1.1 	A bill for an act
1.2 	relating to the operation and financing of government;
1.3 	providing for early childhood, adult, family, and
1.4 	kindergarten through grade 12 education including
1.5 	general education, education excellence, special
1.6 	programs, facilities and technology, nutrition and
1.7 	accounting, libraries, early childhood education,
1.8 	prevention, self-sufficiency and lifelong learning,
1.9 	state agencies, and technical and conforming
1.10 	amendments; reestablishing statutory authority for the
1.11 	Humanities Commission; authorizing certain nonprofit
1.12 	contracts; reimbursing local governments; authorizing
1.13 	certain state agencies and constitutional officers to
1.14 	carry forward unencumbered balances for fiscal year
1.15 	2005; appropriating money for lets go fishing to
1.16 	promote opportunities for fishing in the state;
1.17 	authorizing rulemaking; providing for reports;
1.18 	appropriating money; amending Minnesota Statutes 2004,
1.19 	sections 13.32, subdivision 8; 13.321, by adding a
1.20 	subdivision; 119A.46, subdivisions 1, 2, 3, 8;
1.21 	120A.05, by adding a subdivision; 120A.22, subdivision
1.22 	12; 120B.02; 120B.021, by adding a subdivision;
1.23 	120B.11, subdivisions 1, 2, 3, 4, 5, 8; 120B.13,
1.24 	subdivisions 1, 3; 120B.22, subdivision 1; 120B.30,
1.25 	subdivisions 1, 1a, by adding a subdivision; 120B.31,
1.26 	subdivision 4; 121A.03, subdivision 1; 121A.06,
1.27 	subdivisions 2, 3; 121A.15, subdivision 3; 121A.17,
1.28 	subdivisions 1, 5; 121A.19; 121A.41, subdivision 10;
1.29 	121A.47, subdivision 14; 121A.53; 121A.66, subdivision
1.30 	5, by adding subdivisions; 121A.67; 122A.06,
1.31 	subdivision 4; 122A.12, subdivision 2; 122A.18,
1.32 	subdivision 2a; 122A.33; 122A.40, subdivision 5, as
1.33 	amended; 122A.41, subdivisions 2, as amended, 5a, 14;
1.34 	122A.413; 122A.414; 122A.415, subdivisions 1, 3;
1.35 	122A.60, subdivision 1, by adding subdivisions;
1.36 	123A.05, subdivision 2; 123B.02, by adding
1.37 	subdivisions; 123B.04, subdivisions 1, 2; 123B.42, by
1.38 	adding a subdivision; 123B.49, subdivision 4;
1.39 	123B.492; 123B.53, subdivision 1; 123B.54; 123B.59,
1.40 	subdivisions 3, 3a; 123B.63, subdivision 2; 123B.71,
1.41 	subdivisions 8, 9, 12; 123B.75, subdivision 5, by
1.42 	adding a subdivision; 123B.76, subdivision 3; 123B.79,
1.43 	subdivision 6; 123B.81, subdivision 1; 123B.82;
1.44 	123B.83, subdivision 2; 123B.88, by adding a
1.45 	subdivision; 123B.92, subdivisions 1, 5; 124D.09,
1.46 	subdivision 12; 124D.095, subdivisions 2, 4, 8, by
2.1 	adding a subdivision; 124D.10, subdivisions 4, 6, 15,
2.2 	23; 124D.11, subdivisions 1, 2, 5, 6; 124D.111,
2.3 	subdivisions 1, 2; 124D.118, subdivision 4; 124D.135,
2.4 	subdivisions 1, 5; 124D.15, subdivisions 1, 3, 5, 10,
2.5 	12, by adding subdivisions; 124D.16, subdivisions 2,
2.6 	3; 124D.20, subdivisions 3, 5; 124D.40; 124D.454,
2.7 	subdivision 5; 124D.52, subdivision 3; 124D.531,
2.8 	subdivisions 1, 4; 124D.66, subdivision 3; 124D.68,
2.9 	subdivision 9; 124D.69, subdivision 1; 124D.74,
2.10 	subdivision 1; 124D.81, subdivision 1; 124D.84,
2.11 	subdivision 1; 125A.11, subdivision 1; 125A.24;
2.12 	125A.28; 125A.51; 125A.76, subdivision 4; 125A.79,
2.13 	subdivisions 1, 6; 126C.01, subdivision 11; 126C.05,
2.14 	by adding a subdivision; 126C.10, subdivisions 1, 2,
2.15 	13, 13a, 24, 31, by adding subdivisions; 126C.13,
2.16 	subdivision 4; 126C.15, subdivisions 2, 3; 126C.17,
2.17 	subdivisions 2, 5, 7, 9, 13; 126C.21, subdivision 4;
2.18 	126C.40, subdivision 1; 126C.43, subdivisions 2, 3;
2.19 	126C.457; 126C.48, subdivisions 2, 8; 126C.63,
2.20 	subdivisions 5, 8; 127A.41, subdivision 8; 127A.45,
2.21 	subdivisions 2, 10, 11, 12, 13, 14, 16; 127A.47,
2.22 	subdivisions 7, 8; 127A.49, subdivisions 2, 3;
2.23 	128C.05, by adding a subdivision; 128C.12,
2.24 	subdivisions 1, 3; 128D.11, subdivision 9; 134.31, by
2.25 	adding a subdivision; 179A.03, subdivision 14, as
2.26 	amended; 260C.201, subdivision 1, as amended; 275.14;
2.27 	275.16; 469.177, subdivision 9; 475.61, subdivision 4;
2.28 	Laws 1996, chapter 412, article 5, section 24; Laws
2.29 	2003, First Special Session chapter 9, article 3,
2.30 	section 20, subdivision 6, as amended; Laws 2003,
2.31 	First Special Session chapter 9, article 4, section
2.32 	29, as amended; proposing coding for new law in
2.33 	Minnesota Statutes, chapters 120B; 121A; 122A; 123A;
2.34 	123B; 124D; 125B; 127A; 129C; 138; 171; repealing
2.35 	Minnesota Statutes 2004, sections 122A.415,
2.36 	subdivision 2; 123B.83, subdivision 1; 124D.095,
2.37 	subdivision 9; 124D.15, subdivisions 2, 4, 6, 7, 8, 9,
2.38 	11, 13; 124D.16, subdivisions 1, 4; 125A.75,
2.39 	subdivision 8; 126C.42, subdivisions 1, 4; 128C.12,
2.40 	subdivision 4.
2.41 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.42 	ARTICLE 1
2.43 	GENERAL EDUCATION

2.44 	Section 1. Minnesota Statutes 2004, section 120A.05, is
2.45 	amended by adding a subdivision to read:
2.46 		Subd. 18.Kindergarten. "Kindergarten" means a program
2.47 	designed for pupils five years of age on September 1 of the
2.48 	calendar year in which the school year commences that prepares
2.49 	pupils to enter first grade the following school year.  A
2.50 	program designed for pupils younger than five years of age on
2.51 	September 1 of the calendar year in which the school year
2.52 	commences that prepares pupils to enter kindergarten the
2.53 	following school year is a prekindergarten program.
2.54 	
EFFECTIVE DATE. This section is effective the day
2.55 	following final enactment.

3.1 	Sec. 2. Minnesota Statutes 2004, section 123A.05,
3.2 	subdivision 2, is amended to read:
3.3 		Subd. 2.Reserve revenue.  Each district that is a member
3.4 	of an area learning center must reserve revenue in an amount
3.5 	equal to the sum of (1) at least 90 percent of the district
3.6 	average general education revenue per pupil unit minus an amount
3.7 	equal to the product of the formula allowance according to
3.8 	section 126C.10, subdivision 2, times .0485, calculated without
3.9 	basic skills revenue,and transportation sparsity revenue, and
3.10 	the transportation portion of the transition revenue adjustment,
3.11 	times the number of pupil units attending an area learning
3.12 	center program under this section, plus (2) the amount of basic
3.13 	skills revenue generated by pupils attending the area learning
3.14 	center.  The amount of reserved revenue under this subdivision
3.15 	may only be spent on program costs associated with the area
3.16 	learning center. Compensatory revenue must be allocated
3.17 	according to section 126C.15, subdivision 2.

3.18 	Sec. 3. Minnesota Statutes 2004, section 123B.75, is
3.19 	amended by adding a subdivision to read:
3.20 		Subd. 4a.Taconite revenue. Taconite revenue received in
3.21 	a calendar year by a school district under section 298.28,
3.22 	subdivisions 4, paragraphs (b) and (c), and 11, paragraph (d),
3.23 	is fully recognized in the fiscal year in which the February
3.24 	payment falls.
3.25 	[EFFECTIVE DATE.]This section is effective for revenue for
3.26 	fiscal year 2006.

3.27 	Sec. 4. Minnesota Statutes 2004, section 123B.76,
3.28 	subdivision 3, is amended to read:
3.29 		Subd. 3.Expenditures by building.  (a) For the purposes
3.30 	of this section, "building" means education site as defined in
3.31 	section 123B.04, subdivision 1.
3.32 	(b) Each district shall maintain separate accounts to
3.33 	identify general fund expenditures, excluding capital
3.34 	expenditures and pupil transportation,for each building.  All
3.35 	expenditures for regular instruction, secondary vocational
3.36 	instruction, and school administration must be reported to the
4.1 	department separately for each building.  All expenditures for
4.2 	special education instruction, instructional support services,
4.3 	and pupil support services provided within a specific building
4.4 	must be reported to the department separately for each
4.5 	building.  Salary expenditures reported by building must reflect
4.6 	actual salaries for staff at the building and must not be based
4.7 	on districtwide averages.  All other general fund expenditures
4.8 	may be reported by building or on a districtwide basis.
4.9 	(c) The department must annually report information showing
4.10 	school district general fund expenditures per pupil by program
4.11 	category for each building and estimated school district general
4.12 	fund revenue generated by pupils attending each building on its
4.13 	Web site.  For purposes of this report:
4.14 	(1) expenditures not required to be reported by building
4.15 	shall be allocated among buildings on a uniform per pupil basis;
4.16 	(2) basic skills revenue shall be allocated according to
4.17 	section 126C.10, subdivision 4;
4.18 	(3) secondary sparsity revenue and elementary sparsity
4.19 	revenue shall be allocated according to section 126C.10,
4.20 	subdivisions 7 and 8;
4.21 	(4) other general education revenue shall be allocated on a
4.22 	uniform per pupil unit basis;
4.23 	(5) first grade preparedness aid shall be allocated
4.24 	according to section 124D.081;
4.25 	(6) state and federal special education aid and Title I aid
4.26 	shall be allocated in proportion to district expenditures for
4.27 	these programs by building; and
4.28 	(7) other general fund revenues shall be allocated on a
4.29 	uniform per pupil basis, except that the department may allocate
4.30 	other revenues attributable to specific buildings directly to
4.31 	those buildings.

4.32 	Sec. 5. Minnesota Statutes 2004, section 123B.79,
4.33 	subdivision 6, is amended to read:
4.34 		Subd. 6.Account transfer for statutory operating debt.
 4.35 	On June 30 of each year, a district may make a permanent
4.36 	transfer from the general fund account entitled " undesignated 
5.1 	net unreserved general fund balance since statutory operating
5.2 	debt" to the account entitled "reserved fund balance reserve
5.3 	account for purposes of statutory operating debt reduction."
5.4 	The amount of the transfer is limited to the lesser of (a) the
5.5 	net undesignated operating unreserved general fund balance, or
5.6 	(b) the sum of the remaining statutory operating debt levies
5.7 	authorized for all future years according to section 126C.42,
5.8 	subdivision 1.  If the net undesignated operating unreserved
5.9 	general fund balance is less than zero, the district may not
5.10 	make a transfer.

5.11 	Sec. 6. Minnesota Statutes 2004, section 123B.81,
5.12 	subdivision 1, is amended to read:
5.13 		Subdivision 1.Operating debt.  The "operating debt" of a
5.14 	school district means the net negative undesignated unreserved
5.15 	general fund balance in all school district funds, other than
5.16 	capital expenditure, building construction, debt service, and
5.17 	trust and agency,calculated as of June 30 of each year in
5.18 	accordance with the uniform financial accounting and reporting
5.19 	standards for Minnesota school districts.

5.20 	Sec. 7. Minnesota Statutes 2004, section 123B.82, is
5.21 	amended to read:
5.22 	123B.82 REORGANIZATION OPERATING DEBT.
5.23 	The "reorganization operating debt" of a school district
5.24 	means the net negative undesignated unreserved fund balance 
5.25 	balances in all school district funds, other than building
5.26 	construction, debt redemption, and trust and agency, calculated
5.27 	in accordance with the uniform financial accounting and
5.28 	reporting standards for Minnesota school districts as of:
5.29 	(1) June 30 of the fiscal year before the first year that a
5.30 	district receives revenue according to section 123A.39,
5.31 	subdivision 3; or
5.32 	(2) June 30 of the fiscal year before the effective date of
5.33 	reorganization according to section 123A.46 or 123A.48.

5.34 	Sec. 8. Minnesota Statutes 2004, section 123B.83,
5.35 	subdivision 2, is amended to read:
5.36 		Subd. 2.undesignated net unreserved general fund
6.1 	balances. Beginning in fiscal year 1978 and each year
6.2 	thereafter, any A school district not subject to the provisions
6.3 	of subdivision 1 must limit its expenditures so that
6.4 	its undesignated net unreserved general fund balances do balance
6.5 	does not constitute statutory operating debt as defined in
6.6 	section 126C.42.

6.7 	Sec. 9. Minnesota Statutes 2004, section 123B.92,
6.8 	subdivision 1, is amended to read:
6.9 		Subdivision 1.Definitions.  For purposes of this section
6.10 	and section 125A.76, the terms defined in this subdivision have
6.11 	the meanings given to them.
6.12 	(a) "Actual expenditure per pupil transported in the
6.13 	regular and excess transportation categories" means the quotient
6.14 	obtained by dividing:
6.15 	(1) the sum of:
6.16 	(i) all expenditures for transportation in the regular
6.17 	category, as defined in paragraph (b), clause (1), and the
6.18 	excess category, as defined in paragraph (b), clause (2), plus
6.19 	(ii) an amount equal to one year's depreciation on the
6.20 	district's school bus fleet and mobile units computed on a
6.21 	straight line basis at the rate of 15 percent per year for
6.22 	districts operating a program under section 124D.128 for grades
6.23 	1 to 12 for all students in the district and 12-1/2 percent per
6.24 	year for other districts of the cost of the fleet, plus
6.25 	(iii) an amount equal to one year's depreciation on the
6.26 	district's type three school buses, as defined in section
6.27 	169.01, subdivision 6, clause (5), which must be used a majority
6.28 	of the time for pupil transportation purposes, computed on a
6.29 	straight line basis at the rate of 20 percent per year of the
6.30 	cost of the type three school buses by:
6.31 	(2) the number of pupils eligible for transportation in the
6.32 	regular category, as defined in paragraph (b), clause (1), and
6.33 	the excess category, as defined in paragraph (b), clause (2).
6.34 	(b) "Transportation category" means a category of
6.35 	transportation service provided to pupils as follows:
6.36 	(1) Regular transportation is:
7.1 	(i) transportation to and from school during the regular
7.2 	school year for resident elementary pupils residing one mile or
7.3 	more from the public or nonpublic school they attend, and
7.4 	resident secondary pupils residing two miles or more from the
7.5 	public or nonpublic school they attend, excluding desegregation
7.6 	transportation and noon kindergarten transportation; but with
7.7 	respect to transportation of pupils to and from nonpublic
7.8 	schools, only to the extent permitted by sections 123B.84 to
7.9 	123B.87;
7.10 	(ii) transportation of resident pupils to and from language
7.11 	immersion programs;
7.12 	(iii) transportation of a pupil who is a custodial parent
7.13 	and that pupil's child between the pupil's home and the child
7.14 	care provider and between the provider and the school, if the
7.15 	home and provider are within the attendance area of the school;
7.16 	(iv) transportation to and from or board and lodging in
7.17 	another district, of resident pupils of a district without a
7.18 	secondary school; and
7.19 	(v) transportation to and from school during the regular
7.20 	school year required under subdivision 3 for nonresident
7.21 	elementary pupils when the distance from the attendance area
7.22 	border to the public school is one mile or more, and for
7.23 	nonresident secondary pupils when the distance from the
7.24 	attendance area border to the public school is two miles or
7.25 	more, excluding desegregation transportation and noon
7.26 	kindergarten transportation.
7.27 	For the purposes of this paragraph, a district may
7.28 	designate a licensed day care facility, respite care facility,
7.29 	the residence of a relative, or the residence of a person chosen
7.30 	by the pupil's parent or guardian as the home of a pupil for
7.31 	part or all of the day, if requested by the pupil's parent or
7.32 	guardian, and if that facility or residence is within the
7.33 	attendance area of the school the pupil attends.
7.34 	(2) Excess transportation is:
7.35 	(i) transportation to and from school during the regular
7.36 	school year for resident secondary pupils residing at least one
8.1 	mile but less than two miles from the public or nonpublic school
8.2 	they attend, and transportation to and from school for resident
8.3 	pupils residing less than one mile from school who are
8.4 	transported because of extraordinary traffic, drug, or crime
8.5 	hazards; and
8.6 	(ii) transportation to and from school during the regular
8.7 	school year required under subdivision 3 for nonresident
8.8 	secondary pupils when the distance from the attendance area
8.9 	border to the school is at least one mile but less than two
8.10 	miles from the public school they attend, and for nonresident
8.11 	pupils when the distance from the attendance area border to the
8.12 	school is less than one mile from the school and who are
8.13 	transported because of extraordinary traffic, drug, or crime
8.14 	hazards.
8.15 	(3) Desegregation transportation is transportation within
8.16 	and outside of the district during the regular school year of
8.17 	pupils to and from schools located outside their normal
8.18 	attendance areas under a plan for desegregation mandated by the
8.19 	commissioner or under court order.
8.20 	(4) "Transportation services for pupils with disabilities"
8.21 	is:
8.22 	(i) transportation of pupils with disabilities who cannot
8.23 	be transported on a regular school bus between home or a respite
8.24 	care facility and school;
8.25 	(ii) necessary transportation of pupils with disabilities
8.26 	from home or from school to other buildings, including centers
8.27 	such as developmental achievement centers, hospitals, and
8.28 	treatment centers where special instruction or services required
8.29 	by sections 125A.03 to 125A.24, 125A.26 to 125A.48, and 125A.65
8.30 	are provided, within or outside the district where services are
8.31 	provided;
8.32 	(iii) necessary transportation for resident pupils with
8.33 	disabilities required by sections 125A.12, and 125A.26 to
8.34 	125A.48;
8.35 	(iv) board and lodging for pupils with disabilities in a
8.36 	district maintaining special classes;
9.1 	(v) transportation from one educational facility to another
9.2 	within the district for resident pupils enrolled on a
9.3 	shared-time basis in educational programs, and necessary
9.4 	transportation required by sections 125A.18, and 125A.26 to
9.5 	125A.48, for resident pupils with disabilities who are provided
9.6 	special instruction and services on a shared-time basis or if
9.7 	resident pupils are not transported, the costs of necessary
9.8 	travel between public and private schools or neutral
9.9 	instructional sites by essential personnel employed by the
9.10 	district's program for children with a disability;
9.11 	(vi) transportation for resident pupils with disabilities
9.12 	to and from board and lodging facilities when the pupil is
9.13 	boarded and lodged for educational purposes; and
9.14 	(vii) services described in clauses (i) to (vi), when
9.15 	provided for pupils with disabilities in conjunction with a
9.16 	summer instructional program that relates to the pupil's
9.17 	individual education plan or in conjunction with a learning year
9.18 	program established under section 124D.128.
9.19 	For purposes of computing special education base revenue
9.20 	under section 125A.76, subdivision 2, the cost of providing
9.21 	transportation for children with disabilities includes (A) the
9.22 	additional cost of transporting a homeless student from a
9.23 	temporary nonshelter home in another district to the school of
9.24 	origin, or a formerly homeless student from a permanent home in
9.25 	another district to the school of origin but only through the
9.26 	end of the academic year; and (B) depreciation on district-owned
9.27 	school buses purchased after July 1, 2005, and used primarily
9.28 	for transportation of pupils with disabilities, calculated
9.29 	according to paragraph (a), clauses (ii) and (iii).
9.30 	Depreciation costs included in the disabled transportation
9.31 	category must be excluded in calculating the actual expenditure
9.32 	per pupil transported in the regular and excess transportation
9.33 	categories according to paragraph (a).
9.34 	(5) "Nonpublic nonregular transportation" is:
9.35 	(i) transportation from one educational facility to another
9.36 	within the district for resident pupils enrolled on a
10.1 	shared-time basis in educational programs, excluding
10.2 	transportation for nonpublic pupils with disabilities under
10.3 	clause (4);
10.4 	(ii) transportation within district boundaries between a
10.5 	nonpublic school and a public school or a neutral site for
10.6 	nonpublic school pupils who are provided pupil support services
10.7 	pursuant to section 123B.44; and
10.8 	(iii) late transportation home from school or between
10.9 	schools within a district for nonpublic school pupils involved
10.10 	in after-school activities.
10.11 	(c) "Mobile unit" means a vehicle or trailer designed to
10.12 	provide facilities for educational programs and services,
10.13 	including diagnostic testing, guidance and counseling services,
10.14 	and health services.  A mobile unit located off nonpublic school
10.15 	premises is a neutral site as defined in section 123B.41,
10.16 	subdivision 13.

10.17 	Sec. 10. Minnesota Statutes 2004, section 123B.92,
10.18 	subdivision 5, is amended to read:
10.19 		Subd. 5.District reports. (a) Each district must report
10.20 	data to the department as required by the department to account
10.21 	for transportation expenditures.
10.22 	(b) Salaries and fringe benefits of district employees
10.23 	whose primary duties are other than transportation, including
10.24 	central office administrators and staff, building administrators
10.25 	and staff, teachers, social workers, school nurses, and
10.26 	instructional aides, must not be included in a district's
10.27 	transportation expenditures, except that a district may include
10.28 	salaries and benefits according to paragraph (c) for (1) an
10.29 	employee designated as the district transportation director, (2)
10.30 	an employee providing direct support to the transportation
10.31 	director, or (3) an employee providing direct transportation
10.32 	services such as a bus driver or bus aide.
10.33 	(c) Salaries and fringe benefits of other district
10.34 	employees who work part time in transportation and part time in
10.35 	other areas must not be included in a district's transportation
10.36 	expenditures unless the district maintains documentation of the
11.1 	employee's time spent on pupil transportation matters in the
11.2 	form and manner prescribed by the department.
11.3 	(d) Pupil transportation expenditures, excluding
11.4 	expenditures for capital outlay, leased buses, student board and
11.5 	lodging, crossing guards, and aides on buses, must be allocated
11.6 	among transportation categories based on cost-per-mile,
11.7 	cost-per-student, cost-per-hour, or cost-per-route, regardless
11.8 	of whether the transportation services are provided on
11.9 	district-owned or contractor-owned school buses.  Expenditures
11.10 	for school bus driver salaries and fringe benefits may either be
11.11 	directly charged to the appropriate transportation category or
11.12 	may be allocated among transportation categories based on
11.13 	cost-per-mile, cost-per-student, cost-per-hour, or
11.14 	cost-per-route.  Expenditures by private contractors or
11.15 	individuals who provide transportation exclusively in one
11.16 	transportation category must be charged directly to the
11.17 	appropriate transportation category.  Transportation services
11.18 	provided by contractor-owned school bus companies incorporated
11.19 	under different names but owned by the same individual or group
11.20 	of individuals must be treated as the same company for cost
11.21 	allocation purposes.
11.22 	
EFFECTIVE DATE. This section is effective for expenditure
11.23 	reporting for fiscal year 2006.

