Once a school site is calculated to be 
 87.9   eligible, it remains eligible for the duration of the pilot 
 87.10  program, unless the site's ranking falls below the state average 
 87.11  for elementary schools.  For each school site, the percentage 
 87.12  used to calculate the ranking must be the greater of (1) the 
 87.13  percent of the fall kindergarten enrollment receiving free and 
 87.14  reduced lunch, or (2) the percent of the total fall enrollment 
 87.15  receiving free and reduced lunch.  The list of ranked sites must 
 87.16  be separated into the following geographic areas:  Minneapolis 
 87.17  district, St. Paul district, suburban Twin Cities districts in 
 87.18  the seven-county metropolitan area, and school districts in 
 87.19  greater Minnesota. 
 87.20     (b) The commissioner shall establish a process and 
 87.21  timelines to qualify school sites for the next school year.  
 87.22  School sites must be qualified in each geographic area from the 
 87.23  list of ranked sites until the estimated revenue available for 
 87.24  this program has been allocated.  The total estimated revenue 
 87.25  must be distributed to qualified school sites in each geographic 
 87.26  area as follows:  25 percent for Minneapolis sites, 25 percent 
 87.27  for St. Paul sites, 25 percent for suburban Twin Cities sites, 
 87.28  and 25 percent for greater Minnesota. 
 87.29     Subd. 4.  [PROGRAM.] A qualifying school site must develop 
 87.30  its first-grade preparedness all-day kindergarten program in 
 87.31  collaboration with other providers of school readiness and child 
 87.32  development services.  A school site must offer a full-day 
 87.33  kindergarten program to participating children who are five 
 87.34  years of age or older for the full school day every day, a 
 87.35  program for participating children who are four years old, or a 
 87.36  combination of both.  The program may offer as an option to 
 88.1   families home visits and other practices as appropriate, and may 
 88.2   provide such services with the consent of the parent or 
 88.3   guardian.  Program providers must ensure that the program 
 88.4   supplements existing school readiness and child development 
 88.5   programs and complements the services provided with compensatory 
 88.6   revenue.  Where possible, individuals receiving assistance under 
 88.7   a family assistance plan can meet the work activity requirement 
 88.8   of the plan by participating in a first-grade preparedness an 
 88.9   all-day kindergarten program as a volunteer. 
 88.10     Subd. 5.  [EXTENDED DAY REQUIREMENTS.] The board of a 
 88.11  qualifying school district must develop and approve a plan to 
 88.12  provide extended day services to serve as many children as 
 88.13  possible.  To accept children whose families participate in 
 88.14  child care assistance programs under section 119B.03 or 119B.05, 
 88.15  and to meet the requirements of section 245A.03, subdivision 2, 
 88.16  the board must formally approve the first-grade preparedness 
 88.17  all-day kindergarten program.  All revenue received under 
 88.18  subdivision 6 must be allocated to the qualifying school sites 
 88.19  within the district. 
 88.20     Subd. 6.  [PREPAREDNESS REVENUE.] (a) A qualifying school 
 88.21  district is eligible for first-grade preparedness all-day 
 88.22  kindergarten revenue equal to the basic formula allowance for 
 88.23  that year times the number of children five years of age or 
 88.24  older enrolled in a kindergarten program at the site on October 
 88.25  1 of the previous year times .53. 
 88.26     (b) This revenue must supplement and not replace 
 88.27  compensatory revenue that the district uses for the same or 
 88.28  similar purposes under chapters 120B, 123A, 123B, 124D, 126C, 
 88.29  and 127A. 
 88.30     (c) A pupil enrolled in the first grade preparedness 
 88.31  all-day kindergarten program at a qualifying school site is 
 88.32  eligible for transportation under section 123B.88, subdivision 1.
 88.33     (d) First grade preparedness All-day kindergarten revenue 
 88.34  paid to a charter school for which a school district is 
 88.35  providing transportation according to section 124D.10, 
 88.36  subdivision 16, shall be decreased by an amount equal to the 
 89.1   product of the formula allowance according to section 126C.10, 
 89.2   subdivision 2, times .0485 times the pupil units calculated 
 89.3   according to paragraph (a).  This amount shall be paid to the 
 89.4   school district for transportation costs.  
 89.5      Subd. 9.  [RESERVE ACCOUNT.] First grade preparedness 
 89.6   All-day kindergarten revenue must be placed in a reserve account 
 89.7   within the general fund and may only be used for first grade 
 89.8   preparedness all-day kindergarten programs at qualifying school 
 89.9   sites. 
 89.10     Sec. 48.  Minnesota Statutes 2004, section 124D.09, 
 89.11  subdivision 12, is amended to read: 
 89.12     Subd. 12.  [CREDITS.] A pupil may enroll in a course under 
 89.13  this section for either secondary credit or postsecondary 
 89.14  credit.  At the time a pupil enrolls in a course, the pupil 
 89.15  shall designate whether the course is for secondary or 
 89.16  postsecondary credit.  A pupil taking several courses may 
 89.17  designate some for secondary credit and some for postsecondary 
 89.18  credit.  A pupil must not audit a course under this section. 
 89.19     A district shall grant academic credit to a pupil enrolled 
 89.20  in a course for secondary credit if the pupil successfully 
 89.21  completes the course.  Seven quarter or four semester college 
 89.22  credits equal at least one full year of high school credit.  
 89.23  Fewer college credits may be prorated.  A district must also 
 89.24  grant academic credit to a pupil enrolled in a course for 
 89.25  postsecondary credit if secondary credit is requested by a 
 89.26  pupil.  If no comparable course is offered by the district, the 
 89.27  district must, as soon as possible, notify the commissioner, who 
 89.28  shall determine the number of credits that shall be granted to a 
 89.29  pupil who successfully completes a course.  If a comparable 
 89.30  course is offered by the district, the school board shall grant 
 89.31  a comparable number of credits to the pupil.  If there is a 
 89.32  dispute between the district and the pupil regarding the number 
 89.33  of credits granted for a particular course, the pupil may appeal 
 89.34  the board's decision to the commissioner.  The commissioner's 
 89.35  decision regarding the number of credits shall be final.  
 89.36     The secondary credits granted to a pupil must be counted 
 90.1   toward the graduation requirements and subject area requirements 
 90.2   of the district.  Evidence of successful completion of each 
 90.3   course and secondary credits granted must be included in the 
 90.4   pupil's secondary school record.  A pupil shall provide the 
 90.5   school with a copy of the pupil's grade in each course taken for 
 90.6   secondary credit under this section.  Upon the request of a 
 90.7   pupil, the pupil's secondary school record must also include 
 90.8   evidence of successful completion and credits granted for a 
 90.9   course taken for postsecondary credit.  In either case, the 
 90.10  record must indicate that the credits were earned at a 
 90.11  postsecondary institution. 
 90.12     If a pupil enrolls in a postsecondary institution after 
 90.13  leaving secondary school, the postsecondary institution must 
 90.14  award postsecondary credit for any course successfully completed 
 90.15  for secondary credit at that institution.  Other postsecondary 
 90.16  institutions may award, after a pupil leaves secondary school, 
 90.17  postsecondary credit for any courses successfully completed 
 90.18  under this section.  An institution may not charge a pupil for 
 90.19  the award of credit. 
 90.20     The Board of Trustees of the Minnesota State Colleges and 
 90.21  Universities and the Board of Regents of the University of 
 90.22  Minnesota must, and private nonprofit and proprietary 
 90.23  postsecondary institutions, should award postsecondary credit 
 90.24  for any successfully completed courses in a program certified by 
 90.25  the National Alliance of Concurrent Enrollment Partnerships 
 90.26  offered according to an agreement under subdivision 10. 
 90.27     Sec. 49.  Minnesota Statutes 2004, section 124D.11, 
 90.28  subdivision 6, is amended to read: 
 90.29     Subd. 6.  [OTHER AID, GRANTS, REVENUE.] (a) A charter 
 90.30  school is eligible to receive other aids, grants, and revenue 
 90.31  according to chapters 120A to 129C, as though it were a district.
 90.32     (b) Notwithstanding paragraph (a), a charter school may not 
 90.33  receive aid, a grant, or revenue if a levy is required to obtain 
 90.34  the money, or if the aid, grant, or revenue is a replacement of 
 90.35  levy revenue, except as otherwise provided in this section.  
 90.36     (c) Federal aid received by the state must be paid to the 
 91.1   school, if it qualifies for the aid as though it were a school 
 91.2   district. 
 91.3      (d) A charter school may receive money from any source for 
 91.4   capital facilities needs.  In the year-end report to the 
 91.5   commissioner of education, the charter school shall report the 
 91.6   total amount of funds received from grants and other outside 
 91.7   sources. 
 91.8      Sec. 50.  Minnesota Statutes 2004, section 124D.66, 
 91.9   subdivision 3, is amended to read: 
 91.10     Subd. 3.  [ELIGIBLE SERVICES.] (a) Assurance of mastery 
 91.11  programs may provide direct instructional services to an 
 91.12  eligible pupil, or a group of eligible pupils, under the 
 91.13  following conditions in paragraphs (b) to (d). 
 91.14     (b) Instruction may be provided at one or more grade levels 
 91.15  from kindergarten to grade 8 and for students in grades 9 
 91.16  through 12 who were enrolled in grade 8 before the 2005-2006 
 91.17  school year and have failed the basic skills tests, or were 
 91.18  enrolled in grade 8 in the 2005-2006 school year and later and 
 91.19  who have failed the Minnesota Comprehensive Assessments 
 91.20  (MCA-IIs) in reading, mathematics, or writing as required for 
 91.21  high school graduation under section 120B.02.  If an assessment 
 91.22  of pupils' needs within a district demonstrates that the 
 91.23  eligible pupils in grades kindergarten to grade 8 are being 
 91.24  appropriately served, a district may serve eligible pupils in 
 91.25  grades 9 to 12. 
 91.26     (c) Instruction must be provided under the supervision of 
 91.27  the eligible pupil's regular classroom teacher.  Instruction may 
 91.28  be provided by the eligible pupil's classroom teacher, by 
 91.29  another teacher, by a team of teachers, or by an education 
 91.30  assistant or aide.  A special education teacher may provide 
 91.31  instruction, but instruction that is provided under this section 
 91.32  is not eligible for aid under section 125A.76. 
 91.33     (d) The instruction that is provided must differ from the 
 91.34  initial instruction the pupil received in the regular classroom 
 91.35  setting.  The instruction may differ by presenting different 
 91.36  curriculum than was initially presented in the regular classroom 
 92.1   or by presenting the same curriculum: 
 92.2      (1) at a different rate or in a different sequence than it 
 92.3   was initially presented; 
 92.4      (2) using different teaching methods or techniques than 
 92.5   were used initially; or 
 92.6      (3) using different instructional materials than were used 
 92.7   initially. 
 92.8      Sec. 51.  Minnesota Statutes 2004, section 124D.74, 
 92.9   subdivision 1, is amended to read: 
 92.10     Subdivision 1.  [PROGRAM DESCRIBED.] American Indian 
 92.11  education programs are programs in public elementary and 
 92.12  secondary schools, nonsectarian nonpublic, community, 
 92.13  tribal, charter, or alternative schools enrolling American 
 92.14  Indian children designed to: 
 92.15     (1) support postsecondary preparation for pupils; 
 92.16     (2) support the academic achievement of American Indian 
 92.17  students with identified focus to improve reading and mathematic 
 92.18  skills; 
 92.19     (3) make the curriculum more relevant to the needs, 
 92.20  interests, and cultural heritage of American Indian pupils; 
 92.21     (4) provide positive reinforcement of the self-image of 
 92.22  American Indian pupils; 
 92.23     (5) develop intercultural awareness among pupils, parents, 
 92.24  and staff; and 
 92.25     (6) supplement, not supplant, state and federal educational 
 92.26  and cocurricular programs.  
 92.27  Program components may include:  development of support 
 92.28  components for students in the areas of academic achievement, 
 92.29  retention, and attendance; development of support components for 
 92.30  staff, including in-service training and technical assistance in 
 92.31  methods of teaching American Indian pupils; research projects, 
 92.32  including experimentation with and evaluation of methods of 
 92.33  relating to American Indian pupils; provision of personal and 
 92.34  vocational counseling to American Indian pupils; modification of 
 92.35  curriculum, instructional methods, and administrative procedures 
 92.36  to meet the needs of American Indian pupils; and supplemental 
 93.1   instruction in American Indian language, literature, history, 
 93.2   and culture.  Districts offering programs may make contracts for 
 93.3   the provision of program components by establishing cooperative 
 93.4   liaisons with tribal programs and American Indian social service 
 93.5   agencies.  These programs may also be provided as components of 
 93.6   early childhood and family education programs. 
 93.7      Sec. 52.  Minnesota Statutes 2004, section 124D.81, 
 93.8   subdivision 1, is amended to read: 
 93.9      Subdivision 1.  [GRANTS; PROCEDURES.] Each fiscal year the 
 93.10  commissioner of education must make grants to no fewer than six 
 93.11  American Indian education programs.  At least three programs 
 93.12  must be in urban areas and at least three must be on or near 
 93.13  reservations.  The board of a local district, a participating 
 93.14  school or a group of boards may develop a proposal for grants in 
 93.15  support of American Indian education programs.  Proposals may 
 93.16  provide for contracts for the provision of program components by 
 93.17  nonsectarian nonpublic, community, tribal, charter, or 
 93.18  alternative schools.  The commissioner shall prescribe the form 
 93.19  and manner of application for grants, and no grant shall be made 
 93.20  for a proposal not complying with the requirements of sections 
 93.21  124D.71 to 124D.82.  The commissioner must submit all proposals 
 93.22  to the state Advisory Committee on American Indian Education 
 93.23  Programs for its recommendations concerning approval, 
 93.24  modification, or disapproval and the amounts of grants to 
 93.25  approved programs. 
 93.26     Sec. 53.  Minnesota Statutes 2004, section 124D.84, 
 93.27  subdivision 1, is amended to read: 
 93.28     Subdivision 1.  [AWARDS.] The commissioner, with the advice 
 93.29  and counsel of the Minnesota Indian Education Committee, may 
 93.30  award scholarships to any Minnesota resident student who is of 
 93.31  one-fourth or more Indian ancestry, who has applied for other 
 93.32  existing state and federal scholarship and grant programs, and 
 93.33  who, in the opinion of the commissioner, has the capabilities to 
 93.34  benefit from further education.  Scholarships must be for 
 93.35  accredited degree programs in accredited Minnesota colleges or 
 93.36  universities or for courses in accredited Minnesota business, 
 94.1   technical, or vocational schools.  Scholarships may also be 
 94.2   given to students attending Minnesota colleges that are in 
 94.3   candidacy status for obtaining full accreditation, and are 
 94.4   eligible for and receiving federal financial aid programs.  
 94.5   Students are also eligible for scholarships when enrolled as 
 94.6   students in Minnesota higher education institutions that have 
 94.7   joint programs with other accredited higher education 
 94.8   institutions.  Scholarships shall be used to defray the total 
 94.9   cost of education including tuition, incidental fees, books, 
 94.10  supplies, transportation, other related school costs and the 
 94.11  cost of board and room and shall be paid directly to the college 
 94.12  or school concerned where the student receives federal financial 
 94.13  aid.  The total cost of education includes all tuition and fees 
 94.14  for each student enrolling in a public institution and the 
 94.15  portion of tuition and fees for each student enrolling in a 
 94.16  private institution that does not exceed the tuition and fees at 
 94.17  a comparable public institution.  Each student shall be awarded 
 94.18  a scholarship based on the total cost of the student's education 
 94.19  and a federal standardized need analysis.  Applicants are 
 94.20  encouraged to apply for all other sources of financial aid.  The 
 94.21  amount and type of each scholarship shall be determined through 
 94.22  the advice and counsel of the Minnesota Indian education 
 94.23  committee. 
 94.24     When an Indian student satisfactorily completes the work 
 94.25  required by a certain college or school in a school year the 
 94.26  student is eligible for additional scholarships, if additional 
 94.27  training is necessary to reach the student's educational and 
 94.28  vocational objective.  Scholarships may not be given to any 
 94.29  Indian student for more than five years of study without special 
 94.30  recommendation of the Minnesota Indian Education Committee.  
 94.31     Sec. 54.  [127A.095] [IMPLEMENTATION OF NO CHILD LEFT 
 94.32  BEHIND ACT.] 
 94.33     Subdivision 1.  [CONTINUED IMPLEMENTATION.] The Department 
 94.34  of Education shall continue to implement the federal No Child 
 94.35  Left Behind Act, Public Law 107-110, without interruption. 
 94.36     Subd. 2.  [NO CHILD LEFT BEHIND REVIEW.] (a) The 
 95.1   legislature states its intention to require the Department of 
 95.2   Education to conduct a comprehensive review of the consolidated 
 95.3   state plan submitted by the state to the federal Department of 
 95.4   Education on implementing the No Child Left Behind Act.  The 
 95.5   Minnesota Department of Education shall review and seek waivers 
 95.6   under paragraph (b).  If the Department of Education is unable 
 95.7   to obtain waivers under paragraph (b), it should make a 
 95.8   recommendation in its report under paragraph (b) about whether 
 95.9   the state should opt out of the No Child Left Behind Act. 
 95.10     (b) The commissioner shall report to the house of 
 95.11  representatives and senate committees having jurisdiction over 
 95.12  kindergarten through grade 12 education policy and finance by 
 95.13  April 1, 2006, whether the department has: 
 95.14     (1) received approval from the federal Department of 
 95.15  Education to allow the state to develop a plan using multiple 
 95.16  measures including value-added measurement of student 
 95.17  achievement in addition to relying on standardized test results 
 95.18  to evaluate school and student performance for the purpose of 
 95.19  determining adequate yearly progress; 
 95.20     (2) received approval from the federal Department of 
 95.21  Education to allow the state to average three years of data for 
 95.22  the purposes of identifying a school for improvement; 
 95.23     (3) developed a plan and model legislation to ensure that 
 95.24  if an adequate yearly progress determination was made in error, 
 95.25  that the error will not adversely affect the school's or school 
 95.26  district's sanction status in subsequent years.  The department 
 95.27  must have a policy in place to correct errors to accountability 
 95.28  reports; 
 95.29     (4) reported the additional costs for state fiscal years 
 95.30  2006 to 2009 that the No Child Left Behind Act imposes on the 
 95.31  state, the state's school districts, and charter schools that 
 95.32  are in excess of costs associated with the Improving America's 
 95.33  Schools Act of 1994, Public Law 103-382; 
 95.34     (5) received approval from the federal Department of 
 95.35  Education to allow the state to use No Child Left Behind Act 
 95.36  money to provide supplemental education services only in the 
 96.1   academic subject area that causes a school to miss adequate 
 96.2   yearly progress; 
 96.3      (6) received approval from the federal Department of 
 96.4   Education to exclude from sanctions schools that have not made 
 96.5   adequate yearly progress solely due to a subgroup of students 
 96.6   with disabilities not testing at a proficient level; 
 96.7      (7) received approval from the federal Department of 
 96.8   Education to exclude from sanctions a school that is classified 
 96.9   as not having made adequate yearly progress solely due to 
 96.10  different subgroups testing below proficient levels for at least 
 96.11  two consecutive years; 
 96.12     (8) received approval from the federal Department of 
 96.13  Education to identify a school as not making adequate yearly 
 96.14  progress only after missing the adequate yearly progress targets 
 96.15  in the same subject and subgroup for two consecutive years; 
 96.16     (9) received approval from the federal Department of 
 96.17  Education to identify a district as in need of improvement only 
 96.18  after missing the adequate yearly progress target in the same 
 96.19  subject across multiple grade spans for two consecutive years; 
 96.20     (10) received approval from the federal Department of 
 96.21  Education to limit the score of a student within multiple 
 96.22  subgroups to the one subgroup that is the smallest subgroup in 
 96.23  which that student is a part of when calculating adequate yearly 
 96.24  progress; 
 96.25     (11) implemented a uniform financial reporting system for 
 96.26  school districts to report costs related to implementing No 
 96.27  Child Left Behind Act requirements, including the costs of 
 96.28  complying with sanctions; 
 96.29     (12) received approval from the federal Department of 
 96.30  Education to determine the percentage of the special education 
 96.31  students that would be best educated based on out-of-level 
 96.32  standards and tested accordingly based on an individual 
 96.33  education plan; and 
 96.34     (13) received approval from the federal Department of 
 96.35  Education to determine when to hold schools accountable for 
 96.36  including a student with limited English proficiency in adequate 
 97.1   yearly progress calculations.  
 97.2      Subd. 3.  [DEPARTMENT OF FINANCE CERTIFICATION.] If the 
 97.3   commissioner of education has not received approval from the 
 97.4   federal Department of Education regarding the conditions in 
 97.5   subdivision 2, paragraph (b), the commissioner of finance shall 
 97.6   certify and report to the legislature beginning January 1, 2007, 
 97.7   and each year thereafter, the amount of federal revenue, if any, 
 97.8   that may be withheld by the federal government as a result of a 
 97.9   potential state decision to discontinue implementation of the No 
 97.10  Child Left Behind Act.  The report shall also specify the 
 97.11  intended purpose of the federal revenue and the amount of 
 97.12  revenue that may be withheld from the state, each school 
 97.13  district, and each charter school in each fiscal year. 
 97.14     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 97.15  following final enactment. 
 97.16     Sec. 55.  [129C.105] [BOARD MEETINGS BY TELEPHONE OR OTHER 
 97.17  ELECTRONIC MEANS.] 
 97.18     (a) Notwithstanding section 13D.01 and if complying with 
 97.19  section 13D.02 is impractical, the Board of the Perpich Center 
 97.20  for Arts Education may conduct a meeting of its members by 
 97.21  telephone or other electronic means when: 
 97.22     (1) all members of the board participating in the meeting, 
 97.23  wherever the members' physical locations, can hear one another 
 97.24  and all discussion and testimony; 
 97.25     (2) members of the public present at the regular meeting 
 97.26  location of the board can hear all discussion and testimony and 
 97.27  all votes of members of the board; 
 97.28     (3) at least one member of the board is physically present 
 97.29  at the regular meeting location; and 
 97.30     (4) all votes are conducted by roll call, so each member's 
 97.31  vote on each issue can be identified and recorded. 