11.24 	Sec. 11. Minnesota Statutes 2004, section 124D.68,
11.25 	subdivision 9, is amended to read:
11.26 		Subd. 9.Enrollment verification.  (a) For a pupil
11.27 	attending an eligible program full time under subdivision 3,
11.28 	paragraph (d), the department must pay 90 percent of the
11.29 	district's average general education revenue less basic skills
11.30 	revenue to the eligible program and ten percent of the
11.31 	district's average general education revenue less basic skills
11.32 	revenue to the contracting district within 30 days after the
11.33 	eligible program verifies enrollment using the form provided by
11.34 	the department.  For a pupil attending an eligible program part
11.35 	time, revenue, excluding compensatory revenue,shall be reduced
11.36 	proportionately, according to the amount of time the pupil
12.1 	attends the program, and the payments to the eligible program
12.2 	and the contracting district shall be reduced accordingly.  A
12.3 	pupil for whom payment is made according to this section may not
12.4 	be counted by any district for any purpose other than
12.5 	computation of general education revenue.  If payment is made
12.6 	for a pupil under this subdivision, a district shall not
12.7 	reimburse a program under section 124D.69 for the same
12.8 	pupil. The basic skills revenue shall be paid generated by
12.9 	pupils attending the eligible program according to section
12.10 	126C.10, subdivision 4, shall be paid to the eligible program.
12.11 	(b) The department must pay up to 100 percent of the
12.12 	revenue to the eligible program if there is an agreement to that
12.13 	effect between the school district and the eligible program.
12.14 	(c) Notwithstanding paragraphs (a) and (b), for an eligible
12.15 	program that provides chemical treatment services to students,
12.16 	the department must pay 100 percent of the revenue to the
12.17 	eligible program.

12.18 	Sec. 12. Minnesota Statutes 2004, section 124D.69,
12.19 	subdivision 1, is amended to read:
12.20 		Subdivision 1.Aid.  If a pupil enrolls in an alternative
12.21 	program, eligible under section 124D.68, subdivision 3,
12.22 	paragraph (d), or subdivision 4, operated by a private
12.23 	organization that has contracted with a school district to
12.24 	provide educational services for eligible pupils under section
12.25 	124D.68, subdivision 2, the district contracting with the
12.26 	private organization must reimburse the provider an amount equal
12.27 	to the sum of (1) at least 95 percent of the district's average
12.28 	general education less basic skills revenue per pupil unit times
12.29 	the number of pupil units for pupils attending the program., and
12.30 	(2) the amount of basic skills revenue shall be paid generated
12.31 	by pupils attending the program according to section 126C.10,
12.32 	subdivision 4. Compensatory revenue must be allocated according
12.33 	to section 126C.15, subdivision 2.For a pupil attending the
12.34 	program part time, the revenue paid to the program, excluding
12.35 	compensatory revenue,must be reduced proportionately, according
12.36 	to the amount of time the pupil attends the program, and revenue
13.1 	paid to the district shall be reduced accordingly.  Pupils for
13.2 	whom a district provides reimbursement may not be counted by the
13.3 	district for any purpose other than computation of general
13.4 	education revenue.  If payment is made to a district or program
13.5 	for a pupil under this section, the department must not make a
13.6 	payment for the same pupil under section 124D.68, subdivision 9.
13.7 	Notwithstanding sections 125A.15, 125A.51, and 125A.515, general
13.8 	education revenue for a student who receives educational
13.9 	services under this section shall be paid according to this
13.10 	section.

13.11 	Sec. 13. Minnesota Statutes 2004, section 125A.51, is
13.12 	amended to read:
13.13 	125A.51 PLACEMENT OF CHILDREN WITHOUT DISABILITIES;
13.14 	EDUCATION AND TRANSPORTATION.
13.15 	The responsibility for providing instruction and
13.16 	transportation for a pupil without a disability who has a
13.17 	short-term or temporary physical or emotional illness or
13.18 	disability, as determined by the standards of the commissioner,
13.19 	and who is temporarily placed for care and treatment for that
13.20 	illness or disability, must be determined as provided in this
13.21 	section.
13.22 	(a) The school district of residence of the pupil is the
13.23 	district in which the pupil's parent or guardian resides.
13.24 	(b) When parental rights have been terminated by court
13.25 	order, the legal residence of a child placed in a residential or
13.26 	foster facility for care and treatment is the district in which
13.27 	the child resides.
13.28 	(c) Before the placement of a pupil for care and treatment,
13.29 	the district of residence must be notified and provided an
13.30 	opportunity to participate in the placement decision.  When an
13.31 	immediate emergency placement is necessary and time does not
13.32 	permit resident district participation in the placement
13.33 	decision, the district in which the pupil is temporarily placed,
13.34 	if different from the district of residence, must notify the
13.35 	district of residence of the emergency placement within 15 days
13.36 	of the placement.
14.1 	(d) When a pupil without a disability is temporarily placed
14.2 	for care and treatment in a day program and the pupil continues
14.3 	to live within the district of residence during the care and
14.4 	treatment, the district of residence must provide instruction
14.5 	and necessary transportation to and from the treatment facility
14.6 	for the pupil.  Transportation shall only be provided by the
14.7 	district during regular operating hours of the district.  The
14.8 	district may provide the instruction at a school within the
14.9 	district of residence, at the pupil's residence, or in the case
14.10 	of a placement outside of the resident district, in the district
14.11 	in which the day treatment program is located by paying tuition
14.12 	to that district.  The district of placement may contract with a
14.13 	facility to provide instruction by teachers licensed by the
14.14 	state Board of Teaching.
14.15 	(e) When a pupil without a disability is temporarily placed
14.16 	in a residential program for care and treatment, the district in
14.17 	which the pupil is placed must provide instruction for the pupil
14.18 	and necessary transportation while the pupil is receiving
14.19 	instruction, and in the case of a placement outside of the
14.20 	district of residence, the nonresident district must bill the
14.21 	district of residence for the actual cost of providing the
14.22 	instruction for the regular school year and for summer school,
14.23 	excluding transportation costs.
14.24 	(f) Notwithstanding paragraph (e), if the pupil is homeless
14.25 	and placed in a public or private homeless shelter, then the
14.26 	district that enrolls the pupil under section 127A.47,
14.27 	subdivision 2, shall provide the transportation, unless the
14.28 	district that enrolls the pupil and the district in which the
14.29 	pupil is temporarily placed agree that the district in which the
14.30 	pupil is temporarily placed shall provide transportation.When
14.31 	a pupil without a disability is temporarily placed in a
14.32 	residential program outside the district of residence, the
14.33 	administrator of the court placing the pupil must send timely
14.34 	written notice of the placement to the district of residence.
14.35 	The district of placement may contract with a residential
14.36 	facility to provide instruction by teachers licensed by the
15.1 	state Board of Teaching. For purposes of this section, the state
15.2 	correctional facilities operated on a fee-for-service basis are
15.3 	considered to be residential programs for care and treatment.
15.4 	(f) (g) The district of residence must include the pupil in
15.5 	its residence count of pupil units and pay tuition as provided
15.6 	in section 123A.488 to the district providing the instruction.
15.7 	Transportation costs must be paid by the district providing the
15.8 	transportation and the state must pay transportation aid to that
15.9 	district.  For purposes of computing state transportation aid,
15.10 	pupils governed by this subdivision must be included in the
15.11 	disabled transportation category if the pupils cannot be
15.12 	transported on a regular school bus route without special
15.13 	accommodations.

15.14 	Sec. 14. Minnesota Statutes 2004, section 126C.01,
15.15 	subdivision 11, is amended to read:
15.16 		Subd. 11.Net unappropriated operating unreserved general 
15.17 	fund balance.  "Net unappropriated operating unreserved general 
15.18 	fund balance" means the sum of the unreserved general fund
15.19 	balances in the general, food service, and community service
15.20 	funds minus the balances reserved for statutory operating debt
15.21 	reduction, bus purchase, severance pay, taconite, unemployment
15.22 	benefits, maintenance levy reduction, operating capital,
15.23 	disabled access, health and safety,balance and encumbrances,
15.24 	computed as of June 30 each year.

15.25 	Sec. 15. Minnesota Statutes 2004, section 126C.05, is
15.26 	amended by adding a subdivision to read:
15.27 		Subd. 20.Project-based average daily membership. (a) To
15.28 	receive general education revenue for a pupil enrolled in a
15.29 	public school with a project-based program, a school must meet
15.30 	the requirements in this paragraph.  The school must:
15.31 	(1) register with the commissioner as a project-based
15.32 	program by May 30 of the preceding fiscal year;
15.33 	(2) provide a minimum teacher contact of no less than one
15.34 	hour per week per project-based credit for each pupil;
15.35 	(3) maintain a record system that shows when each credit or
15.36 	portion thereof was reported for membership for each pupil; and 
16.1 	(4) report pupil membership consistent with paragraph (b).
16.2 	(b) The commissioner must develop a formula for reporting
16.3 	pupil membership to compute average daily membership for each
16.4 	registered project-based school.  Average daily membership for a
16.5 	pupil in a registered project-based program is the lesser of:
16.6 	(1) 1.0; or 
16.7 	(2) the ratio of (i) the number of membership hours
16.8 	generated by project-based credits completed during the school
16.9 	year plus membership hours generated by credits completed in a
16.10 	seat-based setting to (ii) the annual required instructional
16.11 	hours at that grade level.  Membership hours for a partially
16.12 	completed project-based credit must be prorated.

16.13 	Sec. 16. Minnesota Statutes 2004, section 126C.10,
16.14 	subdivision 1, is amended to read:
16.15 		Subdivision 1.General education revenue. (a) For fiscal
16.16 	year 2003, the general education revenue for each district
16.17 	equals the sum of the district's basic revenue, basic skills
16.18 	revenue, training and experience revenue, secondary sparsity
16.19 	revenue, elementary sparsity revenue, transportation sparsity
16.20 	revenue, total operating capital revenue, and equity revenue.
16.21 	(b) For fiscal year 2004 2006 and later, the general
16.22 	education revenue for each district equals the sum of the
16.23 	district's basic revenue, extended time revenue, gifted and
16.24 	talented revenue,basic skills revenue, training and experience
16.25 	revenue, secondary sparsity revenue, elementary sparsity
16.26 	revenue, transportation sparsity revenue, total operating
16.27 	capital revenue, equity revenue, alternative teacher
16.28 	compensation revenue,and transition revenue.
16.29 	
EFFECTIVE DATE. This section is effective for revenue for
16.30 	fiscal year 2006.

16.31 	Sec. 17. Minnesota Statutes 2004, section 126C.10,
16.32 	subdivision 2, is amended to read:
16.33 		Subd. 2.Basic revenue.  The basic revenue for each
16.34 	district equals the formula allowance times the adjusted
16.35 	marginal cost pupil units for the school year.  The formula
16.36 	allowance for fiscal year 2001 2005 is $3,964 $4,601.  The
17.1 	formula allowance for fiscal year 2002 2006 is $4,068 $4,783.
17.2 	The formula allowance for fiscal year 2003 2007 and subsequent
17.3 	years is $4,601 $4,974.

17.4 	Sec. 18. Minnesota Statutes 2004, section 126C.10, is
17.5 	amended by adding a subdivision to read:
17.6 		Subd. 2b.Gifted and talented revenue. Gifted and
17.7 	talented revenue for each district equals $4 times the
17.8 	district's adjusted marginal cost pupil units for fiscal year
17.9 	2006 and $9 for fiscal year 2007 and later.  A school district
17.10 	must reserve gifted and talented revenue and, consistent with
17.11 	section 120B.15, must spend the revenue only to:
17.12 	(1) identify gifted and talented students;
17.13 	(2) provide education programs for gifted and talented
17.14 	students; or 
17.15 	(3) provide staff development to prepare teachers to best
17.16 	meet the unique needs of gifted and talented students.
17.17 	
EFFECTIVE DATE. This section is effective for revenue for
17.18 	fiscal year 2006 and later.

17.19 	Sec. 19. Minnesota Statutes 2004, section 126C.10,
17.20 	subdivision 13, is amended to read:
17.21 		Subd. 13.Total operating capital revenue.  (a) For
17.22 	fiscal year 2000 and thereafter,Total operating capital revenue
17.23 	for a district equals the amount determined under paragraph (b)
17.24 	or (c), plus $73 times the adjusted marginal cost pupil units
17.25 	for the school year.  The revenue must be placed in a reserved
17.26 	account in the general fund and may only be used according
17.27 	to paragraph (d) or subdivision 14.
17.28 	(b) For fiscal years 2000 and later,Capital revenue for a
17.29 	district equals $100 times the district's maintenance cost index
17.30 	times its adjusted marginal cost pupil units for the school year.
17.31 	(c) For fiscal years 2000 and later,The revenue for a
17.32 	district that operates a program under section 124D.128, is
17.33 	increased by an amount equal to $30 times the number of marginal
17.34 	cost pupil units served at the site where the program is
17.35 	implemented.
17.36 	(d) For fiscal years 2001, 2002, and 2003, the district
18.1 	must reserve an amount equal to $5 per adjusted marginal cost
18.2 	pupil unit for telecommunication access costs.  Reserve revenue
18.3 	under this paragraph must first be used to pay for ongoing or
18.4 	recurring telecommunication access costs, including access to
18.5 	data and video connections, including Internet access.  Any
18.6 	revenue remaining after covering all ongoing or recurring access
18.7 	costs may be used for computer hardware or equipment.

18.8 	Sec. 20. Minnesota Statutes 2004, section 126C.10,
18.9 	subdivision 13a, is amended to read:
18.10 		Subd. 13a.Operating capital levy.  To obtain operating
18.11 	capital revenue for fiscal year 2005 2007 and later, a district
18.12 	may levy an amount not more than the product of its operating
18.13 	capital revenue for the fiscal year times the lesser of one or
18.14 	the ratio of its adjusted net tax capacity per adjusted marginal
18.15 	cost pupil unit to $22,222 the operating capital equalizing
18.16 	factor. The operating capital equalizing factor equals $22,222
18.17 	for fiscal year 2006, and $10,700 for fiscal year 2007 and later.
18.18 	
EFFECTIVE DATE. This section is effective for revenue for
18.19 	fiscal year 2007.

18.20 	Sec. 21. Minnesota Statutes 2004, section 126C.10,
18.21 	subdivision 24, is amended to read:
18.22 		Subd. 24.Equity revenue.  (a) A school district
18.23 	qualifies for equity revenue if:
18.24 	(1) the school district's adjusted marginal cost pupil unit
18.25 	amount of basic revenue, supplemental revenue, transition
18.26 	revenue, and referendum revenue is less than the value of the
18.27 	school district at or immediately above the 95th percentile of
18.28 	school districts in its equity region for those revenue
18.29 	categories; and
18.30 	(2) the school district's administrative offices are not
18.31 	located in a city of the first class on July 1, 1999.
18.32 	(b) Equity revenue for a qualifying district that receives
18.33 	referendum revenue under section 126C.17, subdivision 4, equals
18.34 	the product of (1) the district's adjusted marginal cost pupil
18.35 	units for that year; times (2) the sum of (i) $13, plus (ii)
18.36 	$75, times the school district's equity index computed under
19.1 	subdivision 27.
19.2 	(c) Equity revenue for a qualifying district that does not
19.3 	receive referendum revenue under section 126C.17, subdivision 4,
19.4 	equals the product of the district's adjusted marginal cost
19.5 	pupil units for that year times $13.
19.6 	(d) A school district's equity revenue is increased by the
19.7 	greater of zero or an amount equal to the district's resident
19.8 	marginal pupil units times the difference between ten percent of
19.9 	the statewide average amount of referendum revenue per resident
19.10 	marginal cost pupil unit for that year and the district's
19.11 	referendum revenue per resident marginal cost pupil unit.  A
19.12 	school district's revenue under this paragraph must not exceed
19.13 	$100,000 for that year.
19.14 	(e) A school district's equity revenue for a school
19.15 	district located in the metro equity region equals the amount
19.16 	computed in paragraphs (b), (c), and (d) multiplied by 1.25.
19.17 	(f) For fiscal year 2007 and later, notwithstanding
19.18 	paragraph (a), clause (2), a school district that has per pupil
19.19 	referendum revenue below the 95th percentile qualifies for
19.20 	additional equity revenue equal to $46 times its adjusted
19.21 	marginal cost pupil unit.
19.22 	(g) A district that does not qualify for revenue under
19.23 	paragraph (f) qualifies for equity revenue equal to one-half of
19.24 	the per pupil allowance in paragraph (f) times its adjusted
19.25 	marginal cost pupil units.
19.26 	
EFFECTIVE DATE. This section is effective for revenue for
19.27 	fiscal year 2006.

19.28 	Sec. 22. Minnesota Statutes 2004, section 126C.10,
19.29 	subdivision 31, is amended to read:
19.30 		Subd. 31.Transition revenue.  (a) A district's
19.31 	transition allowance for fiscal years 2004 through 2008 equals
19.32 	the greater of zero or the product of the ratio of the number of
19.33 	adjusted marginal cost pupil units the district would have
19.34 	counted for fiscal year 2004 under Minnesota Statutes 2002 to
19.35 	the district's adjusted marginal cost pupil units for fiscal
19.36 	year 2004, times the difference between:  (1) the lesser of the
20.1 	district's general education revenue per adjusted marginal cost
20.2 	pupil unit for fiscal year 2003 or the amount of general
20.3 	education revenue the district would have received per adjusted
20.4 	marginal cost pupil unit for fiscal year 2004 according to
20.5 	Minnesota Statutes 2002, and (2) the district's general
20.6 	education revenue for fiscal year 2004 excluding transition
20.7 	revenue divided by the number of adjusted marginal cost pupil
20.8 	units the district would have counted for fiscal year 2004 under
20.9 	Minnesota Statutes 2002.
20.10 	A district's transition allowance for fiscal year 2009 and
20.11 	later is zero.
20.12 	(b) A district's transition revenue for fiscal year 2004
20.13 	and later 2006 and later equals the sum of (1) the product of
20.14 	the district's transition allowance times the district's
20.15 	adjusted marginal cost pupil units.plus (2) the amount of
20.16 	referendum revenue under section 126C.17 and general education
20.17 	revenue, excluding transition revenue, for fiscal year 2004
20.18 	attributable to pupils four or five years of age on September 1,
20.19 	2003, enrolled in a prekindergarten program implemented by the
20.20 	district before July 1, 2003, and reported as kindergarten
20.21 	pupils under section 126C.05, subdivision 1, for fiscal year
20.22 	2004, plus (3) the amount of compensatory education revenue
20.23 	under subdivision 3 for fiscal year 2005 attributable to pupils
20.24 	four years of age on September 1, 2003, enrolled in a
20.25 	prekindergarten program implemented by the district before July
20.26 	1, 2003, and reported as kindergarten pupils under section
20.27 	126C.05, subdivision 1, for fiscal year 2004 multiplied by .04.

20.28 	Sec. 23. Minnesota Statutes 2004, section 126C.10, is
20.29 	amended by adding a subdivision to read:
20.30 		Subd. 34.Basic alternative teacher compensation aid. (a)
20.31 	For fiscal year 2006, the basic alternative teacher compensation
20.32 	aid for a school district or an intermediate school district
20.33 	with a plan approved under section 122A.414, subdivision 2b,
20.34 	equals the alternative teacher compensation revenue under
20.35 	section 122A.415, subdivision 1.  The basic alternative teacher
20.36 	compensation aid for a charter school with an approved plan
21.1 	under section 122A.414, subdivision 2b, equals $260 times the
21.2 	number of pupils enrolled in the school on October 1 of the
21.3 	previous school year, or on October 1 of the current fiscal year
21.4 	for a charter school in the first year of operation.
21.5 	(b) For fiscal year 2007 and later, the basic alternative
21.6 	teacher compensation aid for a school district with a plan
21.7 	approved under section 122A.414, subdivision 2b, equals 73.1
21.8 	percent of the alternative teacher compensation revenue under
21.9 	section 122A.415, subdivision 1.  The basic alternative teacher
21.10 	compensation aid for an intermediate school district or charter
21.11 	school with a plan approved under section 122A.414, subdivision
21.12 	2b, and subdivision 2a, if the recipient is a charter school,
21.13 	equals $260 times the number of pupils enrolled in the school on
21.14 	October 1 of the previous fiscal year, or on October 1 of the
21.15 	current fiscal year for a charter school in the first year of
21.16 	operation, times the ratio of the sum of the alternative teacher
21.17 	compensation aid and alternative teacher compensation levy for
21.18 	all participating school districts to the maximum alternative
21.19 	teacher compensation revenue for those districts under section
21.20 	122A.415, subdivision 1.
21.21 	(c) Notwithstanding paragraphs (a) and (b) and section
21.22 	122A.415, subdivision 1, the state total basic alternative
21.23 	teacher compensation aid entitlement must not exceed $19,329,000
21.24 	for fiscal year 2006 and $75,636,000 for fiscal year 2007 and
21.25 	later.  The commissioner must limit the amount of alternative
21.26 	teacher compensation aid approved under section 122A.415 so as
21.27 	not to exceed these limits.

21.28 	Sec. 24. Minnesota Statutes 2004, section 126C.10, is
21.29 	amended by adding a subdivision to read:
21.30 		Subd. 35.Alternative teacher compensation levy. For
21.31 	fiscal year 2007 and later, the alternative teacher compensation
21.32 	levy for a district receiving basic alternative teacher
21.33 	compensation aid equals the product of (1) the difference
21.34 	between the district's alternative teacher compensation revenue
21.35 	and the district's basic alternative teacher compensation aid
21.36 	times (2) the lesser of one or the ratio of the district's
22.1 	adjusted net tax capacity per adjusted pupil unit to $5,913.

22.2 	Sec. 25. Minnesota Statutes 2004, section 126C.10, is
22.3 	amended by adding a subdivision to read:
22.4 		Subd. 36.Alternative teacher compensation aid. (a) For
22.5 	fiscal year 2007 and later, a district's alternative teacher
22.6 	compensation equalization aid equals the district's alternative
22.7 	teacher compensation revenue minus the district's basic
22.8 	alternative teacher compensation aid minus the district's
22.9 	alternative teacher compensation levy.  If a district does not
22.10 	levy the entire amount permitted, the alternative teacher
22.11 	compensation equalization aid must be reduced in proportion to
22.12 	the actual amount levied.
22.13 	(b) A district's alternative teacher compensation aid
22.14 	equals the sum of the district's basic alternative teacher
22.15 	compensation aid and the district's alternative teacher
22.16 	compensation equalization aid.

22.17 	Sec. 26. Minnesota Statutes 2004, section 126C.13,
22.18 	subdivision 4, is amended to read:
22.19 		Subd. 4.General education aid.  (a) For fiscal year
22.20 	2004, a district's general education aid is the sum of the
22.21 	following amounts:
22.22 	(1) general education revenue;
22.23 	(2) shared time aid according to section 126C.01,
22.24 	subdivision 7;
22.25 	(3) referendum aid according to section 126C.17; and 
22.26 	(4) online learning aid according to section 126C.24.
22.27 	(b) For fiscal year 2005 and later 2006, a district's
22.28 	general education aid is the sum of the following amounts:
22.29 	(1) general education revenue, excluding equity revenue,
22.30 	total operating capital, and transition revenue;
22.31 	(2) operating capital aid according to section 126C.10,
22.32 	subdivision 13b;
22.33 	(3) equity aid according to section 126C.10, subdivision
22.34 	30;
22.35 	(4) transition aid according to section 126C.10,
22.36 	subdivision 33;
23.1 	(5) shared time aid according to section 126C.01,
23.2 	subdivision 7;
23.3 	(6) referendum aid according to section 126C.17; and
23.4 	(7) online learning aid according to section 126C.24 
23.5 	124D.096.
23.6 	(b) For fiscal year 2007 and later, a district's general
23.7 	education aid is the sum of the following amounts:
23.8 	(1) general education revenue, excluding equity revenue,
23.9 	total operating capital revenue, alternative teacher
23.10 	compensation revenue, and transition revenue;
23.11 	(2) operating capital aid under section 126C.10,
23.12 	subdivision 13b;
23.13 	(3) equity aid under section 126C.10, subdivision 30;
23.14 	(4) alternative teacher compensation aid under section
23.15 	126C.10, subdivision 36;
23.16 	(5) transition aid under section 126C.10, subdivision 33;
23.17 	(6) shared time aid under section 126C.01, subdivision 7;
23.18 	(7) referendum aid under section 126C.17; and 
23.19 	(8) online learning aid according to section 124D.096.

23.20 	Sec. 27. Minnesota Statutes 2004, section 126C.15,
23.21 	subdivision 2, is amended to read:
23.22 		Subd. 2.Building allocation.  (a) A district must
23.23 	allocate its compensatory revenue to each school building in the
23.24 	district where the children who have generated the revenue are
23.25 	served unless the school district has received permission under
23.26 	section 50 to allocate compensatory revenue according to student
23.27 	performance measures developed by the school board.
23.28 	(b) Notwithstanding paragraph (a), a district may allocate
23.29 	up to five percent of the amount of compensatory revenue that
23.30 	the district received during the previous fiscal year receives 
23.31 	to school sites according to a plan adopted by the school board.
23.32 	(c) For the purposes of this section and section 126C.05,
23.33 	subdivision 3, "building" means education site as defined in
23.34 	section 123B.04, subdivision 1.
23.35 	(d) If the pupil is served at a site other than one owned
23.36 	and operated by the district, the revenue shall be paid to the
24.1 	district and used for services for pupils who generate the
24.2 	revenue.
24.3 	
EFFECTIVE DATE. This section is retroactively effective
24.4 	from July 1, 2005, for revenue for fiscal year 2006.

24.5 	Sec. 28. Minnesota Statutes 2004, section 126C.15,
24.6 	subdivision 3, is amended to read:
24.7 		Subd. 3.Recommendation.  A school site decision-making
24.8 	team, as defined in section 123B.04, subdivision 2, paragraph
24.9 	(a), or the instruction and curriculum advisory committee under
24.10 	section 120B.11, if the school has no school site decision team,
24.11 	shall recommend how the compensatory education revenue will be
24.12 	used to carry out the purpose of this section. A school
24.13 	district that has received permission under section 50 to
24.14 	allocate compensatory revenue according to school performance
24.15 	measures shall share its plan for the distribution of
24.16 	compensatory revenue with the school site decision team.
24.17 	
EFFECTIVE DATE. This section is effective retroactively
24.18 	from July 1, 2005, for revenue for fiscal year 2006.

24.19 	Sec. 29. Minnesota Statutes 2004, section 126C.17,
24.20 	subdivision 2, is amended to read:
24.21 		Subd. 2.Referendum allowance limit.  (a) Notwithstanding
24.22 	subdivision 1, for fiscal year 2003, a district's referendum
24.23 	allowance must not exceed the greater of:
24.24 	(1) the sum of a district's referendum allowance for fiscal
24.25 	year 1994 times 1.162 plus its referendum conversion allowance
24.26 	for fiscal year 2003, minus $415;
24.27 	(2) 18.2 percent of the formula allowance;
24.28 	(3) for a newly reorganized district created on July 1,
24.29 	2002, the referendum revenue authority for each reorganizing
24.30 	district in the year preceding reorganization divided by its
24.31 	resident marginal cost pupil units for the year preceding
24.32 	reorganization, minus $415; or 
24.33 	(4) for a newly reorganized district created after July 1,
24.34 	2002, the referendum revenue authority for each reorganizing
24.35 	district in the year preceding reorganization divided by its
24.36 	resident marginal cost pupil units for the year preceding
25.1 	reorganization.
25.2 	(b) Notwithstanding subdivision 1, for fiscal year 2004 
25.3 	2007 and later, a district's referendum allowance must not
25.4 	exceed the greater of:
25.5 	(1) the sum of:  (i) a district's referendum allowance for
25.6 	fiscal year 1994 times 1.177 times the annual inflationary
25.7 	increase as calculated under paragraph (c) (b) plus (ii) its
25.8 	referendum conversion allowance for fiscal year 2003, minus
25.9 	(iii) $415 $215;
25.10 	(2) the greater of (i) 18.6 26 percent of the formula
25.11 	allowance or (ii) $855.79 $1,294 times the annual inflationary
25.12 	increase as calculated under paragraph (c) (b); or
25.13 	(3) for a newly reorganized district created after July 1,
25.14 	2002 2006, the referendum revenue authority for each
25.15 	reorganizing district in the year preceding reorganization
25.16 	divided by its resident marginal cost pupil units for the year
25.17 	preceding reorganization.
25.18 	(c) (b) For purposes of this subdivision, for fiscal year
25.19 	2005 and later, "inflationary increase" means one plus the
25.20 	percentage change in the Consumer Price Index for urban
25.21 	consumers, as prepared by the United States Bureau of Labor
25.22 	Standards, for the current fiscal year to fiscal year 2004.  For
25.23 	fiscal years 2009 and later, for purposes of paragraph (b) (a),
25.24 	clause (1), the inflationary increase equals the inflationary
25.25 	increase for fiscal year 2008 plus one-fourth of the percentage
25.26 	increase in the formula allowance for that year compared with
25.27 	the formula allowance for fiscal year 2008.
25.28 	
EFFECTIVE DATE. This section is effective for revenue for
25.29 	fiscal year 2007.

25.30 	Sec. 30. Minnesota Statutes 2004, section 126C.17,
25.31 	subdivision 5, is amended to read:
25.32 		Subd. 5.Referendum equalization revenue.  (a) For fiscal
25.33 	year 2003 and later, a district's referendum equalization
25.34 	revenue equals the sum of the first tier referendum equalization
25.35 	revenue and the second tier referendum equalization revenue.
25.36 	(b) A district's first tier referendum equalization revenue
26.1 	equals the district's first tier referendum equalization
26.2 	allowance times the district's resident marginal cost pupil
26.3 	units for that year.
26.4 	(c) For fiscal years 2003 and 2004, a district's first tier
26.5 	referendum equalization allowance equals the lesser of the
26.6 	district's referendum allowance under subdivision 1 or $126.
26.7 	For fiscal year 2005, a district's first tier referendum
26.8 	equalization allowance equals the lesser of the district's
26.9 	referendum allowance under subdivision 1 or $405.For fiscal
26.10 	year 2006 and later, a district's first tier referendum
26.11 	equalization allowance equals the lesser of the district's
26.12 	referendum allowance under subdivision 1 or $500. For fiscal
26.13 	year 2007, a district's first tier referendum equalization
26.14 	allowance equals the lesser of the district's referendum
26.15 	allowance under subdivision 1 or $600.
26.16 	For fiscal year 2008 and later, a district's first tier
26.17 	referendum equalization allowance equals the lesser of the
26.18 	district's referendum allowance under subdivision 1 or $700.
26.19 	(d) A district's second tier referendum equalization
26.20 	revenue equals the district's second tier referendum
26.21 	equalization allowance times the district's resident marginal
26.22 	cost pupil units for that year.
26.23 	(e) For fiscal year 2006,a district's second tier
26.24 	referendum equalization allowance equals the lesser of the
26.25 	district's referendum allowance under subdivision 1 or 18.6
26.26 	percent of the formula allowance, minus the district's first
26.27 	tier referendum equalization allowance. For fiscal year 2007
26.28 	and later, a district's second tier referendum equalization
26.29 	allowance equals the lesser of the district's referendum
26.30 	allowance under subdivision 1 or 26 percent of the formula
26.31 	allowance, minus the district's first tier referendum
26.32 	equalization allowance.
26.33 	(f) Notwithstanding paragraph (e), the second tier
26.34 	referendum allowance for a district qualifying for secondary
26.35 	sparsity revenue under section 126C.10, subdivision 7, or
26.36 	elementary sparsity revenue under section 126C.10, subdivision
27.1 	8, equals the district's referendum allowance under subdivision
27.2 	1 minus the district's first tier referendum equalization
27.3 	allowance.

27.4 	Sec. 31. Minnesota Statutes 2004, section 126C.17,
27.5 	subdivision 7, is amended to read:
27.6 		Subd. 7.Referendum equalization aid.  (a) A district's
27.7 	referendum equalization aid equals the difference between its
27.8 	referendum equalization revenue and levy.
27.9 	(b) If a district's actual levy for first or second tier
27.10 	referendum equalization revenue is less than its maximum levy
27.11 	limit for that tier, aid shall be proportionately reduced.
27.12 	(c) Notwithstanding paragraph (a), the referendum
27.13 	equalization aid for a district, where the referendum
27.14 	equalization aid under paragraph (a) exceeds 90 percent of the
27.15 	referendum revenue, must not exceed 18.6 26 percent of the
27.16 	formula allowance times the district's resident marginal cost
27.17 	pupil units.  A district's referendum levy is increased by the
27.18 	amount of any reduction in referendum aid under this paragraph.
27.19 	
EFFECTIVE DATE. This section is effective for revenue for
27.20 	fiscal year 2007.

27.21 	Sec. 32. Minnesota Statutes 2004, section 126C.17,
27.22 	subdivision 9, is amended to read:
27.23 		Subd. 9.Referendum revenue.  (a) The revenue authorized
27.24 	by section 126C.10, subdivision 1, may be increased in the
27.25 	amount approved by the voters of the district at a referendum
27.26 	called for the purpose.  The referendum may be called by the
27.27 	board or shall be called by the board upon written petition of
27.28 	qualified voters of the district.  The referendum must be
27.29 	conducted one or two calendar years before the increased levy
27.30 	authority, if approved, first becomes payable.  Only one
27.31 	election to approve an increase may be held in a calendar year.
27.32 	Unless the referendum is conducted by mail under paragraph (g),
27.33 	the referendum must be held on the first Tuesday after the first
27.34 	Monday in November.  The ballot must state the maximum amount of
27.35 	the increased revenue per resident marginal cost pupil unit, the
27.36 	estimated referendum tax rate as a percentage of referendum
28.1 	market value in the first year it is to be levied, and that the
28.2 	revenue must be used to finance school operations.  The ballot
28.3 	may state a schedule, determined by the board, of increased
28.4 	revenue per resident marginal cost pupil unit that differs from
28.5 	year to year over the number of years for which the increased
28.6 	revenue is authorized. If the ballot contains a schedule
28.7 	showing different amounts, it must also indicate the estimated
28.8 	referendum tax rate as a percent of referendum market value for
28.9 	the amount specified for the first year and for the maximum
28.10 	amount specified in the schedule.The ballot may state that
28.11 	existing referendum levy authority is expiring.  In this case,
28.12 	the ballot may also compare the proposed levy authority to the
28.13 	existing expiring levy authority, and express the proposed
28.14 	increase as the amount, if any, over the expiring referendum
28.15 	levy authority.  The ballot must designate the specific number
28.16 	of years, not to exceed ten, for which the referendum
28.17 	authorization applies. The ballot, including a ballot on the
28.18 	question to revoke or reduce the increased revenue amount under
28.19 	paragraph (c), must abbreviate the term "per resident marginal
28.20 	cost pupil unit" as "per pupil." The notice required under
28.21 	section 275.60 may be modified to read, in cases of renewing
28.22 	existing levies:
28.23 	"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU MAY BE VOTING
28.24 	FOR A PROPERTY TAX INCREASE."
28.25 	The ballot may contain a textual portion with the
28.26 	information required in this subdivision and a question stating
28.27 	substantially the following:
28.28 	"Shall the increase in the revenue proposed by (petition
28.29 	to) the board of ........., School District No. .., be approved?"
28.30 	If approved, an amount equal to the approved revenue per
28.31 	resident marginal cost pupil unit times the resident marginal
28.32 	cost pupil units for the school year beginning in the year after
28.33 	the levy is certified shall be authorized for certification for
28.34 	the number of years approved, if applicable, or until revoked or
28.35 	reduced by the voters of the district at a subsequent referendum.
28.36 	(b) The board must prepare and deliver by first class mail
29.1 	at least 15 days but no more than 30 days before the day of the
29.2 	referendum to each taxpayer a notice of the referendum and the
29.3 	proposed revenue increase.  The board need not mail more than
29.4 	one notice to any taxpayer.  For the purpose of giving mailed
29.5 	notice under this subdivision, owners must be those shown to be
29.6 	owners on the records of the county auditor or, in any county
29.7 	where tax statements are mailed by the county treasurer, on the
29.8 	records of the county treasurer.  Every property owner whose
29.9 	name does not appear on the records of the county auditor or the
29.10 	county treasurer is deemed to have waived this mailed notice
29.11 	unless the owner has requested in writing that the county
29.12 	auditor or county treasurer, as the case may be, include the
29.13 	name on the records for this purpose.  The notice must project
29.14 	the anticipated amount of tax increase in annual dollars and
29.15 	annual percentage for typical residential homesteads,
29.16 	agricultural homesteads, apartments, and commercial-industrial
29.17 	property within the school district.
29.18 	The notice for a referendum may state that an existing
29.19 	referendum levy is expiring and project the anticipated amount
29.20 	of increase over the existing referendum levy in the first year,
29.21 	if any, in annual dollars and annual percentage for typical
29.22 	residential homesteads, agricultural homesteads, apartments, and
29.23 	commercial-industrial property within the district.
29.24 	The notice must include the following statement:  "Passage
29.25 	of this referendum will result in an increase in your property
29.26 	taxes."  However, in cases of renewing existing levies, the
29.27 	notice may include the following statement:  "Passage of this
29.28 	referendum may result in an increase in your property taxes."
29.29 	(c) A referendum on the question of revoking or reducing
29.30 	the increased revenue amount authorized pursuant to paragraph
29.31 	(a) may be called by the board and shall be called by the board
29.32 	upon the written petition of qualified voters of the district.
29.33 	A referendum to revoke or reduce the revenue amount must state
29.34 	the amount per resident marginal cost pupil unit by which the
29.35 	authority is to be reduced.  Revenue authority approved by the
29.36 	voters of the district pursuant to paragraph (a) must be
30.1 	available to the school district at least once before it is
30.2 	subject to a referendum on its revocation or reduction for
30.3 	subsequent years.  Only one revocation or reduction referendum
30.4 	may be held to revoke or reduce referendum revenue for any
30.5 	specific year and for years thereafter.
30.6 	(d) A petition authorized by paragraph (a) or (c) is
30.7 	effective if signed by a number of qualified voters in excess of
30.8 	15 percent of the registered voters of the district on the day
30.9 	the petition is filed with the board.  A referendum invoked by
30.10 	petition must be held on the date specified in paragraph (a).
30.11 	(e) The approval of 50 percent plus one of those voting on
30.12 	the question is required to pass a referendum authorized by this
30.13 	subdivision.
30.14 	(f) At least 15 days before the day of the referendum, the
30.15 	district must submit a copy of the notice required under
30.16 	paragraph (b) to the commissioner and to the county auditor of
30.17 	each county in which the district is located.  Within 15 days
30.18 	after the results of the referendum have been certified by the
30.19 	board, or in the case of a recount, the certification of the
30.20 	results of the recount by the canvassing board, the district
30.21 	must notify the commissioner of the results of the referendum.

30.22 	Sec. 33. Minnesota Statutes 2004, section 126C.17,
30.23 	subdivision 13, is amended to read:
30.24 		Subd. 13.Referendum conversion allowance. (a) A school
30.25 	district that received supplemental or transition revenue in
30.26 	fiscal year 2002 may convert its supplemental revenue conversion
30.27 	allowance and transition revenue conversion allowance to
30.28 	additional referendum allowance under subdivision 1 for fiscal
30.29 	year 2003 and thereafter.  A majority of the school board must
30.30 	approve the conversion at a public meeting before November 1,
30.31 	2001.  For a district with other referendum authority, the
30.32 	referendum conversion allowance approved by the board continues
30.33 	until the portion of the district's other referendum authority
30.34 	with the earliest expiration date after June 30, 2006, expires.
30.35 	For a district with no other referendum authority, the
30.36 	referendum conversion allowance approved by the board continues
31.1 	until June 30, 2012.
31.2 	(b) A school district that received transition revenue in
31.3 	fiscal year 2004 may convert all or part of its transition
31.4 	revenue to referendum revenue with voter approval in a
31.5 	referendum called for the purpose.  The referendum must be held
31.6 	in accordance with subdivision 9, except that the ballot may
31.7 	state that existing transition revenue authority is being
31.8 	canceled or is expiring.  In this case, the ballot shall compare
31.9 	the proposed referendum allowance to the canceled or expiring
31.10 	transition revenue allowance.  For purposes of this comparison,
31.11 	the canceled or expiring transition revenue allowance per
31.12 	adjusted marginal cost pupil unit shall be converted to an
31.13 	allowance per resident marginal cost pupil unit based on the
31.14 	district's ratio of adjusted marginal cost pupil units to
31.15 	resident marginal cost pupil units for the preceding fiscal
31.16 	year.  The referendum must be held on the first Tuesday after
31.17 	the first Monday in November.  The notice required under section
31.18 	275.60 may be modified to read:  "BY VOTING 'YES' ON THIS BALLOT
31.19 	QUESTION, YOU MAY BE VOTING FOR A PROPERTY TAX INCREASE."
31.20 	Elections under this paragraph must be held in 2007 or earlier.

31.21 	Sec. 34. Minnesota Statutes 2004, section 126C.21,
31.22 	subdivision 4, is amended to read:
31.23 		Subd. 4.Taconite deductions. (1) Notwithstanding any
31.24 	provisions of any other law to the contrary, the adjusted net
31.25 	tax capacity used in calculating general education aid may
31.26 	include only that property that is currently taxable in the
31.27 	district.
31.28 	(2) For districts that received payments have revenue under
31.29 	sections 298.018; 298.225; 229.24 to 298.28, excluding 298.26
31.30 	and 298.28, subdivision 4, paragraph (d); 298.34 to 298.39;
31.31 	298.391 to 298.396; and 298.405; and 477A.15, or any law
31.32 	imposing a tax upon severed mineral values; or recognized
31.33 	revenue under section 477A.15;,the general education aid must
31.34 	be reduced in the final adjustment payment by (1) the difference
31.35 	between the dollar amount of the payments received revenue
31.36 	recognized pursuant to those sections, or revenue recognized
32.1 	under section 477A.15 in for the fiscal year to which the final
32.2 	adjustment is attributable and , less (2) the amount that was
32.3 	calculated, pursuant to section 126C.48, subdivision 8, as a
32.4 	reduction of the levy attributable to the fiscal year to which
32.5 	the final adjustment is attributable.  If the final adjustment
32.6 	of a district's general education aid for a fiscal year is a
32.7 	negative amount because of this clause subdivision, the next
32.8 	fiscal year's general education aid to that district must be
32.9 	reduced by this negative amount in the following manner:  there
32.10 	must be withheld from each scheduled general education aid
32.11 	payment due the district in such fiscal year, 15 percent of the
32.12 	total negative amount, until the total negative amount has been
32.13 	withheld.  The amount reduced from general education aid
32.14 	pursuant to this clause subdivision must be recognized as reduce 
32.15 	revenue in the fiscal year to which the final adjustment payment
32.16 	is attributable.
32.17 	[EFFECTIVE DATE.]This section is effective for revenue for
32.18 	fiscal year 2006.

32.19 	Sec. 35. Minnesota Statutes 2004, section 126C.40,
32.20 	subdivision 1, is amended to read:
32.21 		Subdivision 1.To lease building or land.  (a) When an
32.22 	independent or a special school district or a group of
32.23 	independent or special school districts finds it economically
32.24 	advantageous to rent or lease a building or land for any
32.25 	instructional purposes or for school storage or furniture
32.26 	repair, and it determines that the operating capital revenue
32.27 	authorized under section 126C.10, subdivision 13, is
32.28 	insufficient for this purpose, it may apply to the commissioner
32.29 	for permission to make an additional capital expenditure levy
32.30 	for this purpose.  An application for permission to levy under
32.31 	this subdivision must contain financial justification for the
32.32 	proposed levy, the terms and conditions of the proposed lease,
32.33 	and a description of the space to be leased and its proposed use.
32.34 	(b) The criteria for approval of applications to levy under
32.35 	this subdivision must include:  the reasonableness of the price,
32.36 	the appropriateness of the space to the proposed activity, the
33.1 	feasibility of transporting pupils to the leased building or
33.2 	land, conformity of the lease to the laws and rules of the state
33.3 	of Minnesota, and the appropriateness of the proposed lease to
33.4 	the space needs and the financial condition of the district.
33.5 	The commissioner must not authorize a levy under this
33.6 	subdivision in an amount greater than 90 percent of the cost to
33.7 	the district of renting or leasing a building or land for
33.8 	approved purposes.  The proceeds of this levy must not be used
33.9 	for custodial or other maintenance services.  A district may not
33.10 	levy under this subdivision for the purpose of leasing or
33.11 	renting a district-owned building or site to itself.
33.12 	(c) For agreements finalized after July 1, 1997, a district
33.13 	may not levy under this subdivision for the purpose of leasing:
33.14 	(1) a newly constructed building used primarily for regular
33.15 	kindergarten, elementary, or secondary instruction; or (2) a
33.16 	newly constructed building addition or additions used primarily
33.17 	for regular kindergarten, elementary, or secondary instruction
33.18 	that contains more than 20 percent of the square footage of the
33.19 	previously existing building.
33.20 	(d) Notwithstanding paragraph (b), a district may levy
33.21 	under this subdivision for the purpose of leasing or renting a
33.22 	district-owned building or site to itself only if the amount is
33.23 	needed by the district to make payments required by a lease
33.24 	purchase agreement, installment purchase agreement, or other
33.25 	deferred payments agreement authorized by law, and the levy
33.26 	meets the requirements of paragraph (c).  A levy authorized for
33.27 	a district by the commissioner under this paragraph may be in
33.28 	the amount needed by the district to make payments required by a
33.29 	lease purchase agreement, installment purchase agreement, or
33.30 	other deferred payments agreement authorized by law, provided
33.31 	that any agreement include a provision giving the school
33.32 	districts the right to terminate the agreement annually without
33.33 	penalty.
33.34 	(e) The total levy under this subdivision for a district
33.35 	for any year must not exceed $90 $100 times the resident pupil
33.36 	units for the fiscal year to which the levy is attributable.
34.1 	(f) For agreements for which a review and comment have been
34.2 	submitted to the Department of Education after April 1, 1998,
34.3 	the term "instructional purpose" as used in this subdivision
34.4 	excludes expenditures on stadiums.
34.5 	(g) The commissioner of education may authorize a school
34.6 	district to exceed the limit in paragraph (e) if the school
34.7 	district petitions the commissioner for approval.  The
34.8 	commissioner shall grant approval to a school district to exceed
34.9 	the limit in paragraph (e) for not more than five years if the
34.10 	district meets the following criteria:
34.11 	(1) the school district has been experiencing pupil
34.12 	enrollment growth in the preceding five years;
34.13 	(2) the purpose of the increased levy is in the long-term
34.14 	public interest;
34.15 	(3) the purpose of the increased levy promotes colocation
34.16 	of government services; and
34.17 	(4) the purpose of the increased levy is in the long-term
34.18 	interest of the district by avoiding over construction of school
34.19 	facilities.
34.20 	(h) A school district that is a member of an intermediate
34.21 	school district may include in its authority under this section
34.22 	90 percent of the costs associated with leases of administrative
34.23 	and classroom space for intermediate school district programs.
34.24 	This authority must not exceed $22.50 $25 times the adjusted
34.25 	marginal cost pupil units of the member districts.  This
34.26 	authority is in addition to any other authority authorized under
34.27 	this section.
34.28 	(i) In addition to the allowable capital levies in
34.29 	paragraph (a), a district that is a member of the "Technology
34.30 	and Information Education Systems" data processing joint board,
34.31 	that finds it economically advantageous to enter into a lease
34.32 	purchase agreement for a building for a group of school
34.33 	districts or special school districts for staff development
34.34 	purposes, may levy for its portion of lease costs attributed to
34.35 	the district within the total levy limit in paragraph (e).