 97.32     (b) Each member of the board participating in a meeting by 
 97.33  telephone or other electronic means is considered present at the 
 97.34  meeting for purposes of determining a quorum and participating 
 97.35  in all proceedings. 
 97.36     (c) If telephone or other electronic means is used to 
 98.1   conduct a meeting, the board, to the extent practical, shall 
 98.2   allow a person to monitor the meeting electronically from a 
 98.3   remote location.  The board may require the person making such a 
 98.4   connection to pay for documented marginal costs that the board 
 98.5   incurs as a result of the additional connection. 
 98.6      (d) If telephone or other electronic means is used to 
 98.7   conduct a regular, special, or emergency meeting, the board 
 98.8   shall provide notice of the regular meeting location, of the 
 98.9   fact that some members may participate by telephone or other 
 98.10  electronic means, and of the provisions of paragraph (c).  The 
 98.11  timing and method of providing notice is governed by section 
 98.12  13D.04. 
 98.13     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
 98.14  following final enactment. 
 98.15     Sec. 56.  Minnesota Statutes 2004, section 179A.03, 
 98.16  subdivision 14, is amended to read: 
 98.17     Subd. 14.  [PUBLIC EMPLOYEE OR EMPLOYEE.] "Public employee" 
 98.18  or "employee" means any person appointed or employed by a public 
 98.19  employer except:  
 98.20     (a) elected public officials; 
 98.21     (b) election officers; 
 98.22     (c) commissioned or enlisted personnel of the Minnesota 
 98.23  National Guard; 
 98.24     (d) emergency employees who are employed for emergency work 
 98.25  caused by natural disaster; 
 98.26     (e) part-time employees whose service does not exceed the 
 98.27  lesser of 14 hours per week or 35 percent of the normal work 
 98.28  week in the employee's appropriate unit; 
 98.29     (f) employees whose positions are basically temporary or 
 98.30  seasonal in character and:  (1) are not for more than 67 working 
 98.31  days in any calendar year; or (2) are not for more than 100 
 98.32  working days in any calendar year and the employees are under 
 98.33  the age of 22, are full-time students enrolled in a nonprofit or 
 98.34  public educational institution prior to being hired by the 
 98.35  employer, and have indicated, either in an application for 
 98.36  employment or by being enrolled at an educational institution 
 99.1   for the next academic year or term, an intention to continue as 
 99.2   students during or after their temporary employment; 
 99.3      (g) employees providing services for not more than two 
 99.4   consecutive quarters to the Board of Trustees of the Minnesota 
 99.5   State Colleges and Universities under the terms of a 
 99.6   professional or technical services contract as defined in 
 99.7   section 16C.08, subdivision 1; 
 99.8      (h) employees of charitable hospitals as defined by section 
 99.9   179.35, subdivision 3; 
 99.10     (i) full-time undergraduate students employed by the school 
 99.11  which they attend under a work-study program or in connection 
 99.12  with the receipt of financial aid, irrespective of number of 
 99.13  hours of service per week; 
 99.14     (j) an individual who is employed for less than 300 hours 
 99.15  in a fiscal year as an instructor in an adult vocational 
 99.16  education program; 
 99.17     (k) an individual hired by the Board of Trustees of the 
 99.18  Minnesota State Colleges and Universities to teach one course 
 99.19  for three or fewer credits for one semester in a year; 
 99.20     (l) with respect to court employees: 
 99.21     (1) personal secretaries to judges; 
 99.22     (2) law clerks; 
 99.23     (3) managerial employees; 
 99.24     (4) confidential employees; and 
 99.25     (5) supervisory employees. 
 99.26     The following individuals are public employees regardless 
 99.27  of the exclusions of clauses (e) and (f):  
 99.28     (i) an employee hired by a school district or the Board of 
 99.29  Trustees of the Minnesota State Colleges and Universities except 
 99.30  at the university established in section 136F.13 or for 
 99.31  community services or community education instruction offered on 
 99.32  a noncredit basis:  (A) to replace an absent teacher or faculty 
 99.33  member who is a public employee, where the replacement employee 
 99.34  is employed more than 30 working days as a replacement for that 
 99.35  teacher or faculty member; or (B) to take a teaching position 
 99.36  created due to increased enrollment, curriculum expansion, 
100.1   courses which are a part of the curriculum whether offered 
100.2   annually or not, or other appropriate reasons; and 
100.3      (ii) an employee hired for a position under clause (f)(1) 
100.4   if that same position has already been filled under clause 
100.5   (f)(1) in the same calendar year and the cumulative number of 
100.6   days worked in that same position by all employees exceeds 67 
100.7   calendar days in that year.  For the purpose of this paragraph, 
100.8   "same position" includes a substantially equivalent position if 
100.9   it is not the same position solely due to a change in the 
100.10  classification or title of the position; and 
100.11     (iii) an early childhood family education teacher employed 
100.12  by a school district. 
100.13     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2005.  
100.14     Sec. 57.  Minnesota Statutes 2004, section 260C.201, 
100.15  subdivision 1, is amended to read: 
100.16     Subdivision 1.  [DISPOSITIONS.] (a) If the court finds that 
100.17  the child is in need of protection or services or neglected and 
100.18  in foster care, it shall enter an order making any of the 
100.19  following dispositions of the case: 
100.20     (1) place the child under the protective supervision of the 
100.21  responsible social services agency or child-placing agency in 
100.22  the home of a parent of the child under conditions prescribed by 
100.23  the court directed to the correction of the child's need for 
100.24  protection or services: 
100.25     (i) the court may order the child into the home of a parent 
100.26  who does not otherwise have legal custody of the child, however, 
100.27  an order under this section does not confer legal custody on 
100.28  that parent; 
100.29     (ii) if the court orders the child into the home of a 
100.30  father who is not adjudicated, he must cooperate with paternity 
100.31  establishment proceedings regarding the child in the appropriate 
100.32  jurisdiction as one of the conditions prescribed by the court 
100.33  for the child to continue in his home; 
100.34     (iii) the court may order the child into the home of a 
100.35  noncustodial parent with conditions and may also order both the 
100.36  noncustodial and the custodial parent to comply with the 
101.1   requirements of a case plan under subdivision 2; or 
101.2      (2) transfer legal custody to one of the following: 
101.3      (i) a child-placing agency; or 
101.4      (ii) the responsible social services agency.  In placing a 
101.5   child whose custody has been transferred under this paragraph, 
101.6   the agencies shall make an individualized determination of how 
101.7   the placement is in the child's best interests using the 
101.8   consideration for relatives and the best interest factors in 
101.9   section 260C.212, subdivision 2, paragraph (b); or 
101.10     (3) if the child has been adjudicated as a child in need of 
101.11  protection or services because the child is in need of special 
101.12  services or care to treat or ameliorate a physical or mental 
101.13  disability, the court may order the child's parent, guardian, or 
101.14  custodian to provide it.  The court may order the child's health 
101.15  plan company to provide mental health services to the child.  
101.16  Section 62Q.535 applies to an order for mental health services 
101.17  directed to the child's health plan company.  If the health 
101.18  plan, parent, guardian, or custodian fails or is unable to 
101.19  provide this treatment or care, the court may order it 
101.20  provided.  Absent specific written findings by the court that 
101.21  the child's disability is the result of abuse or neglect by the 
101.22  child's parent or guardian, the court shall not transfer legal 
101.23  custody of the child for the purpose of obtaining special 
101.24  treatment or care solely because the parent is unable to provide 
101.25  the treatment or care.  If the court's order for mental health 
101.26  treatment is based on a diagnosis made by a treatment 
101.27  professional, the court may order that the diagnosing 
101.28  professional not provide the treatment to the child if it finds 
101.29  that such an order is in the child's best interests; or 
101.30     (4) if the court believes that the child has sufficient 
101.31  maturity and judgment and that it is in the best interests of 
101.32  the child, the court may order a child 16 years old or older to 
101.33  be allowed to live independently, either alone or with others as 
101.34  approved by the court under supervision the court considers 
101.35  appropriate, if the county board, after consultation with the 
101.36  court, has specifically authorized this dispositional 
102.1   alternative for a child. 
102.2      (b) If the child was adjudicated in need of protection or 
102.3   services because the child is a runaway or habitual truant, the 
102.4   court may order any of the following dispositions in addition to 
102.5   or as alternatives to the dispositions authorized under 
102.6   paragraph (a): 
102.7      (1) counsel the child or the child's parents, guardian, or 
102.8   custodian; 
102.9      (2) place the child under the supervision of a probation 
102.10  officer or other suitable person in the child's own home under 
102.11  conditions prescribed by the court, including reasonable rules 
102.12  for the child's conduct and the conduct of the parents, 
102.13  guardian, or custodian, designed for the physical, mental, and 
102.14  moral well-being and behavior of the child; or with the consent 
102.15  of the commissioner of corrections, place the child in a group 
102.16  foster care facility which is under the commissioner's 
102.17  management and supervision; 
102.18     (3) subject to the court's supervision, transfer legal 
102.19  custody of the child to one of the following: 
102.20     (i) a reputable person of good moral character.  No person 
102.21  may receive custody of two or more unrelated children unless 
102.22  licensed to operate a residential program under sections 245A.01 
102.23  to 245A.16; or 
102.24     (ii) a county probation officer for placement in a group 
102.25  foster home established under the direction of the juvenile 
102.26  court and licensed pursuant to section 241.021; 
102.27     (4) require the child to pay a fine of up to $100.  The 
102.28  court shall order payment of the fine in a manner that will not 
102.29  impose undue financial hardship upon the child; 
102.30     (5) require the child to participate in a community service 
102.31  project; 
102.32     (6) order the child to undergo a chemical dependency 
102.33  evaluation and, if warranted by the evaluation, order 
102.34  participation by the child in a drug awareness program or an 
102.35  inpatient or outpatient chemical dependency treatment program; 
102.36     (7) if the court believes that it is in the best interests 
103.1   of the child and or of public safety that the child's driver's 
103.2   license or instruction permit be canceled, the court may order 
103.3   the commissioner of public safety to cancel the child's license 
103.4   or permit for any period up to the child's 18th birthday.  If 
103.5   the child does not have a driver's license or permit, the court 
103.6   may order a denial of driving privileges for any period up to 
103.7   the child's 18th birthday.  The court shall forward an order 
103.8   issued under this clause to the commissioner, who shall cancel 
103.9   the license or permit or deny driving privileges without a 
103.10  hearing for the period specified by the court.  At any time 
103.11  before the expiration of the period of cancellation or denial, 
103.12  the court may, for good cause, order the commissioner of public 
103.13  safety to allow the child to apply for a license or permit, and 
103.14  the commissioner shall so authorize; 
103.15     (8) order that the child's parent or legal guardian deliver 
103.16  the child to school at the beginning of each school day for a 
103.17  period of time specified by the court; or 
103.18     (9) require the child to perform any other activities or 
103.19  participate in any other treatment programs deemed appropriate 
103.20  by the court.  
103.21     To the extent practicable, the court shall enter a 
103.22  disposition order the same day it makes a finding that a child 
103.23  is in need of protection or services or neglected and in foster 
103.24  care, but in no event more than 15 days after the finding unless 
103.25  the court finds that the best interests of the child will be 
103.26  served by granting a delay.  If the child was under eight years 
103.27  of age at the time the petition was filed, the disposition order 
103.28  must be entered within ten days of the finding and the court may 
103.29  not grant a delay unless good cause is shown and the court finds 
103.30  the best interests of the child will be served by the delay. 
103.31     (c) If a child who is 14 years of age or older is 
103.32  adjudicated in need of protection or services because the child 
103.33  is a habitual truant and truancy procedures involving the child 
103.34  were previously dealt with by a school attendance review board 
103.35  or county attorney mediation program under section 260A.06 or 
103.36  260A.07, the court shall order a cancellation or denial of 
104.1   driving privileges under paragraph (b), clause (7), for any 
104.2   period up to the child's 18th birthday. 
104.3      (d) In the case of a child adjudicated in need of 
104.4   protection or services because the child has committed domestic 
104.5   abuse and been ordered excluded from the child's parent's home, 
104.6   the court shall dismiss jurisdiction if the court, at any time, 
104.7   finds the parent is able or willing to provide an alternative 
104.8   safe living arrangement for the child, as defined in Laws 1997, 
104.9   chapter 239, article 10, section 2.  
104.10     (e) When a parent has complied with a case plan ordered 
104.11  under subdivision 6 and the child is in the care of the parent, 
104.12  the court may order the responsible social services agency to 
104.13  monitor the parent's continued ability to maintain the child 
104.14  safely in the home under such terms and conditions as the court 
104.15  determines appropriate under the circumstances. 
104.16     Sec. 58.  2005 S.F. No. 1879, article 3, section 3, 
104.17  subdivision 24, if enacted, is amended to read: 
104.18     Subd. 24.  [BEST PRACTICES SEMINARS.] For best practices 
104.19  seminars and other professional development capacity building 
104.20  activities that assure proficiency in teaching and 
104.21  implementation of graduation rule standards: 
104.22       $1,000,000     .....     2006 
104.23       $1,000,000     .....     2007 
104.24     $400,000 each year is for a grant to the Minnesota 
104.25  Humanities Commission. 
104.26     $150,000 each year is for a grant to the Minnesota 
104.27  Historical Society. 
104.28     $250,000 each year is for a grant to Special School 
104.29  District No. 6, South St. Paul, for the IB program expansion to 
104.30  the elementary and middle school years. 
104.31     $200,000 each year is for a grant to A Chance to Grow/New 
104.32  Visions for the Minnesota Learning Resource Center's 
104.33  comprehensive training program for education professionals 
104.34  charged with helping children acquire basic reading and 
104.35  mathematic skills. 
104.36     Sec. 59.  2005 S.F. No. 1879, article 3, section 3, 
105.1   subdivision 25, if enacted, is amended to read: 
105.2      Subd. 25.  [ALTERNATIVE TEACHER PROFESSIONAL COMPENSATION 
105.3   FOR TEACHERS.] For alternative teacher professional compensation 
105.4   for teachers aid established under Minnesota Statutes, sections 
105.5   122A.413 to 122A.415 section 122A.4142: 
105.6        $3,700,000 8,700,000     .....     2006 
105.7        $3,700,000 8,700,000     .....     2007 
105.8      If the appropriations under this subdivision are 
105.9   insufficient to fund all program participants, a participant may 
105.10  receive less than the maximum per pupil amount available under 
105.11  Minnesota Statutes, section 122A.415 122A.4142, subdivision 1 
105.12  4.  A qualifying district or site receiving alternative teacher 
105.13  professional compensation for teacher funding under this 
105.14  subdivision may use the funding it receives to leverage 
105.15  additional funds from a national program for enhancing teacher 
105.16  professionalism.  Grantees who received revenue in fiscal year 
105.17  2005 under Minnesota Statutes 2004, sections 122A.413 to 
105.18  122A.415 shall receive revenue in fiscal years 2006 and 2007 
105.19  under Minnesota Statutes, section 122A.4142. 
105.20     Sec. 60.  2005 S.F. No. 1879, article 3, section 3, 
105.21  subdivision 26, if enacted, is amended to read: 
105.22     Subd. 26.  [YOUTHWORKS YOUTH WORKS PROGRAM.] For funding 
105.23  youthworks youth works programs under Minnesota Statutes, 
105.24  sections 124D.37 to 124D.45: 
105.25       $  900,000     .....     2006 
105.26       $  900,000     .....     2007 
105.27     A grantee organization may provide health and child care 
105.28  coverage to the dependents of each participant enrolled in a 
105.29  full-time youth works program to the extent such coverage is not 
105.30  otherwise available. 
105.31     Sec. 61.  2005 S.F. No. 1879, article 3, section 3, 
105.32  subdivision 27, if enacted, is amended to read: 
105.33     Subd. 27.  [STUDENT ORGANIZATIONS.] For student 
105.34  organizations: 
105.35       $625,000 $725,000     .....     2006 
105.36       $625,000 $725,000     .....     2007
106.1      Sec. 62.  2005 S.F. No. 1879, article 3, section 3, 
106.2   subdivision 29, if enacted, is amended to read: 
106.3      Subd. 29.  [COLLABORATIVE URBAN EDUCATOR.] For the 
106.4   collaborative urban educator program: 
106.5        $  528,000 550,000     .....     2006 
106.6        $  528,000 550,000     .....     2007 
106.7      Sec. 63.  2005 S.F. No. 1879, article 3, section 3, 
106.8   subdivision 31, if enacted, is amended to read: 
106.9      Subd. 31.  [FIRST GRADE PREPAREDNESS ALL-DAY KINDERGARTEN.] 
106.10  For first grade preparedness grants all-day kindergarten under 
106.11  Minnesota Statutes, section 124D.081: 
106.12       $7,250,000     .....     2006 
106.13       $7,250,000     .....     2007 
106.14     Sec. 64.  [COLLEGE PREPARATION STANDARDS.] 
106.15     (a) The Higher Education Advisory Council must convene a 
106.16  working group to develop standards describing the skills and 
106.17  knowledge a high school graduate must have at entry into 
106.18  postsecondary education in order to successfully graduate from 
106.19  college.  The standards must, to the extent possible, be 
106.20  applicable for all postsecondary education but may describe 
106.21  differences in the skills and knowledge necessary for success in 
106.22  different higher education institutions and programs.  The 
106.23  standards need not be comprehensive but must, at a minimum, be 
106.24  the essential skills and knowledge that will enable a student to 
106.25  succeed in college.  The Higher Education Services Office must 
106.26  provide staff for the working group. 
106.27     (b) The Higher Education Advisory Council must submit the 
106.28  standards to the commissioner of education no later than January 
106.29  15, 2006.  No later than March 15, 2006, the commissioner of 
106.30  education must report, to the chairs of the legislative 
106.31  committees with jurisdiction over kindergarten through grade 12 
106.32  education policy and finance and higher education policy and 
106.33  finance, its recommendations regarding the changes, if any, that 
106.34  must be made in Minnesota's academic standards in order to 
106.35  ensure that Minnesota high school graduates meet the college 
106.36  readiness standards established by the Higher Education Advisory 
107.1   Council. 
107.2      (c) The Higher Education Advisory Council must invite the 
107.3   University of Minnesota, Minnesota State Colleges and 
107.4   Universities, representatives of private colleges, and other 
107.5   private postsecondary institutions, to participate in the 
107.6   working group and may invite other individuals or entities to 
107.7   participate.  The Higher Education Advisory Council and its 
107.8   working group may collaborate with the Minnesota P-16 Education 
107.9   Partnership in developing the college readiness standards.  
107.10     Sec. 65.  [MINNESOTA COMPREHENSIVE ASSESSMENTS; RULES.] 
107.11     The commissioner of education shall adopt rules on or 
107.12  before January 1, 2005, to implement the Minnesota Comprehensive 
107.13  Assessments Second Edition (MCA-IIs) in reading, mathematics, 
107.14  and writing.  For purposes of state and local high school 
107.15  graduation requirements, the rules must include criteria 
107.16  enabling school districts to: 
107.17     (1) appropriately accommodate a student who fails but seeks 
107.18  to pass the Minnesota Comprehensive Assessments Second Edition; 
107.19  and 
107.20     (2) exempt a disabled student, consistent with the 
107.21  student's individualized education plan, or an English language 
107.22  learner from the Minnesota Comprehensive Assessments Second 
107.23  Edition or administer an alternative assessment either to a 
107.24  disabled student, consistent with the student's individualized 
107.25  education plan, or to an English language learner. 
107.26     Sec. 66.  [ADAPTIVE COMPUTER-BASED ASSESSMENT.] 
107.27     The commissioner of education shall include the cost of 
107.28  developing an adaptive computer-based assessment within the 
107.29  budget for statewide testing, including the Minnesota 
107.30  comprehensive assessments and value-added testing.  If an 
107.31  additional appropriation is necessary to develop the 
107.32  computer-based assessment, the commissioner shall request that 
107.33  the legislature include the required appropriation in a 
107.34  subsequent budget. 
107.35     Sec. 67.  [HEALTH AND PHYSICAL EDUCATION MODEL BENCHMARKS.] 
107.36     By July 1, 2006, the commissioner of education must 
108.1   transmit to school districts model kindergarten through grade 12 
108.2   health and physical education benchmarks developed by the 
108.3   department's health and physical education quality teaching 
108.4   network. 
108.5      Sec. 68.  [RULES FOR SUPPLEMENTAL SERVICE PROVIDERS.] 
108.6      The commissioner of education must amend Minnesota Rules, 
108.7   part 3512.5400, relating to supplemental service providers to 
108.8   include outcome standards.  The commissioner must include in the 
108.9   amended rules criteria to remove an education service provider 
108.10  from the listing of approved service providers if they fail to 
108.11  meet the outcome standards. 
108.12     Sec. 69.  [MODEL POLICY; INTIMIDATION AND BULLYING.] 
108.13     The commissioner of education shall work with the Minnesota 
108.14  School Boards Association to develop a model policy that 
108.15  prohibits intimidating and bullying as required in Minnesota 
108.16  Statutes, section 121A.0695, subdivision 2. 
108.17     Sec. 70.  [SCHOOL FINANCE STUDY.] 
108.18     (a) The commissioner of education must contract with an 
108.19  independent contractor that has extensive experience working 
108.20  with various states on education finance systems to continue and 
108.21  complete the work done by the governor's education funding task 
108.22  force included in the June 2004 report, Investing in Our 
108.23  Future.  The commissioner must contract with a firm other than 
108.24  the consulting firm performing services for and submitting a 
108.25  report on behalf of the governor's education funding task force. 