34.36 	Sec. 36. Minnesota Statutes 2004, section 126C.43,
35.1 	subdivision 2, is amended to read:
35.2 		Subd. 2.Payment to unemployment insurance program trust
35.3 	fund by state and political subdivisions.  A district may
35.4 	levy 90 percent of the amount exceeding $10 times the district's
35.5 	adjusted marginal cost pupil units for the fiscal year ending in
35.6 	the year before the year the levy is certified necessary (i) to
35.7 	pay the district's obligations under section 268.052,
35.8 	subdivision 1, and (ii) to pay for job placement services
35.9 	offered to employees who may become eligible for benefits
35.10 	pursuant to section 268.085 for the fiscal year the levy is
35.11 	certified.
35.12 	
EFFECTIVE DATE. This section is effective for taxes
35.13 	payable in 2006.

35.14 	Sec. 37. Minnesota Statutes 2004, section 126C.43,
35.15 	subdivision 3, is amended to read:
35.16 		Subd. 3.Tax levy for judgment.  A district may levy 90
35.17 	percent of the amount exceeding $10 times the district's
35.18 	adjusted marginal cost pupil units for the fiscal year ending in
35.19 	the year before the year the levy is certified necessary to pay
35.20 	judgments against the district under section 123B.25 that became
35.21 	final after the date the district certified its proposed levy in
35.22 	the previous year.  With the approval of the commissioner, a
35.23 	district may spread this levy over a period not to exceed three
35.24 	years.  Upon approval through the adoption of a resolution by
35.25 	each of an intermediate district's member school district
35.26 	boards, a member school district may include its proportionate
35.27 	share of the costs of a judgment against an intermediate school
35.28 	district that became final under section 123B.25 after the date
35.29 	that the earliest member school district certified its proposed
35.30 	levy in the previous year.  With the approval of the
35.31 	commissioner, an intermediate school district member school
35.32 	district may spread this levy over a period not to exceed three
35.33 	years.
35.34 	
EFFECTIVE DATE. This section is effective for taxes
35.35 	payable in 2006.

35.36 	Sec. 38. Minnesota Statutes 2004, section 126C.48,
36.1 	subdivision 2, is amended to read:
36.2 		Subd. 2.Notice to commissioner; forms.  By October 7 of
36.3 	each year each district must notify the commissioner of the
36.4 	proposed levies in compliance with the levy limitations of this
36.5 	chapter and chapters 120B, 122A, 123A, 123B, 124D, 125A, 127A,
36.6 	and 136D.  By January 15 7 of each year each district must
36.7 	notify the commissioner of the final levies certified.  The
36.8 	commissioner shall prescribe the form of these notifications and
36.9 	may request any additional information necessary to compute
36.10 	certified levy amounts.

36.11 	Sec. 39. Minnesota Statutes 2004, section 126C.48,
36.12 	subdivision 8, is amended to read:
36.13 		Subd. 8.Taconite payment and other reductions.  (1)
36.14 	Reductions in levies pursuant to subdivision 1 must be made
36.15 	prior to the reductions in clause (2).
36.16 	(2) Notwithstanding any other law to the contrary,
36.17 	districts which received payments that have revenue pursuant to
36.18 	sections 298.018; 298.225; 298.24 to 298.28, except an amount
36.19 	distributed under section sections 298.26;298.28, subdivision
36.20 	4, paragraph paragraphs (c), clause (ii), and (d); 298.34 to
36.21 	298.39; 298.391 to 298.396; 298.405; 477A.15;and any law
36.22 	imposing a tax upon severed mineral values; or recognized
36.23 	revenue under section 477A.15 must not include a portion of
36.24 	these aids in their permissible levies pursuant to those
36.25 	sections, but instead must reduce the permissible levies
36.26 	authorized by this chapter and chapters 120B, 122A, 123A, 123B,
36.27 	124A, 124D, 125A, and 127A by the greater of the following:95
36.28 	percent of the previous year's revenue specified under this
36.29 	clause.
36.30 	(a) an amount equal to 50 percent of the total dollar
36.31 	amount of the payments received pursuant to those sections or
36.32 	revenue recognized under section 477A.15 in the previous fiscal
36.33 	year; or 
36.34 	(b) an amount equal to the total dollar amount of the
36.35 	payments received pursuant to those sections or revenue
36.36 	recognized under section 477A.15 in the previous fiscal year
37.1 	less the product of the same dollar amount of payments or
37.2 	revenue times five percent.
37.3 	For levy year 2002 only, 77 percent of the amounts
37.4 	distributed under section 298.225 and 298.28, and 100 percent of
37.5 	the amounts distributed under sections 298.018; 298.34 to
37.6 	298.39; 298.391 to 298.396; 298.405; and any law imposing a tax
37.7 	upon severed mineral values, or recognized revenue under section
37.8 	477A.15, shall be used for purposes of the calculations under
37.9 	this paragraph.  For levy year 2003 only, the levy reductions
37.10 	under this subdivision must be calculated as if section 298.28,
37.11 	subdivision 4, paragraph (f), did not apply for the 2003
37.12 	distribution.
37.13 	(3) The amount of any voter approved referendum, facilities
37.14 	down payment, and debt levies shall not be reduced by more than
37.15 	50 percent under this subdivision.  In administering this
37.16 	paragraph, the commissioner shall first reduce the nonvoter
37.17 	approved levies of a district; then, if any payments, severed
37.18 	mineral value tax revenue or recognized revenue under paragraph
37.19 	(2) remains, the commissioner shall reduce any voter approved
37.20 	referendum levies authorized under section 126C.17; then, if any
37.21 	payments, severed mineral value tax revenue or recognized
37.22 	revenue under paragraph (2) remains, the commissioner shall
37.23 	reduce any voter approved facilities down payment levies
37.24 	authorized under section 123B.63 and then, if any payments,
37.25 	severed mineral value tax revenue or recognized revenue under
37.26 	paragraph (2) remains, the commissioner shall reduce any voter
37.27 	approved debt levies.
37.28 	(4) Before computing the reduction pursuant to this
37.29 	subdivision of the health and safety levy authorized by sections
37.30 	123B.57 and 126C.40, subdivision 5, the commissioner shall
37.31 	ascertain from each affected school district the amount it
37.32 	proposes to levy under each section or subdivision.  The
37.33 	reduction shall be computed on the basis of the amount so
37.34 	ascertained.
37.35 	(5) To the extent the levy reduction calculated under
37.36 	paragraph (2) exceeds the limitation in paragraph (3), an amount
38.1 	equal to the excess must be distributed from the school
38.2 	district's distribution under sections 298.225, 298.28, and
38.3 	477A.15 in the following year to the cities and townships within
38.4 	the school district in the proportion that their taxable net tax
38.5 	capacity within the school district bears to the taxable net tax
38.6 	capacity of the school district for property taxes payable in
38.7 	the year prior to distribution.  No city or township shall
38.8 	receive a distribution greater than its levy for taxes payable
38.9 	in the year prior to distribution.  The commissioner of revenue
38.10 	shall certify the distributions of cities and towns under this
38.11 	paragraph to the county auditor by September 30 of the year
38.12 	preceding distribution.  The county auditor shall reduce the
38.13 	proposed and final levies of cities and towns receiving
38.14 	distributions by the amount of their distribution.
38.15 	Distributions to the cities and towns shall be made at the times
38.16 	provided under section 298.27.
38.17 	
EFFECTIVE DATE. This section is effective for revenue for
38.18 	fiscal year 2006.

38.19 	Sec. 40. Minnesota Statutes 2004, section 127A.45,
38.20 	subdivision 11, is amended to read:
38.21 		Subd. 11.Payment percentage for reimbursement aids.  One
38.22 	hundred percent of the aid for the previous fiscal year must be
38.23 	paid in the current year for the following aids:
38.24 	telecommunications/Internet access equity and according to
38.25 	section 125B.26,special education special pupil aid according
38.26 	to section 125A.75, subdivision 3, aid for litigation costs
38.27 	according to section 125A.75, subdivision 8, aid for
38.28 	court-placed special education expenses according to section
38.29 	125A.79, subdivision 4, and aid for special education
38.30 	out-of-state tuition according to section 125A.79, subdivision
38.31 	8, and shared time aid according to section 126C.01, subdivision
38.32 	7.

38.33 	Sec. 41. Minnesota Statutes 2004, section 127A.49,
38.34 	subdivision 2, is amended to read:
38.35 		Subd. 2.Abatements.  Whenever by virtue of chapter 278,
38.36 	sections 270.07, 375.192, or otherwise, the net tax capacity of
39.1 	any district for any taxable year is changed after the taxes for
39.2 	that year have been spread by the county auditor and the local
39.3 	tax rate as determined by the county auditor based upon the
39.4 	original net tax capacity is applied upon the changed net tax
39.5 	capacities, the county auditor shall, prior to February 1 of
39.6 	each year, certify to the commissioner of education the amount
39.7 	of any resulting net revenue loss that accrued to the district
39.8 	during the preceding year.  Each year, the commissioner shall
39.9 	pay an abatement adjustment to the district in an amount
39.10 	calculated according to the provisions of this subdivision.
39.11 	This amount shall be deducted from the amount of the levy
39.12 	authorized by section 126C.46.  The amount of the abatement
39.13 	adjustment must be the product of:
39.14 	(1) the net revenue loss as certified by the county
39.15 	auditor, times
39.16 	(2) the ratio of:
39.17 	(i) the sum of the amounts of the district's certified levy
39.18 	in the third preceding year according to the following:
39.19 	(A) section 123B.57, if the district received health and
39.20 	safety aid according to that section for the second preceding
39.21 	year;
39.22 	(B) section 124D.20, if the district received aid for
39.23 	community education programs according to that section for the
39.24 	second preceding year;
39.25 	(C) section 124D.135, subdivision 3, if the district
39.26 	received early childhood family education aid according to
39.27 	section 124D.135 for the second preceding year; and
39.28 	(D) section 126C.17, subdivision 6, if the district
39.29 	received referendum equalization aid according to that section
39.30 	for the second preceding year; to
39.31 	(ii) the total amount of the district's certified levy in
39.32 	the third preceding December, plus or minus auditor's
39.33 	adjustments.

39.34 	Sec. 42. Minnesota Statutes 2004, section 127A.49,
39.35 	subdivision 3, is amended to read:
39.36 		Subd. 3.Excess tax increment.  (a) If a return of excess
40.1 	tax increment is made to a district pursuant to section sections 
40.2 	469.176, subdivision 2, and 469.177, subdivision 9,or upon
40.3 	decertification of a tax increment district, the school
40.4 	district's aid and levy limitations must be adjusted for the
40.5 	fiscal year in which the excess tax increment is paid under the
40.6 	provisions of this subdivision.
40.7 	(b) An amount must be subtracted from the district's aid
40.8 	for the current fiscal year equal to the product of:
40.9 	(1) the amount of the payment of excess tax increment to
40.10 	the district, times
40.11 	(2) the ratio of:
40.12 	(i) the sum of the amounts of the district's certified levy
40.13 	for the fiscal year in which the excess tax increment is paid
40.14 	according to the following:
40.15 	(A) section 123B.57, if the district received health and
40.16 	safety aid according to that section for the second preceding
40.17 	year;
40.18 	(B) section 124D.20, if the district received aid for
40.19 	community education programs according to that section for the
40.20 	second preceding year;
40.21 	(C) section 124D.135, subdivision 3, if the district
40.22 	received early childhood family education aid according to
40.23 	section 124D.135 for the second preceding year; and
40.24 	(D) section 126C.17, subdivision 6, if the district
40.25 	received referendum equalization aid according to that section
40.26 	for the second preceding year; to
40.27 	(ii) the total amount of the district's certified levy for
40.28 	the fiscal year, plus or minus auditor's adjustments.
40.29 	(c) An amount must be subtracted from the school district's
40.30 	levy limitation for the next levy certified equal to the
40.31 	difference between:
40.32 	(1) the amount of the distribution of excess increment; and
40.33 	(2) the amount subtracted from aid pursuant to clause (a).
40.34 	If the aid and levy reductions required by this subdivision
40.35 	cannot be made to the aid for the fiscal year specified or to
40.36 	the levy specified, the reductions must be made from aid for
41.1 	subsequent fiscal years, and from subsequent levies.  The school
41.2 	district must use the payment of excess tax increment to replace
41.3 	the aid and levy revenue reduced under this subdivision.
41.4 	(d) This subdivision applies only to the total amount of
41.5 	excess increments received by a district for a calendar year
41.6 	that exceeds $25,000.

41.7 	Sec. 43. Minnesota Statutes 2004, section 275.14, is
41.8 	amended to read:
41.9 	275.14 CENSUS.
41.10 	For the purposes of sections 275.124 to 275.16, the
41.11 	population of a city shall be that established by the last
41.12 	federal census, by a special census taken by the United States
41.13 	Bureau of the Census, by an estimate made by the Metropolitan
41.14 	Council, or by the state demographer made according to section
41.15 	4A.02, whichever has the latest stated date of count or
41.16 	estimate, before July 2 of the current levy year.The
41.17 	population of a school district must be as certified by the
41.18 	Department of Education from the most recent federal census.  In
41.19 	any year in which no federal census is taken pursuant to law in
41.20 	any school district affected by sections 275.124 to
41.21 	275.16 124D.20 and 124D.531a population estimate may be made
41.22 	and submitted to the state demographer for approval as
41.23 	hereinafter provided.  The school board of a school district, in
41.24 	case it desires a population estimate, shall pass a resolution
41.25 	by July 1 containing a current estimate of the population of the
41.26 	school district and shall submit the resolution to the state
41.27 	demographer.  The resolution shall describe the criteria on
41.28 	which the estimate is based and shall be in a form and
41.29 	accompanied by the data prescribed by the state demographer.
41.30 	The state demographer shall determine whether or not the
41.31 	criteria and process described in the resolution provide a
41.32 	reasonable basis for the population estimate and shall inform
41.33 	the school district of that determination within 30 days of
41.34 	receipt of the resolution.  If the state demographer determines
41.35 	that the criteria and process described in the resolution do not
41.36 	provide a reasonable basis for the population estimate, the
42.1 	resolution shall be of no effect.  If the state demographer
42.2 	determines that the criteria and process do provide a reasonable
42.3 	basis for the population estimate, the estimate shall be treated
42.4 	as the population of the school district for the purposes of
42.5 	sections 275.124 to 275.16124D.20 and 124D.531until the
42.6 	population of the school district has been established by the
42.7 	next federal census or until a more current population estimate
42.8 	is prepared and approved as provided herein, whichever occurs
42.9 	first.  The state demographer shall establish guidelines for
42.10 	acceptable population estimation criteria and processes.  The
42.11 	state demographer shall issue advisory opinions upon request in
42.12 	writing to cities or school districts as to proposed criteria
42.13 	and processes prior to their implementation in an estimation.
42.14 	The advisory opinion shall be final and binding upon the
42.15 	demographer unless the demographer can show cause why it should
42.16 	not be final and binding.
42.17 	In the event that a census tract employed in taking a
42.18 	federal or local census overlaps two or more school districts,
42.19 	the county auditor shall, on the basis of the best information
42.20 	available, allocate the population of said census tract to the
42.21 	school districts involved.
42.22 	The term "council," as used in sections 275.124 to 275.16,
42.23 	means any board or body, whether composed of one or more
42.24 	branches, authorized to make ordinances for the government of a
42.25 	city within this state.

42.26 	Sec. 44. Minnesota Statutes 2004, section 275.16, is
42.27 	amended to read:
42.28 	275.16 COUNTY AUDITOR TO FIX AMOUNT OF LEVY.
42.29 	If any such municipality shall return to the county auditor
42.30 	a levy greater than permitted by chapters 123A, 123B, 124D,
42.31 	126C, and 136C, and 136D,sections 275.124 to 275.16, and 275.70
42.32 	to 275.74, such county auditor shall extend only such amount of
42.33 	taxes as the limitations herein prescribed will permit;
42.34 	provided, if such levy shall include any levy for the payment of
42.35 	bonded indebtedness or judgments, such levies for bonded
42.36 	indebtedness or judgments shall be extended in full, and the
43.1 	remainder of the levies shall be reduced so that the total
43.2 	thereof, including levies for bonds and judgments, shall not
43.3 	exceed such amount as the limitations herein prescribed will
43.4 	permit.

43.5 	Sec. 45. Minnesota Statutes 2004, section 469.177,
43.6 	subdivision 9, is amended to read:
43.7 		Subd. 9.Distributions of excess taxes on captured net
43.8 	tax capacity.  (a) If the amount of tax paid on captured net tax
43.9 	capacity exceeds the amount of tax increment, the county auditor
43.10 	shall distribute the excess to the municipality, county, and
43.11 	school district as follows:  each governmental unit's share of
43.12 	the excess equals
43.13 	(1) the total amount of the excess for the tax increment
43.14 	financing district, multiplied by
43.15 	(2) a fraction, the numerator of which is the current local
43.16 	tax rate of the governmental unit less the governmental unit's
43.17 	local tax rate for the year the original local tax rate for the
43.18 	district was certified (in no case may this amount be less than
43.19 	zero) and the denominator of which is the sum of the numerators
43.20 	for the municipality, county, and school district.
43.21 	If the entire increase in the local tax rate is attributable to
43.22 	a taxing district, other than the municipality, county, or
43.23 	school district, then the excess must be distributed to the
43.24 	municipality, county, and school district in proportion to their
43.25 	respective local tax rates.
43.26 	(b) The amounts distributed shall be deducted in computing
43.27 	the levy limits of the taxing district for the succeeding
43.28 	taxable year. In the case of a school district, only the
43.29 	proportion of the excess taxes attributable to unequalized
43.30 	levies that are subject to a fixed dollar amount levy limit
43.31 	shall be deducted from the levy limit.
43.32 	(c) In the case of distributions to a school district that
43.33 	are attributable to state equalized levies, the county auditor
43.34 	shall report amounts distributed to the commissioner of
43.35 	education in the same manner as provided for excess increments
43.36 	under section 469.176, subdivision 2, and the distribution shall
44.1 	be deducted from the school district's state aid payments and
44.2 	levy limitation according to section 127A.49, subdivision 3.

44.3 	Sec. 46. KINDERGARTEN REPORTING.
 44.4 	Notwithstanding Minnesota Statutes, sections 120A.05,
44.5 	subdivision 18; 120A.20, subdivision 1; and 124D.02, subdivision
44.6 	1, pupils four or five years of age on September 1 of the
44.7 	calendar year in which the school year commences and enrolled in
44.8 	a prekindergarten program implemented by the district before
44.9 	July 1, 2003, may be reported as kindergarten pupils under
44.10 	Minnesota Statutes, section 126C.05, subdivision 1, for fiscal
44.11 	years 2004 and earlier.

44.12 	EFFECTIVE DATE. This section is effective the day
44.13 	following final enactment and applies to fiscal years 2004 and
44.14 	earlier.

44.15 	Sec. 47. ALTERNATIVE TEACHER COMPENSATION REVENUE
44.16 	GUARANTEE.
 44.17 	Notwithstanding Minnesota Statutes, sections 122A.415,
44.18 	subdivision 1, and 126C.10, subdivision 34, paragraphs (a) and
44.19 	(b), a school district that received alternative teacher
44.20 	compensation aid for fiscal year 2005, but does not qualify for
44.21 	alternative teacher compensation revenue for all sites in the
44.22 	district for fiscal year 2006 or 2007, shall receive additional
44.23 	basic alternative teacher compensation aid for that fiscal year
44.24 	equal to the lesser of the amount of alternative teacher
44.25 	compensation aid it received for fiscal year 2005 or the amount
44.26 	it would have received for that fiscal year under Minnesota
44.27 	Statutes 2004, section 122A.415, subdivision 1, for teachers at
44.28 	sites not qualifying for alternative teacher compensation
44.29 	revenue for that fiscal year, if the district submits a timely
44.30 	application and the commissioner determines that the district
44.31 	continues to implement an alternative teacher compensation
44.32 	system, consistent with its application under Minnesota Statutes
44.33 	2004, section 122A.415, for fiscal year 2005.  The additional
44.34 	basic alternative teacher compensation aid under this section
44.35 	must not be used in calculating the alternative teacher
44.36 	compensation levy under Minnesota Statutes, section 126C.10,
45.1 	subdivision 35.  This section applies only to fiscal years 2006
45.2 	and 2007 and does not apply to later fiscal years.

45.3 	Sec. 48. INITIAL APPROVAL PROCESS.
 45.4 	Notwithstanding Minnesota Statutes, sections 122A.414,
45.5 	subdivision 2b, and 122A.415, subdivision 3, paragraph (b), or
45.6 	other law to the contrary, until July 1, 2006, only, the
45.7 	commissioner of education may accept, and subsequently approve
45.8 	an application to participate in the alternative teacher
45.9 	compensation system under Minnesota Statutes, section 122A.414,
45.10 	based on the proportionate distribution of the student
45.11 	population in the seven-county metropolitan area and in rural
45.12 	Minnesota.  The commissioner must provide timely public notice
45.13 	of the applicants the commissioner approves under this section.

45.14 	EFFECTIVE DATE. This section is effective for revenue for
45.15 	fiscal year 2007.

45.16 	Sec. 49. SCHOOL BUS LEVY; CARPENTER SCHOOL BUSES.
 45.17 	For taxes payable in 2006 through 2010, a school district
45.18 	may levy an amount, not to exceed in the aggregate, $30,000
45.19 	times the number of Carpenter school buses in its fleet as of
45.20 	January 1, 2003, that have been determined to have potentially
45.21 	defective welds and are subject to limitations imposed by the
45.22 	Department of Public Safety.

45.23 	Sec. 50. COMPENSATORY REVENUE ALLOCATION; TEST SCORE
45.24 	PILOT PROGRAM.
 45.25 		Subdivision 1.Pilot program created. A pilot program is
45.26 	created to allow a school district to allocate compensatory
45.27 	revenue received under Minnesota Statutes, section 126C.10,
45.28 	subdivision 3, among its school buildings according to each
45.29 	building's school performance measures.
45.30 		Subd. 2.Application process. Independent School
45.31 	Districts Nos. 11, Anoka-Hennepin; 279, Osseo; 281, Robbinsdale;
45.32 	535, Rochester; and 833, South Washington may submit an
45.33 	application to the commissioner of education by August 15, 2005,
45.34 	for a plan to allocate compensatory revenue to school sites
45.35 	based on student performance.  The application must include a
45.36 	written resolution approved by the school board that:  (1)
46.1 	identifies the test results that will be used to assess student
46.2 	performance; (2) describes the method for distribution of
46.3 	compensatory revenue to the school sites; and (3) summarizes the
46.4 	evaluation procedure the district will use to determine if the
46.5 	redistribution of compensatory revenue improves overall student
46.6 	performance.  The application must be submitted in the form and
46.7 	manner specified by the commissioner.  The commissioner must
46.8 	notify the selected school districts by September 1, 2005.
46.9 		Subd. 3.Report. The commissioner of education must
46.10 	submit a report by February 15, 2008, to the education
46.11 	committees of the legislature evaluating the effectiveness of
46.12 	the pilot program.
46.13 	
EFFECTIVE DATE. This section is effective the day
46.14 	following final enactment.

46.15 	Sec. 51. INCREASE IN EQUITY REVENUE; FISCAL YEAR 2006
46.16 	ONLY.
 46.17 	For fiscal year 2006 only, the increase in equity revenue
46.18 	under section 21 is payable entirely in state aid.

46.19 	Sec. 52. RED LAKE FISCAL YEAR 2005 PUPIL UNITS.
 46.20 	Notwithstanding Minnesota Statutes, section 126C.05, the
46.21 	fiscal year 2005 average daily membership for Independent School
46.22 	District No. 38, Red Lake, shall be the greater of the amount
46.23 	that would have been computed if the district's school buildings
46.24 	had not reopened after March 21, 2005, or the amount computed
46.25 	using actual data for the entire school year.  Notwithstanding
46.26 	Minnesota Statutes, section 126C.05, subdivision 15, for fiscal
46.27 	year 2005, learning year pupil units for Independent School
46.28 	District No. 38, Red Lake, must be calculated using the hours in
46.29 	excess of the actual number of instructional hours in the
46.30 	calendar year for the school attended by the student, instead of
46.31 	the number of hours in excess of 1,020 for a secondary school
46.32 	pupil.

46.33 	Sec. 53. FISCAL YEARS 2006 AND 2007 DECLINING PUPIL UNIT
46.34 	AID, RED LAKE.
 46.35 	For fiscal years 2006 and 2007 only, Independent School
46.36 	District No. 38, Red Lake, is eligible for declining pupil unit
47.1 	aid equal to the greater of zero or the product of the general
47.2 	education formula allowance times the difference between the
47.3 	district's adjusted marginal cost pupil units for fiscal year
47.4 	2005 and the district's adjusted marginal cost pupil units for
47.5 	that fiscal year.  Notwithstanding Minnesota Statutes, section
47.6 	126C.13, the declining pupil unit aid must be included in
47.7 	calculating the district's general education aid.

47.8 	Sec. 54. APPROPRIATIONS.
 47.9 		Subdivision 1.Department of education. The sums
47.10 	indicated in this section are appropriated from the general fund
47.11 	to the Department of Education for the fiscal years designated
47.12 	and include and supersede any amounts appropriated in Laws 2005,
47.13 	First Special Session chapter 2, or authorized by order of the
47.14 	Ramsey County District Court in Case No. C9-05-5928.
47.15 		Subd. 2.General education aid. For general education
47.16 	aid under Minnesota Statutes, section 126C.13, subdivision 4:
47.17 	$5,136,578,000 .....2006 
47.18 	$5,390,196,000 .....2007 
47.19 	The 2006 appropriation includes $784,978,000 for 2005 and
47.20 	$4,351,600,000 for 2006.
47.21 	The 2007 appropriation includes $817,588,000 for 2006 and
47.22 	$4,572,608,000 for 2007.
47.23 		Subd. 3.Referendum tax base replacement aid. For
47.24 	referendum tax base replacement aid under Minnesota Statutes,
47.25 	section 126C.17, subdivision 7a:
47.26 	$8,704,000 .....2006 
47.27 	$8,704,000 .....2007 
47.28 	The 2006 appropriation includes $1,366,000 for 2005 and
47.29 	$7,338,000 for 2006.
47.30 	The 2007 appropriation includes $1,366,000 for 2006 and
47.31 	$7,338,000 for 2007.
47.32 		Subd. 4.Enrollment options transportation. For
47.33 	transportation of pupils attending postsecondary institutions
47.34 	under Minnesota Statutes, section 124D.09, or for transportation
47.35 	of pupils attending nonresident districts under Minnesota
47.36 	Statutes, section 124D.03:
48.1 	$55,000 .....2006 
48.2 	$55,000 .....2007 
48.3 		Subd. 5.Abatement revenue. For abatement aid under
48.4 	Minnesota Statutes, section 127A.49:
48.5 	$903,000 .....2006 
48.6 	$955,000 .....2007 
48.7 	The 2006 appropriation includes $187,000 for 2005 and
48.8 	$716,000 for 2006.
48.9 	The 2007 appropriation includes $133,000 for 2006 and
48.10 	$822,000 for 2007.
48.11 		Subd. 6.Consolidation transition. For districts
48.12 	consolidating under Minnesota Statutes, section 123A.485:
48.13 	$253,000 .....2007 
48.14 	The 2007 appropriation includes $0 for 2006 and $253,000
48.15 	for 2007.
48.16 		Subd. 7.Nonpublic pupil education aid. For nonpublic
48.17 	pupil education aid under Minnesota Statutes, sections 123B.87
48.18 	and 123B.40 to 123B.43:
48.19 	$15,370,000 .....2006 
48.20 	$16,434,000 .....2007 
48.21 	The 2006 appropriation includes $2,305,000 for 2005 and
48.22 	$13,065,000 for 2006.
48.23 	The 2007 appropriation includes $2,433,000 for 2006 and
48.24 	$14,001,000 for 2007.
48.25 		Subd. 8.Nonpublic pupil transportation. For nonpublic
48.26 	pupil transportation aid under Minnesota Statutes, section
48.27 	123B.92, subdivision 9:
48.28 	$21,451,000 .....2006 
48.29 	$23,043,000 .....2007 
48.30 	The 2006 appropriation includes $3,274,000 for 2005 and
48.31 	$18,177,000 for 2006.
48.32 	The 2007 appropriation includes $3,385,000 for 2006 and
48.33 	$19,658,000 for 2007.
48.34 		Subd. 9.One room schoolhouse. For a grant to
48.35 	Independent School District No. 690, Warroad, to operate the
48.36 	Angle Inlet School:
49.1 	$50,000 .....2006 
49.2 	$50,000 .....2007 
49.3 		Subd. 10.Declining pupil aid; albert lea. For declining
49.4 	pupil aid to Independent School District No. 241, Albert Lea:
49.5 	$75,000 .....2006 
49.6 		Subd. 11.Declining pupil aid; mesabi east. For
49.7 	declining pupil aid to Independent School District No. 2711,
49.8 	Mesabi East:
49.9 	$50,000 .....2006 
49.10 		Subd. 12.Declining pupil aid; roseau. For declining
49.11 	pupil aid to Independent School District No. 682, Roseau:
49.12 	$10,000 .....2006 
49.13 		Subd. 13.Compensatory revenue pilot project. For grants
49.14 	for participation in the compensatory revenue pilot program
49.15 	under section 50:
49.16 	$2,100,000 .....2006 
49.17 	$2,100,000 .....2007 
49.18 	Of this amount, $1,500,000 in each year is for a grant to
49.19 	Independent School District No. 11, Anoka-Hennepin, $210,000 in
49.20 	each year is for a grant to Independent School District No. 279,
49.21 	Osseo, $160,000 in each year is for a grant to Independent
49.22 	School District No. 281, Robbinsdale, $165,000 each year is for
49.23 	a grant to Independent School District No. 535, Rochester, and
49.24 	$65,000 in each year is for Independent School District No. 833,
49.25 	South Washington.
49.26 	If a grant to a specific school district is not awarded,
49.27 	the commissioner may increase the aid amounts to any of the
49.28 	remaining participating school districts.
49.29 	This appropriation is part of the base budget for
49.30 	subsequent fiscal years.

49.31 	Sec. 55. REPEALER.
 49.32 	Minnesota Statutes 2004, sections 122A.415, subdivision 2;
49.33 	123B.83, subdivision 1; and 126C.42, subdivisions 1 and 4, are
49.34 	repealed.

49.35 	Sec. 56. EFFECTIVE DATE.
 49.36 	Any section in this article without a specified effective
50.1 	date is retroactively effective from July 1, 2005.

50.2 	ARTICLE 2
50.3 	EDUCATION EXCELLENCE

50.4 	Section 1. Minnesota Statutes 2004, section 13.32,
50.5 	subdivision 8, is amended to read:
50.6 		Subd. 8.Access by juvenile justice system.  (a) Upon
50.7 	request, the following education data shall be disclosed under
50.8 	subdivision 3, clause (i), to the juvenile justice system:  a
50.9 	student's full name, home address, telephone number, date of
50.10 	birth; a student's school schedule, daily attendance record, and
50.11 	photographs, if any; and parents' names, home addresses, and
50.12 	telephone numbers.
50.13 	(b) In addition, the existence of the following data about
50.14 	a student may be disclosed under subdivision 3, clause (i):
50.15 	(1) use of a controlled substance, alcohol, or tobacco;
50.16 	(2) assaultive or threatening conduct that could result in
50.17 	dismissal from school under section 121A.45, subdivision 2,
50.18 	clause (b) or (c);
50.19 	(3) possession or use of weapons or look-alike weapons;
50.20 	(4) theft; or
50.21 	(5) vandalism or other damage to property.
50.22 	Any request for access to data under this paragraph must
50.23 	contain an explanation of why access to the data is necessary to
50.24 	serve the student.
50.25 	(c) A principal or chief administrative officer of a school
50.26 	who receives a request to disclose information about a student
50.27 	to the juvenile justice system under paragraph (b) shall, to the
50.28 	extent permitted by federal law, notify the student's parent or
50.29 	guardian by certified mail of the request to disclose
50.30 	information before disclosing the information.  If the student's
50.31 	parent or guardian notifies the principal or chief
50.32 	administrative officer within ten days of receiving the
50.33 	certified notice that the parent or guardian objects to the
50.34 	disclosure, the principal or chief administrative officer must
50.35 	not disclose the information.  The principal or chief
50.36 	administrative officer must inform the requesting member of the
51.1 	juvenile justice system of the objection.
51.2 	(d) A principal or chief administrative officer is not
51.3 	required to create data under this subdivision.  Information
51.4 	provided in response to a data request under paragraph (b) shall
51.5 	indicate only whether the data described in paragraph (b)
51.6 	exist.  The principal or chief administrative officer is not
51.7 	authorized under paragraph (b) to disclose the actual data or
51.8 	other information contained in the student's education record.
51.9 	A principal or chief administrative officer is not required to
51.10 	provide data that are protected by court order.  A principal or
51.11 	chief administrative officer must respond to a data request
51.12 	within 14 days if no objection is received from the parent or
51.13 	guardian.
51.14 	(e) Nothing in this subdivision shall limit the disclosure
51.15 	of educational data pursuant to court order.
51.16 	(f) A school district, its agents, and employees who
51.17 	provide data in good faith under this subdivision are not liable
51.18 	for compensatory or exemplary damages or an award of attorney
51.19 	fees in an action under section 13.08, or other law, or for a
51.20 	penalty under section 13.09.
51.21 	(g) Section 13.03, subdivision 4, applies to data that are
51.22 	shared under this subdivision with a government entity.  If data
51.23 	are shared with a member of the juvenile justice system who is
51.24 	not a government entity, the person receiving the shared data
51.25 	must treat the data consistent with the requirements of this
51.26 	chapter applicable to a government entity.
51.27 	(h) A member of the juvenile justice system who falsely
51.28 	certifies a request for data under this section is subject to
51.29 	the penalties under section 13.09.

51.30 	Sec. 2. Minnesota Statutes 2004, section 13.321, is
51.31 	amended by adding a subdivision to read:
51.32 		Subd. 10.Teacher data from value-added assessment
51.33 	model. Data on individual teachers generated from a value-added
51.34 	assessment model are governed under section 120B.362.
51.35 	
EFFECTIVE DATE. This section is effective the day
51.36 	following final enactment.

52.1 	Sec. 3. Minnesota Statutes 2004, section 120A.22,
52.2 	subdivision 12, is amended to read:
52.3 		Subd. 12.Legitimate exemptions.  A parent, guardian, or
52.4 	other person having control of a child may apply to a school
52.5 	district to have the child excused from attendance for the whole
52.6 	or any part of the time school is in session during any school
52.7 	year.  Application may be made to any member of the board, a
52.8 	truant officer, a principal, or the superintendent. The school
52.9 	district may state in its school attendance policy that it may
52.10 	ask the student's parent or legal guardian to verify in writing
52.11 	the reason for the child's absence from school.The board of
52.12 	the district in which the child resides may approve the
52.13 	application upon the following being demonstrated to the
52.14 	satisfaction of that board:
52.15 	(1) that the child's bodily or mental condition is such as
52.16 	to prevent attendance at school or application to study for the
52.17 	period required; or , which includes:
52.18 	(i) child illness, medical, dental, orthodontic, or
52.19 	counseling appointments;
52.20 	(ii) family emergencies;
52.21 	(iii) the death or serious illness or funeral of an
52.22 	immediate family member;
52.23 	(iv) active duty in any military branch of the United
52.24 	States; or 
52.25 	(v) other exemptions included in the district's school
52.26 	attendance policy;
52.27 	(2) that for the school years 1988-1989 through 1999-2000
52.28 	the child has already completed the studies ordinarily required
52.29 	in the 10th grade and that for the school years beginning with
52.30 	the 2000-2001 school year the child has already completed the
52.31 	studies ordinarily required to graduate the child has already
52.32 	completed state and district standards required for graduation 
52.33 	from high school; or
52.34 	(3) that it is the wish of the parent, guardian, or other
52.35 	person having control of the child, that the child attend for a
52.36 	period or periods not exceeding in the aggregate three hours in
53.1 	any week, a school for religious instruction conducted and
53.2 	maintained by some church, or association of churches, or any
53.3 	Sunday school association incorporated under the laws of this
53.4 	state, or any auxiliary thereof.  This school for religious
53.5 	instruction must be conducted and maintained in a place other
53.6 	than a public school building, and it must not, in whole or in
53.7 	part, be conducted and maintained at public expense.  However, a
53.8 	child may be absent from school on such days as the child
53.9 	attends upon instruction according to the ordinances of some
53.10 	church.

53.11 	Sec. 4. Minnesota Statutes 2004, section 120B.02, is
53.12 	amended to read:
53.13 	120B.02 EDUCATIONAL EXPECTATIONS FOR MINNESOTA'S
53.14 	STUDENTS.
53.15 	(a) The legislature is committed to establishing rigorous
53.16 	academic standards for Minnesota's public school students.  To
53.17 	that end, the commissioner shall adopt in rule statewide
53.18 	academic standards.  The commissioner shall not prescribe in
53.19 	rule or otherwise the delivery system, classroom assessments, or
53.20 	form of instruction that school sites must use.  For purposes of
53.21 	this chapter, a school site is a separate facility, or a
53.22 	separate program within a facility that a local school board
53.23 	recognizes as a school site for funding purposes.
53.24 	(b) All commissioner actions regarding the rule must be
53.25 	premised on the following:
53.26 	(1) the rule is intended to raise academic expectations for
53.27 	students, teachers, and schools;
53.28 	(2) any state action regarding the rule must evidence
53.29 	consideration of school district autonomy; and
53.30 	(3) the Department of Education, with the assistance of
53.31 	school districts, must make available information about all
53.32 	state initiatives related to the rule to students and parents,
53.33 	teachers, and the general public in a timely format that is
53.34 	appropriate, comprehensive, and readily understandable.
53.35 	(c) When fully implemented, the requirements for high
53.36 	school graduation in Minnesota must require students to pass the
54.1 	basic skills test requirements and satisfactorily complete, as
54.2 	determined by the school district, the course credit
54.3 	requirements under section 120B.024and:
54.4 	(1) for students enrolled in grade 8 before the 2005-2006
54.5 	school year, to pass the basic skills test requirements; and 
54.6 	(2) for students enrolled in grade 8 in the 2005-2006
54.7 	school year and later, to pass the Minnesota Comprehensive
54.8 	Assessments Second Edition (MCA-IIs).
54.9 	(d) The commissioner shall periodically review and report
54.10 	on the state's assessment process.
54.11 	(e) School districts are not required to adopt specific
54.12 	provisions of the Goals 2000 and the federal School-to-Work
54.13 	programs.

54.14 	Sec. 5. Minnesota Statutes 2004, section 120B.021, is
54.15 	amended by adding a subdivision to read:
54.16 		Subd. 1a.Rigorous course of study; waiver. (a) Upon
54.17 	receiving a student's application signed by the student's parent
54.18 	or guardian, a school district, area learning center, or charter
54.19 	school must declare that a student meets or exceeds a specific
54.20 	academic standard required for graduation under this section if
54.21 	the local school board, the school board of the school district
54.22 	in which the area learning center is located, or the charter
54.23 	school board of directors determines that the student:
54.24 	(1) is participating in a course of study, including an
54.25 	advanced placement or international baccalaureate course or
54.26 	program; a learning opportunity outside the curriculum of the
54.27 	district, area learning center, or charter school; or an
54.28 	approved preparatory program for employment or postsecondary
54.29 	education that is equally or more rigorous than the
54.30 	corresponding state or local academic standard required by the
54.31 	district, area learning center, or charter school;
54.32 	(2) would be precluded from participating in the rigorous
54.33 	course of study, learning opportunity, or preparatory employment
54.34 	or postsecondary education program if the student were required
54.35 	to achieve the academic standard to be waived; and 
54.36 	(3) satisfactorily completes the requirements for the
55.1 	rigorous course of study, learning opportunity, or preparatory
55.2 	employment or postsecondary education program.
55.3 	Consistent with the requirements of this section, the local
55.4 	school board, the school board of the school district in which
55.5 	the area learning center is located, or the charter school board
55.6 	of directors also may formally determine other circumstances in
55.7 	which to declare that a student meets or exceeds a specific
55.8 	academic standard that the site requires for graduation under
55.9 	this section.
55.10 	(b) A student who satisfactorily completes a postsecondary
55.11 	enrollment options course or program under section 124D.09 is
55.12 	not required to complete other requirements of the academic
55.13 	standards corresponding to that specific rigorous course of
55.14 	study.

55.15 	Sec. 6. Minnesota Statutes 2004, section 120B.11,
55.16 	subdivision 1, is amended to read:
55.17 		Subdivision 1.Definitions.  For the purposes of this
55.18 	section and section 120B.10, the following terms have the
55.19 	meanings given them.
55.20 	(a) "Instruction" means methods of providing learning
55.21 	experiences that enables enable a student to meet state and
55.22 	district academic standards and graduation
55.23 	standards requirements.
55.24 	(b) "Curriculum" means district or school adopted programs
55.25 	and written plans for providing students with learning
55.26 	experiences that lead to expected knowledge,and skills, and
55.27 	positive attitudes.

55.28 	Sec. 7. Minnesota Statutes 2004, section 120B.11,
55.29 	subdivision 2, is amended to read:
55.30 		Subd. 2.Adopting policies.  (a) A school board shall
55.31 	adopt annually a have in place an adopted written policy that
55.32 	includes the following:
55.33 	(1) district goals for instruction and including the use of
55.34 	best practices, district and school curriculum, and achievement
55.35 	for all student subgroups;
55.36 	(2) a process for evaluating each student's progress toward
56.1 	meeting graduation academic standards and identifying the
56.2 	strengths and weaknesses of instruction and curriculum affecting
56.3 	students' progress;
56.4 	(3) a system for periodically reviewing and evaluating all
56.5 	instruction and curriculum;
56.6 	(4) a plan for improving instruction and ,curriculum, and
56.7 	student achievement; and
56.8 	(5) an instruction plan that includes education
56.9 	effectiveness processes developed under plan aligned with 
56.10 	section 122A.625and that integrates instruction, curriculum,
56.11 	and technology.

56.12 	Sec. 8. Minnesota Statutes 2004, section 120B.11,
56.13 	subdivision 3, is amended to read:
56.14 		Subd. 3.instruction and curriculum district advisory
56.15 	committee.  Each school board shall establish an Instruction and
56.16 	Curriculum advisory committee to ensure active community
56.17 	participation in all phases of planning and improving the
56.18 	instruction and curriculum affecting state graduation and
56.19 	district academic standards.  A district advisory committee, to
56.20 	the extent possible, shall reflect the diversity of the district
56.21 	and its learning sites, and shall include teachers, parents,
56.22 	support staff, pupils students, and other community residents.
56.23 	The district may establish building teams as subcommittees of
56.24 	the district advisory committee under subdivision 4.  The
56.25 	district advisory committee shall recommend to the school
56.26 	board districtwide education standards rigorous academic
56.27 	standards, student achievement goals and measures, assessments,
56.28 	and program evaluations.  Learning sites may expand upon
56.29 	district evaluations of instruction, curriculum, assessments, or
56.30 	programs.  Whenever possible, parents and other community
56.31 	residents shall comprise at least two-thirds of advisory
56.32 	committee members.

56.33 	Sec. 9. Minnesota Statutes 2004, section 120B.11,
56.34 	subdivision 4, is amended to read:
56.35 		Subd. 4.Building team.  A school may establish a
56.36 	building team to develop and implement an education
57.1 	effectiveness plan to improve instruction and ,curriculum, and
57.2 	student achievement.  The team shall advise the board and the
57.3 	advisory committee about developing an instruction and
57.4 	curriculum improvement plan that aligns curriculum, assessment
57.5 	of student progress in meeting state graduation and district
57.6 	academic standards, and instruction.

57.7 	Sec. 10. Minnesota Statutes 2004, section 120B.11,
57.8 	subdivision 5, is amended to read:
57.9 		Subd. 5.Report.  (a) By October 1 of each year, the
57.10 	school board shall use standard statewide reporting procedures
57.11 	the commissioner develops and adopt a report that includes the
57.12 	following:
57.13 	(1) student performance achievement goals for meeting state
57.14 	graduation academic standards adopted for that year;
57.15 	(2) results of local assessment data, and any additional
57.16 	test data;
57.17 	(3) the annual school district improvement plans including
57.18 	staff development goals under section 122A.60;
57.19 	(4) information about district and learning site progress
57.20 	in realizing previously adopted improvement plans; and
57.21 	(5) the amount and type of revenue attributed to each
57.22 	education site as defined in section 123B.04.
57.23 	(b) The school board shall publish the report in the local
57.24 	newspaper with the largest circulation in the district or ,by
57.25 	mail, or by electronic means such as the district Web site.  If
57.26 	electronic means are used, school districts must publish notice
57.27 	of the report in a periodical of general circulation in the
57.28 	district.  School districts must make copies of the report
57.29 	available to the public on request.  The board shall make a copy
57.30 	of the report available to the public for inspection.  The board
57.31 	shall send a copy of the report to the commissioner of education
57.32 	by October 15 of each year.
57.33 	(c) The title of the report shall contain the name and
57.34 	number of the school district and read "Annual Report on
57.35 	Curriculum, Instruction, and Student Performance Achievement."
57.36 	The report must include at least the following information about
58.1 	advisory committee membership:
58.2 	(1) the name of each committee member and the date when
58.3 	that member's term expires;
58.4 	(2) the method and criteria the school board uses to select
58.5 	committee members; and
58.6 	(3) the date by which a community resident must apply to
58.7 	next serve on the committee.

58.8 	Sec. 11. Minnesota Statutes 2004, section 120B.11,
58.9 	subdivision 8, is amended to read:
58.10 		Subd. 8.Biennial evaluation; assessment program.  At
58.11 	least once every two years, the district report shall include an
58.12 	evaluation of the district testing programs, according to the
58.13 	following:
58.14 	(1) written objectives of the assessment program;
58.15 	(2) names of tests and grade levels tested;
58.16 	(3) use of test results; and
58.17 	(4) implementation of an assurance of mastery program 
58.18 	student achievement results compared to previous years.