108.26     (b) The contractor must: 
108.27     (1) conduct an in-depth analysis of the governor's 
108.28  education funding task force report, Investing in Our Future, 
108.29  dated June 2004, focusing on the data produced by the 
108.30  professional judgment panel study included in the report; 
108.31     (2) convene a meeting in Minnesota to help gather any 
108.32  necessary additional data that is not contained in the 
108.33  governor's task force report or to further validate some of the 
108.34  report's existing data; 
108.35     (3) determine the dollar value of an instructional services 
108.36  allocation, including cost estimates for each school district 
109.1   adjusting the allocation for individual student and school 
109.2   district characteristics; and 
109.3      (4) conduct outreach and support to explain its findings to 
109.4   appropriate officials in Minnesota. 
109.5      (c) In addition to the requirements in paragraph (b), the 
109.6   contractor must analyze data from Minnesota school districts 
109.7   that have proven to be successful in educating students to meet 
109.8   the state's academic standards.  The contractor must use a 
109.9   statistical analysis to help explain differences in spending 
109.10  across school districts while controlling for student 
109.11  performance. 
109.12     (d) The commissioner must report on the findings on the 
109.13  contract to the legislative committees having jurisdiction over 
109.14  kindergarten through grade 12 finance before December 15, 2005. 
109.15     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
109.16  following final enactment. 
109.17     Sec. 71.  [EVALUATING THE EDUCATIONAL IMPACT OF FEDERAL AND 
109.18  STATE TESTS ON KINDERGARTEN THROUGH GRADE 12 STUDENTS.] 
109.19     (a) The Office of Educational Accountability under 
109.20  Minnesota Statutes, section 120B.31, subdivision 3, must 
109.21  evaluate the educational impact of the federal No Child Left 
109.22  Behind Act and other state and federal laws requiring school 
109.23  districts to administer tests to kindergarten through grade 12 
109.24  students.  The evaluation at least must include: 
109.25     (1) potential educational costs to kindergarten through 
109.26  grade 12 public school students through the 2013-2014 school 
109.27  year of complying with testing requirements; 
109.28     (2) educational factors that may increase or decrease the 
109.29  educational costs identified under clause (1); 
109.30     (3) the impact of testing requirements on the statewide 
109.31  accountability system, teacher training and employment, and 
109.32  curriculum development; and 
109.33     (4) the relationship between the testing requirements, 
109.34  postsecondary entrance requirements, and the expectations of the 
109.35  business community regarding the educational preparation of new 
109.36  high school graduates seeking employment. 
110.1      The Office of Educational Accountability, at its 
110.2   discretion, may include additional areas for evaluation. 
110.3      (b) In preparing this evaluation, the Office of Educational 
110.4   Accountability must select a sample of school districts to 
110.5   explore in depth the areas listed in paragraph (a).  The school 
110.6   districts must be of varying sizes and geographical locations, 
110.7   and must include some districts with schools designated by the 
110.8   state Department of Education as "needing improvement" under the 
110.9   No Child Left Behind Act.  The Office of Educational 
110.10  Accountability must contact school officials, employees of 
110.11  postsecondary institutions, and representatives of business 
110.12  communities from throughout the state to collect information and 
110.13  perceptions related to the evaluation.  State and local entities 
110.14  must cooperate with and assist the Office of Educational 
110.15  Accountability with this evaluation at the request of the Office 
110.16  of Educational Accountability. 
110.17     (c) The Office of Educational Accountability must submit 
110.18  the evaluation in writing to the chairs of the house of 
110.19  representatives and senate committees having jurisdiction over 
110.20  kindergarten through grade 12 education policy and finance by 
110.21  February 15, 2006. 
110.22     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
110.23  following final enactment.  
110.24     Sec. 72.  [LICENSED STUDENT SUPPORT SERVICES.] 
110.25     Subdivision 1.  [ACCESS TO SERVICES.] School districts and 
110.26  the Department of Education shall work to provide for students' 
110.27  educational achievement, to provide for student safety, and to 
110.28  enhance student physical, emotional, and social well-being by 
110.29  providing access to licensed student support services, such as 
110.30  licensed school nurses, licensed school counselors, licensed 
110.31  school social workers, licensed alcohol and drug abuse 
110.32  counselors, and licensed school psychologists. 
110.33     Subd. 2.  [FUNDING.] School districts and the Department of 
110.34  Education shall explore opportunities for obtaining additional 
110.35  funds to improve students' access to needed licensed student 
110.36  support services including, at least, medical assistance 
111.1   reimbursements, local collaborative time study funds, federal 
111.2   funds, public health funds, and specifically designated funds. 
111.3      Subd. 3.  [IMPROVING ACCESS.] School districts and the 
111.4   Department of Education must consider nationally recommended 
111.5   licensed staff-to-student ratios, work loads, and best practices 
111.6   when working to improve student access to needed licensed 
111.7   student support services.  
111.8      Sec. 73.  [BOARD OF TEACHING REPORT.] 
111.9      By January 16, 2006, the Board of Teaching, in consultation 
111.10  with the Department of Education and other education 
111.11  stakeholders, must prepare and submit to the house of 
111.12  representatives and senate committees having jurisdiction over 
111.13  kindergarten through grade 12 education policy and finance 
111.14  proposed licensure requirements for teachers of 
111.15  interdisciplinary curriculum to facilitate learning in 
111.16  state-approved innovative schools and programs. 
111.17     Sec. 74.  [PROFESSIONAL COMPENSATION FOR TEACHERS TASK 
111.18  FORCE.] 
111.19     The commissioner of education must convene a task force on 
111.20  professional compensation models for teachers.  The commissioner 
111.21  shall report the task force findings to the legislative 
111.22  committees having jurisdiction over kindergarten through grade 
111.23  12 education funding and policy issues by December 16, 2006.  
111.24  The task force must recommend a professional compensation model 
111.25  designed to improve teacher performance and student 
111.26  achievement.  The task force must recommend a method to 
111.27  transition from the current pilot alternative compensation sites 
111.28  to a statewide program, including recommendations for funding a 
111.29  statewide program. 
111.30     Sec. 75.  [APPROPRIATIONS.] 
111.31     Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
111.32  indicated in this section are appropriated from the general fund 
111.33  to the Department of Education for the fiscal years designated. 
111.34     Subd. 2.  [IMPROVED SCHOOL FINANCE SYSTEM CONTRACT.] For a 
111.35  contract to follow up on the work of the governor's education 
111.36  funding task force: 
112.1        $  175,000     .....     2006
112.2      Subd. 3.  [STAFF DEVELOPMENT STATE MATCH.] For the state 
112.3   match for staff development under Minnesota Statutes, section 
112.4   122A.61: 
112.5        $45,939,000    .....     2006 
112.6        $47,883,000    .....     2007 
112.7      Special School District No. 6, South St. Paul, may use its 
112.8   state match to implement its elementary and middle school 
112.9   international baccalaureate program expansion. 
112.10     Subd. 4.  [PROFESSIONAL COMPENSATION FOR TEACHERS TASK 
112.11  FORCE.] For the professional compensation for teachers task 
112.12  force: 
112.13       $  200,000     .....     2006 
112.14       $  200,000     .....     2007 
112.15     Sec. 76.  [REPEALER.] 
112.16     Minnesota Statutes 2004, sections 121A.23; 122A.414; and 
112.17  122A.415, are repealed. 
112.18                             ARTICLE 3 
112.19                          SPECIAL PROGRAMS 
112.20     Section 1.  Minnesota Statutes 2004, section 121A.66, 
112.21  subdivision 5, is amended to read: 
112.22     Subd. 5.  [EMERGENCY.] "Emergency" means a situation in 
112.23  which immediate intervention is necessary to protect a pupil or 
112.24  other individual from physical injury or to prevent serious 
112.25  property damage.  
112.26     Sec. 2.  Minnesota Statutes 2004, section 121A.66, is 
112.27  amended by adding a subdivision to read: 
112.28     Subd. 6.  [POSITIVE BEHAVIORAL INTERVENTIONS AND 
112.29  SUPPORTS.] "Positive behavioral interventions and supports" 
112.30  means those strategies used to improve the school environment 
112.31  and teach pupils skills likely to increase pupil ability to 
112.32  exhibit appropriate behaviors. 
112.33     Sec. 3.  Minnesota Statutes 2004, section 121A.66, is 
112.34  amended by adding a subdivision to read: 
112.35     Subd. 7.  [TIME-OUT.] "Time-out" means: 
112.36     (1) a contingent observation, which is not a regulated 
113.1   intervention, and involves instructing the pupil to leave the 
113.2   school activity during the school day and not participate for a 
113.3   period of time, but to observe the activity and listen to the 
113.4   discussion from a time-out area within the same setting; 
113.5      (2) an exclusionary time-out, which is not a regulated 
113.6   intervention, and involves instructing the pupil to leave the 
113.7   school activity during the school day and not participate in or 
113.8   observe the classroom activity, but to go to another area from 
113.9   which the pupil may leave; or 
113.10     (3) a locked time-out, which is a regulated intervention, 
113.11  and involves involuntarily removing the pupil from the school 
113.12  activity during the school day and placing the pupil in a 
113.13  specially designed and continuously supervised isolation room 
113.14  that the pupil is prevented from leaving. 
113.15     Sec. 4.  Minnesota Statutes 2004, section 121A.67, is 
113.16  amended to read: 
113.17     121A.67 [AVERSIVE AND DEPRIVATION PROCEDURES.] 
113.18     Subdivision 1.  [RULES.] The commissioner, after 
113.19  consultation with interested parent organizations and advocacy 
113.20  groups, the Minnesota Administrators for Special Education, the 
113.21  Minnesota Association of School Administrators, Education 
113.22  Minnesota, the Minnesota School Boards Association, the 
113.23  Minnesota Police Officers Association, a representative of a 
113.24  bargaining unit that represents paraprofessionals, the 
113.25  Elementary School Principals Association, and the Secondary 
113.26  School Principals Association, must adopt amend rules governing 
113.27  the use of aversive and deprivation procedures by school 
113.28  district employees or persons under contract with a school 
113.29  district.  The rules must: 
113.30     (1) promote the use of positive approaches behavioral 
113.31  interventions and supports and must not encourage or require the 
113.32  use of aversive or deprivation procedures; 
113.33     (2) require that planned application of aversive and 
113.34  deprivation procedures only be a part of an instituted after 
113.35  completing a functional behavior assessment and developing a 
113.36  behavior intervention plan that is included in or maintained 
114.1   with the individual education plan; 
114.2      (3) require parents or guardians to be notified after the 
114.3   use of educational personnel to notify a parent or guardian of a 
114.4   pupil with an individual education plan on the same day aversive 
114.5   or deprivation procedures are used in an emergency or in writing 
114.6   within two school days if district personnel are unable to 
114.7   provide same-day notice; 
114.8      (4) establish health and safety standards for the use of 
114.9   locked time-out procedures that require a safe environment, 
114.10  continuous monitoring of the child, ventilation, and adequate 
114.11  space, a locking mechanism that disengages automatically when 
114.12  not continuously engaged by school personnel, and full 
114.13  compliance with state and local fire and building codes, 
114.14  including state rules on time-out rooms; and 
114.15     (5) contain a list of prohibited procedures; 
114.16     (6) consolidate and clarify provisions related to behavior 
114.17  intervention plans; 
114.18     (7) require school districts to register with the 
114.19  commissioner any room used for locked time-out, which the 
114.20  commissioner must monitor by making announced and unannounced 
114.21  on-site visits; 
114.22     (8) place a student in locked time-out only if the 
114.23  intervention is: 
114.24     (i) part of the comprehensive behavior intervention plan 
114.25  that is included in or maintained with the student's individual 
114.26  education plan, and the plan uses positive behavioral 
114.27  interventions and supports, and data support its continued use; 
114.28  or 
114.29     (ii) used in an emergency for the duration of the emergency 
114.30  only; and 
114.31     (9) require a providing school district or cooperative to 
114.32  establish an oversight committee composed of at least one member 
114.33  with training in behavioral analysis and other appropriate 
114.34  education personnel to annually review aggregate data regarding 
114.35  the use of aversive and deprivation procedures. 
114.36     Subd. 2.  [REMOVAL BY PEACE OFFICER.] If a pupil who has an 
115.1   individual education plan is restrained or removed from a 
115.2   classroom, school building, or school grounds by a peace officer 
115.3   at the request of a school administrator or a school staff 
115.4   person during the school day twice in a 30-day period, the 
115.5   pupil's individual education program team must meet to determine 
115.6   if the pupil's individual education plan is adequate or if 
115.7   additional evaluation is needed. 
115.8      <b>[EFFECTIVE DATE.]</b> Subdivision 1 of this section is 
115.9   effective the day following final enactment. 
115.10     Sec. 5.  Minnesota Statutes 2004, section 122A.15, is 
115.11  amended by adding a subdivision to read: 
115.12     Subd. 3.  [STUDENT SUPPORT SERVICES ADVISORY COMMITTEE; 
115.13  DISTRICT PLAN.] (a) A student support services advisory 
115.14  committee composed of ten members selected by the commissioner 
115.15  is established under section 15.059.  The commissioner must 
115.16  select one committee member from each of the following 
115.17  organizations: 
115.18     (1) the Minnesota Department of Education; 
115.19     (2) the Minnesota School Boards Association; 
115.20     (3) the Minnesota Association of School Administrators; 
115.21     (4) the Minnesota School Social Work Association; 
115.22     (5) the School Nurse Organization of Minnesota; 
115.23     (6) the Minnesota School Psychologists Association; 
115.24     (7) the Minnesota School Counselors Association; 
115.25     (8) the Minnesota Association of Resources for Recovery and 
115.26  Chemical Health; 
115.27     (9) the Minnesota Administrators for Special Education; and 
115.28     (10) the Minnesota Parent Teachers Association. 
115.29     (b) The committee must: 
115.30     (1) establish a method for identifying student needs that 
115.31  are barriers to learning; 
115.32     (2) identify alternatives for integrating student support 
115.33  services into public schools; 
115.34     (3) recommend support staff to student ratios and best 
115.35  practices for providing student support services premised on 
115.36  evidence-based practice; 
116.1      (4) identify the substance and extent of the work that 
116.2   student support services staff are trained and licensed to 
116.3   provide and the characteristics of the student populations they 
116.4   serve; 
116.5      (5) recommend how school districts can most appropriately 
116.6   integrate student support services into the education program; 
116.7   and 
116.8      (6) recommend public and nonpublic revenue sources that 
116.9   school districts can use to fund student support services 
116.10  including, among other sources, medical assistance 
116.11  reimbursements, private health insurance, local collaborative 
116.12  time study funds, federal funds, public health funds, and 
116.13  specifically designated funds such as school safety levies and 
116.14  district general funds, among other funds. 
116.15     (c) The committee must consider the oral and written 
116.16  testimony of school district personnel and parents and students 
116.17  in complying with paragraph (b).  The committee must submit 
116.18  periodic recommendations about student support services to the 
116.19  commissioner and to the committees of the legislature having 
116.20  jurisdiction over birth to age 21 education policy and budget 
116.21  issues.  The commissioner must consider the committee's 
116.22  recommendations in deciding whether to develop and maintain a 
116.23  model district plan for student support services.  If the 
116.24  commissioner develops and maintains a model plan, the 
116.25  commissioner also must decide whether to transmit the plan to 
116.26  school districts, whether to require the districts to adopt and 
116.27  maintain a district plan for providing student support services 
116.28  that meets the criteria recommended by the advisory committee, 
116.29  and whether to require the districts to submit the plan for 
116.30  biennial review. 
116.31     (d) Notwithstanding section 15.059, subdivision 5, the 
116.32  committee expires on June 30, 2016. 
116.33     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
116.34  following final enactment and applies to the 2006-2007 school 
116.35  year and later. 
116.36     Sec. 6.  Minnesota Statutes 2004, section 123B.92, 
117.1   subdivision 1, is amended to read: 
117.2      Subdivision 1.  [DEFINITIONS.] For purposes of this section 
117.3   and section 125A.76, the terms defined in this subdivision have 
117.4   the meanings given to them. 
117.5      (a) "Actual expenditure per pupil transported in the 
117.6   regular and excess transportation categories" means the quotient 
117.7   obtained by dividing: 
117.8      (1) the sum of: 
117.9      (i) all expenditures for transportation in the regular 
117.10  category, as defined in paragraph (b), clause (1), and the 
117.11  excess category, as defined in paragraph (b), clause (2), plus 
117.12     (ii) an amount equal to one year's depreciation on the 
117.13  district's school bus fleet and mobile units computed on a 
117.14  straight line basis at the rate of 15 percent per year for 
117.15  districts operating a program under section 124D.128 for grades 
117.16  1 to 12 for all students in the district and 12-1/2 percent per 
117.17  year for other districts of the cost of the fleet, plus 
117.18     (iii) an amount equal to one year's depreciation on the 
117.19  district's type three school buses, as defined in section 
117.20  169.01, subdivision 6, clause (5), which must be used a majority 
117.21  of the time for pupil transportation purposes, computed on a 
117.22  straight line basis at the rate of 20 percent per year of the 
117.23  cost of the type three school buses by: 
117.24     (2) the number of pupils eligible for transportation in the 
117.25  regular category, as defined in paragraph (b), clause (1), and 
117.26  the excess category, as defined in paragraph (b), clause (2).  
117.27     (b) "Transportation category" means a category of 
117.28  transportation service provided to pupils as follows:  
117.29     (1) Regular transportation is:  
117.30     (i) transportation to and from school during the regular 
117.31  school year for resident elementary pupils residing one mile or 
117.32  more from the public or nonpublic school they attend, and 
117.33  resident secondary pupils residing two miles or more from the 
117.34  public or nonpublic school they attend, excluding desegregation 
117.35  transportation and noon kindergarten transportation; but with 
117.36  respect to transportation of pupils to and from nonpublic 
118.1   schools, only to the extent permitted by sections 123B.84 to 
118.2   123B.87; 
118.3      (ii) transportation of resident pupils to and from language 
118.4   immersion programs; 
118.5      (iii) transportation of a pupil who is a custodial parent 
118.6   and that pupil's child between the pupil's home and the child 
118.7   care provider and between the provider and the school, if the 
118.8   home and provider are within the attendance area of the school; 
118.9      (iv) transportation to and from or board and lodging in 
118.10  another district, of resident pupils of a district without a 
118.11  secondary school; and 
118.12     (v) transportation to and from school during the regular 
118.13  school year required under subdivision 3 for nonresident 
118.14  elementary pupils when the distance from the attendance area 
118.15  border to the public school is one mile or more, and for 
118.16  nonresident secondary pupils when the distance from the 
118.17  attendance area border to the public school is two miles or 
118.18  more, excluding desegregation transportation and noon 
118.19  kindergarten transportation. 
118.20     For the purposes of this paragraph, a district may 
118.21  designate a licensed day care facility, respite care facility, 
118.22  the residence of a relative, or the residence of a person chosen 
118.23  by the pupil's parent or guardian as the home of a pupil for 
118.24  part or all of the day, if requested by the pupil's parent or 
118.25  guardian, and if that facility or residence is within the 
118.26  attendance area of the school the pupil attends. 
118.27     (2) Excess transportation is: 
118.28     (i) transportation to and from school during the regular 
118.29  school year for resident secondary pupils residing at least one 
118.30  mile but less than two miles from the public or nonpublic school 
118.31  they attend, and transportation to and from school for resident 
118.32  pupils residing less than one mile from school who are 
118.33  transported because of extraordinary traffic, drug, or crime 
118.34  hazards; and 
118.35     (ii) transportation to and from school during the regular 
118.36  school year required under subdivision 3 for nonresident 
119.1   secondary pupils when the distance from the attendance area 
119.2   border to the school is at least one mile but less than two 
119.3   miles from the public school they attend, and for nonresident 
119.4   pupils when the distance from the attendance area border to the 
119.5   school is less than one mile from the school and who are 
119.6   transported because of extraordinary traffic, drug, or crime 
119.7   hazards. 
119.8      (3) Desegregation transportation is transportation within 
119.9   and outside of the district during the regular school year of 
119.10  pupils to and from schools located outside their normal 
119.11  attendance areas under a plan for desegregation mandated by the 
119.12  commissioner or under court order.  
119.13     (4) "Transportation services for pupils with disabilities" 
119.14  is: 
119.15     (i) transportation of pupils with disabilities who cannot 
119.16  be transported on a regular school bus between home or a respite 
119.17  care facility and school; 
119.18     (ii) necessary transportation of pupils with disabilities 
119.19  from home or from school to other buildings, including centers 
119.20  such as developmental achievement centers, hospitals, and 
119.21  treatment centers where special instruction or services required 
119.22  by sections 125A.03 to 125A.24, 125A.26 to 125A.48, and 125A.65 
119.23  are provided, within or outside the district where services are 
119.24  provided; 
119.25     (iii) necessary transportation for resident pupils with 
119.26  disabilities required by sections 125A.12, and 125A.26 to 
119.27  125A.48; 
119.28     (iv) board and lodging for pupils with disabilities in a 
119.29  district maintaining special classes; 
119.30     (v) transportation from one educational facility to another 
119.31  within the district for resident pupils enrolled on a 
119.32  shared-time basis in educational programs, and necessary 
119.33  transportation required by sections 125A.18, and 125A.26 to 
119.34  125A.48, for resident pupils with disabilities who are provided 
119.35  special instruction and services on a shared-time basis or if 
119.36  resident pupils are not transported, the costs of necessary 
120.1   travel between public and private schools or neutral 
120.2   instructional sites by essential personnel employed by the 
120.3   district's program for children with a disability; 
120.4      (vi) transportation for resident pupils with disabilities 
120.5   to and from board and lodging facilities when the pupil is 
120.6   boarded and lodged for educational purposes; and 
120.7      (vii) services described in clauses (i) to (vi), when 
120.8   provided for pupils with disabilities in conjunction with a 
120.9   summer instructional program that relates to the pupil's 
120.10  individual education plan or in conjunction with a learning year 
120.11  program established under section 124D.128. 