58.19 	Sec. 12. [120B.128] EDUCATIONAL PLANNING AND ASSESSMENT
58.20 	SYSTEM (EPAS) PROGRAM.
58.21 	(a) School districts and charter schools may elect to
58.22 	participate in the Educational Planning and Assessment System
58.23 	(EPAS) program offered by ACT, Inc. to provide a longitudinal,
58.24 	systematic approach to student educational and career planning,
58.25 	assessment, instructional support, and evaluation.  The EPAS
58.26 	achievement tests include English, reading, mathematics,
58.27 	science, and components on planning for high school and
58.28 	postsecondary education, interest inventory, needs assessments,
58.29 	and student education plans.  These tests are linked to the ACT
58.30 	assessment for college admission and allow students, parents,
58.31 	teachers, and schools to determine the student's college
58.32 	readiness before grades 11 and 12.
58.33 	(b) The commissioner of education shall provide ACT Explore
58.34 	tests for students in grade 8 and the ACT Plan test for students
58.35 	in grade 10 to assess individual student academic strengths and
58.36 	weaknesses, academic achievement and progress, higher order
59.1 	thinking skills, and college readiness.  The state shall pay the
59.2 	test costs for school districts and charter schools that choose
59.3 	to participate in the EPAS program.  The commissioner shall
59.4 	establish an application procedure and a process for state
59.5 	payment of costs.

59.6 	Sec. 13. Minnesota Statutes 2004, section 120B.13,
59.7 	subdivision 1, is amended to read:
59.8 		Subdivision 1.Program structure; training programs for
59.9 	teachers.  (a) The advanced placement and international
59.10 	baccalaureate programs are well-established academic programs
59.11 	for mature, academically directed high school students.  These
59.12 	programs, in addition to providing academic rigor, offer sound
59.13 	curricular design, accountability, comprehensive external
59.14 	assessment, feedback to students and teachers, and the
59.15 	opportunity for high school students to compete academically on
59.16 	a global level.  Advanced placement and international
59.17 	baccalaureate programs allow students to leave high school with
59.18 	the academic skills and self-confidence to succeed in college
59.19 	and beyond.  The advanced placement and international
59.20 	baccalaureate programs help provide Minnesota students with
59.21 	world-class educational opportunity.
59.22 	(b) Critical to schools' educational success is ongoing
59.23 	advanced placement/international baccalaureate-approved teacher
59.24 	training.  A secondary teacher assigned by a district to teach
59.25 	an advanced placement or international baccalaureate course or
59.26 	other interested educator may participate in a training program
59.27 	offered by The College Board or International Baccalaureate
59.28 	North America, Inc.  The state may pay a portion of the tuition,
59.29 	room, and board, and out-of-state travel costs a teacher or
59.30 	other interested educator incurs in participating in a training
59.31 	program.  The commissioner shall determine application
59.32 	procedures and deadlines, and select teachers and other
59.33 	interested educators to participate in the training program, and
59.34 	determine the payment process and amount of the subsidy.  The
59.35 	procedures determined by the commissioner shall, to the extent
59.36 	possible, ensure that advanced placement and international
60.1 	baccalaureate courses become available in all parts of the state
60.2 	and that a variety of course offerings are available in school
60.3 	districts.  This subdivision does not prevent teacher or other
60.4 	interested educator participation in training programs offered
60.5 	by The College Board or International Baccalaureate North
60.6 	America, Inc., when tuition is paid by a source other than the
60.7 	state.

60.8 	Sec. 14. Minnesota Statutes 2004, section 120B.13,
60.9 	subdivision 3, is amended to read:
60.10 		Subd. 3.Subsidy for examination fees.  The state may pay
60.11 	all or part of the fee for advanced placement or international
60.12 	baccalaureate examinations for pupils of low-income families in
60.13 	public and nonpublic schools.  The commissioner shall adopt a
60.14 	schedule for fee subsidies that may allow payment of the entire
60.15 	fee for pay all examination fees for all public and nonpublic
60.16 	students of low-income families, as defined by the commissioner,
60.17 	and to the limit of the available appropriation, shall also pay
60.18 	a portion or all of the examination fees for other public and
60.19 	nonpublic students sitting for an advanced placement
60.20 	examination, international baccalaureate examination, or both.
60.21 	The commissioner shall determine procedures for state payments
60.22 	of fees.

60.23 	Sec. 15. [120B.131] COLLEGE-LEVEL EXAMINATION PROGRAM
60.24 	(CLEP).
60.25 		Subdivision 1.Reimbursement for examination fees. The
60.26 	state may reimburse college level examination program (CLEP)
60.27 	fees for a Minnesota public high school student who has
60.28 	successfully completed one or more college-level courses in high
60.29 	school and earned a satisfactory score on one or more CLEP
60.30 	examinations in the following subjects: composition and
60.31 	literature, mathematics and science, social sciences and
60.32 	history, foreign languages, and business and humanities.  The
60.33 	state may reimburse each successful student for up to six
60.34 	examination fees.  The commissioner shall establish application
60.35 	procedures and a process and schedule for fee reimbursements.
60.36 	The commissioner must give priority to reimburse the CLEP
61.1 	examination fees of students of low-income families.
61.2 		Subd. 2.College credit. The colleges and universities
61.3 	of the Minnesota State Colleges and Universities system must
61.4 	award, and the University of Minnesota and private postsecondary
61.5 	institutions are encouraged to award, college credit to high
61.6 	school students who receive a satisfactory score on a CLEP
61.7 	examination under this section.  The commissioner, in
61.8 	consultation with the Minnesota State Colleges and Universities,
61.9 	shall set a passing score for college credits.

61.10 	Sec. 16. [120B.15] GIFTED AND TALENTED STUDENTS
61.11 	PROGRAMS.
61.12 	School districts may identify students, locally develop
61.13 	programs, provide staff development, and evaluate programs to
61.14 	provide gifted and talented students with challenging
61.15 	educational programs.
61.16 	School districts may adopt guidelines for assessing and
61.17 	identifying students for participation in gifted and talented
61.18 	programs.  The guidelines should include the use of:
61.19 	(1) multiple and objective criteria; and 
61.20 	(2) assessments and procedures that are valid and reliable,
61.21 	fair, and based on current theory and research.

61.22 	EFFECTIVE DATE. This section is effective for the
61.23 	2005-2006 school year.

61.24 	Sec. 17. Minnesota Statutes 2004, section 120B.22,
61.25 	subdivision 1, is amended to read:
61.26 		Subdivision 1.Violence prevention curriculum.  (a) The
61.27 	commissioner of education, in consultation with the
61.28 	commissioners of health and human services, state minority
61.29 	councils, battered women's and domestic abuse programs, battered
61.30 	women's shelters, sexual assault centers, representatives of
61.31 	religious communities, and the assistant commissioner of the
61.32 	Office of Drug Policy and Violence Prevention, shall assist
61.33 	districts on request in developing or implementing a violence
61.34 	prevention program for students in kindergarten to grade 12 that
61.35 	can be integrated into existing curriculum.  The purpose of the
61.36 	program is to help students learn how to resolve conflicts
62.1 	within their families and communities in nonviolent, effective
62.2 	ways.
62.3 	(b) Each district is encouraged to integrate into its
62.4 	existing curriculum a program for violence prevention that
62.5 	includes at least:
62.6 	(1) a comprehensive, accurate, and age appropriate
62.7 	curriculum on violence prevention, nonviolent conflict
62.8 	resolution, sexual, racial, and cultural
62.9 	harassment, self-protection,and student hazing that promotes
62.10 	equality, respect, understanding, effective communication,
62.11 	individual responsibility, thoughtful decision making, positive
62.12 	conflict resolution, useful coping skills, critical thinking,
62.13 	listening and watching skills, and personal safety;
62.14 	(2) planning materials, guidelines, and other accurate
62.15 	information on preventing physical and emotional violence,
62.16 	identifying and reducing the incidence of sexual, racial, and
62.17 	cultural harassment, and reducing child abuse and neglect;
62.18 	(3) a special parent education component of early childhood
62.19 	family education programs to prevent child abuse and neglect and
62.20 	to promote positive parenting skills, giving priority to
62.21 	services and outreach programs for at-risk families;
62.22 	(4) involvement of parents and other community members,
62.23 	including the clergy, business representatives, civic leaders,
62.24 	local elected officials, law enforcement officials, and the
62.25 	county attorney;
62.26 	(5) collaboration with local community services, agencies,
62.27 	and organizations that assist in violence intervention or
62.28 	prevention, including family-based services, crisis services,
62.29 	life management skills services, case coordination services,
62.30 	mental health services, and early intervention services;
62.31 	(6) collaboration among districts and service cooperatives;
62.32 	(7) targeting early adolescents for prevention efforts,
62.33 	especially early adolescents whose personal circumstances may
62.34 	lead to violent or harassing behavior;
62.35 	(8) opportunities for teachers to receive in-service
62.36 	training or attend other programs on strategies or curriculum
63.1 	designed to assist students in intervening in or preventing
63.2 	violence in school and at home; and
63.3 	(9) administrative policies that reflect, and a staff that
63.4 	models, nonviolent behaviors that do not display or condone
63.5 	sexual, racial, or cultural harassment or student hazing.
63.6 	(c) The department may provide assistance at a neutral site
63.7 	to a nonpublic school participating in a district's program.

63.8 	Sec. 18. [120B.225] CHARACTER DEVELOPMENT EDUCATION.
63.9 		Subdivision 1.Character development education. The
63.10 	legislature encourages districts to integrate or offer
63.11 	instruction on character education including, but not limited
63.12 	to, character qualities such as attentiveness, truthfulness,
63.13 	respect for authority, diligence, gratefulness, self-discipline,
63.14 	patience, forgiveness, respect for others, peacemaking, and
63.15 	resourcefulness.  Instruction should be integrated into a
63.16 	district's existing programs, curriculum, or the general school
63.17 	environment.  The commissioner shall provide assistance at the
63.18 	request of a district to develop character education curriculum
63.19 	and programs.
63.20 		Subd. 2.Funding sources. The commissioner must first
63.21 	use federal funds for character development education programs
63.22 	to the extent available under United States Code, title 20,
63.23 	section 7247.  Districts may accept funds from private and other
63.24 	public sources for character development education programs
63.25 	developed and implemented under this section.
63.26 	
EFFECTIVE DATE. This section is effective the day
63.27 	following final enactment.

63.28 	Sec. 19. [120B.25] AMERICAN HERITAGE EDUCATION.
63.29 	(a) School districts shall permit grade-level instruction
63.30 	for students to read and study America's founding documents,
63.31 	including documents that contributed to the foundation or
63.32 	maintenance of America's representative form of limited
63.33 	government, the Bill of Rights, our free-market economic system,
63.34 	and patriotism.
63.35 	(b) Districts may not censor or restrain instruction in
63.36 	American or Minnesota state history or heritage based on
64.1 	religious references in original source documents, writings,
64.2 	speeches, proclamations, or records.

64.3 	Sec. 20. Minnesota Statutes 2004, section 120B.30,
64.4 	subdivision 1, is amended to read:
64.5 		Subdivision 1.Statewide testing.  (a) The commissioner,
64.6 	with advice from experts with appropriate technical
64.7 	qualifications and experience and stakeholders, consistent with
64.8 	subdivision 1a, shall include in the comprehensive assessment
64.9 	system, for each grade level to be tested, state-constructed
64.10 	tests developed from and aligned with the state's required
64.11 	academic standards under section 120B.021 and administered
64.12 	annually to all students in grades 3 through 8 and at the high
64.13 	school level.  A state-developed test in a subject other than
64.14 	writing, developed after the 2002-2003 school year, must include
64.15 	both multiple choice machine-scoreable and constructed response
64.16 	questions.  The commissioner shall establish one or more months
64.17 	during which schools shall administer the tests to students each
64.18 	school year. For students enrolled in grade 8 before the
64.19 	2005-2006 school year,only Minnesota basic skills tests in
64.20 	reading, mathematics, and writing shall fulfill students' basic
64.21 	skills testing requirements for a passing state notation.  The
64.22 	passing scores of the state tests in reading and mathematics are
64.23 	the equivalent of:
64.24 	(1) 70 percent correct for students entering grade 9 in
64.25 	1996; and
64.26 	(2) 75 percent correct for students entering grade 9 in
64.27 	1997 and thereafter, as based on the first uniform test
64.28 	administration of February 1998.
64.29 	For students enrolled in grade 8 in the 2005-2006 school
64.30 	year and later, only the Minnesota Comprehensive Assessments
64.31 	Second Edition (MCA-IIs) in reading, mathematics, and writing
64.32 	shall fulfill students' academic standard requirements.
64.33 	(b) The third through 8th grade and high school level test
64.34 	results shall be available to districts for diagnostic purposes
64.35 	affecting student learning and district instruction and
64.36 	curriculum, and for establishing educational accountability.
65.1 	The commissioner must disseminate to the public the test results
65.2 	upon receiving those results.
65.3 	(c) State tests must be constructed and aligned with state
65.4 	academic standards.  The testing process and the order of
65.5 	administration shall be determined by the commissioner.  The
65.6 	statewide results shall be aggregated at the site and district
65.7 	level, consistent with subdivision 1a.
65.8 	(d) In addition to the testing and reporting requirements
65.9 	under this section, the commissioner shall include the following
65.10 	components in the statewide public reporting system:
65.11 	(1) uniform statewide testing of all students in grades 3
65.12 	through 8 and at the high school level that provides exemptions,
65.13 	only with parent or guardian approval, for those very few
65.14 	students for whom the student's individual education plan team
65.15 	under sections 125A.05 and 125A.06, determines that the student
65.16 	is incapable of taking a statewide test, or for a limited
65.17 	English proficiency student under section 124D.59, subdivision
65.18 	2, if the student has been in the United States for fewer than
65.19 	three years;
65.20 	(2) educational indicators that can be aggregated and
65.21 	compared across school districts and across time on a statewide
65.22 	basis, including average daily attendance, high school
65.23 	graduation rates, and high school drop-out rates by age and
65.24 	grade level;
65.25 	(3) students' scores on the American College Test; and
65.26 	(4) state results from participation in the National
65.27 	Assessment of Educational Progress so that the state can
65.28 	benchmark its performance against the nation and other states,
65.29 	and, where possible, against other countries, and contribute to
65.30 	the national effort to monitor achievement.
65.31 	(e) Districts must report exemptions under paragraph (d),
65.32 	clause (1), to the commissioner consistent with a format
65.33 	provided by the commissioner.

65.34 	Sec. 21. Minnesota Statutes 2004, section 120B.30,
65.35 	subdivision 1a, is amended to read:
65.36 		Subd. 1a.Statewide and local assessments; results.  (a)
66.1 	The commissioner must develop language arts reading,
66.2 	mathematics, and science assessments aligned with state academic
66.3 	standards that districts and sites must use to monitor student
66.4 	growth toward achieving those standards.  The commissioner must
66.5 	not develop statewide assessments for academic standards in
66.6 	social studies, health and physical education,and the arts.
66.7 	The commissioner must require:
66.8 	(1) annual language arts reading and mathematics
66.9 	assessments in grades 3 through 8 and at the high school level
66.10 	for the 2005-2006 school year and later; and
66.11 	(2) annual science assessments in one grade in the grades 3
66.12 	through 5 span, the grades 6 through 9 span, and a life sciences
66.13 	assessment in the grades 10 through 12 span for the 2007-2008
66.14 	school year and later.
66.15 	(b) The commissioner must ensure that all statewide tests
66.16 	administered to elementary and secondary students measure
66.17 	students' academic knowledge and skills and not students'
66.18 	values, attitudes, and beliefs.
66.19 	(c) Reporting of assessment results must:
66.20 	(1) provide timely, useful, and understandable information
66.21 	on the performance of individual students, schools, school
66.22 	districts, and the state;
66.23 	(2) include, by the 2006-2007 school year, a value-added
66.24 	component to measure student achievement growth over time; and
66.25 	(3) (i) for students enrolled in grade 8 before the
66.26 	2005-2006 school year,determine whether students have met the
66.27 	state's basic skills requirements; and 
66.28 	(ii) for students enrolled in grade 8 in the 2005-2006
66.29 	school year and later, determine whether students have met the
66.30 	state's academic standards.
66.31 	(d) Consistent with applicable federal law and subdivision
66.32 	1, paragraph (d), clause (1), the commissioner must include
66.33 	alternative assessments for the very few students with
66.34 	disabilities for whom statewide assessments are inappropriate
66.35 	and for students with limited English proficiency.
66.36 	(e) A school, school district, and charter school must
67.1 	administer statewide assessments under this section, as the
67.2 	assessments become available, to evaluate student progress in
67.3 	achieving the academic standards.  If a state assessment is not
67.4 	available, a school, school district, and charter school must
67.5 	determine locally if a student has met the required academic
67.6 	standards.  A school, school district, or charter school may use
67.7 	a student's performance on a statewide assessment as one of
67.8 	multiple criteria to determine grade promotion or retention.  A
67.9 	school, school district, or charter school may use a high school
67.10 	student's performance on a statewide assessment as a percentage
67.11 	of the student's final grade in a course, or place a student's
67.12 	assessment score on the student's transcript.

67.13 	Sec. 22. Minnesota Statutes 2004, section 120B.30, is
67.14 	amended by adding a subdivision to read:
67.15 		Subd. 4.Access to tests. The commissioner must adopt
67.16 	and publish a policy to provide public and parental access for
67.17 	review of basic skills tests, Minnesota Comprehensive
67.18 	Assessments, or any other such statewide test and assessment.
67.19 	Upon receiving a written request, the commissioner must make
67.20 	available to parents or guardians a copy of their student's
67.21 	actual answer sheet to the test questions to be reviewed by the
67.22 	parent.

67.23 	Sec. 23. [120B.362] VALUE-ADDED ASSESSMENT PROGRAM.
67.24 	(a) The commissioner of education must implement a
67.25 	value-added assessment program to assist school districts,
67.26 	public schools, and charter schools in assessing and reporting
67.27 	individual students' growth in academic achievement under
67.28 	section 120B.30, subdivision 1a.  The program must use
67.29 	assessments of individual students' academic achievement to make
67.30 	longitudinal comparisons of each student's academic growth over
67.31 	time.  School districts, public schools, and charter schools may
67.32 	apply to the commissioner to participate in the initial trial
67.33 	program using a form and in the manner the commissioner
67.34 	prescribes.  The commissioner must select program participants
67.35 	from urban, suburban, and rural areas throughout the state.
67.36 	(b) The commissioner may issue a request for proposals to
68.1 	contract with an organization that provides a value-added
68.2 	assessment model that reliably estimates school and school
68.3 	district effects on students' academic achievement over time.
68.4 	The model the commissioner selects must accommodate diverse data
68.5 	and must use each student's test data across grades.  Data on
68.6 	individual teachers generated under the model are personnel data
68.7 	under section 13.43.
68.8 	(c) The contract under paragraph (b) must be consistent
68.9 	with the definition of "best value" under section 16C.02,
68.10 	subdivision 4.

68.11 	EFFECTIVE DATE. This section is effective the day
68.12 	following final enactment.

68.13 	Sec. 24. Minnesota Statutes 2004, section 121A.03,
68.14 	subdivision 1, is amended to read:
68.15 		Subdivision 1.Model policy.  The commissioner shall
68.16 	maintain and make available to school boards a model sexual,
68.17 	religious, and racial harassment and violence policy.  The model
68.18 	policy shall address the requirements of subdivision 2, and may
68.19 	encourage violence prevention and character development
68.20 	education programs, consistent with section 120B.225,
68.21 	subdivision 1, to prevent and reduce policy violations.
68.22 	
EFFECTIVE DATE. This section is effective the day
68.23 	following final enactment.

68.24 	Sec. 25. Minnesota Statutes 2004, section 121A.06,
68.25 	subdivision 2, is amended to read:
68.26 		Subd. 2.Reports; content. By January 1, 1994, the
68.27 	commissioner, in consultation with the criminal and juvenile
68.28 	information policy group, shall develop a standardized form to
68.29 	be used by schools to report incidents involving the use or
68.30 	possession of a dangerous weapon in school zones.School
68.31 	districts must electronically report to the commissioner of
68.32 	education incidents involving the use or possession of a
68.33 	dangerous weapon in school zones.The form shall must include
68.34 	the following information:
68.35 	(1) a description of each incident, including a description
68.36 	of the dangerous weapon involved in the incident;
69.1 	(2) where, at what time, and under what circumstances the
69.2 	incident occurred;
69.3 	(3) information about the offender, other than the
69.4 	offender's name, including the offender's age; whether the
69.5 	offender was a student and, if so, where the offender attended
69.6 	school; and whether the offender was under school expulsion or
69.7 	suspension at the time of the incident;
69.8 	(4) information about the victim other than the victim's
69.9 	name, if any, including the victim's age; whether the victim was
69.10 	a student and, if so, where the victim attended school; and if
69.11 	the victim was not a student, whether the victim was employed at
69.12 	the school;
69.13 	(5) the cost of the incident to the school and to the
69.14 	victim; and
69.15 	(6) the action taken by the school administration to
69.16 	respond to the incident.
69.17 	The commissioner also shall develop provide an alternative 
69.18 	electronic reporting format that allows school districts to
69.19 	provide aggregate data, with an option to use computer
69.20 	technology to report the data.

69.21 	Sec. 26. Minnesota Statutes 2004, section 121A.06,
69.22 	subdivision 3, is amended to read:
69.23 		Subd. 3.Reports; filing requirements.  By February 1 and 
69.24 	July 1 31 of each year, each public school shall report
69.25 	incidents involving the use or possession of a dangerous weapon
69.26 	in school zones to the commissioner.  The reports must be made
69.27 	on the standardized forms or using the alternative
69.28 	format submitted using the electronic reporting system developed
69.29 	by the commissioner under subdivision 2.  The commissioner shall
69.30 	compile the information it receives from the schools and report
69.31 	it annually to the commissioner of public safety, the criminal
69.32 	and juvenile information policy group,and the legislature.

69.33 	Sec. 27. [121A.0695] SCHOOL BOARD POLICY; PROHIBITING
69.34 	INTIMIDATION AND BULLYING.
69.35 	Each school board shall adopt a written policy prohibiting
69.36 	intimidation and bullying of any student.

70.1 	EFFECTIVE DATE. This section is effective for the
70.2 	2005-2006 school year and later.

70.3 	Sec. 28. Minnesota Statutes 2004, section 121A.15,
70.4 	subdivision 3, is amended to read:
70.5 		Subd. 3.Exemptions from immunizations.  (a) If a person
70.6 	is at least seven years old and has not been immunized against
70.7 	pertussis, the person must not be required to be immunized
70.8 	against pertussis.
70.9 	(b) If a person is at least 18 years old and has not
70.10 	completed a series of immunizations against poliomyelitis, the
70.11 	person must not be required to be immunized against
70.12 	poliomyelitis.
70.13 	(c) If a statement, signed by a physician, is submitted to
70.14 	the administrator or other person having general control and
70.15 	supervision of the school or child care facility stating that an
70.16 	immunization is contraindicated for medical reasons or that
70.17 	laboratory confirmation of the presence of adequate immunity
70.18 	exists, the immunization specified in the statement need not be
70.19 	required.
70.20 	(d) If a notarized statement signed by the minor child's
70.21 	parent or guardian or by the emancipated person is submitted to
70.22 	the administrator or other person having general control and
70.23 	supervision of the school or child care facility stating that
70.24 	the person has not been immunized as prescribed in subdivision 1
70.25 	because of the conscientiously held beliefs of the parent or
70.26 	guardian of the minor child or of the emancipated person, the
70.27 	immunizations specified in the statement shall not be required.
70.28 	This statement must also be forwarded to the commissioner of the
70.29 	Department of Health.
70.30 	(e) If the person is under 15 months, the person is not
70.31 	required to be immunized against measles, rubella, or mumps.
70.32 	(f) If a person is at least five years old and has not been
70.33 	immunized against haemophilus influenza type b, the person is
70.34 	not required to be immunized against haemophilus influenza type
70.35 	b.
70.36 	(g) If a person who is not a Minnesota resident enrolls in
71.1 	a Minnesota school online learning course or program that
71.2 	delivers instruction to the person only by computer and does not
71.3 	provide any teacher or instructor contact time or require
71.4 	classroom attendance, the person is not subject to the
71.5 	immunization, statement, and other requirements of this section.
71.6 	
EFFECTIVE DATE. This section is effective the day
71.7 	following final enactment.