120.12     For purposes of computing special education base revenue 
120.13  under section 125A.76, subdivision 2, the cost of providing 
120.14  transportation for children with disabilities includes (A) the 
120.15  additional cost of transporting a homeless student from a 
120.16  temporary nonshelter home in another district to the school of 
120.17  origin, or a formerly homeless student from a permanent home in 
120.18  another district to the school of origin but only through the 
120.19  end of the academic year; and (B) depreciation on district-owned 
120.20  school buses purchased after July 1, 2005, and used primarily 
120.21  for transportation of pupils with disabilities, calculated 
120.22  according to paragraph (a), clauses (ii) and (iii).  
120.23  Depreciation costs included in the disabled transportation 
120.24  category must be excluded in calculating the actual expenditure 
120.25  per pupil transported in the regular and excess transportation 
120.26  categories according to paragraph (a). 
120.27     (5) "Nonpublic nonregular transportation" is: 
120.28     (i) transportation from one educational facility to another 
120.29  within the district for resident pupils enrolled on a 
120.30  shared-time basis in educational programs, excluding 
120.31  transportation for nonpublic pupils with disabilities under 
120.32  clause (4); 
120.33     (ii) transportation within district boundaries between a 
120.34  nonpublic school and a public school or a neutral site for 
120.35  nonpublic school pupils who are provided pupil support services 
120.36  pursuant to section 123B.44; and 
121.1      (iii) late transportation home from school or between 
121.2   schools within a district for nonpublic school pupils involved 
121.3   in after-school activities. 
121.4      (c) "Mobile unit" means a vehicle or trailer designed to 
121.5   provide facilities for educational programs and services, 
121.6   including diagnostic testing, guidance and counseling services, 
121.7   and health services.  A mobile unit located off nonpublic school 
121.8   premises is a neutral site as defined in section 123B.41, 
121.9   subdivision 13. 
121.10     Sec. 7.  Minnesota Statutes 2004, section 124D.11, 
121.11  subdivision 5, is amended to read: 
121.12     Subd. 5.  [SPECIAL EDUCATION AID.] (a) Except as provided 
121.13  in subdivision 2, special education aid must be paid to a 
121.14  charter school according to section 125A.76, as though it were a 
121.15  school district.  
121.16     (b) For fiscal year 2006, the charter school may charge 
121.17  tuition to the district of residence as follows: 
121.18     (1) if the charter school does not receive general 
121.19  education revenue on behalf of the student according to 
121.20  subdivision 1, tuition shall be charged as provided in section 
121.21  125A.11.; or 
121.22     (2) if the charter school receives general education 
121.23  revenue on behalf of the student according to subdivision 1, 
121.24  tuition shall be charged as provided in section 127A.47, 
121.25  subdivision 7, paragraph (d). 
121.26     (c) For fiscal year 2007 and later, the special education 
121.27  aid paid to the charter school shall be adjusted as follows: 
121.28     (1) if the charter school does not receive general 
121.29  education revenue on behalf of the student according to 
121.30  subdivision 1, the aid shall be adjusted as provided in section 
121.31  125A.11; or 
121.32     (2) if the charter school receives general education 
121.33  revenue on behalf of the student according to subdivision 1, the 
121.34  aid shall be adjusted as provided in section 127A.47, 
121.35  subdivision 7, paragraph (d). 
121.36     (d) Notwithstanding paragraphs (b) and (c), sections 
122.1   125A.11 and 127A.47, subdivision 7, paragraph (d), for charter 
122.2   schools where fewer than 30 percent of enrolled students receive 
122.3   special education and related services, the tuition calculations 
122.4   or aid adjustments must be based on the lesser of the charter 
122.5   school's or the resident district's actual special education 
122.6   cost per service hour for the student's primary disability area, 
122.7   or grouping of disability areas used by the school for tuition 
122.8   billing.  For fiscal year 2006, the charter school may submit a 
122.9   tuition bill in an amount equal to 70 percent of its remaining 
122.10  unreimbursed special education costs to the commissioner.  For 
122.11  fiscal year 2007 and later, the commissioner must calculate the 
122.12  remaining unreimbursed special education costs.  The 
122.13  commissioner must reimburse the charter school in an amount 
122.14  equal to 70 percent of the school's remaining unreimbursed 
122.15  special education costs from the charter school special 
122.16  education reimbursement account according to section 125A.795. 
122.17     Sec. 8.  [124D.4531] [CAREER AND TECHNICAL LEVY.] 
122.18     Subdivision 1.  [CAREER AND TECHNICAL LEVY.] (a) A district 
122.19  with a career and technical program approved under this section 
122.20  for the fiscal year in which the levy is certified may levy an 
122.21  amount equal to the lesser of: 
122.22     (1) $80 times the district's average daily membership in 
122.23  grades 10 through 12 for the fiscal year in which the levy is 
122.24  certified; or 
122.25     (2) 25 percent of approved expenditures in the fiscal year 
122.26  in which the levy is certified for the following: 
122.27     (i) salaries paid to essential, licensed personnel 
122.28  providing direct instructional services to students in that 
122.29  fiscal year for services rendered in the district's approved 
122.30  career and technical education programs; 
122.31     (ii) contracted services provided by a public or private 
122.32  agency other than a Minnesota school district or cooperative 
122.33  center under subdivision 7; 
122.34     (iii) necessary travel between instructional sites by 
122.35  licensed career and technical education personnel; 
122.36     (iv) necessary travel by licensed career and technical 
123.1   education personnel for vocational student organization 
123.2   activities held within the state for instructional purposes; 
123.3      (v) curriculum development activities that are part of a 
123.4   five-year plan for improvement based on program assessment; 
123.5      (vi) necessary travel by licensed career and technical 
123.6   education personnel for noncollegiate credit-bearing 
123.7   professional development; and 
123.8      (vii) specialized vocational instructional supplies. 
123.9      (b) Up to ten percent of a district's career and technical 
123.10  levy may be spent on equipment purchases.  Districts using the 
123.11  career and technical levy for equipment purchases must report to 
123.12  the department on the improved learning opportunities for 
123.13  students that result from the investment in equipment. 
123.14     (c) The district must recognize the full amount of this 
123.15  levy as revenue for the fiscal year in which it is certified. 
123.16     Subd. 2.  [ALLOCATION FROM COOPERATIVE CENTERS AND 
123.17  INTERMEDIATE DISTRICTS.] For purposes of this section, a 
123.18  cooperative center or an intermediate district must allocate its 
123.19  approved expenditures for career and technical education 
123.20  programs among participating districts. 
123.21     Subd. 3.  [LEVY GUARANTEE.] Notwithstanding subdivision 1, 
123.22  the career and technical education levy for a district is not 
123.23  less than the lesser of: 
123.24     (1) the district's career and technical education levy 
123.25  authority for the previous fiscal year; or 
123.26     (2) 100 percent of the approved expenditures for career and 
123.27  technical programs included in subdivision 1, paragraph (b), for 
123.28  the fiscal year in which the levy is certified. 
123.29     Subd. 4.  [DISTRICT REPORTS.] Each district or cooperative 
123.30  center must report data to the department for all career and 
123.31  technical education programs as required by the department to 
123.32  implement the career and technical levy formula. 
123.33     <b>[EFFECTIVE DATE.]</b> This section is effective for taxes 
123.34  payable in 2009. 
123.35     Sec. 9.  Minnesota Statutes 2004, section 124D.59, 
123.36  subdivision 2, is amended to read: 
124.1      Subd. 2.  [PUPIL OF LIMITED ENGLISH PROFICIENCY.] (a) 
124.2   "Pupil of limited English proficiency" means a pupil in 
124.3   kindergarten through grade 12 who meets the following 
124.4   requirements: 
124.5      (1) the pupil, as declared by a parent or guardian first 
124.6   learned a language other than English, comes from a home where 
124.7   the language usually spoken is other than English, or usually 
124.8   speaks a language other than English; and 
124.9      (2) the pupil is determined by developmentally appropriate 
124.10  measures, which might include observations, teacher judgment, 
124.11  parent recommendations, or developmentally appropriate 
124.12  assessment instruments, to lack the necessary English skills to 
124.13  participate fully in classes taught in English. 
124.14     (b) Notwithstanding paragraph (a), a pupil in grades 4 
124.15  through 12 who was enrolled in a Minnesota public school on the 
124.16  dates during the previous school year when a commissioner 
124.17  provided assessment that measures the pupil's emerging academic 
124.18  English was administered, shall not be counted as a pupil of 
124.19  limited English proficiency in calculating limited English 
124.20  proficiency pupil units under section 126C.05, subdivision 17, 
124.21  and shall not generate state limited English proficiency aid 
124.22  under section 124D.65, subdivision 5, unless the pupil scored 
124.23  below the state cutoff score on an assessment measuring emerging 
124.24  academic English provided by the commissioner during the 
124.25  previous school year. 
124.26     (c) Notwithstanding paragraphs (a) and (b), a pupil in 
124.27  kindergarten through grade 12 shall not be counted as a pupil of 
124.28  limited English proficiency in calculating limited English 
124.29  proficiency pupil units under section 126C.05, subdivision 17, 
124.30  and shall not generate state limited English proficiency aid 
124.31  under section 124D.65, subdivision 5, if: 
124.32     (1) the pupil is not enrolled during the current fiscal 
124.33  year in an educational program for pupils of limited English 
124.34  proficiency in accordance with sections 124D.58 to 124D.64; or 
124.35     (2) the pupil has generated five seven or more years of 
124.36  average daily membership in Minnesota public schools since July 
125.1   1, 1996. 
125.2      <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
125.3   fiscal years 2006 and 2007 if the basic formula allowance under 
125.4   Minnesota Statutes, section 126C.10, subdivision 2, does not 
125.5   grow by at least three and one-half percent each year, excluding 
125.6   roll-ins. 
125.7      Sec. 10.  Minnesota Statutes 2004, section 125A.11, 
125.8   subdivision 1, is amended to read: 
125.9      Subdivision 1.  [NONRESIDENT TUITION RATE; OTHER COSTS.] 
125.10  (a) For fiscal year 2006, when a school district provides 
125.11  instruction and services outside the district of residence, 
125.12  board and lodging, and any tuition to be paid, shall be paid by 
125.13  the district of residence, except as provided in subdivision 4.  
125.14  The tuition rate to be charged for any child with a disability, 
125.15  excluding a pupil for whom tuition is calculated according to 
125.16  section 127A.47, subdivision 7, paragraph (d), must be the sum 
125.17  of (1) the actual cost of providing special instruction and 
125.18  services to the child including a proportionate amount 
125.19  for capital outlay and debt service but not including any amount 
125.20  for special transportation and unreimbursed building lease and 
125.21  debt service costs for facilities used primarily for special 
125.22  education, plus (2) the amount of general education revenue and 
125.23  referendum aid attributable to the pupil, minus (3) the amount 
125.24  of special education aid for children with a disability received 
125.25  on behalf of that child, minus (4) if the pupil receives special 
125.26  instruction and services outside the regular classroom for more 
125.27  than 60 percent of the school day, the amount of general 
125.28  education revenue and referendum aid, excluding portions 
125.29  attributable to district and school administration, district 
125.30  support services, operations and maintenance, capital 
125.31  expenditures, and pupil transportation, attributable to that 
125.32  pupil for the portion of time the pupil receives instruction in 
125.33  the regular classroom.  If the boards involved do not agree upon 
125.34  the tuition rate, either board may apply to the commissioner to 
125.35  fix the rate.  Notwithstanding chapter 14, the commissioner must 
125.36  then set a date for a hearing or request a written statement 
126.1   from each board, giving each board at least ten days' notice, 
126.2   and after the hearing or review of the written statements the 
126.3   commissioner must make an order fixing the tuition rate, which 
126.4   is binding on both school districts.  General education revenue 
126.5   and referendum aid attributable to a pupil must be calculated 
126.6   using the resident district's average general education and 
126.7   referendum revenue per adjusted pupil unit. 
126.8      (b) For fiscal year 2007 and later, when a school district 
126.9   provides special instruction and services for a pupil with a 
126.10  disability as defined in section 125A.02 outside the district of 
126.11  residence, excluding a pupil for whom an adjustment to special 
126.12  education aid is calculated according to section 127A.47, 
126.13  subdivision 7, paragraph (e), special education aid paid to the 
126.14  resident district must be reduced by an amount equal to (1) the 
126.15  actual cost of providing special instruction and services to the 
126.16  pupil, including a proportionate amount for special 
126.17  transportation and unreimbursed building lease and debt service 
126.18  costs for facilities used primarily for special education, plus 
126.19  (2) the amount of general education revenue and referendum aid 
126.20  attributable to that pupil, minus (3) the amount of special 
126.21  education aid for children with a disability received on behalf 
126.22  of that child, minus (4) if the pupil receives special 
126.23  instruction and services outside the regular classroom for more 
126.24  than 60 percent of the school day, the amount of general 
126.25  education revenue and referendum aid, excluding portions 
126.26  attributable to district and school administration, district 
126.27  support services, operations and maintenance, capital 
126.28  expenditures, and pupil transportation, attributable to that 
126.29  pupil for the portion of time the pupil receives instruction in 
126.30  the regular classroom.  General education revenue and referendum 
126.31  aid attributable to a pupil must be calculated using the 
126.32  resident district's average general education revenue and 
126.33  referendum aid per adjusted pupil unit.  If the resident 
126.34  district's special education aid is insufficient to make the 
126.35  full adjustment, the remaining adjustment shall be made to other 
126.36  state aid due to the district. 
127.1      <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2005, 
127.2   for revenue for fiscal year 2006. 
127.3      Sec. 11.  Minnesota Statutes 2004, section 125A.24, is 
127.4   amended to read: 
127.5      125A.24 [PARENT ADVISORY COUNCILS.] 
127.6      In order to increase the involvement of parents of children 
127.7   with disabilities in district policy making and decision making, 
127.8   school districts must have a special education advisory council 
127.9   that is incorporated into the district's special education 
127.10  system plan. 
127.11     (1) This advisory council may be established either for 
127.12  individual districts or in cooperation with other districts who 
127.13  are members of the same special education cooperative. 
127.14     (2) A district may set up this council as a subgroup of an 
127.15  existing board, council, or committee. 
127.16     (3) At least half of the designated council members must be 
127.17  parents of students with a disability.  The council must include 
127.18  at least one member who is a parent of a nonpublic school 
127.19  student with a disability or an employee of a nonpublic school 
127.20  if a nonpublic school is located in the district.  Each local 
127.21  council must meet no less than once each year.  The number of 
127.22  members, frequency of meetings, and operational procedures are 
127.23  to be locally determined.  
127.24     Sec. 12.  Minnesota Statutes 2004, section 125A.28, is 
127.25  amended to read: 
127.26     125A.28 [STATE INTERAGENCY COORDINATING COUNCIL.] 
127.27     An Interagency Coordinating Council of at least 17, but not 
127.28  more than 25 members is established, in compliance with Public 
127.29  Law 102-119, section 682.  The members must be appointed by the 
127.30  governor.  Council members must elect the council chair.  The 
127.31  representative of the commissioner may not serve as the chair.  
127.32  The council must be composed of at least five parents, including 
127.33  persons of color, of children with disabilities under age 12, 
127.34  including at least three parents of a child with a disability 
127.35  under age seven, five representatives of public or private 
127.36  providers of services for children with disabilities under age 
128.1   five, including a special education director, county social 
128.2   service director, local Head Start director, and a community 
128.3   health services or public health nursing administrator, one 
128.4   member of the senate, one member of the house of 
128.5   representatives, one representative of teacher preparation 
128.6   programs in early childhood-special education or other 
128.7   preparation programs in early childhood intervention, at least 
128.8   one representative of advocacy organizations for children with 
128.9   disabilities under age five, one physician who cares for young 
128.10  children with special health care needs, one representative each 
128.11  from the commissioners of commerce, education, health, human 
128.12  services, a representative from the state agency responsible for 
128.13  child care, and a representative from Indian health services or 
128.14  a tribal council.  Section 15.059, subdivisions 2 to 5, apply to 
128.15  the council.  The council must meet at least quarterly.  
128.16     The council must address methods of implementing the state 
128.17  policy of developing and implementing comprehensive, 
128.18  coordinated, multidisciplinary interagency programs of early 
128.19  intervention services for children with disabilities and their 
128.20  families. 
128.21     The duties of the council include recommending policies to 
128.22  ensure a comprehensive and coordinated system of all state and 
128.23  local agency services for children under age five with 
128.24  disabilities and their families.  The policies must address how 
128.25  to incorporate each agency's services into a unified state and 
128.26  local system of multidisciplinary assessment practices, 
128.27  individual intervention plans, comprehensive systems to find 
128.28  children in need of services, methods to improve public 
128.29  awareness, and assistance in determining the role of interagency 
128.30  early intervention committees.  
128.31     By September 1 On the date that Minnesota Part C Annual 
128.32  Performance Report is submitted to the federal Office of Special 
128.33  Education, the council must recommend to the governor and the 
128.34  commissioners of education, health, human services, commerce, 
128.35  and employment and economic development policies for a 
128.36  comprehensive and coordinated system. 
129.1      Notwithstanding any other law to the contrary, the State 
129.2   Interagency Coordinating Council expires on June 30, 2005 2009.  
129.3      Sec. 13.  Minnesota Statutes 2004, section 125A.51, is 
129.4   amended to read: 
129.5      125A.51 [PLACEMENT OF CHILDREN WITHOUT DISABILITIES; 
129.6   EDUCATION AND TRANSPORTATION.] 
129.7      The responsibility for providing instruction and 
129.8   transportation for a pupil without a disability who has a 
129.9   short-term or temporary physical or emotional illness or 
129.10  disability, as determined by the standards of the commissioner, 
129.11  and who is temporarily placed for care and treatment for that 
129.12  illness or disability, must be determined as provided in this 
129.13  section.  
129.14     (a) The school district of residence of the pupil is the 
129.15  district in which the pupil's parent or guardian resides. 
129.16     (b) When parental rights have been terminated by court 
129.17  order, the legal residence of a child placed in a residential or 
129.18  foster facility for care and treatment is the district in which 
129.19  the child resides. 
129.20     (c) Before the placement of a pupil for care and treatment, 
129.21  the district of residence must be notified and provided an 
129.22  opportunity to participate in the placement decision.  When an 
129.23  immediate emergency placement is necessary and time does not 
129.24  permit resident district participation in the placement 
129.25  decision, the district in which the pupil is temporarily placed, 
129.26  if different from the district of residence, must notify the 
129.27  district of residence of the emergency placement within 15 days 
129.28  of the placement.  
129.29     (d) When a pupil without a disability is temporarily placed 
129.30  for care and treatment in a day program and the pupil continues 
129.31  to live within the district of residence during the care and 
129.32  treatment, the district of residence must provide instruction 
129.33  and necessary transportation to and from the treatment facility 
129.34  for the pupil.  Transportation shall only be provided by the 
129.35  district during regular operating hours of the district.  The 
129.36  district may provide the instruction at a school within the 
130.1   district of residence, at the pupil's residence, or in the case 
130.2   of a placement outside of the resident district, in the district 
130.3   in which the day treatment program is located by paying tuition 
130.4   to that district.  The district of placement may contract with a 
130.5   facility to provide instruction by teachers licensed by the 
130.6   state Board of Teaching.  
130.7      (e) When a pupil without a disability is temporarily placed 
130.8   in a residential program for care and treatment, the district in 
130.9   which the pupil is placed must provide instruction for the pupil 
130.10  and necessary transportation while the pupil is receiving 
130.11  instruction, and in the case of a placement outside of the 
130.12  district of residence, the nonresident district must bill the 
130.13  district of residence for the actual cost of providing the 
130.14  instruction for the regular school year and for summer school, 
130.15  excluding transportation costs. 
130.16     (f) Notwithstanding paragraph (e), if the pupil is homeless 
130.17  and placed in a public or private homeless shelter, then the 
130.18  district that enrolls the pupil under section 127A.47, 
130.19  subdivision 2, shall provide the transportation, unless the 
130.20  district that enrolls the pupil and the district in which the 
130.21  pupil is temporarily placed agree that the district in which the 
130.22  pupil is temporarily placed shall provide transportation.  When 
130.23  a pupil without a disability is temporarily placed in a 
130.24  residential program outside the district of residence, the 
130.25  administrator of the court placing the pupil must send timely 
130.26  written notice of the placement to the district of residence.  
130.27  The district of placement may contract with a residential 
130.28  facility to provide instruction by teachers licensed by the 
130.29  state Board of Teaching. For purposes of this section, the state 
130.30  correctional facilities operated on a fee-for-service basis are 
130.31  considered to be residential programs for care and treatment. 
130.32     (f) (g) The district of residence must include the pupil in 
130.33  its residence count of pupil units and pay tuition as provided 
130.34  in section 123A.488 to the district providing the instruction.  
130.35  Transportation costs must be paid by the district providing the 
130.36  transportation and the state must pay transportation aid to that 
131.1   district.  For purposes of computing state transportation aid, 
131.2   pupils governed by this subdivision must be included in the 
131.3   disabled transportation category if the pupils cannot be 
131.4   transported on a regular school bus route without special 
131.5   accommodations. 
131.6      Sec. 14.  Minnesota Statutes 2004, section 125A.76, 
131.7   subdivision 1, is amended to read: 
131.8      Subdivision 1.  [DEFINITIONS.] For the purposes of this 
131.9   section, the definitions in this subdivision apply. 
131.10     (a) "Base year" for fiscal year 1998 and later fiscal years 
131.11  means the second fiscal year preceding the fiscal year for which 
131.12  aid will be paid. 
131.13     (b) "Basic revenue" has the meaning given it in section 
131.14  126C.10, subdivision 2.  For the purposes of computing basic 
131.15  revenue pursuant to this section, each child with a disability 
131.16  shall be counted as prescribed in section 126C.05, subdivision 1.
131.17     (c) "Essential personnel" means teachers, cultural 
131.18  liaisons, related services, and support services staff providing 
131.19  direct services to students.  Essential personnel may also 
131.20  include special education paraprofessionals or clericals 
131.21  providing support to teachers and students by preparing 
131.22  paperwork and making arrangements related to special education 
131.23  compliance requirements, including parent meetings and 
131.24  individual education plans. 
131.25     (d) "Average daily membership" has the meaning given it in 
131.26  section 126C.05. 
131.27     (e) "Program growth factor" means 1.046 for fiscal year 
131.28  2003, and; 1.0 for fiscal year years 2004, 2005, and 2006; 
131.29  1.042 for fiscal year 2007; and 1.046 for fiscal year 2008 and 
131.30  later. 
131.31     <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
131.32  fiscal year 2006. 
131.33     Sec. 15.  Minnesota Statutes 2004, section 125A.76, 
131.34  subdivision 3, is amended to read: 
131.35     Subd. 3.  [ADJUSTED SPECIAL EDUCATION BASE REVENUE.] For 
131.36  fiscal year 1997 2006 and later, a district's adjusted special 
132.1   education base revenue equals the district's special education 
132.2   base revenue times the ratio of the district's average daily 
132.3   membership unduplicated count of students with an individual 
132.4   education plan for the current school year to the district's 
132.5   average daily membership unduplicated count of students with an 
132.6   individual education plan for the base year.  
132.7      <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
132.8   fiscal year 2006. 
132.9      Sec. 16.  Minnesota Statutes 2004, section 125A.76, 
132.10  subdivision 4, is amended to read: 
132.11     Subd. 4.  [STATE TOTAL SPECIAL EDUCATION AID.] The state 
132.12  total special education aid for fiscal year 2004 equals 
132.13  $530,642,000.  The state total special education aid for fiscal 
132.14  year 2005 equals $529,164,000.  The state total special 
132.15  education aid for fiscal year 2006 equals $528,846,000.  The 
132.16  state total special education aid for later fiscal years equals: 
132.17     (1) the state total special education aid for the preceding 
132.18  fiscal year; times 
132.19     (2) the program growth factor; times 
132.20     (3) the ratio of the state total average daily membership 
132.21  for the current fiscal year to the state total average daily 
132.22  membership for the preceding fiscal year. 
132.23     <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
132.24  fiscal year 2006.  
132.25     Sec. 17.  Minnesota Statutes 2004, section 125A.79, 
132.26  subdivision 1, is amended to read: 
132.27     Subdivision 1.  [DEFINITIONS.] For the purposes of this 
132.28  section, the definitions in this subdivision apply. 
132.29     (a) "Unreimbursed special education cost" means the sum of 
132.30  the following: 
132.31     (1) expenditures for teachers' salaries, contracted 
132.32  services, supplies, equipment, and transportation services 
132.33  eligible for revenue under section 125A.76; plus 
132.34     (2) expenditures for tuition bills received under sections 
132.35  125A.03 to 125A.24 and 125A.65 for services eligible for revenue 
132.36  under section 125A.76, subdivision 2; minus 
133.1      (3) revenue for teachers' salaries, contracted services, 
133.2   supplies, and equipment under section 125A.76; minus 
133.3      (4) tuition receipts under sections 125A.03 to 125A.24 and 
133.4   125A.65 for services eligible for revenue under section 125A.76, 
133.5   subdivision 2. 
133.6      (b) "General revenue" means for fiscal year 1996, the sum 
133.7   of the general education revenue according to section 126C.10, 
133.8   subdivision 1, as adjusted according to section 127A.47, 
133.9   subdivision 7, plus the total referendum revenue according to 
133.10  section 126C.17, subdivision 4.  For fiscal years 1997 and 
133.11  later, "General revenue" means the sum of the general education 
133.12  revenue according to section 126C.10, subdivision 1, as adjusted 
133.13  according to section 127A.47, subdivisions 7 and 8, plus the 
133.14  total referendum revenue minus transportation sparsity revenue 
133.15  minus total operating capital revenue.  
133.16     (c) "Average daily membership" has the meaning given it in 
133.17  section 126C.05. 
133.18     (d) "Program growth factor" means 1.02 for fiscal year 
133.19  2003, and; 1.0 for fiscal year years 2004 and 2005; and 1.02 
133.20  for fiscal year 2006 and later. 
133.21     <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
133.22  fiscal year 2006. 
133.23     Sec. 18.  Minnesota Statutes 2004, section 125A.79, 
133.24  subdivision 6, is amended to read: 
133.25     Subd. 6.  [STATE TOTAL SPECIAL EDUCATION EXCESS COST AID.] 
133.26  The state total special education excess cost aid for fiscal 
133.27  year 2004 equals $92,067,000.  The state total special education 
133.28  aid for fiscal year 2005 equals $91,811,000.  The state total 
133.29  special education excess cost aid for fiscal year 2006 equals 
133.30  $91,784,000.  The state total special education excess cost aid 
133.31  for fiscal year 2006 2007 and later fiscal years equals: 
133.32     (1) the state total special education excess cost aid for 
133.33  the preceding fiscal year; times 
133.34     (2) the program growth factor; times 
133.35     (3) the ratio of the state total average daily membership 
133.36  for the current fiscal year to the state total average daily 
134.1   membership for the preceding fiscal year; 
134.2      (4) all less the amount transferred into the charter school 
134.3   special education reimbursement account under section 125A.795.  
134.4      <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
134.5   fiscal year 2006. 
134.6      Sec. 19.  [125A.795] [CHARTER SCHOOL SPECIAL EDUCATION 
134.7   REIMBURSEMENT ACCOUNT.] 
134.8      Subdivision 1.  [ACCOUNT CREATED.] The charter school 
134.9   special education reimbursement account is created in the state 
134.10  general fund. 
134.11     Subd. 2.  [REVENUE.] The estimated amount necessary to pay 
134.12  for the state share of net unreimbursed special education costs 
134.13  of charter school pupils with a disability is transferred from 
134.14  the appropriation for special education excess cost aid to the 
134.15  charter school special education reimbursement account. 
134.16     Subd. 3.  [REVIEW.] The commissioner of education must 
134.17  examine the tuition bills from charter schools and may adjust 
134.18  the bills in the same manner as authorized under section 125A.80.
134.19     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2005, 
134.20  for revenue for fiscal year 2006. 
134.21     Sec. 20.  Minnesota Statutes 2004, section 126C.40, 
134.22  subdivision 1, is amended to read: 
134.23     Subdivision 1.  [TO LEASE BUILDING OR LAND.] (a) When an 
134.24  independent or a special school district or a group of 
134.25  independent or special school districts finds it economically 
134.26  advantageous to rent or lease a building or land for any 
134.27  instructional purposes or for school storage or furniture 
134.28  repair, and it determines that the operating capital revenue 
134.29  authorized under section 126C.10, subdivision 13, is 
134.30  insufficient for this purpose, it may apply to the commissioner 
134.31  for permission to make an additional capital expenditure levy 
134.32  for this purpose.  An application for permission to levy under 
134.33  this subdivision must contain financial justification for the 
134.34  proposed levy, the terms and conditions of the proposed lease, 
134.35  and a description of the space to be leased and its proposed use.
134.36     (b) The criteria for approval of applications to levy under 
135.1   this subdivision must include:  the reasonableness of the price, 
135.2   the appropriateness of the space to the proposed activity, the 
135.3   feasibility of transporting pupils to the leased building or 
135.4   land, conformity of the lease to the laws and rules of the state 
135.5   of Minnesota, and the appropriateness of the proposed lease to 
135.6   the space needs and the financial condition of the district.  
135.7   The commissioner must not authorize a levy under this 
135.8   subdivision in an amount greater than 90 percent of the cost to 
135.9   the district of renting or leasing a building or land for 
135.10  approved purposes.  The proceeds of this levy must not be used 
135.11  for custodial or other maintenance services.  A district may not 
135.12  levy under this subdivision for the purpose of leasing or 
135.13  renting a district-owned building or site to itself. 
135.14     (c) For agreements finalized after July 1, 1997, a district 
135.15  may not levy under this subdivision for the purpose of leasing:  
135.16  (1) a newly constructed building used primarily for regular 
135.17  kindergarten, elementary, or secondary instruction; or (2) a 
135.18  newly constructed building addition or additions used primarily 
135.19  for regular kindergarten, elementary, or secondary instruction 
135.20  that contains more than 20 percent of the square footage of the 
135.21  previously existing building. 
135.22     (d) Notwithstanding paragraph (b), a district may levy 
135.23  under this subdivision for the purpose of leasing or renting a 
135.24  district-owned building or site to itself only if the amount is 
135.25  needed by the district to make payments required by a lease 
135.26  purchase agreement, installment purchase agreement, or other 
135.27  deferred payments agreement authorized by law, and the levy 
135.28  meets the requirements of paragraph (c).  A levy authorized for 
135.29  a district by the commissioner under this paragraph may be in 
135.30  the amount needed by the district to make payments required by a 
135.31  lease purchase agreement, installment purchase agreement, or 
135.32  other deferred payments agreement authorized by law, provided 
135.33  that any agreement include a provision giving the school 
135.34  districts the right to terminate the agreement annually without 
135.35  penalty. 
135.36     (e) The total levy under this subdivision for a district 
136.1   for any year must not exceed $90 times the resident pupil units 
136.2   for the fiscal year to which the levy is attributable. 
136.3      (f) For agreements for which a review and comment have been 
136.4   submitted to the Department of Education after April 1, 1998, 
136.5   the term "instructional purpose" as used in this subdivision 
136.6   excludes expenditures on stadiums. 
136.7      (g) The commissioner of education may authorize a school 
136.8   district to exceed the limit in paragraph (e) if the school 
136.9   district petitions the commissioner for approval.  The 
136.10  commissioner shall grant approval to a school district to exceed 
136.11  the limit in paragraph (e) for not more than five years if the 
136.12  district meets the following criteria: 
136.13     (1) the school district has been experiencing pupil 
136.14  enrollment growth in the preceding five years; 
136.15     (2) the purpose of the increased levy is in the long-term 
136.16  public interest; 
136.17     (3) the purpose of the increased levy promotes colocation 
136.18  of government services; and 
136.19     (4) the purpose of the increased levy is in the long-term 
136.20  interest of the district by avoiding over construction of school 
136.21  facilities. 
136.22     (h) A school district that is a member of an intermediate 
136.23  school district may include in its authority under this section 
136.24  90 percent of the costs associated with leases of administrative 
136.25  and classroom space for intermediate school district programs.  
136.26  This authority must not exceed $22.50 times the adjusted 
136.27  marginal cost pupil units of the member districts.  This 
136.28  authority is in addition to any other authority authorized under 
136.29  this section. 
136.30     (i) In addition to the allowable capital levies in 
136.31  paragraph (a), a district that is a member of the "Technology 
136.32  and Information Education Systems" data processing joint board, 
136.33  that finds it economically advantageous to enter into a lease 
136.34  purchase agreement for a building for a group of school 
136.35  districts or special school districts for staff development 
136.36  purposes, may levy for its portion of lease costs attributed to 
137.1   the district within the total levy limit in paragraph (e). 
137.2      (j) A school district that is a member of the Wright 
137.3   Technical Center may include in its authority under this section 
137.4   90 percent of the costs associated with leases of administrative 
137.5   and classroom space at the Wright Technical Center.  This 
137.6   authority must not exceed $22.50 times the adjusted marginal 
137.7   cost pupil units of the member districts.  This authority may be 
137.8   in addition to any other authority authorized under this section.
137.9      Sec. 21.  Minnesota Statutes 2004, section 126C.457, is 
137.10  amended to read: 
137.11     126C.457 [CAREER AND TECHNICAL LEVY.] 
137.12     For taxes payable in 2006, 2007, and 2008, a school 
137.13  district may levy an amount equal to the greater of (1) $10,000, 
137.14  or (2) the district's fiscal year 2001 entitlement for career 
137.15  and technical aid under Minnesota Statutes 2000, section 
137.16  124D.453.  The district must recognize the full amount of this 
137.17  levy as revenue for the fiscal year in which it is certified.  
137.18  Revenue received under this section must be reserved and used 
137.19  only for career and technical programs. 
137.20     Sec. 22.  [127A.21] [STATE COORDINATOR FOR WORLD 
137.21  LANGUAGES.] 
137.22     (a) The commissioner of education shall designate a 
137.23  full-time state coordinator for world languages education within 
137.24  the Department of Education by July 1, 2005.  The commissioner 
137.25  shall seek input from the Quality Teaching Network before 
137.26  designating or hiring the coordinator who must have classroom 
137.27  experience teaching world languages.  The coordinator, at a 
137.28  minimum, shall: 
137.29     (1) survey school districts in the state to: 
137.30     (i) identify the types of existing world language programs 
137.31  and exemplary model extended world languages programs; and 
137.32     (ii) in consultation with Minnesota postsecondary 
137.33  institutions, identify and address staff development needs of 
137.34  current world language teachers and preservice teachers; 
137.35     (2) identify successful extended world language programs 
137.36  from other states; 
138.1      (3) establish guidelines for a variety of model extended 
138.2   world languages programs; 
138.3      (4) research and recommend the funding necessary to 
138.4   implement various models of extended world languages programs in 
138.5   different languages; and 
138.6      (5) support and monitor, using the most recent information 
138.7   available, current world languages programs. 
138.8      (b) For the purposes of this section, "extended world 
138.9   languages program" means a world languages program: 
138.10     (1) with a sequence of consecutive years in any of 
138.11  kindergarten through grade 12, including, for example, sequences 
138.12  of kindergarten through grade 12, grades 5 through 12, and 
138.13  grades 7 through 12; and 
138.14     (2) based on professionally recognized proficiency 
138.15  guidelines, and which incorporates current best practices for 
138.16  world language programs. 
138.17     Sec. 23.  Minnesota Statutes 2004, section 127A.47, 
138.18  subdivision 7, is amended to read: 
138.19     Subd. 7.  [ALTERNATIVE ATTENDANCE PROGRAMS.] The general 
138.20  education aid and special education aid for districts must be 
138.21  adjusted for each pupil attending a nonresident district under 
138.22  sections 123A.05 to 123A.08, 124D.03, 124D.06, 124D.08, and 
138.23  124D.68.  The adjustments must be made according to this 
138.24  subdivision. 
138.25     (a) General education aid paid to a resident district must 
138.26  be reduced by an amount equal to the referendum equalization aid 
138.27  attributable to the pupil in the resident district. 
138.28     (b) General education aid paid to a district serving a 
138.29  pupil in programs listed in this subdivision must be increased 
138.30  by an amount equal to the referendum equalization aid 
138.31  attributable to the pupil in the nonresident district.  
138.32     (c) If the amount of the reduction to be made from the 
138.33  general education aid of the resident district is greater than 
138.34  the amount of general education aid otherwise due the district, 
138.35  the excess reduction must be made from other state aids due the 
138.36  district. 
139.1      (d) For fiscal year 2006, the district of residence must 
139.2   pay tuition to a district or an area learning center, operated 
139.3   according to paragraph (e) (f), providing special instruction 
139.4   and services to a pupil with a disability, as defined in section 
139.5   125A.02, or a pupil, as defined in section 125A.51, who is 
139.6   enrolled in a program listed in this subdivision.  The tuition 
139.7   must be equal to (1) the actual cost of providing special 
139.8   instruction and services to the pupil, including a proportionate 
139.9   amount for debt service and for capital expenditure facilities 
139.10  and equipment, and debt service but not including any amount for 
139.11  special transportation and unreimbursed building lease and debt 
139.12  service costs for facilities used primarily for special 
139.13  education, minus (2) if the pupil receives special instruction 
139.14  and services outside the regular classroom for more than 60 
139.15  percent of the school day, the amount of general education 
139.16  revenue and referendum aid attributable to that pupil for the 
139.17  portion of time the pupil receives special instruction and 
139.18  services outside of the regular classroom, excluding portions 
139.19  attributable to district and school administration, district 
139.20  support services, operations and maintenance, capital 
139.21  expenditures, and pupil transportation, minus (3) special 
139.22  education aid but not including any amount for transportation, 
139.23  attributable to that pupil, that is received by the district 
139.24  providing special instruction and services.  For purposes of 
139.25  this paragraph, general education revenue and referendum aid 
139.26  attributable to a pupil must be calculated using the serving 
139.27  district's average general education revenue and referendum aid 
139.28  per adjusted pupil unit. 
139.29     (e) For fiscal year 2007 and later, special education aid 
139.30  paid to a resident district must be reduced by an amount equal 
139.31  to (1) the actual cost of providing special instruction and 
139.32  services, including special transportation and unreimbursed 
139.33  building lease and debt service costs for facilities used 
139.34  primarily for special education, for a pupil with a disability, 
139.35  as defined in section 125A.02, or a pupil, as defined in section 
139.36  125A.51, who is enrolled in a program listed in this 
140.1   subdivision, minus (2) if the pupil receives special instruction 
140.2   and services outside the regular classroom for more than 60 
140.3   percent of the school day, the amount of general education 
140.4   revenue and referendum aid attributable to that pupil for the 
140.5   portion of time the pupil receives special instruction and 
140.6   services outside of the regular classroom, excluding portions 
140.7   attributable to district and school administration, district 
140.8   support services, operations and maintenance, capital 
140.9   expenditures, and pupil transportation, minus (3) special 
140.10  education aid attributable to that pupil, that is received by 
140.11  the district providing special instruction and services.  For 
140.12  purposes of this paragraph, general education revenue and 
140.13  referendum aid attributable to a pupil must be calculated using 
140.14  the serving district's average general education revenue and 
140.15  referendum aid per adjusted pupil unit.  Special education aid 
140.16  paid to the district providing special instruction and services 
140.17  for the pupil, or to the fiscal agent district for a 
140.18  cooperative, must be increased by the amount of the reduction in 
140.19  the aid paid to the resident district.  If the resident 
140.20  district's special education aid is insufficient to make the 
140.21  full adjustment, the remaining adjustment shall be made to other 
140.22  state aids due to the district. 
140.23     (f) An area learning center operated by a service 
140.24  cooperative, intermediate district, education district, or a 
140.25  joint powers cooperative may elect through the action of the 
140.26  constituent boards to charge the resident district tuition for 
140.27  pupils rather than to have the general education revenue paid to 
140.28  a fiscal agent school district.  Except as provided in paragraph 
140.29  (d) or (e), the district of residence must pay tuition equal to 
140.30  at least 90 percent of the district average general education 
140.31  revenue per pupil unit minus an amount equal to the product of 
140.32  the formula allowance according to section 126C.10, subdivision 
140.33  2, times .0485 for fiscal year 2006, and .0458 for fiscal year 
140.34  2007 and later fiscal years, calculated without basic skills 
140.35  revenue and transportation sparsity revenue, times the number of 
140.36  pupil units for pupils attending the area learning center, plus 
141.1   the amount of compensatory revenue generated by pupils attending 
141.2   the area learning center. 
141.3      Sec. 24.  Minnesota Statutes 2004, section 134.31, is 
141.4   amended by adding a subdivision to read: 
141.5      Subd. 6.  [ADVISORY COMMITTEE.] The commissioner shall 
141.6   appoint an advisory committee of five members to advise the 
141.7   staff of the Minnesota Library for the Blind and Physically 
141.8   Handicapped on long-range plans and library services.  Members 
141.9   shall be people who use the library.  Section 15.059 governs 
141.10  this committee except that the committee shall not expire. 
141.11     Sec. 25.  2005 Senate File No. 1879, article 3, section 3, 
141.12  subdivision 32, if enacted, is amended to read: 
141.13     Subd. 32.  [SPECIAL EDUCATION; REGULAR.] For special 
141.14  education aid under Minnesota Statutes, section 125A.75: 
141.15       $528,846,000   .....     2006 
141.16       $527,446,000 546,111,000   .....     2007 
141.17     The 2006 appropriation includes $83,078,000 for 2005 and 
141.18  $445,768,000 for 2006. 
141.19     The 2007 appropriation includes $83,019,000 for 2006 and 
141.20  $444,427,000 463,092,000 for 2007. 
141.21     Sec. 26.  2005 Senate File No. 1879, article 3, section 3, 
141.22  subdivision 35, if enacted, is amended to read: 
141.23     Subd. 35.  [SPECIAL EDUCATION; EXCESS COSTS.] For excess 
141.24  cost aid under Minnesota Statutes, section 125A.79, subdivision 
141.25  7: 
141.26       $91,784,000    .....     2006 
141.27       $91,595,000 93,430,000    .....     2007 
141.28     The 2006 appropriation includes $37,455,000 for 2005 and 
141.29  $54,329,000 for 2006. 
141.30     The 2007 appropriation includes $37,417,000 39,252,000 for 
141.31  2006 and $54,178,000 for 2007.  