71.8 	Sec. 29. Minnesota Statutes 2004, section 121A.47,
71.9 	subdivision 14, is amended to read:
71.10 		Subd. 14.Admission or readmission plan. (a) A school
71.11 	administrator shall prepare and enforce an admission or
71.12 	readmission plan for any pupil who is excluded or expelled from
71.13 	school.  The plan may include measures to improve the pupil's
71.14 	behavior, including completing a character education program,
71.15 	consistent with section 120B.225, subdivision 1,and require
71.16 	parental involvement in the admission or readmission process,
71.17 	and may indicate the consequences to the pupil of not improving
71.18 	the pupil's behavior.
71.19 	(b) The definition of suspension under section 121A.41,
71.20 	subdivision 10, does not apply to a student's dismissal from
71.21 	school for one school day or less, except as provided under
71.22 	federal law for a student with a disability.  Each suspension
71.23 	action may include a readmission plan.  A readmission plan must
71.24 	provide, where appropriate, alternative education services,
71.25 	which must not be used to extend the student's current
71.26 	suspension period.  Consistent with section 125A.091,
71.27 	subdivision 5, a readmission plan must not obligate a parent or
71.28 	guardian to provide psychotropic drugs to their student as a
71.29 	condition of readmission.  School officials must not use the
71.30 	refusal of a parent or guardian to consent to the administration
71.31 	of psychotropic drugs to their student or to consent to a
71.32 	psychiatric evaluation, screening or examination of the student
71.33 	as a ground, by itself, to prohibit the student from attending
71.34 	class or participating in a school-related activity, or as a
71.35 	basis of a charge of child abuse, child neglect or medical or
71.36 	educational neglect.
72.1 	
EFFECTIVE DATE. This section is effective the day
72.2 	following final enactment.

72.3 	Sec. 30. Minnesota Statutes 2004, section 121A.53, is
72.4 	amended to read:
72.5 	121A.53 REPORT TO COMMISSIONER OF EDUCATION.
72.6 		Subdivision 1.Exclusions and expulsions. The school
72.7 	board shall must report through the department electronic
72.8 	reporting system each exclusion or expulsion within 30 days of
72.9 	the effective date of the action to the commissioner of
72.10 	education.  This report shall must include a statement of
72.11 	alternative educational services given the pupil and the reason
72.12 	for, the effective date, and the duration of the exclusion or
72.13 	expulsion. The report must also include the student's age,
72.14 	grade, gender, race, and special education status.
72.15 		Subd. 2.Report. The school board must include state
72.16 	student identification numbers of affected pupils on all
72.17 	dismissal reports required by the department.  The department
72.18 	must report annually to the commissioner summary data on the
72.19 	number of dismissals by age, grade, gender, race, and special
72.20 	education status of the affected pupils. All dismissal reports
72.21 	must be submitted through the department electronic reporting
72.22 	system.

72.23 	Sec. 31. [121A.575] ALTERNATIVES TO PUPIL SUSPENSION.
72.24 	Notwithstanding any law to the contrary and in accordance
72.25 	with sections 121A.40 to 121A.56, after a school administration
72.26 	notifies a pupil of the grounds for suspension, the school
72.27 	administration may, instead of imposing the suspension, do one
72.28 	or more of the following:
72.29 	(1) strongly encourage a parent or guardian of the pupil to
72.30 	attend school with the pupil for one day;
72.31 	(2) assign the pupil to attend school on Saturday as
72.32 	supervised by the principal or the principal's designee; and 
72.33 	(3) petition the juvenile court that the student is in need
72.34 	of services under chapter 260C.

72.35 	Sec. 32. Minnesota Statutes 2004, section 122A.06,
72.36 	subdivision 4, is amended to read:
73.1 		Subd. 4.Comprehensive, scientifically based reading
73.2 	instruction. "Comprehensive, scientifically based reading
73.3 	instruction" includes instruction and practice in phonemic
73.4 	awareness, phonics and other word-recognition skills, and guided
73.5 	oral reading for beginning readers, as well as extensive silent
73.6 	reading, vocabulary instruction, instruction in comprehension,
73.7 	and instruction that fosters understanding and higher-order
73.8 	thinking for readers of all ages and proficiency
73.9 	levels."Comprehensive, scientifically based reading
73.10 	instruction" includes a program or collection of instructional
73.11 	practices that is based on reliable, valid evidence showing that
73.12 	when these programs or practices are used, students can be
73.13 	expected to achieve, at a minimum, satisfactory reading
73.14 	progress.  The program or collection of practices must include,
73.15 	at a minimum, instruction in five areas of reading:  phonemic
73.16 	awareness, phonics, fluency, vocabulary, and text comprehension.
73.17 	Comprehensive, scientifically based reading instruction
73.18 	also includes and integrates instructional strategies for
73.19 	continuously assessing, evaluating, and communicating the
73.20 	student's reading progress and needs in order to design and
73.21 	implement ongoing interventions so that students of all ages and
73.22 	proficiency levels can read and comprehend text and apply higher
73.23 	level thinking skills.

73.24 	Sec. 33. Minnesota Statutes 2004, section 122A.12,
73.25 	subdivision 2, is amended to read:
73.26 		Subd. 2.Terms; compensation; removal; administration;
73.27 	reimbursement. (a) Membership terms, removal of members, and
73.28 	the filling of membership vacancies are as provided in section
73.29 	214.09.  The terms of the initial board members must be
73.30 	determined by lot as follows:
73.31 	(1) three members must be appointed for terms that expire
73.32 	August 1, 2002;
73.33 	(2) three members must be appointed for terms that expire
73.34 	August 1, 2003; and
73.35 	(3) four members must be appointed for terms that expire
73.36 	August 1, 2004.
74.1 	Members shall not receive the daily payment under section
74.2 	214.09, subdivision 3.  The public employer of a member shall
74.3 	not reduce the member's compensation or benefits for the
74.4 	member's absence from employment when engaging in the business
74.5 	of the board.  The provision of staff, administrative services,
74.6 	and office space; the review and processing of complaints; the
74.7 	setting of fees; the selection and duties of an executive
74.8 	secretary to serve the board; and other provisions relating to
74.9 	board operations are as provided in chapter 214.  Fiscal year
74.10 	and reporting requirements are as provided in sections 214.07
74.11 	and 214.08.
74.12 	(b) The board may reimburse local school districts for the
74.13 	cost of a substitute teacher employed when a regular teacher is
74.14 	providing professional assistance to the state by serving on the
74.15 	board or on a committee or task force appointed by the board.

74.16 	Sec. 34. Minnesota Statutes 2004, section 122A.18,
74.17 	subdivision 2a, is amended to read:
74.18 		Subd. 2a.Reading strategies.  (a) All colleges and
74.19 	universities approved by the Board of Teaching to prepare
74.20 	persons for classroom teacher licensure must include in their
74.21 	teacher preparation programs reading best practices that enable
74.22 	classroom teacher licensure candidates to know how to teach
74.23 	reading, such as phonics or other research-based best practices
74.24 	in reading, consistent with section 122A.06, subdivision 4, that
74.25 	enable the licensure candidate to know how to teach reading in
74.26 	the candidate's content areas.
74.27 	(b) Board-approved teacher preparation programs for
74.28 	teachers of elementary education must require instruction in the
74.29 	application of comprehensive, scientifically based, and balanced
74.30 	reading instruction programs.that:
74.31 	(1) teach students to read using foundational knowledge,
74.32 	practices, and strategies consistent with section 122A.06,
74.33 	subdivision 4, so that all students will achieve continuous
74.34 	progress in reading; and 
74.35 	(2) teach specialized instruction in reading strategies,
74.36 	interventions, and remediations that enable students of all ages
75.1 	and proficiency levels to become proficient readers.

75.2 	Sec. 35. Minnesota Statutes 2004, section 122A.33, is
75.3 	amended to read:
75.4 	122A.33 LICENSE AND DEGREE EXEMPTION FOR HEAD COACH.
75.5 		Subdivision 1.Employment. Notwithstanding section
75.6 	122A.15, subdivision 1, a school district may employ as a head
75.7 	varsity coach of an interscholastic sport at its secondary
75.8 	school a person who does not have a license as head varsity
75.9 	coach of interscholastic sports and who does not have a
75.10 	bachelor's degree if:
75.11 	(1) in the judgment of the school board, the person has the
75.12 	knowledge and experience necessary to coach the sport;
75.13 	(2) can verify completion of six quarter credits, or the
75.14 	equivalent, or 60 clock hours of instruction in first aid and
75.15 	the care and prevention of athletic injuries; and
75.16 	(3) can verify completion of a coaching methods or theory
75.17 	course.
75.18 		Subd. 2.Annual contract. Notwithstanding section
75.19 	122A.58, a person employed as a head varsity coach under this
75.20 	section has an annual contract as a coach that the school board
75.21 	may or may not renew as the board sees fit.
75.22 		Subd. 3.Notice of nonrenewal; opportunity to respond. A
75.23 	school board that declines to renew the coaching contract of a
75.24 	licensed or nonlicensed head varsity coach must notify the coach
75.25 	within 14 days of that decision.  If the coach requests reasons
75.26 	for not renewing the coaching contract, the board must give the
75.27 	coach its reasons in writing within ten days of receiving the
75.28 	request.  Upon request, the board must provide the coach with a
75.29 	reasonable opportunity to respond to the reasons at a board
75.30 	meeting.  The hearing may be opened or closed at the election of
75.31 	the coach unless the board closes the meeting under section
75.32 	13D.05, subdivision 2, to discuss nonpublic data.
75.33 	
EFFECTIVE DATE. This section is effective August 1, 2005.

75.34 	Sec. 36. Minnesota Statutes 2004, section 122A.41,
75.35 	subdivision 5a, is amended to read:
75.36 		Subd. 5a.Probationary period for principals hired
76.1 	internally.  A board and the exclusive representative of the
76.2 	school principals in the district may negotiate a plan for a
76.3 	probationary period of up to two school years for licensed
76.4 	teachers employed by the board who are subsequently employed by
76.5 	the board as a licensed school principal or assistant principal
76.6 	and an additional probationary period of up to two years for
76.7 	licensed assistant principals employed by the board who are
76.8 	subsequently employed by the board as a licensed school
76.9 	principal.
76.10 	
EFFECTIVE DATE. This section is effective August 1, 2005.

76.11 	Sec. 37. Minnesota Statutes 2004, section 122A.41,
76.12 	subdivision 14, is amended to read:
76.13 		Subd. 14.Services terminated by discontinuance or lack
76.14 	of pupils; preference given.  (a) A teacher whose services are
76.15 	terminated on account of discontinuance of position or lack of
76.16 	pupils must receive first consideration for other positions in
76.17 	the district for which that teacher is qualified.  In the event
76.18 	it becomes necessary to discontinue one or more positions, in
76.19 	making such discontinuance, teachers must be discontinued in any
76.20 	department in the inverse order in which they were employed,
76.21 	unless a board and the exclusive representative of teachers in
76.22 	the district negotiate a plan providing otherwise.
76.23 	(b) Notwithstanding the provisions of clause (a), a teacher
76.24 	is not entitled to exercise any seniority when that exercise
76.25 	results in that teacher being retained by the district in a
76.26 	field for which the teacher holds only a provisional license, as
76.27 	defined by the Board of Teaching, unless that exercise of
76.28 	seniority results in the termination of services, on account of
76.29 	discontinuance of position or lack of pupils, of another teacher
76.30 	who also holds a provisional license in the same field.  The
76.31 	provisions of this clause do not apply to vocational education
76.32 	licenses.
76.33 	(c) Notwithstanding the provisions of clause (a), a teacher
76.34 	must not be reinstated to a position in a field in which the
76.35 	teacher holds only a provisional license, other than a
76.36 	vocational education license, while another teacher who holds a
77.1 	nonprovisional license in the same field is available for
77.2 	reinstatement.
77.3 	
EFFECTIVE DATE. This section is effective August 1, 2005.

77.4 	Sec. 38. Minnesota Statutes 2004, section 122A.413, is
77.5 	amended to read:
77.6 	122A.413 EDUCATIONAL IMPROVEMENT PLAN.
77.7 		Subdivision 1.Qualifying plan. A district or
77.8 	intermediate school district may develop an educational
77.9 	improvement plan for the purpose of qualifying for alternative
77.10 	teacher compensation aid the alternative teacher professional
77.11 	pay system under sections 122A.414 and 122A.415section
77.12 	122A.414.  The plan must include measures for improving school
77.13 	district, intermediate school district, school site, teacher,
77.14 	and individual student performance.
77.15 		Subd. 2.Plan components. The educational improvement
77.16 	plan must be approved by the school board and have at least
77.17 	these elements:
77.18 	(1) assessment and evaluation tools to measure student
77.19 	performance and progress;
77.20 	(2) performance goals and benchmarks for improvement;
77.21 	(3) measures of student attendance and completion rates;
77.22 	(4) a rigorous professional development system, consistent
77.23 	with section 122A.60,that is aligned with educational
77.24 	improvement, designed to achieve teaching quality improvement,
77.25 	and consistent with clearly defined research-based standards;
77.26 	(5) measures of student, family, and community involvement
77.27 	and satisfaction;
77.28 	(6) a data system about students and their academic
77.29 	progress that provides parents and the public with
77.30 	understandable information; and 
77.31 	(7) a teacher induction and mentoring program for
77.32 	probationary teachers that provides continuous learning and
77.33 	sustained teacher support.  The process for developing the plan
77.34 	must involve district teachers ; and 
77.35 	(8) substantial participation by the exclusive
77.36 	representative of the teachers in developing the plan.
78.1 		Subd. 3.School site accountability. A district or
78.2 	intermediate school district that develops a plan under
78.3 	subdivisions 1 and 2 must ensure that each school site develops
78.4 	a board-approved educational improvement plan that is aligned
78.5 	with the district educational improvement plan under subdivision
78.6 	2 and developed with the exclusive representative of the
78.7 	teachers.  While a site plan must be consistent with the
78.8 	district educational improvement plan, it may establish
78.9 	performance goals and benchmarks that meet or exceed those of
78.10 	the district. The process for developing the plan must involve
78.11 	site teachers.

78.12 	Sec. 39. Minnesota Statutes 2004, section 122A.414, is
78.13 	amended to read:
78.14 	122A.414 ALTERNATIVE TEACHER COMPENSATION PAY.
78.15 		Subdivision 1.Restructured pay system. A restructured
78.16 	alternative teacher compensation professional pay system is
78.17 	established under subdivision 2 to provide incentives for to
78.18 	encourage teachers to improve their knowledge and instructional 
78.19 	skills in order to improve student learning and for school
78.20 	districts, intermediate school districts, and charter schools to
78.21 	recruit and retain highly qualified teachers, encourage highly
78.22 	qualified teachers to undertake challenging assignments,and to 
78.23 	support teachers' roles in improving students' educational
78.24 	achievement.
78.25 		Subd. 1a.Transitional planning year. (a) To be eligible
78.26 	to participate in an alternative teacher professional pay
78.27 	system, a school district, intermediate school district, or
78.28 	site, at least one school year before it expects to fully
78.29 	implement an alternative pay system, must:
78.30 	(1) submit to the department a letter of intent executed by
78.31 	the school district or intermediate school district and the
78.32 	exclusive representative of the teachers to complete a plan
78.33 	preparing for full implementation, consistent with subdivision
78.34 	2, that may include, among other activities, training to
78.35 	evaluate teacher performance, a restructured school day to
78.36 	develop integrated ongoing site-based professional development
79.1 	activities, release time to develop an alternative pay system
79.2 	agreement, and teacher and staff training on using multiple data
79.3 	sources; and 
79.4 	(2) agree to use up to two percent of basic revenue for
79.5 	staff development purposes, consistent with sections 122A.60 and
79.6 	122A.61, to develop the alternative teacher professional pay
79.7 	system agreement under this section.
79.8 	(b) To be eligible to participate in an alternative teacher
79.9 	professional pay system, a charter school, at least one school
79.10 	year before it expects to fully implement an alternative pay
79.11 	system, must:
79.12 	(1) submit to the department a letter of intent executed by
79.13 	the charter school and the charter school board of directors;
79.14 	(2) submit the record of a formal vote by the teachers
79.15 	employed at the charter school indicating at least 70 percent of
79.16 	all teachers agree to implement the alternative pay system; and 
79.17 	(3) agree to use up to two percent of basic revenue for
79.18 	staff development purposes, consistent with sections 122A.60 and
79.19 	122A.61, to develop the alternative teacher professional pay
79.20 	system.
79.21 	(c) The commissioner may waive the planning year if the
79.22 	commissioner determines, based on the criteria under subdivision
79.23 	2, that the school district, intermediate school district, site
79.24 	or charter school is ready to fully implement an alternative pay
79.25 	system.
79.26 		Subd. 2.Alternative teacher professional pay system.
 79.27 	(a) To participate in this program, a school district,
79.28 	intermediate school district, school site, or charter school 
79.29 	must have an educational improvement plan as described in under 
79.30 	section 122A.413 and an alternative teacher professional pay
79.31 	system as described in agreement under paragraph (b). A charter
79.32 	school participant also must comply with subdivision 2a.
79.33 	(b) The alternative teacher professional pay
79.34 	system agreement must:
79.35 	(1) describe the conditions necessary for how teachers can
79.36 	achieve career advancement and additional compensation;
80.1 	(2) describe how the school district, intermediate school
80.2 	district, school site, or charter school will provide teachers
80.3 	with career advancement options for teachers retaining that
80.4 	allow teachers to retain primary roles in student
80.5 	instruction and facilitate site-focused professional development
80.6 	that helps other teachers improve their skills;
80.7 	(3) use a professional pay system that replaces the step
80.8 	and lane salary schedule and is not based on years of service;
80.9 	(4) encourage teachers' continuous improvement in content
80.10 	knowledge, pedagogy, and use of best practices; and 
80.11 	(5) implement an objective evaluation system, including
80.12 	classroom observation, that is aligned with the district's or
80.13 	the site's educational improvement plan as described in section
80.14 	122A.413.reform the "steps and lanes" salary schedule, prevent
80.15 	any teacher's compensation paid before implementing the pay
80.16 	system from being reduced as a result of participating in this
80.17 	system, and base at least 60 percent of any compensation
80.18 	increase on teacher performance using:
80.19 	(i) schoolwide student achievement gains under section
80.20 	120B.35 or locally selected standardized assessment outcomes, or
80.21 	both;
80.22 	(ii) measures of student achievement; and 
80.23 	(iii) an objective evaluation program that includes:
80.24 	(A) individual teacher evaluations aligned with the
80.25 	educational improvement plan under section 122A.413 and the
80.26 	staff development plan under section 122A.60; and 
80.27 	(B) objective evaluations using multiple criteria conducted
80.28 	by a locally selected and periodically trained evaluation team
80.29 	that understands teaching and learning;
80.30 	(4) provide integrated ongoing site-based professional
80.31 	development activities to improve instructional skills and
80.32 	learning that are aligned with student needs under section
80.33 	122A.413, consistent with the staff development plan under
80.34 	section 122A.60 and led during the school day by trained teacher
80.35 	leaders such as master or mentor teachers;
80.36 	(5) allow any teacher in a participating school district,
81.1 	intermediate school district, school site, or charter school
81.2 	that implements an alternative pay system to participate in that
81.3 	system without any quota or other limit; and 
81.4 	(6) encourage collaboration rather than competition among
81.5 	teachers.
81.6 		Subd. 2a.Charter school applications. For charter
81.7 	school applications, the board of directors of a charter school
81.8 	that satisfies the conditions under subdivisions 2 and 2b must
81.9 	submit to the commissioner an application that contains:
81.10 	(1) an agreement to implement an alternative teacher
81.11 	professional pay system under this section;
81.12 	(2) a resolution by the charter school board of directors
81.13 	adopting the agreement; and 
81.14 	(3) the record of a formal vote by the teachers employed at
81.15 	the charter school indicating that at least 70 percent of all
81.16 	teachers agree to implement the alternative teacher professional
81.17 	pay system, unless the charter school submits an alternative
81.18 	teacher professional pay system agreement under this section
81.19 	before the first year of operation.
81.20 	Alternative compensation revenue for a qualifying charter
81.21 	school must be calculated under section 126C.10, subdivision 34,
81.22 	paragraphs (a) and (b).
81.23 		Subd. 2b.Approval process. (a) Consistent with the
81.24 	requirements of this section and sections 122A.413 and 122A.415,
81.25 	the department must prepare and transmit to interested school
81.26 	districts, intermediate school districts, school sites, and
81.27 	charter schools a standard form for applying to participate in
81.28 	the alternative teacher professional pay system.  An interested
81.29 	school district, intermediate school district, school site, or
81.30 	charter school must submit to the commissioner a completed
81.31 	application executed by the district superintendent and the
81.32 	exclusive bargaining representative of the teachers if the
81.33 	applicant is a school district, intermediate school district, or
81.34 	school site, or executed by the charter school board of
81.35 	directors if the applicant is a charter school.  The application
81.36 	must include the proposed alternative teacher professional pay
82.1 	system agreement under subdivision 2.  The department must
82.2 	convene a review committee that at least includes teachers and
82.3 	administrators within 30 days of receiving a completed
82.4 	application to recommend to the commissioner whether to approve
82.5 	or disapprove the application.  The commissioner must approve
82.6 	applications on a first-come, first-served basis.  The
82.7 	applicant's alternative teacher professional pay system
82.8 	agreement must be legally binding on the applicant and the
82.9 	collective bargaining representative before the applicant
82.10 	receives alternative compensation revenue.  The commissioner
82.11 	must approve or disapprove an application based on the
82.12 	requirements under subdivisions 2 and 2a.
82.13 	(b) If the commissioner disapproves an application, the
82.14 	commissioner must give the applicant timely notice of the
82.15 	specific reasons in detail for disapproving the application.
82.16 	The applicant may revise and resubmit its application and
82.17 	related documents to the commissioner within 30 days of
82.18 	receiving notice of the commissioner's disapproval and the
82.19 	commissioner must approve or disapprove the revised application,
82.20 	consistent with this subdivision.  Applications that are revised
82.21 	and then approved are considered submitted on the date the
82.22 	applicant initially submitted the application.
82.23 		Subd. 3.Report; continued funding. (a) Participating
82.24 	districts and , intermediate school districts,school sites, and
82.25 	charter schools must report on the implementation and
82.26 	effectiveness of the alternative teacher compensation plan 
82.27 	professional pay system, particularly addressing each
82.28 	requirement under subdivision 2 and make biennial annual 
82.29 	recommendations by January 1 June 15 to their school boards.
82.30 	The school boards board or board of directors shall transmit a
82.31 	copy of the report with a summary of the findings and
82.32 	recommendations of their the district, intermediate school
82.33 	district, school site, or charter school to the commissioner.
82.34 	(b) If the commissioner determines that a school district,
82.35 	intermediate school district, school site, or charter school
82.36 	that receives alternative teacher compensation revenue is not
83.1 	complying with the requirements of this section, the
83.2 	commissioner may withhold funding from that participant.  Before
83.3 	making the determination, the commissioner must notify the
83.4 	participant of any deficiencies and provide the participant an
83.5 	opportunity to comply.
83.6 		Subd. 3a.Planning and staff development. A school
83.7 	district that qualifies to participate in the alternative
83.8 	teacher professional pay system transitional planning year under
83.9 	subdivision 1a may use up to two percent of basic revenue that
83.10 	would otherwise be reserved under section 122A.61 for complying
83.11 	with the planning and staff development activities under this
83.12 	section.