141.32     Sec. 27.  2005 Senate File No. 1879, article 3, section 3, 
141.33  subdivision 36, if enacted, is amended to read: 
141.34     Subd. 36.  [LITIGATION COSTS FOR SPECIAL EDUCATION.] For 
141.35  paying the costs a district incurs under Minnesota Statutes, 
141.36  section 125A.75, subdivision 8: 
142.1        $  17,000 0    .....     2006 
142.2        $  17,000 0    .....     2007 
142.3      Sec. 28.  [EMINENCE CREDENTIALING.] 
142.4      Subdivision 1.  [GOAL.] It is the goal of the state to 
142.5   support the teaching and revitalization of the Dakota and 
142.6   Anishinaabe languages.  The Native Language Eminence 
142.7   Credentialing Task Force is created to achieve this goal. 
142.8      Subd. 2.  [MEMBERSHIP.] The Native Language Eminence 
142.9   Credentialing Task Force consists of the following members: 
142.10     (1) four members representing public schools with large 
142.11  Native American populations appointed by the commissioner of 
142.12  education; 
142.13     (2) one member appointed by each federally recognized 
142.14  Indian tribe in the state; 
142.15     (3) one member appointed by each institution of higher 
142.16  education that trains credentialed Dakota and Anishinaabe 
142.17  language teachers; 
142.18     (4) one member representing the Minnesota Historical 
142.19  Society; 
142.20     (5) the chair of the state Indian Affairs Council; and 
142.21     (6) three native speakers of the Anishinaabe language and 
142.22  three native speakers of the Dakota language, all appointed by 
142.23  the Dakota Ojibwe Language Revitalization Alliance. 
142.24     Subd. 3.  [ADMINISTRATION.] (a) The Native Language 
142.25  Eminence Credentialing Task Force is governed by Minnesota 
142.26  Statutes, section 15.059. 
142.27     (b) The task force shall elect a chair from its 
142.28  membership.  The commissioner of education shall provide staff 
142.29  and administrative support for the task force. 
142.30     Subd. 4.  [DUTIES.] The task force shall review and 
142.31  recommend changes to the eminence credentials for teachers of 
142.32  the Dakota and Anishinaabe languages in order to increase the 
142.33  number of fluent "first speakers" who can teach the language and 
142.34  the number of teachers of the Dakota and Anishinaabe languages 
142.35  by considering and addressing the following: 
142.36     (1) whether a rating system should be developed that 
143.1   includes separate ratings for fluency of the spoken language, 
143.2   writing and reading skills in language, and specifying which 
143.3   dialect of the Anishinaabe and Dakota languages is being spoken; 
143.4      (2) whether a strategy for determining the level of fluency 
143.5   should be developed; 
143.6      (3) consistency of evaluation of language fluency; 
143.7      (4) identifying issues between tribal authority and state 
143.8   law around strategies of language revitalization; and 
143.9      (5) a strategy to provide affordable and accessible 
143.10  language and culture credentials throughout Minnesota. 
143.11     Subd. 5.  [REPORT.] The task force shall submit a report to 
143.12  the legislature by January 15, 2006, to fulfill the duties of 
143.13  the task force. 
143.14     Subd. 6.  [EXPIRATION.] The task force expires upon 
143.15  submission of the report on January 15, 2006. 
143.16     Sec. 29.  [TASK FORCE ON DELIVERY OF SPECIAL EDUCATION TO 
143.17  NONPUBLIC SCHOOL STUDENTS BY PUBLIC SCHOOL DISTRICTS.] 
143.18     Subdivision 1.  [PURPOSE; ESTABLISHMENT.] With the 
143.19  congressional reauthorization of the federal Individuals with 
143.20  Disabilities Education Act, a task force on the delivery of 
143.21  special education services to nonpublic school students by 
143.22  public school districts shall be established to compare and 
143.23  evaluate how the individual needs of each child are being met, 
143.24  if services are provided in the least restrictive environment, 
143.25  and whether best practices and program efficiencies are being 
143.26  used in the specific areas of transportation, location of 
143.27  services, and shared time aid. 
143.28     Subd. 2.  [MEMBERS.] The governor shall appoint the members 
143.29  of the task force from each of the following: 
143.30     (1) two members from the Department of Education, one 
143.31  representing special education programs and policy and one 
143.32  representing district finances; 
143.33     (2) two special education teachers with one member from a 
143.34  public school and one member from a nonpublic school; 
143.35     (3) two special education administrators with one member 
143.36  from a public school and one member from a nonpublic school; 
144.1      (4) two members with one from each of two special education 
144.2   advocacy organizations; 
144.3      (5) two parents of children receiving special education 
144.4   services with one member from a public school and one member 
144.5   from a nonpublic school; 
144.6      (6) two elementary school principals with one member from a 
144.7   public school and one member from a nonpublic school; 
144.8      (7) two superintendents with one member from a public 
144.9   school district and one member from a nonpublic school district; 
144.10     (8) two school business officials with one from a public 
144.11  school and one from a nonpublic school; and 
144.12     (9) two school board officials with one from a public 
144.13  school and one from a nonpublic school. 
144.14     The task force may select additional members to work on the 
144.15  task force.  The commissioner of education shall provide 
144.16  necessary materials and assistance. 
144.17     Subd. 3.  [REPORT.] The task force shall submit a report by 
144.18  January 15, 2006, to the house of representatives and senate 
144.19  committees having jurisdiction over education on the delivery of 
144.20  special education services to nonpublic school students by 
144.21  public school districts, to compare and evaluate how the 
144.22  individual needs of each child are being met in the least 
144.23  restrictive environment, and whether best practices and program 
144.24  efficiencies are being used. 
144.25     Subd. 4.  [EXPIRATION.] This section expires January 31, 
144.26  2006. 
144.27     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
144.28  following final enactment. 
144.29     Sec. 30.  [APPROPRIATIONS.] 
144.30     Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
144.31  indicated in this section are appropriated from the general fund 
144.32  to the Department of Education for the fiscal years designated. 
144.33     Subd. 2.  [NONPUBLIC STUDENT SPECIAL EDUCATION TASK FORCE.] 
144.34  For funding of a task force on delivery of special education to 
144.35  nonpublic school students by public school districts: 
144.36           $50,000    .....     2006 
145.1      Subd. 3.  [NATIVE LANGUAGE EMINENCE CREDENTIALING TASK 
145.2   FORCE.] For funding of a task force to support the teaching and 
145.3   revitalization of the Dakota and Anishinaabe languages: 
145.4           $102,000    .....     2006
145.5      Sec. 31.  [REPEALER.] 
145.6      Minnesota Statutes 2004, section 125A.75, subdivision 8, is 
145.7   repealed. 
145.8                              ARTICLE 4 
145.9                TECHNOLOGY, FACILITIES, AND ACCOUNTING 
145.10     Section 1.  Minnesota Statutes 2004, section 123B.42, is 
145.11  amended by adding a subdivision to read: 
145.12     Subd. 1a.  [CURRICULUM; ELECTRONIC COMPONENTS.] A school 
145.13  district that provides curriculum to resident students that has 
145.14  both physical and electronic components must make the electronic 
145.15  component accessible to a resident student in a home school in 
145.16  compliance with sections 120A.22 and 120A.24 at the request of 
145.17  the student or the student's parent or guardian, provided that 
145.18  the district does not incur more than an incidental cost as a 
145.19  result of providing access electronically. 
145.20     Sec. 2.  Minnesota Statutes 2004, section 123B.492, is 
145.21  amended to read: 
145.22     123B.492 [SUPERVISED COMPETITIVE HIGH SCHOOL DIVING.] 
145.23     Notwithstanding Minnesota Rules, part 4717.3750, any pool 
145.24  built before January 1, 1987, that was used for a one-meter 
145.25  board high school diving program during the 2000-2001 school 
145.26  year may be used for supervised competitive one-meter board high 
145.27  school diving.  Schools and school districts are strongly 
145.28  encouraged to use a pool for supervised competitive high school 
145.29  diving that meets the requirements of Minnesota Rules, part 
145.30  4717.3750.  A school or district using a pool for 
145.31  supervised training practice for competitive high school 
145.32  diving for either training practice or competition that does not 
145.33  meet the requirements of Minnesota Rules, part 4717.3750, must 
145.34  provide appropriate notice to parents and participants as to the 
145.35  type of variance from Minnesota Rules and risk it may present. 
145.36     Sec. 3.  Minnesota Statutes 2004, section 123B.54, as 
146.1   amended by 2005 S. F. No. 1879, article 3, section 1, if 
146.2   enacted, is amended to read: 
146.3      123B.54 [DEBT SERVICE APPROPRIATION.] 
146.4      (a) $22,942,000 $22,282,000 in fiscal year 2008 and 
146.5   $21,942,000 $21,182,000 in fiscal year 2009 and later are 
146.6   appropriated from the general fund to the commissioner of 
146.7   education for payment of debt service equalization aid under 
146.8   section 123B.53.  
146.9      (b) The appropriations in paragraph (a) must be reduced by 
146.10  the amount of any money specifically appropriated for the same 
146.11  purpose in any year from any state fund. 
146.12     Sec. 4.  [123B.715] [ACOUSTICAL PERFORMANCE CRITERIA.] 
146.13     School districts are encouraged to consider the American 
146.14  National Standards Institute acoustical performance criteria 
146.15  design requirements and guidelines for schools of the maximum 
146.16  background noise level and reverberation times when designing a 
146.17  new building or remodeling an existing building. 
146.18     Sec. 5.  Minnesota Statutes 2004, section 124D.095, 
146.19  subdivision 2, is amended to read: 
146.20     Subd. 2.  [DEFINITIONS.] For purposes of this section, the 
146.21  following terms have the meanings given them. 
146.22     (a) "Online learning" is an interactive course or program 
146.23  that delivers instruction from a teacher to a student by 
146.24  computer; is combined with other traditional delivery methods 
146.25  that include frequent student assessment and may include actual 
146.26  teacher contact time; and meets or exceeds state academic 
146.27  standards. 
146.28     (b) "Online learning provider" is a school district, an 
146.29  intermediate school district, an organization of two or more 
146.30  school districts operating under a joint powers agreement, or a 
146.31  charter school located in Minnesota that provides online 
146.32  learning to students. 
146.33     (c) "Student" is a Minnesota resident enrolled in a school 
146.34  under section 120A.22, subdivision 4, in kindergarten through 
146.35  grade 12. 
146.36     (d) "Online learning student" is a student enrolled in an 
147.1   online learning course or program delivered by an online 
147.2   provider under paragraph (b). 
147.3      (e) "Enrolling district" means the school district or 
147.4   charter school in which a student is enrolled under section 
147.5   120A.22, subdivision 4, for purposes of compulsory attendance. 
147.6      Sec. 6.  Minnesota Statutes 2004, section 124D.095, 
147.7   subdivision 4, is amended to read: 
147.8      Subd. 4.  [ONLINE LEARNING PARAMETERS.] (a) An online 
147.9   learning student must receive academic credit for completing the 
147.10  requirements of an online learning course or program.  Secondary 
147.11  credits granted to an online learning student must be counted 
147.12  toward the graduation and credit requirements of the enrolling 
147.13  district.  The enrolling district must apply the same graduation 
147.14  requirements to all students, including online learning 
147.15  students, and must continue to provide nonacademic services to 
147.16  online learning students.  If a student completes an online 
147.17  learning course or program that meets or exceeds a graduation 
147.18  standard or grade progression requirement at the enrolling 
147.19  district, that standard or requirement is met.  The enrolling 
147.20  district must use the same criteria for accepting online 
147.21  learning credits or courses as it does for accepting credits or 
147.22  courses for transfer students under section 124D.03, subdivision 
147.23  9.  The enrolling district may reduce the teacher contact time 
147.24  of an online learning student in proportion to the number of 
147.25  online learning courses the student takes from an online 
147.26  learning provider that is not the enrolling district.  
147.27     (b) An online learning student may: 
147.28     (1) enroll during a single school year in a maximum of 12 
147.29  semester-long courses or their equivalent delivered by an online 
147.30  learning provider or the enrolling district; 
147.31     (2) complete course work at a grade level that is different 
147.32  from the student's current grade level; and 
147.33     (3) enroll in additional courses with the online learning 
147.34  provider under a separate agreement that includes terms for 
147.35  payment of any tuition or course fees.  
147.36     (c) A student with a disability may enroll in an online 
148.1   learning course or program if the student's IEP team determines 
148.2   that online learning is appropriate education for the student. 
148.3      (d) An online learning student has the same access to the 
148.4   computer hardware and education software available in a school 
148.5   as all other students in the enrolling district.  An online 
148.6   learning provider must assist an online learning student whose 
148.7   family qualifies for the education tax credit under section 
148.8   290.0674 to acquire computer hardware and educational software 
148.9   for online learning purposes. 
148.10     (e) An enrolling district may offer online learning to its 
148.11  enrolled students.  Such online learning does not generate 
148.12  online learning funds under this section.  An enrolling district 
148.13  that offers online learning only to its enrolled students is not 
148.14  subject to the reporting requirements or review criteria under 
148.15  subdivision 7.  A teacher with a Minnesota license must assemble 
148.16  and deliver instruction to enrolled students receiving online 
148.17  learning from an enrolling district.  The delivery of 
148.18  instruction occurs when the student interacts with the computer 
148.19  or the teacher and receives ongoing assistance and assessment of 
148.20  learning.  The instruction may include curriculum developed by 
148.21  persons other than a teacher with a Minnesota license. 
148.22     (f) An online learning provider that is not the enrolling 
148.23  district is subject to the reporting requirements and review 
148.24  criteria under subdivision 7.  A teacher with a Minnesota 
148.25  license must assemble and deliver instruction to online learning 
148.26  students.  The delivery of instruction occurs when the student 
148.27  interacts with the computer or the teacher and receives ongoing 
148.28  assistance and assessment of learning.  The instruction may 
148.29  include curriculum developed by persons other than a teacher 
148.30  with a Minnesota license.  Unless the commissioner grants a 
148.31  waiver, a teacher providing online learning instruction must not 
148.32  instruct more than 40 students in any one online learning course 
148.33  or program. 
148.34     Sec. 7.  Minnesota Statutes 2004, section 124D.095, 
148.35  subdivision 8, is amended to read: 
148.36     Subd. 8.  [FINANCIAL ARRANGEMENTS.] (a) For a student 
149.1   enrolled in an online learning course, the department must 
149.2   calculate average daily membership and make payments according 
149.3   to this subdivision. 
149.4      (b) The initial online learning average daily membership 
149.5   equals 1/12 for each semester course or a proportionate amount 
149.6   for courses of different lengths.  The adjusted online learning 
149.7   average daily membership equals the initial online learning 
149.8   average daily membership times .88. 
149.9      (c) No online learning average daily membership shall be 
149.10  generated if:  (1) the student does not complete the online 
149.11  learning course, or (2) the student is enrolled in online 
149.12  learning provided by the enrolling district and the student was 
149.13  either enrolled in a Minnesota public school for the school year 
149.14  before the school year in which the student first enrolled in 
149.15  online learning, or the student is enrolled in an instructional 
149.16  program in which at least 40 percent of the total instructional 
149.17  time takes place in the school's facilities.  For students 
149.18  enrolled in online learning according to clause (2), the 
149.19  department shall calculate average daily membership according to 
149.20  section 126C.05, subdivision 8. 
149.21     (d) Online learning average daily membership under this 
149.22  subdivision for a student currently enrolled in a Minnesota 
149.23  public school and who was enrolled in a Minnesota public school 
149.24  for the school year before the school year in which the student 
149.25  first enrolled in online learning shall be used only for 
149.26  computing average daily membership according to section 126C.05, 
149.27  subdivision 19, paragraph (a), clause (ii) (2), and for 
149.28  computing online learning aid according to section 126C.24 
149.29  124D.096. 
149.30     (e) Online learning average daily membership under this 
149.31  subdivision for students not included in paragraph (c) or (d) 
149.32  shall be used only for computing average daily membership 
149.33  according to section 126C.05, subdivision 19, paragraph (a), 
149.34  clause (ii) (2), and for computing payments under paragraphs (f) 
149.35  and (g). 
149.36     (f) Subject to the limitations in this subdivision, the 
150.1   department must pay an online learning provider an amount equal 
150.2   to the product of the adjusted online learning average daily 
150.3   membership for students under paragraph (e) times the student 
150.4   grade level weighting under section 126C.05, subdivision 1, 
150.5   times the formula allowance. 
150.6      (g) The department must pay each online learning provider 
150.7   100 percent of the amount in paragraph (f) within 45 days of 
150.8   receiving final enrollment and course completion information 
150.9   each quarter or semester. 
150.10     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
150.11  following final enactment. 
150.12     Sec. 8.  Minnesota Statutes 2004, section 124D.095, is 
150.13  amended by adding a subdivision to read: 
150.14     Subd. 10.  [ONLINE LEARNING ADVISORY COUNCIL.] (a) An 
150.15  online learning advisory council is established under section 
150.16  15.059, except that the term for each council member shall be 
150.17  three years.  The advisory council is composed of 12 members 
150.18  from throughout the state who have demonstrated experience with 
150.19  or interest in online learning.  The members of the council 
150.20  shall be appointed by the commissioner.  The advisory council 
150.21  shall bring to the attention of the commissioner any matters 
150.22  related to online learning and provide input to the department 
150.23  in matters related, but not restricted, to: 
150.24     (1) quality assurance; 
150.25     (2) teacher qualifications; 
150.26     (3) program approval; 
150.27     (4) special education; 
150.28     (5) attendance; 
150.29     (6) program design and requirements; and 
150.30     (7) fair and equal access to programs. 
150.31     (b) The online learning advisory council under this 
150.32  subdivision expires June 30, 2008. 
150.33     Sec. 9.  [125B.26] [TELECOMMUNICATIONS/INTERNET ACCESS 
150.34  EQUITY AID.] 
150.35     Subdivision 1.  [COSTS TO BE SUBMITTED.] (a) A district or 
150.36  charter school shall submit its actual 
151.1   telecommunications/Internet access costs for the previous fiscal 
151.2   year, adjusted for any e-rate revenue received, to the 
151.3   department by August 15 of each year as prescribed by the 
151.4   commissioner.  Costs eligible for reimbursement under this 
151.5   program are limited to the following: 
151.6      (1) ongoing or recurring telecommunications/Internet access 
151.7   costs associated with Internet access, data lines, and video 
151.8   links providing: 
151.9      (i) the equivalent of one data line, video link, or 
151.10  integrated data/video link that relies on a transport medium 
151.11  that operates at a minimum speed of 1.544 megabytes per second 
151.12  (T1) for each elementary school, middle school, or high school 
151.13  under section 120A.05, subdivisions 9, 11, and 13, including the 
151.14  recurring telecommunications line lease costs and ongoing 
151.15  Internet access service fees; or 
151.16     (ii) the equivalent of one data line or video circuit, or 
151.17  integrated data/video link that relies on a transport medium 
151.18  that operates at a minimum speed of 1.544 megabytes per second 
151.19  (T1) for each district, including recurring telecommunications 
151.20  line lease costs and ongoing Internet access service fees; 
151.21     (2) recurring costs of contractual or vendor-provided 
151.22  maintenance on the school district's wide area network to the 
151.23  point of presence at the school building up to the router, 
151.24  codec, or other service delivery equipment located at the point 
151.25  of presence termination at the school or school district; 
151.26     (3) recurring costs of cooperative, shared arrangements for 
151.27  regional delivery of telecommunications/Internet access between 
151.28  school districts, postsecondary institutions, and public 
151.29  libraries including network gateways, peering points, regional 
151.30  network infrastructure, Internet2 access, and network support, 
151.31  maintenance, and coordination; and 
151.32     (4) service provider installation fees for installation of 
151.33  new telecommunications lines or increased bandwidth. 
151.34     (b) Costs not eligible for reimbursement under this program 
151.35  include: 
151.36     (1) recurring costs of school district staff providing 
152.1   network infrastructure support; 
152.2      (2) recurring costs associated with voice and standard 
152.3   telephone service; 
152.4      (3) costs associated with purchase of network hardware, 
152.5   telephones, computers, or other peripheral equipment needed to 
152.6   deliver telecommunications access to the school or school 
152.7   district; 
152.8      (4) costs associated with laying fiber for 
152.9   telecommunications access; 
152.10     (5) costs associated with wiring school or school district 
152.11  buildings; 
152.12     (6) costs associated with purchase, installation, or 
152.13  purchase and installation of Internet filtering; and 
152.14     (7) costs associated with digital content, including online 
152.15  learning or distance learning programming, and information 
152.16  databases. 
152.17     Subd. 2.  [E-RATES.] To be eligible for aid under this 
152.18  section, a district or charter school is required to file an 
152.19  e-rate application either separately or through its 
152.20  telecommunications access cluster and have a current technology 
152.21  plan on file with the department.  Discounts received on 
152.22  telecommunications expenditures shall be reflected in the costs 
152.23  submitted to the department for aid under this section. 
152.24     Subd. 3.  [REIMBURSEMENT CRITERIA.] The commissioner shall 
152.25  develop criteria for approving costs submitted by organized 
152.26  school districts and charter schools under subdivision 1. 
152.27     Subd. 4.  [DISTRICT AID.] For fiscal year 2006 and later, a 
152.28  district or charter school's Internet access equity aid equals 
152.29  the district or charter school's approved cost for the previous 
152.30  fiscal year according to subdivision 1 exceeding $15 times the 
152.31  district's adjusted marginal cost pupil units for the previous 
152.32  fiscal year or no reduction if the district is part of an 
152.33  organized telecommunications access cluster.  Equity aid must be 
152.34  distributed to the telecommunications access cluster for 
152.35  districts that are members of the cluster or to individual 
152.36  districts and charter schools not part of a telecommunications 
153.1   access cluster.  
153.2      Subd. 5.  [TELECOMMUNICATIONS/INTERNET ACCESS SERVICES FOR 
153.3   NONPUBLIC SCHOOLS.] (a) Districts shall provide each year upon 
153.4   formal request by or on behalf of a nonpublic school, not 
153.5   including home schools, located in that district or area, 
153.6   ongoing or recurring telecommunications access services to the 
153.7   nonpublic school either through existing district providers or 
153.8   through separate providers. 
153.9      (b) The amount of district aid for telecommunications 
153.10  access services for each nonpublic school under this subdivision 
153.11  equals the lesser of: 
153.12     (1) 90 percent of the nonpublic school's approved cost for 
153.13  the previous fiscal year according to subdivision 1 exceeding 
153.14  $10 for fiscal year 2006 and later times the number of weighted 
153.15  pupils enrolled at the nonpublic school as of October 1 of the 
153.16  previous school year; or 
153.17     (2) the product of the district's aid per pupil unit 
153.18  according to subdivision 4 times the number of weighted pupils 
153.19  enrolled at the nonpublic school as of October 1 of the previous 
153.20  school year. 
153.21     (c) For purposes of this subdivision, nonpublic school 
153.22  pupils shall be weighted by grade level using the weighting 
153.23  factors defined in section 126C.05, subdivision 1. 
153.24     (d) Each year, a district providing services under 
153.25  paragraph (a) may claim up to five percent of the aid determined 
153.26  in paragraph (b) for costs of administering this subdivision.  
153.27  No district may expend an amount for these telecommunications 
153.28  access services which exceeds the amount allocated under this 
153.29  subdivision.  The nonpublic school is responsible for the 
153.30  Internet access costs not covered by this section. 
153.31     (e) At the request of a nonpublic school, districts may 
153.32  allocate the amount determined in paragraph (b) directly to the 
153.33  nonpublic school to pay for or offset the nonpublic school's 
153.34  costs for telecommunications access services; however, the 
153.35  amount allocated directly to the nonpublic school may not exceed 
153.36  the actual amount of the school's ongoing or recurring 
154.1   telecommunications access costs. 
154.2      Subd. 6.  [SEVERABILITY.] If any portion of this section is 
154.3   found by a court to be unconstitutional, the remaining portions 
154.4   of the section shall remain in effect. 
154.5      <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
154.6   fiscal year 2006. 
154.7      Sec. 10.  Minnesota Statutes 2004, section 126C.17, 
154.8   subdivision 11, is amended to read: 
154.9      Subd. 11.  [REFERENDUM DATE.] (a) Except for a referendum 
154.10  held under paragraph (b) or (d), any referendum under this 
154.11  section held on a day other than the first Tuesday after the 
154.12  first Monday in November must be conducted by mail in accordance 
154.13  with section 204B.46.  Notwithstanding subdivision 9, paragraph 
154.14  (b), to the contrary, in the case of a referendum conducted by 
154.15  mail under this paragraph, the notice required by subdivision 9, 
154.16  paragraph (b), must be prepared and delivered by first-class 
154.17  mail at least 20 days before the referendum. 
154.18     (b) In addition to the referenda allowed in subdivision 9, 
154.19  clause (a), the commissioner may grant authority to a district 
154.20  to hold a referendum on a different day if the district is in 
154.21  statutory operating debt and has an approved plan or has 
154.22  received an extension from the department to file a plan to 
154.23  eliminate the statutory operating debt.  
154.24     (c) The commissioner must approve, deny, or modify each 
154.25  district's request for a referendum levy on a different day 
154.26  within 60 days of receiving the request from a district. 
154.27     (d) In addition to the referenda allowed in subdivision 9, 
154.28  paragraph (a), a district may hold a referendum on the same day 
154.29  as a district election for a facility under chapter 475 if the 
154.30  referendum is directly related to the operating costs of the 
154.31  proposed facility except for licensed personnel costs. 
154.32     <b>[EFFECTIVE DATE.]</b> This section is effective for referenda 
154.33  held on or after July 1, 2005. 
154.34     Sec. 11.  Minnesota Statutes 2004, section 126C.63, 
154.35  subdivision 5, is amended to read: 
154.36     Subd. 5.  [LEVY.] "Levy" means a district's net debt 
155.1   service levy after the reduction of debt service equalization 
155.2   aid under section 123B.53, subdivision 6.  For taxes payable in 
155.3   2003 and later, each district's maximum effort debt service levy 
155.4   for purposes of subdivision 8, must be reduced by an equal 
155.5   number of percentage points if the commissioner of finance 
155.6   determines that the levy reduction will not result in a payment 
155.7   from the general fund in the state treasury according to section 
155.8   16A.641, as would be required under section 126C.72, subdivision 
155.9   3.  A district's levy that is adjusted under this section must 
155.10  not be reduced below 30.1 25 percent of the district's adjusted 
155.11  net tax capacity. 
155.12     Sec. 12.  Minnesota Statutes 2004, section 126C.63, 
155.13  subdivision 8, is amended to read: 
155.14     Subd. 8.  [MAXIMUM EFFORT DEBT SERVICE LEVY.] (a) "Maximum 
155.15  effort debt service levy" means the lesser of: 
155.16     (1) a levy in whichever of the following amounts is 
155.17  applicable: 
155.18     (i) in any district receiving a debt service loan for a 
155.19  debt service levy payable in 2002 and thereafter, or granted a 
155.20  capital loan after January 1, 2002, a levy in total dollar 
155.21  amount computed at a rate of 40 32 percent of adjusted net tax 
155.22  capacity for taxes payable in 2002 and thereafter; 
155.23     (ii) in any district receiving a debt service loan for a 
155.24  debt service levy payable in 2001 or earlier, or granted a 
155.25  capital loan before January 2, 2001 2002, a levy in a total 
155.26  dollar amount computed at a rate of 32 28 percent of adjusted 
155.27  net tax capacity for taxes payable in 2002 and thereafter; or 
155.28     (2) a levy in any district for which a capital loan was 
155.29  approved prior to August 1, 1981, a levy in a total dollar 
155.30  amount equal to the sum of the amount of the required debt 
155.31  service levy and an amount which when levied annually will in 
155.32  the opinion of the commissioner be sufficient to retire the 
155.33  remaining interest and principal on any outstanding loans from 
155.34  the state within 30 years of the original date when the capital 
155.35  loan was granted.  
155.36     (b) The board in any district affected by the provisions of 
156.1   paragraph (a), clause (2), may elect instead to determine the 
156.2   amount of its levy according to the provisions of paragraph (a), 
156.3   clause (1).  If a district's capital loan is not paid within 30 
156.4   years because it elects to determine the amount of its levy 
156.5   according to the provisions of paragraph (a), clause (2), the 
156.6   liability of the district for the amount of the difference 
156.7   between the amount it levied under paragraph (a), clause (2), 
156.8   and the amount it would have levied under paragraph (a), clause 
156.9   (1), and for interest on the amount of that difference, must not 
156.10  be satisfied and discharged pursuant to Minnesota Statutes 1988, 
156.11  or an earlier edition of Minnesota Statutes if applicable, 
156.12  section 124.43, subdivision 4. 
156.13     Sec. 13.  Minnesota Statutes 2004, section 128C.12, 
156.14  subdivision 1, is amended to read: 
156.15     Subdivision 1.  [DUES AND EVENTS REVENUE.] (a) The state 
156.16  auditor annually must examine the accounts of, and audit all 
156.17  money paid to, the State High School League by its members.  The 
156.18  audit must include financial and compliance issues.  The state 
156.19  auditor audit must also audit include all money derived from any 
156.20  event sponsored by the league.  League audits must include 
156.21  audits of administrative regions of the league.  The league and 
156.22  its administrative regions may not contract with private 
156.23  auditors.  The scope of the state auditor's examinations of the 
156.24  league must be agreed upon by the board and the state auditor, 
156.25  provided that all requirements of this section must be met. 
156.26     (b) The administrative regions of the league may contract 
156.27  with the state auditor or with a private certified public 
156.28  accountant for the audit required by this section.  If the audit 
156.29  is performed by a private certified public accountant, the state 
156.30  auditor may require additional information from the private 
156.31  certified public accountant as the state auditor deems in the 
156.32  public interest.  The state auditor may accept the audit or make 
156.33  additional examinations as the state auditor deems to be in the 
156.34  public interest. 
156.35     Sec. 14.  Minnesota Statutes 2004, section 128C.12, 
156.36  subdivision 3, is amended to read: 
157.1      Subd. 3.  [COPIES.] The state auditor board must file 
157.2   copies of the financial and compliance audit report with the 
157.3   commissioner of education and the director of the Legislative 
157.4   Reference Library. 
157.5      Sec. 15.  Minnesota Statutes 2004, section 128D.11, 
157.6   subdivision 9, is amended to read: 
157.7      Subd. 9.  [NET DEBT DEFINED.] The net debt of the school 
157.8   district for the purposes of this limitation is the amount of 
157.9   bonds less the amount of all money and the face value of all 
157.10  securities then held as a sinking fund for the payment of such 
157.11  bonds, and shall not include school aid and tax anticipation 
157.12  certificates of indebtedness not in default or bonds issued to 
157.13  pay pension fund liabilities under section 475.52, subdivision 6.
157.14     Sec. 16.  Minnesota Statutes 2004, section 475.61, 
157.15  subdivision 4, is amended to read: 
157.16     Subd. 4.  [SURPLUS FUNDS.] (a) All such taxes shall be 
157.17  collected and remitted to the municipality by the county 
157.18  treasurer as other taxes are collected and remitted, and shall 
157.19  be used only for payment of the obligations on account of which 
157.20  levied or to repay advances from other funds used for such 
157.21  payments, except that any surplus remaining in the debt service 
157.22  fund when the obligations and interest thereon are paid may be 
157.23  appropriated to any other general purpose by the municipality.  
157.24  However, for obligations authorized before July 1, 2005, the 
157.25  amount of any surplus remaining in the debt service fund of a 
157.26  school district when the obligations and interest thereon are 
157.27  paid shall be used to reduce the general fund levy levies 
157.28  authorized pursuant to chapters 122A, 123A, 123B, 124D, and 126C 
157.29  and the state aids authorized pursuant to chapters 122A, 123A, 
157.30  123B, 124D, 125A, 126C, and 127A.  For obligations authorized on 
157.31  July 1, 2005, or thereafter, the amount of any surplus remaining 
157.32  in the debt service fund of a school district when the 
157.33  obligations and interest thereon are paid in full may be 
157.34  appropriated to any other general purpose by the school district 
157.35  without any reduction in state aid or levies or may be used to 
157.36  reduce the general fund levies authorized under chapters 122A, 
158.1   123A, 123B, 124D, and 126C, and the state aids authorized under 
158.2   chapters 122A, 123A, 123B, 124D, 125A, 126C, and 127A. 
158.3      (b) If the district qualified for second tier debt service 
158.4   equalization aid in the last year that it qualified for debt 
158.5   service equalization aid, the reduction to state aids equals the 
158.6   lesser of (1) the amount of the surplus times the ratio of the 
158.7   district's second tier debt service equalization aid to the 
158.8   district's second tier debt service equalization revenue for the 
158.9   last year that the district qualified for debt service 
158.10  equalization aid; or (2) the district's cumulative amount of 
158.11  debt service equalization aid. 
158.12     (c) If the district did not qualify for second tier debt 
158.13  service equalization aid in the last year that it qualified for 
158.14  debt service equalization aid, the reduction to state aids 
158.15  equals the lesser of (1) the amount of the surplus times the 
158.16  ratio of the district's debt service equalization aid to the 
158.17  district's debt service equalization revenue for the last year 
158.18  that the district qualified for debt service equalization aid; 
158.19  or (2) the district's cumulative amount of debt service 
158.20  equalization aid.  
158.21     (d) The reduction to the general fund levy levies equals 
158.22  the total amount of the surplus minus the reduction to state 
158.23  aids. 
158.24     Sec. 17.  Laws 1996, chapter 412, article 5, section 24, is 
158.25  amended to read: 
158.26     Sec. 24.  [BONDS PAID FROM TACONITE PRODUCTION TAX 
158.27  REVENUES.] 
158.28     Subdivision 1.  [REFUNDING BONDS.] The appropriation of 
158.29  funds from the distribution of taconite production tax revenues 
158.30  to the taconite environmental protection tax fund and the 
158.31  northeast Minnesota economic protection fund made by Laws 1988, 
158.32  chapter 718, article 7, sections 62 and 63, Laws 1989, chapter 
158.33  329, article 5, section 20, Laws 1990, chapter 604, article 8, 
158.34  section 13, Laws 1992, chapter 499, article 5, section 29, and 
158.35  by sections 18 to 20 Laws 1996, chapter 412, article 5, sections 
158.36  20 to 22, and Laws 2000, chapter 489, article 5, sections 24 to 
159.1   26, shall continue to apply to bonds issued under Minnesota 
159.2   Statutes, chapter 475, to refund bonds originally issued 
159.3   pursuant to those chapters. 
159.4      Subd. 2.  [LOCAL PAYMENTS.] School districts that are 
159.5   required in Laws 1988, chapter 718, article 7, sections 62 and 
159.6   63, Laws 1989, chapter 329, article 5, section 20, Laws 1990, 
159.7   chapter 604, article 8, section 13, Laws 1992, chapter 499, 
159.8   article 5, section 29, and by sections 18 to 20 Laws 1996, 
159.9   chapter 412, article 5, sections 20 to 22, and Laws 2000, 
159.10  chapter 489, article 5, sections 24 to 26, to impose levies to 
159.11  pay debt service on the bonds issued under those provisions to 
159.12  the extent the principal and interest on the bonds is not paid 
159.13  by distributions from the taconite environmental protection fund 
159.14  and the northeast Minnesota economic protection trust, may pay 
159.15  their portion of the principal and interest from any funds 
159.16  available to them.  To the extent a school district uses funds 
159.17  other than the proceeds of a property tax levy to pay its share 
159.18  of the principal and interest on the bonds, the requirement to 
159.19  impose a property tax to pay the local share does not apply to 
159.20  the school district. 
159.21     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
159.22  following final enactment. 
159.23     Sec. 18.  Laws 2003, First Special Session chapter 9, 
159.24  article 4, section 29, as amended by Laws 2003, First Special 
159.25  Session chapter 23, section 18, is amended to read: 
159.26     Sec. 29.  [GARAGE LEASE LEVY; SARTELL.] 
159.27     For taxes payable in 2004, 2005, and 2006, and 2007, 
159.28  independent school district No. 740 748, Sartell, may levy up to 
159.29  $107,000 each year and for taxes payable in 2008 may levy up to 
159.30  $67,000 for the purpose of leasing a school bus storage 
159.31  facility.  The department of education shall include this levy 
159.32  in the calculation of eligible building lease levy under 
159.33  Minnesota Statutes, section 126C.40, subdivision 1.  This levy 
159.34  shall not allow the district to exceed the $90 per resident 
159.35  pupil unit cap in that section.  The district is eligible to 
159.36  make this levy only if it sells its current school bus storage 
160.1   site to the city of Sartell and the district may not use this 
160.2   levy as part of a lease purchase agreement to replace its 
160.3   current school bus storage facility. 
160.4      Sec. 19.  2005 S.F. No. 1879, article 3, section 3, 
160.5   subdivision 41, if enacted, is amended to read: 
160.6      Subd. 41.  [DEBT SERVICE EQUALIZATION.] For debt service 
160.7   aid according to Minnesota Statutes, section 123B.53, 
160.8   subdivision 6: 
160.9        $25,654,000    .....     2006 
160.10       $24,611,000 24,519,000    .....     2007 
160.11     The 2006 appropriation includes $4,654,000 for 2005 and 
160.12  $21,000,000 for 2006. 
160.13     The 2007 appropriation includes $3,911,000 for 2006 and 
160.14  $20,700,000 20,608,000 for 2007. 
160.15     Sec. 20.  [HEALTH AND SAFETY REVENUE; NEW ULM.] 
160.16     Notwithstanding Minnesota Statutes, section 123B.57, 
160.17  subdivision 6, Independent School District No. 88, New Ulm, may 
160.18  use health and safety revenue to construct appurtenances used 
160.19  exclusively to house and maintain mechanical air handling 
160.20  systems that maintain the air quality necessary for a healthy 
160.21  environment. 
160.22     <b>[EFFECTIVE DATE.]</b> This section is effective retroactively 
160.23  from January 1, 2004. 
160.24     Sec. 21.  [DISABLED ACCESS LEVY AUTHORITY; EAST GRAND 
160.25  FORKS.] 
160.26     Notwithstanding the time limits established in Minnesota 
160.27  Statutes, section 123B.58, subdivision 3, Independent School 
160.28  District No. 595, East Grand Forks, may levy its remaining 
160.29  disabled access levy authority over five or fewer years. 
160.30     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
160.31  following final enactment. 
160.32     Sec. 22.  [TAX BASE ADJUSTMENTS, FERTILE-BELTRAMI.] 
160.33     (a) Notwithstanding Minnesota Statutes, section 123B.61, 
160.34  the commissioner of education, when making offsetting levy 
160.35  adjustments between levy categories to ensure that each levy 
160.36  category is positive for Independent School District No. 599, 
161.1   Fertile-Beltrami, shall make such adjustments first between levy 
161.2   categories that are imposed on identical tax bases before making 
161.3   such adjustments between levy categories that are imposed on 
161.4   different tax bases.  The commissioner may make offsetting levy 
161.5   adjustments between the general fund and the debt service fund, 
161.6   if necessary. 
161.7      (b) The commissioner of education must make the offsetting 
161.8   levy adjustments according to the process in paragraph (a) until 
161.9   Independent School District No. 599, Fertile-Beltrami's current 
161.10  referendum authority, under Minnesota Statutes, section 126C.17, 
161.11  expires. 
161.12     Sec. 23.  [RESIDENTIAL PROGRAM FACILITIES; WORTHINGTON.] 
161.13     Subject to Minnesota Statutes, section 16A.695, Independent 
161.14  School District No. 518, Worthington, may use the facilities 
161.15  provided under Laws 1994, chapter 643, section 14, subdivision 
161.16  8, as amended by Laws 1995, chapter 76, to provide adult foster 
161.17  care or child foster care services licensed by the commissioner 
161.18  of human services or for other special education purposes. 
161.19     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
161.20  following final enactment. 
161.21     Sec. 24.  [FUND TRANSFERS.] 
161.22     Subdivision 1.  [BUTTERFIELD.] Notwithstanding Minnesota 
161.23  Statutes, section 123B.79 or 123B.80, for calendar years 2005 
161.24  through 2007, on June 30 of each year, Independent School 
161.25  District No. 836, Butterfield, may permanently transfer up to 
161.26  $50,000 from its reserved operating capital account in its 
161.27  general fund to its undesignated general fund balance and 
161.28  $60,000 from its reserved bus purchase account in its general 
161.29  fund to its undesignated general fund balance.  The total amount 
161.30  transferred for the three-year period must not total more than 
161.31  $50,000 from the reserved operating capital account and $60,000 
161.32  from the reserved bus purchase account. 
161.33     Subd. 2.  [CHOKIO-ALBERTA.] Notwithstanding Minnesota 
161.34  Statutes, section 123B.79 or 123B.80, on June 30, 2005, 
161.35  Independent School District No. 771, Chokio-Alberta, may 
161.36  permanently transfer up to $150,000 from its reserved operating 
162.1   capital account and up to $50,000 from its reserved account for 
162.2   disabled accessibility to the undesignated general fund balance. 
162.3      Subd. 3.  [CLINTON-GRACEVILLE-BEARDSLEY.] Notwithstanding 
162.4   Minnesota Statutes, sections 123B.79, 123B.80, and 475.64, 
162.5   subdivision 4, on June 30, 2005, Independent School District No. 
162.6   2888, Clinton-Graceville-Beardsley may permanently transfer up 
162.7   to $244,000 from its reserved for disabled accessibility account 
162.8   to its unrestricted general fund account without making a levy 
162.9   reduction. 
162.10     Subd. 4.  [HASTINGS.] Notwithstanding Minnesota Statutes, 
162.11  section 123A.27, on June 30, 2005, Independent School District 
162.12  No. 200, Hastings, may permanently transfer up to $300,000 from 
162.13  its reserved account for instructional services from entities 
162.14  formed for cooperative services for special education and 
162.15  secondary vocational programs in its general fund to its 
162.16  unrestricted general fund account. 
162.17     Subd. 5.  [LAKE CRYSTAL-WELLCOME MEMORIAL.] Notwithstanding 
162.18  Minnesota Statutes, section 123B.79 or 123B.80, on June 30, 
162.19  2005, upon approval of the commissioner of education, 
162.20  Independent School District No. 2071, Lake Crystal-Wellcome 
162.21  Memorial, may permanently transfer up to $133,000 from its 
162.22  reserved account for handicapped access to its undesignated 
162.23  general fund balance. 
162.24     Subd. 6.  [M.A.C.C.R.A.Y.] Notwithstanding Minnesota 
162.25  Statutes, section 123B.79 or 123B.80, upon approval of the 
162.26  commissioner of education, on June 30, 2005, Independent School 
162.27  District No. 2180, M.A.C.C.R.A.Y., may permanently transfer up 
162.28  to $230,000 from its reserved account for handicapped access to 
162.29  its undesignated general fund balance. 
162.30     Subd. 7.  [MCLEOD WEST.] Notwithstanding Minnesota 
162.31  Statutes, section 123B.79 or 123B.80, on or before June 30, 
162.32  2007, Independent School District No. 2887, McLeod West, may 
162.33  permanently transfer up to $200,000 from its reserved operating 
162.34  capital account in its general fund to the undesignated fund 
162.35  balance. 
162.36     Subd. 8.  [RUSSELL.] Notwithstanding Minnesota Statutes, 
163.1   section 123B.79 or 123B.80, on June 30, 2005, Independent School 
163.2   District No. 418, Russell, may transfer up to $50,000 from its 
163.3   reserved capital accounts in its general fund to its 
163.4   undesignated fund balance. 
163.5      Subd. 9.  [RUTHTON.] Notwithstanding Minnesota Statutes, 
163.6   section 123B.79 or 123B.80, on June 30, 2005, Independent School 
163.7   District No. 584, Ruthton, may permanently transfer up to 
163.8   $140,000 from its reserved for operating capital account to the 
163.9   undesignated general fund balance. 
163.10     Subd. 10.  [WINDOM.] Notwithstanding Minnesota Statutes, 
163.11  sections 123B.79 and 123B.80, on June 30, 2005, Independent 
163.12  School District No. 177, Windom, may permanently transfer up to 
163.13  $270,000 from its reserved for operating capital account to the 
163.14  undesignated balance in its general fund.  
163.15     Subd. 11.  [WIN-E-MAC.] Notwithstanding Minnesota Statutes, 
163.16  section 123B.79 or 123B.80, on June 30, 2005, Independent School 
163.17  District No. 2609, Win-E-Mac, may permanently transfer up to 
163.18  $87,000 from its reserved account for disabled accessibility to 
163.19  its reserved operating capital account in its general fund. 
163.20     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
163.21  following final enactment. 
163.22     Sec. 25.  [STUDY OF AVERAGE SCHOOL CONSTRUCTION COSTS.] 
163.23     The commissioner shall submit a report by January 15, 2006, 
163.24  to the house of representatives and senate committees having 
163.25  jurisdiction over education finance on the costs of construction 
163.26  of new school facilities as defined in Minnesota Statutes, 
163.27  section 120A.05, including elementary school, middle school, 
163.28  secondary school, or prekindergarten through grade 12 
163.29  facilities.  The commissioner shall review the ranges in costs 
163.30  per square foot of new school construction that received a 
163.31  positive review and comment during the period July 1, 2002, to 
163.32  June 30, 2005, and shall evaluate the specific reasons for those 
163.33  ranges in costs. 
163.34     Sec. 26.  [APPROPRIATIONS.] 
163.35     Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
163.36  indicated in this section are appropriated from the general fund 
164.1   to the Department of Education for the fiscal years designated.  
164.2      Subd. 2.  [EQUITY IN TELECOMMUNICATIONS ACCESS.] For equity 
164.3   in telecommunications access: 
164.4        $5,000,000       .....     2006 
164.5        $5,000,000       .....     2007 
164.6      If the appropriation amount is insufficient, the 
164.7   commissioner shall reduce the reimbursement rate in Minnesota 
164.8   Statutes, section 125B.26, subdivisions 4 and 5, and the revenue 
164.9   for the fiscal years 2006 and 2007 shall be prorated.  The base 
164.10  for this program in fiscal year 2008 and later is $10,000,000.  
164.11  Any balance in the first year does not cancel but is available 
164.12  in the second year. 
164.13     Subd. 3.  [EMERGENCY AID, RED LAKE.] For Independent School 
164.14  District No. 38, Red Lake, for onetime emergency aid to repair 
164.15  infrastructure damage to the Red Lake High School as a result of 
164.16  the March 21, 2005, school shooting:  
164.17       $  100,000       .....     2006
164.18     The school district must submit proposed expenditures for 
164.19  these funds for review and comment approval under Minnesota 
164.20  Statutes, section 123B.71, before the commissioner releases the 
164.21  funds to the district. 
164.22     Sec. 27.  [REPEALER.] 
164.23     Minnesota Statutes 2004, section 128C.12, subdivision 4, is 
164.24  repealed. 
164.25     <b>[EFFECTIVE DATE.]</b> This section is effective for revenue for 
164.26  fiscal year 2006. 
164.27                             ARTICLE 5 
164.28                             NUTRITION 
164.29     Section 1.  Minnesota Statutes 2004, section 124D.111, 
164.30  subdivision 1, is amended to read: 
164.31     Subdivision 1.  [SCHOOL LUNCH AID COMPUTATION.] Each school 
164.32  year, the state must pay districts participating in the national 
164.33  school lunch program the amount of eight ten cents for each full 
164.34  paid, reduced, and free student lunch served to students in the 
164.35  district. 
164.36     Sec. 2.  Minnesota Statutes 2004, section 124D.118, 
165.1   subdivision 4, is amended to read: 
165.2      Subd. 4.  [REIMBURSEMENT.] In accordance with program 
165.3   guidelines, the commissioner shall reimburse each participating 
165.4   public or nonpublic school nine 14 cents for each half-pint of 
165.5   milk that is served to kindergarten students and is not part of 
165.6   a school lunch or breakfast reimbursed under section 124D.111 or 
165.7   124D.1158. 
165.8      Sec. 3.  2005 S.F. No. 1879, article 3, section 3, 
165.9   subdivision 43, if enacted, is amended to read: 
165.10     Subd. 43.  [SCHOOL LUNCH.] For school lunch aid according 
165.11  to Minnesota Statutes, section 124D.111, and Code of Federal 
165.12  Regulations, title 7, section 210.17:  
165.13       $7,748,000 9,585,000     .....     2006 
165.14       $7,826,000 9,781,000     .....     2007 
165.15     Sec. 4.  2005 S.F. No. 1879, article 3, section 3, 
165.16  subdivision 44, if enacted, is amended to read: 
165.17     Subd. 44.  [TRADITIONAL SCHOOL BREAKFAST; MILK FOR 
165.18  KINDERGARTENERS.] For traditional school breakfast aid under 
165.19  Minnesota Statutes, section 124D.1158 and milk for 
165.20  kindergarteners under Minnesota Statutes, section 124D.118: 
165.21       $4,634,000 4,878,000     .....     2006 
165.22       $4,723,000 4,968,000     .....     2007 
165.23     Sec. 5.  [MILK CONSUMPTION PILOT PROGRAM.] 
165.24     Independent School District No. 11, Anoka-Hennepin, and 
165.25  Independent School District No. 709, Duluth, are each eligible 
165.26  to receive $25,000 in fiscal year 2006 to establish a pilot 
165.27  program to enhance milk consumption in the schools.  The funds 
165.28  must be used by the districts to enhance the attractiveness of 
165.29  consuming milk to students in both the school lunch and a la 
165.30  carte programs, including, at a minimum, improving 
165.31  refrigeration, purchasing products or packaging not previously 
165.32  available, and upgrading quality of products previously 
165.33  supplied.  The pilot program must be implemented during the 
165.34  2005-2006 school year.  Each district must develop a plan to 
165.35  implement the pilot program.  The plan must be developed by 
165.36  district food service personnel, the dairy which is contracted 
166.1   to provide milk to the districts' schools, and representatives 
166.2   of the Midwest Dairy Association and the Midwest Dairy Council.  
166.3   The plan must be submitted to the Department of Education by 
166.4   August 15, 2005.  Additional funds for the program may be sought 
166.5   from interested individuals and organizations.  Each eligible 
166.6   school district must report to the house of representatives and 
166.7   senate committees having jurisdiction over kindergarten through 
166.8   grade 12 education funding and agriculture funding by October 
166.9   15, 2006.  The report should include statistics on the prior 
166.10  year's consumption in the district, the various methods chosen 
166.11  to enhance consumption, and the results of those methods. 
166.12     Sec. 6.  [APPROPRIATIONS.] 
166.13     Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
166.14  indicated in this section are appropriated from the general fund 
166.15  to the Department of Education for the fiscal years designated. 
166.16     Subd. 2.  [MILK CONSUMPTION PILOT PROGRAM.] For milk 
166.17  consumption pilot program grants: 
166.18       $  50,000      .....     2006 
166.19                             ARTICLE 6 
166.20                           STATE AGENCIES 
166.21     Section 1.  2005 S.F. No. 1879, article 3, section 3, 
166.22  subdivision 50, if enacted, is amended to read: 
166.23     Subd. 50.  [DEPARTMENT.] (a) For the Department of 
166.24  Education: 
166.25       $21,772,000 21,411,000    .....     2006 
166.26       $21,772,000 22,696,000    .....     2007 
166.27     Any balance in the first year does not cancel but is 
166.28  available in the second year. 
166.29     (b) $260,000 each year is for the Minnesota Children's 
166.30  Museum. 
166.31     (c) $41,000 each year is for the Minnesota Academy of 
166.32  Science. 
166.33     (d) $621,000 each year is for the Board of Teaching. 
166.34     (e) $165,000 each year is for the Board of School 
166.35  Administrators. 
166.36     (f) $29,000 each year is for Minnesota's Washington, D.C., 
167.1   office None of the amounts appropriated under this subdivision 
167.2   may be used for Minnesota's Washington, D.C., office. 
167.3      (g) None of the amounts appropriated under this subdivision 
167.4   or any federal funds may be used for the communications function 
167.5   within the Office of Finance and Administration.  The Department 
167.6   of Education shall not relocate or rename this function to avoid 
167.7   making this reduction. 
167.8      (h) $128,000 each year is for the funding of a world 
167.9   languages coordinator in the Department of Education. 
167.10     (i) $50,000 in fiscal year 2006 and $75,000 in fiscal year 
167.11  2007 is for the development and distribution to school districts 
167.12  of materials addressing the dangers of methamphetamine. 
167.13     (j) $300,000 in fiscal year 2006 and $1,600,000 in fiscal 
167.14  year 2007 and later are for value-added index assessment model. 
167.15     (k) The base in fiscal year 2008 and later for the 
167.16  Department of Education shall be $22,804,000. 
167.17     Sec. 2.  2005 S.F. No. 1879, article 3, section 4, if 
167.18  enacted, is amended to read:  
167.19     Sec. 3.  [APPROPRIATIONS; MINNESOTA STATE ACADEMIES.] 
167.20     The sums indicated in this section are appropriated from 
167.21  the general fund to the Minnesota State Academies for the Deaf 
167.22  and the Blind for the fiscal years designated:  
167.23       $10,466,000 10,878,000    .....     2006 
167.24       $10,466,000 10,953,000    .....     2007 
167.25     Any balance in the first year does not cancel but is 
167.26  available in the second year. 
167.27     Sec. 4.  2005 S.F. No. 1879, article 3, section 5, if 
167.28  enacted, is amended to read:  
167.29     Sec. 5.  [APPROPRIATIONS; PERPICH CENTER FOR ARTS 
167.30  EDUCATION.] 
167.31     The sums indicated in this section are appropriated from 
167.32  the general fund to the Perpich Center for Arts Education for 
167.33  the fiscal years designated: 
167.34       $6,423,000 6,424,000     .....     2006 
167.35       $6,423,000 6,422,000     .....     2007 
167.36     Any balance in the first year does not cancel but is 
168.1   available in the second year.  The base appropriation for fiscal 
168.2   year 2008 and later is $6,672,000. 
168.3      Sec. 6.  [USE OF FEDERAL FUNDS.] 
168.4      Subdivision 1.  [FEDERAL GRANTS AND AIDS.] The expenditures 
168.5   of federal grants and aids as shown in the biennial budget 
168.6   document and its supplements are approved and appropriated and 
168.7   shall be spent as indicated. 
168.8      Subd. 2.  [EXCEPTIONS.] (a) Notwithstanding subdivision 1, 
168.9   the following grants and aids are appropriated as indicated in 
168.10  this section. 
168.11     (b) Ninety-five percent of the improving teacher quality 
168.12  state grant is appropriated for the professional compensation 
168.13  initiative under Minnesota Statutes, section 122A.4142. 
168.14     (c) $200,000 of the twenty-first century community learning 
168.15  centers funds is appropriated to the summit academy for the 
168.16  quantum opportunities program. 
168.17     (d) $500,000 of the improving teacher quality state grant 
168.18  is appropriated for the principals' leadership institute under 
168.19  Minnesota Statutes, section 122A.74.  This appropriation is not 
168.20  available until the commissioner of education has determined 
168.21  that an equal amount has been committed for the operation of the 
168.22  institute from nonstate sources and the programmatic elements 
168.23  are sufficiently reflective of the goals the state has 
168.24  established for principals. 
168.25                             ARTICLE 7 
168.26                TECHNICAL AND CONFORMING AMENDMENTS 
168.27     Section 1.  Minnesota Statutes 2004, section 120B.31, 
168.28  subdivision 4, is amended to read: 
168.29     Subd. 4.  [STATISTICAL ADJUSTMENTS.] In developing policies 
168.30  and assessment processes to hold schools and districts 
168.31  accountable for high levels of academic standards, including the 
168.32  profile of learning under section 120B.021, the commissioner 
168.33  shall aggregate student data over time to report student 
168.34  performance levels measured at the school district, regional, or 
168.35  statewide level.  When collecting and reporting the data, the 
168.36  commissioner shall:  (1) acknowledge the impact of significant 
169.1   demographic factors such as residential instability, the number 
169.2   of single parent families, parents' level of education, and 
169.3   parents' income level on school outcomes; and (2) organize and 
169.4   report the data so that state and local policy makers can 
169.5   understand the educational implications of changes in districts' 
169.6   demographic profiles over time.  Any report the commissioner 
169.7   disseminates containing summary data on student performance must 
169.8   integrate student performance and the demographic factors that 
169.9   strongly correlate with that performance.  
169.10     Sec. 2.  Minnesota Statutes 2004, section 121A.41, 
169.11  subdivision 10, is amended to read: 
169.12     Subd. 10.  [SUSPENSION.] "Suspension" means an action by 
169.13  the school administration, under rules promulgated by the school 
169.14  board, prohibiting a pupil from attending school for a period of 
169.15  no more than ten school days.  If a suspension is longer than 
169.16  five days, the suspending administrator must provide the 
169.17  superintendent with a reason for the longer suspension.  This 
169.18  definition does not apply to dismissal from school for one 
169.19  school day or less, except as provided in federal law for a 
169.20  student with a disability.  Each suspension action may include a 
169.21  readmission plan.  The readmission plan shall include, where 
169.22  appropriate, a provision for implementing alternative 
169.23  educational services upon readmission and may not be used to 
169.24  extend the current suspension.  Consistent with section 
169.25  125A.09 125A.091, subdivision 3 5, the readmission plan must not 
169.26  obligate a parent to provide a sympathomimetic medication for 
169.27  the parent's child as a condition of readmission.  The school 
169.28  administration may not impose consecutive suspensions against 
169.29  the same pupil for the same course of conduct, or incident of 
169.30  misconduct, except where the pupil will create an immediate and 
169.31  substantial danger to self or to surrounding persons or 
169.32  property, or where the district is in the process of initiating 
169.33  an expulsion, in which case the school administration may extend 
169.34  the suspension to a total of 15 days.  In the case of a student 
169.35  with a disability, the student's individual education plan team 
169.36  must meet immediately but not more than ten school days after 
170.1   the date on which the decision to remove the student from the 
170.2   student's current education placement is made.  The individual 
170.3   education plan team and other qualified personnel shall at that 
170.4   meeting:  conduct a review of the relationship between the 
170.5   child's disability and the behavior subject to disciplinary 
170.6   action; and determine the appropriateness of the child's 
170.7   education plan. 
170.8      The requirements of the individual education plan team 
170.9   meeting apply when: 
170.10     (1) the parent requests a meeting; 
170.11     (2) the student is removed from the student's current 
170.12  placement for five or more consecutive days; or 
170.13     (3) the student's total days of removal from the student's 
170.14  placement during the school year exceed ten cumulative days in a 
170.15  school year.  The school administration shall implement 
170.16  alternative educational services when the suspension exceeds 
170.17  five days.  A separate administrative conference is required for 
170.18  each period of suspension. 
170.19     Sec. 3.  Minnesota Statutes 2004, section 124D.10, 
170.20  subdivision 8, is amended to read: 
170.21     Subd. 8.  [STATE AND LOCAL REQUIREMENTS.] (a) A charter 
170.22  school shall meet all applicable state and local health and 
170.23  safety requirements. 
170.24     (b) A school sponsored by a school board may be located in 
170.25  any district, unless the school board of the district of the 
170.26  proposed location disapproves by written resolution.  
170.27     (c) A charter school must be nonsectarian in its programs, 
170.28  admission policies, employment practices, and all other 
170.29  operations.  A sponsor may not authorize a charter school or 
170.30  program that is affiliated with a nonpublic sectarian school or 
170.31  a religious institution. 
170.32     (d) Charter schools must not be used as a method of 
170.33  providing education or generating revenue for students who are 
170.34  being home-schooled. 
170.35     (e) The primary focus of a charter school must be to 
170.36  provide a comprehensive program of instruction for at least one 
171.1   grade or age group from five through 18 years of age.  
171.2   Instruction may be provided to people younger than five years 
171.3   and older than 18 years of age. 
171.4      (f) A charter school may not charge tuition. 
171.5      (g) A charter school is subject to and must comply with 
171.6   chapter 363A and section 121A.04. 
171.7      (h) A charter school is subject to and must comply with the 
171.8   Pupil Fair Dismissal Act, sections 121A.40 to 121A.56, and the 
171.9   Minnesota Public School Fee Law, sections 123B.34 to 123B.39. 
171.10     (i) A charter school is subject to the same financial 
171.11  audits, audit procedures, and audit requirements as a district.  
171.12  Audits must be conducted in compliance with generally accepted 
171.13  governmental auditing standards, the Federal Single Audit Act, 
171.14  if applicable, and section 6.65.  A charter school is subject to 
171.15  and must comply with sections 15.054; 118A.01; 118A.02; 118A.03; 
171.16  118A.04; 118A.05; 118A.06; 123B.52, subdivision 5; 471.38; 
171.17  471.391; 471.392; 471.425; 471.87; 471.88, subdivisions 1, 2, 3, 
171.18  4, 5, 6, 12, 13, and 15; 471.881; and 471.89.  The audit must 
171.19  comply with the requirements of sections 123B.75 to 123B.83, 
171.20  except to the extent deviations are necessary because of the 
171.21  program at the school.  Deviations must be approved by the 
171.22  commissioner.  The Department of Education, state auditor, or 
171.23  legislative auditor may conduct financial, program, or 
171.24  compliance audits.  A charter school determined to be in 
171.25  statutory operating debt under sections 123B.81 to 123B.83 must 
171.26  submit a plan under section 123B.81, subdivision 4. 
171.27     (j) A charter school is a district for the purposes of tort 
171.28  liability under chapter 466. 
171.29     (k) A charter school must comply with sections 13.32; 
171.30  120A.22, subdivision 7; 121A.75; and 260B.171, subdivisions 3 
171.31  and 5.  
171.32     (l) A charter school is subject to the Pledge of Allegiance 
171.33  requirement under section 121A.11, subdivision 3. 
171.34     (m) Charter school board of director open meeting 
171.35  requirements are governed according to subdivision 4. 
171.36     Sec. 4.  Minnesota Statutes 2004, section 124D.40, is 
172.1   amended to read: 
172.2      124D.40 [YOUTH WORKS GRANTS.] 
172.3      Subdivision 1.  [APPLICATION.] An eligible organization 
172.4   interested in receiving a grant under sections 124D.39 to 
172.5   124D.44 may prepare and submit an application to the commission 
172.6   an application that complies with section 124D.41. 
172.7      Subd. 2.  [GRANT AUTHORITY.] The commission must use any 
172.8   state appropriation and any available federal funds, including 
172.9   any grant received under federal law, to award grants to 
172.10  establish programs for youth works meeting the requirements of 
172.11  section 124D.41.  At least one grant each must be available for 
172.12  a metropolitan proposal, a rural proposal, and a statewide 
172.13  proposal.  If a portion of the suburban metropolitan area is not 
172.14  included in the metropolitan grant proposal, the statewide grant 
172.15  proposal must incorporate at least one suburban metropolitan 
172.16  area.  In awarding grants, the commission may select at least 
172.17  one residential proposal and one nonresidential proposal, 
172.18  provided the proposals meet or exceed the criteria in section 
172.19  124D.41. 
172.20     Sec. 5.  Minnesota Statutes 2004, section 127A.41, 
172.21  subdivision 8, is amended to read: 
172.22     Subd. 8.  [APPROPRIATION TRANSFERS.] (a) If a direct 
172.23  appropriation from the general fund to the department for any 
172.24  education aid or grant authorized in this chapter and chapters 
172.25  122A, 123A, 123B, 124D, 125A, 126C, and 134, excluding 
172.26  appropriations under sections 124D.135, 124D.16, 124D.20, 
172.27  124D.21, 124D.22, 124D.52, 124D.531, 124D.54, 124D.55, and 
172.28  124D.56, exceeds the amount required, the commissioner may 
172.29  transfer the excess to any education aid or grant appropriation 
172.30  that is insufficient.  However, section 126C.20 applies to a 
172.31  deficiency in the direct appropriation for general education 
172.32  aid.  Excess appropriations must be allocated proportionately 
172.33  among aids or grants that have insufficient appropriations.  The 
172.34  commissioner of finance shall make the necessary transfers among 
172.35  appropriations according to the determinations of the 
172.36  commissioner.  If the amount of the direct appropriation for the 
173.1   aid or grant plus the amount transferred according to this 
173.2   subdivision is insufficient, the commissioner shall prorate the 
173.3   available amount among eligible districts.  The state is not 
173.4   obligated for any additional amounts. 
173.5      (b) Transfers for aids paid under section 127A.45, 
173.6   subdivisions 12, paragraph (a), 12a, paragraph (a), and 13, 
173.7   shall be made during the fiscal year after the fiscal year of 
173.8   the entitlement.  Transfers for aids paid under section 127A.45, 
173.9   subdivisions 11, 12, paragraph (b), and 12a, paragraph (b), 
173.10  shall be made during the fiscal year of the appropriation. 
173.11     Sec. 6.  Minnesota Statutes 2004, section 127A.45, 
173.12  subdivision 12, is amended to read: 
173.13     Subd. 12.  [PAYMENT PERCENTAGE FOR CERTAIN AIDS.] (a) One 
173.14  hundred percent of the aid for the current fiscal year must be 
173.15  paid for the following aids:  reimbursement for enrollment 
173.16  options transportation, according to sections 124D.03, 
173.17  subdivision 8, 124D.09, subdivision 22, and 124D.10; school 
173.18  lunch aid, according to section 124D.111; hearing impaired 
173.19  support services aid, according to section 124D.57; and Indian 
173.20  postsecondary preparation grants according to section 
173.21  124D.80 124D.81. 
173.22     (b) One hundred percent of the aid for the current fiscal 
173.23  year, based on enrollment in the previous year, must be paid for 
173.24  the first grade preparedness program according to section 
173.25  124D.081.