83.13 	Sec. 40. [122A.4144] SUPPLEMENTAL AGREEMENTS; ALTERNATIVE
83.14 	TEACHER PAY.
83.15 	Notwithstanding section 179A.20 or other law to the
83.16 	contrary, a school board and the exclusive representative of the
83.17 	teachers may agree to reopen a collective bargaining agreement
83.18 	for the purpose of entering into an alternative teacher
83.19 	professional pay system agreement under sections 122A.413,
83.20 	122A.414, and 122A.415.  Negotiations for a contract reopened
83.21 	under this section must be limited to issues related to the
83.22 	alternative teacher professional pay system.

83.23 	EFFECTIVE DATE. This section is effective the day
83.24 	following final enactment.

83.25 	Sec. 41. Minnesota Statutes 2004, section 122A.415,
83.26 	subdivision 1, is amended to read:
83.27 		Subdivision 1.aid revenue amount.  (a) A school district
83.28 	, intermediate school district, school site, or charter school 
83.29 	that meets the conditions of section 122A.414 and submits an
83.30 	application approved by the commissioner is eligible for
83.31 	alternative teacher compensation aid revenue.
83.32 	(b) For school district and intermediate school district
83.33 	applications,the commissioner must consider only those 
83.34 	applications to participate that are submitted jointly by
83.35 	a school district and the exclusive representative of the
83.36 	teachers for participation in the program.  The application must
84.1 	contain a formally adopted collective bargaining agreement,
84.2 	memorandum of understanding, or other binding agreement an
84.3 	alternative teacher professional pay system agreement that:
84.4 	(1) implements an alternative teacher professional pay
84.5 	system consistent with section 122A.414;and includes all
84.6 	teachers in a district, all teachers at a school site, or at
84.7 	least 25 percent of the teachers in a district.  The
84.8 	commissioner, in approving applications, may give preference to
84.9 	applications involving entire districts or sites or to
84.10 	applications that align measures of teacher performance with
84.11 	student academic achievement and progress under section 120B.35,
84.12 	subdivision 1 
84.13 	(2) is negotiated and adopted according to the Public
84.14 	Employment Labor Relations Act under chapter 179A, except that
84.15 	notwithstanding section 179A.20, subdivision 3, a district may
84.16 	enter into a contract for a term of two or four years.
84.17 	(b) Alternative teacher compensation aid revenue for a
84.18 	qualifying school district,or site, or portion of a district or
84.19 	school site is as follows:
84.20 	(1) for a school district in which the school board and the
84.21 	exclusive representative of the teachers agree to place all 
84.22 	teachers in the district or at the site on the
84.23 	alternative compensation schedule, alternative compensation aid 
84.24 	teacher professional pay system equals $150 $260 times the
84.25 	district's or the site's number of pupils enrolled at the
84.26 	district or site on October 1 of the previous fiscal year; or 
84.27 	(2) for a district in which the school board and the
84.28 	exclusive representative of the teachers agree that at least 25
84.29 	percent of the district's licensed teachers will be paid on the
84.30 	alternative compensation schedule, alternative compensation aid
84.31 	equals $150 times the percentage of participating teachers times
84.32 	the district's number of pupils enrolled as of October 1 of the
84.33 	previous fiscal year. Alternative teacher compensation revenue
84.34 	for a qualifying intermediate school district must be calculated
84.35 	under section 126C.10, subdivision 34, paragraphs (a) and (b).
84.36 	(c) For a newly combined or consolidated district, the
85.1 	revenue shall be computed using the sum of pupils enrolled on
85.2 	October 1 of the previous year in the districts entering into
85.3 	the combination or consolidation.  The commissioner may adjust
85.4 	the revenue computed for a site using prior year data to reflect
85.5 	changes attributable to school closings, school openings, or
85.6 	grade level reconfigurations between the prior year and the
85.7 	current year.
85.8 	(d) The revenue is available only to school districts,
85.9 	intermediate school districts, school sites, and charter schools
85.10 	that fully implement an alternative teacher professional pay
85.11 	system by October 1 of the current school year.

85.12 	Sec. 42. Minnesota Statutes 2004, section 122A.415,
85.13 	subdivision 3, is amended to read:
85.14 		Subd. 3.aid revenue timing.  (a) Districts or ,
85.15 	intermediate school districts, school sites, or charter schools 
85.16 	with approved applications must receive alternative compensation
85.17 	aid revenue for each school year that the district or ,
85.18 	intermediate school district, school site participates in the
85.19 	program as described in , or charter school implements an
85.20 	alternative teacher professional pay system under this
85.21 	subdivision and section 122A.414. Districts or sites with
85.22 	applications received by the commissioner before June 1 of the
85.23 	first year of a two-year contract shall receive alternative
85.24 	compensation aid for both years of the contract.  Districts or
85.25 	sites with applications received by the commissioner after June
85.26 	1 of the first year of a two-year contract shall receive
85.27 	alternative compensation aid only for the second year of the
85.28 	contract.For fiscal year 2007 and later,a qualifying district
85.29 	or , intermediate school district, school site, or charter school 
85.30 	that received alternative teacher compensation aid for the
85.31 	previous fiscal year must receive at least an amount of
85.32 	alternative teacher compensation revenue equal to the lesser of
85.33 	the amount it received for the previous fiscal year or its
85.34 	proportionate share of the previous year's appropriation the
85.35 	amount it qualifies for under subdivision 1 for the current
85.36 	fiscal year if the district or , intermediate school district,
86.1 	school site, or charter school submits a timely application and
86.2 	the commissioner determines that the district or , intermediate
86.3 	school district, school site, or charter school continues to
86.4 	implement an alternative teacher professional pay system,
86.5 	consistent with its application under this section. The
86.6 	commissioner must approve initial applications for school
86.7 	districts qualifying under subdivision 1, paragraph (b), clause
86.8 	(1), by January 15 of each year.  If any money remains, the
86.9 	commissioner must approve aid amounts for school districts
86.10 	qualifying under subdivision 1, paragraph (b), clause (2), by
86.11 	February 15 of each year.
86.12 	(b) The commissioner shall approve applications that comply
86.13 	with sections 122A.414, subdivisions 2, paragraph (b), and 2a,
86.14 	if the applicant is a charter school, and 122A.415, subdivision
86.15 	1, in the order in which they are received,select applicants
86.16 	that qualify for this program, notify school districts and ,
86.17 	intermediate school districts,school sites, and charter schools 
86.18 	about the program, develop and disseminate application
86.19 	materials, and carry out other activities needed to implement
86.20 	this section.
86.21 	(c) For applications approved under section 122A.415 before
86.22 	August 1 of the fiscal year for which the aid is paid, the
86.23 	portion of the state total basic alternative teacher
86.24 	compensation aid entitlement allocated to charter schools must
86.25 	not exceed $522,000 for fiscal year 2006 and $3,374,000 for
86.26 	fiscal year 2007.  For fiscal year 2008 and later, the portion
86.27 	of the state total basic alternative teacher compensation aid
86.28 	entitlement allocated to charter schools must not exceed the
86.29 	product of $3,374,000 times the ratio of the state total charter
86.30 	school enrollment for the previous fiscal year to the state
86.31 	total charter school enrollment for the second previous year.
86.32 	Additional basic alternative teacher compensation aid may be
86.33 	approved for charter schools after August 1, not to exceed the
86.34 	charter school limit for the following fiscal year, if the basic
86.35 	alternative teacher compensation aid entitlement for school
86.36 	districts based on applications approved by August 1 does not
87.1 	expend the remaining amount under the limit.
87.2 	
EFFECTIVE DATE. This section is effective August 1, 2005.

87.3 	Sec. 43. Minnesota Statutes 2004, section 122A.60,
87.4 	subdivision 1, is amended to read:
87.5 		Subdivision 1.Staff development committee.  A school
87.6 	board must use the revenue authorized in section 122A.61 for
87.7 	in-service education for programs under section 120B.22,
87.8 	subdivision 2, or for staff development plans under this
87.9 	section.  The board must establish an advisory staff development
87.10 	committee to develop the plan, assist site professional
87.11 	development teams in developing a site plan consistent with the
87.12 	goals of the plan, and evaluate staff development efforts at the
87.13 	site level.  A majority of the advisory committee and the site
87.14 	professional development team must be teachers representing
87.15 	various grade levels, subject areas, and special education.  The
87.16 	advisory committee must also include nonteaching staff, parents,
87.17 	and administrators. Districts must report staff development
87.18 	results and expenditures to the commissioner in the form and
87.19 	manner determined by the commissioner.  The expenditure report
87.20 	must include expenditures by the board for district level
87.21 	activities and expenditures made by the staff.  The report must
87.22 	provide a breakdown of expenditures for (1) curriculum
87.23 	development and programs, (2) in-service education, workshops,
87.24 	and conferences, and (3) the cost of teachers or substitute
87.25 	teachers for staff development purposes.  Within each of these
87.26 	categories, the report must also indicate whether the
87.27 	expenditures were incurred at the district level or the school
87.28 	site level, and whether the school site expenditures were made
87.29 	possible by the grants to school sites that demonstrate
87.30 	exemplary use of allocated staff development revenue.  These
87.31 	expenditures are to be reported using the UFARS system.  The
87.32 	commissioner shall report the staff development expenditure data
87.33 	to the education committees of the legislature by February 15
87.34 	each year.

87.35 	Sec. 44. Minnesota Statutes 2004, section 122A.60, is
87.36 	amended by adding a subdivision to read:
88.1 		Subd. 1a.Effective staff development activities. (a)
88.2 	Staff development activities must:
88.3 	(1) focus on the school classroom and research-based
88.4 	strategies that improve student learning;
88.5 	(2) provide opportunities for teachers to practice and
88.6 	improve their instructional skills over time;
88.7 	(3) provide opportunities for teachers to use student data
88.8 	as part of their daily work to increase student achievement;
88.9 	(4) enhance teacher content knowledge and instructional
88.10 	skills;
88.11 	(5) align with state and local academic standards;
88.12 	(6) provide opportunities to build professional
88.13 	relationships, foster collaboration among principals and staff
88.14 	who provide instruction, and provide opportunities for
88.15 	teacher-to-teacher mentoring; and 
88.16 	(7) align with the plan of the district or site for an
88.17 	alternative teacher professional pay system.
88.18 	Staff development activities may include curriculum development
88.19 	and curriculum training programs, and activities that provide
88.20 	teachers and other members of site-based teams training to
88.21 	enhance team performance.  The school district also may
88.22 	implement other staff development activities required by law and
88.23 	activities associated with professional teacher compensation
88.24 	models.
88.25 	(b) Release time provided for teachers to supervise
88.26 	students on field trips and school activities, or independent
88.27 	tasks not associated with enhancing the teacher's knowledge and
88.28 	instructional skills, such as preparing report cards,
88.29 	calculating grades, or organizing classroom materials, may not
88.30 	be counted as staff development time that is financed with staff
88.31 	development reserved revenue under section 122A.61.

88.32 	Sec. 45. Minnesota Statutes 2004, section 122A.60, is
88.33 	amended by adding a subdivision to read:
88.34 		Subd. 4.Staff development report. (a) By October 15 of
88.35 	each year, the district and site staff development committees
88.36 	shall write and submit a report of staff development activities
89.1 	and expenditures for the previous year, in the form and manner
89.2 	determined by the commissioner.  The report, signed by the
89.3 	district superintendent and staff development chair, must
89.4 	include assessment and evaluation data indicating progress
89.5 	toward district and site staff development goals based on
89.6 	teaching and learning outcomes, including the percentage of
89.7 	teachers and other staff involved in instruction who participate
89.8 	in effective staff development activities under subdivision 3.
89.9 	(b) The report must break down expenditures for:
89.10 	(1) curriculum development and curriculum training
89.11 	programs; and 
89.12 	(2) staff development training models, workshops, and
89.13 	conferences, and the cost of releasing teachers or providing
89.14 	substitute teachers for staff development purposes.
89.15 	The report also must indicate whether the expenditures were
89.16 	incurred at the district level or the school site level, and
89.17 	whether the school site expenditures were made possible by
89.18 	grants to school sites that demonstrate exemplary use of
89.19 	allocated staff development revenue.  These expenditures must be
89.20 	reported using the uniform financial and accounting and
89.21 	reporting standards.
89.22 	(c) The commissioner shall report the staff development
89.23 	progress and expenditure data to the house of representatives
89.24 	and senate committees having jurisdiction over education by
89.25 	February 15 each year.

89.26 	Sec. 46. [122A.628] SCHOOLS MENTORING SCHOOLS REGIONAL
89.27 	SITES.
89.28 		Subdivision 1.Program. The commissioner of education
89.29 	shall select up to four school districts, or partnerships of
89.30 	school districts, for the purpose of assisting other school
89.31 	districts in the region with the development of thorough and
89.32 	effective teacher mentoring programs.  The commissioner shall
89.33 	use geographic balance and proven teacher induction programs as
89.34 	criteria when selecting the sites.  One site must include the
89.35 	Brainerd teacher support system, which has been cited by the
89.36 	Minnesota Board of Teaching as a model program and was one of
90.1 	only six programs in the nation to be recognized for the 2004
90.2 	NEA-Saturn/UAW partnership award.  The sites shall be known as
90.3 	schools mentoring schools regional sites.
90.4 	The sites shall provide high quality mentoring assistance
90.5 	programs and services to other nearby school districts for the
90.6 	development of effective systems of support for new teachers.
90.7 	The sites shall offer coaching/mentor training, in-class
90.8 	observation training, and train-the-teacher opportunities for
90.9 	teams of participating teachers.  The sites shall use their
90.10 	recognized experience and methods to equip schools to work with
90.11 	their own new and beginning teachers.  The commissioner shall
90.12 	review and report annually to the legislature on the operation
90.13 	of each training center.
90.14 		Subd. 2.Revenue. A school district that is selected to
90.15 	participate in the schools mentoring schools program under this
90.16 	section may utilize its professional compensation revenue under
90.17 	section 122A.4142, subdivision 4, to pay regional training sites
90.18 	for staff development and training services.

90.19 	Sec. 47. [122A.74] PRINCIPALS' LEADERSHIP INSTITUTE.
90.20 		Subdivision 1.Establishment. (a) The commissioner of
90.21 	education may contract with the regents of the University of
90.22 	Minnesota to establish a Principals' Leadership Institute to
90.23 	provide professional development to school principals by:
90.24 	(1) creating a network of leaders in the educational and
90.25 	business communities to communicate current and future trends in
90.26 	leadership techniques;
90.27 	(2) helping to create a vision for the school that is
90.28 	aligned with the community and district priorities; and 
90.29 	(3) developing strategies to retain highly qualified
90.30 	teachers.
90.31 	(b) The University of Minnesota must cooperate with
90.32 	participating members of the business community to provide
90.33 	funding and content for the institute.
90.34 	(c) Participants must agree to attend the Principals'
90.35 	Leadership Institute for four weeks during the academic summer.
90.36 	(d) The Principals' Leadership Institute must incorporate
91.1 	program elements offered by leadership programs at the
91.2 	University of Minnesota and program elements used by the
91.3 	participating members of the business community to enhance
91.4 	leadership within their businesses.
91.5 		Subd. 2.Method of selection and requirements. (a) The
91.6 	board of each school district in the state may select a
91.7 	principal, upon the recommendation of the district's
91.8 	superintendent and based on the principal's leadership
91.9 	potential, to attend the institute.
91.10 	(b) The school board shall forward its list of recommended
91.11 	participants to the commissioner of education by February 1 each
91.12 	year.  In addition, a principal may submit an application
91.13 	directly to the commissioner by February 1.  The commissioner of
91.14 	education shall notify the school board, the principal
91.15 	candidates, and the University of Minnesota of the principals
91.16 	selected to participate in the Principals' Leadership Institute
91.17 	each year.

91.18 	Sec. 48. [123A.12] AGREEMENT REGARDING ADMINISTRATIVE
91.19 	SERVICES.
91.20 		Subdivision 1.Agreement. (a) Two or more school
91.21 	districts may enter into an agreement pursuant to section 471.59
91.22 	to increase efficiency in the delivery of administrative
91.23 	services and to reduce costs by the provision of an
91.24 	administrative service by a district or an entity created by or
91.25 	specified in the agreement and the purchase of that service by
91.26 	one or more other districts that are a party to that agreement.
91.27 	(b) Administrative services include, but are not limited to:
91.28 	(1) a superintendent, deputy superintendent, or assistant
91.29 	superintendent;
91.30 	(2) a principal, assistant principal, or vice principal; or 
91.31 	(3) a director, manager, coordinator, supervisor, dean, or
91.32 	other administrative position regardless of title.
91.33 	(c) A person providing administrative services to another
91.34 	district pursuant to the agreement shall remain an employee of
91.35 	the employing district or the entity created by or specified in
91.36 	the agreement for all purposes.
92.1 		Subd. 2.Levy. If an administrative position is
92.2 	discontinued in a district as a result of the purchase of
92.3 	administrative services under the agreement in subdivision 1,
92.4 	the district may levy over a period of up to three years for
92.5 	costs approved by the commissioner for retirement incentives or
92.6 	severance pay or other costs related to the discontinuance of
92.7 	that position.

92.8 	Sec. 49. Minnesota Statutes 2004, section 123B.02, is
92.9 	amended by adding a subdivision to read:
92.10 		Subd. 14a.Employee recognition. A school board may
92.11 	establish and operate an employee recognition program for
92.12 	district employees, including teachers, and may expend funds as
92.13 	necessary to achieve the objectives of the program.  The
92.14 	employee recognition program shall not include monetary awards.

92.15 	Sec. 50. Minnesota Statutes 2004, section 123B.02, is
92.16 	amended by adding a subdivision to read:
92.17 		Subd. 22.Reward. A school board, after formally
92.18 	adopting a policy consistent with this subdivision, may offer a
92.19 	reward to a person who provides accurate and reliable
92.20 	information leading to the conviction of a person who has
92.21 	committed or conspired to commit a crime against students or
92.22 	school employees, volunteers or board members as a result of
92.23 	their affiliation with the school district, or against school
92.24 	district property.
92.25 	
EFFECTIVE DATE. This section is effective the day
92.26 	following final enactment.

92.27 	Sec. 51. Minnesota Statutes 2004, section 123B.02, is
92.28 	amended by adding a subdivision to read:
92.29 		Subd. 23.Credit cards. A board may authorize the use of
92.30 	a credit card by any officer or employee otherwise authorized to
92.31 	make a purchase on behalf of the district.  If a district
92.32 	officer or employee makes or directs a purchase by credit card
92.33 	that is not approved by the school board, the officer or
92.34 	employee is personally liable for the amount of the purchase.  A
92.35 	purchase by credit card must otherwise comply with all statutes,
92.36 	rules, or district policy applicable to school district
93.1 	purchases.
93.2 	
EFFECTIVE DATE. This section is effective the day
93.3 	following final enactment and applies for fiscal year 2005 and
93.4 	later.

93.5 	Sec. 52. Minnesota Statutes 2004, section 123B.04,
93.6 	subdivision 1, is amended to read:
93.7 		Subdivision 1.Definition.  "Education site" means a
93.8 	separate facility.  A program within a facility or within a
93.9 	district is an education site if the school board recognizes it
93.10 	as a site.

93.11 	Sec. 53. Minnesota Statutes 2004, section 123B.04,
93.12 	subdivision 2, is amended to read:
93.13 		Subd. 2.Agreement.  (a) Either the school board or the
93.14 	school site decision-making team may request that the school
93.15 	board enter into an agreement with a school site decision-making
93.16 	team concerning Upon the request of 60 percent of the licensed
93.17 	employees of a site or a school site decision-making team, the
93.18 	school board shall enter into discussions to reach an agreement
93.19 	concerning the governance, management, or control of the
93.20 	school.  A school site decision-making team may include the
93.21 	school principal, teachers in the school or their designee,
93.22 	other employees in the school, parents of pupils in the school,
93.23 	representatives of pupils in the school, or other members in the
93.24 	community. A school site decision-making team must include at
93.25 	least one parent of a pupil in the school.  For purposes of
93.26 	formation of a new site, a school site decision-making team may
93.27 	be a team of teachers that is recognized by the board as a
93.28 	site.The school site decision-making team shall include the
93.29 	school principal or other person having general control and
93.30 	supervision of the school.  The site decision-making team must
93.31 	reflect the diversity of the education site. No more than At
93.32 	least one-half of the members shall be employees of the
93.33 	district, unless an employee is the parent of a student enrolled
93.34 	in the school site, in which case the employee may elect to
93.35 	serve as a parent member of the site team.
93.36 	(b) School site decision-making agreements must delegate
94.1 	powers, duties, and broad management responsibilities to site
94.2 	teams and involve staff members, students as appropriate, and
94.3 	parents in decision making.
94.4 	(c) An agreement shall include a statement of powers,
94.5 	duties, responsibilities, and authority to be delegated to and
94.6 	within the site.
94.7 	(d) An agreement may include:
94.8 	(1) an achievement contract according to subdivision 4;
94.9 	(2) a mechanism to allow principals, a site leadership
94.10 	team,or other persons having general control and supervision of
94.11 	the school, to make decisions regarding how financial and
94.12 	personnel resources are best allocated at the site and from whom
94.13 	goods or services are purchased;
94.14 	(3) a mechanism to implement parental involvement programs
94.15 	under section 124D.895 and to provide for effective parental
94.16 	communication and feedback on this involvement at the site
94.17 	level;
94.18 	(4) a provision that would allow the team to determine who
94.19 	is hired into licensed and nonlicensed positions;
94.20 	(5) a provision that would allow teachers to choose the
94.21 	principal or other person having general control;
94.22 	(6) an amount of revenue allocated to the site under
94.23 	subdivision 3; and
94.24 	(7) any other powers and duties determined appropriate by
94.25 	the board.
94.26 	The school board of the district remains the legal employer
94.27 	under clauses (4) and (5).
94.28 	(e) Any powers or duties not delegated to the school site
94.29 	management team in the school site management agreement shall
94.30 	remain with the school board.
94.31 	(f) Approved agreements shall be filed with the
94.32 	commissioner.  If a school board denies a request or the school
94.33 	site and school board fail to reach an agreement to enter into a
94.34 	school site management agreement, it the school board shall
94.35 	provide a copy of the request and the reasons for its denial to
94.36 	the commissioner.
95.1 	(g) A site decision-making grant program is established,
95.2 	consistent with this subdivision, to allow sites to implement an
95.3 	agreement that at least:
95.4 	(1) notwithstanding subdivision 3, allocates to the site
95.5 	all revenue that is attributable to the students at that site;
95.6 	(2) a provision, consistent with current law and the
95.7 	collective bargaining agreement in effect, allows the site team
95.8 	to decide who is selected from within the district for licensed
95.9 	and nonlicensed positions at the site and to make staff
95.10 	assignments in the site; and 
95.11 	(3) includes a completed performance agreement under
95.12 	subdivision 4.
95.13 	The commissioner shall establish the form and manner of the
95.14 	application for a grant and annually, at the end of each fiscal
95.15 	year, report to the house of representative and senate
95.16 	committees having jurisdiction over education on the progress of
95.17 	the program.

95.18 	Sec. 54. Minnesota Statutes 2004, section 123B.49,
95.19 	subdivision 4, is amended to read:
95.20 		Subd. 4.Board control of extracurricular activities.
 95.21 	(a) The board may take charge of and control all extracurricular
95.22 	activities of the teachers and children of the public schools in
95.23 	the district.  Extracurricular activities means all direct and
95.24 	personal services for pupils for their enjoyment that are
95.25 	managed and operated under the guidance of an adult or staff
95.26 	member.  The board shall allow all resident pupils receiving
95.27 	instruction in a home school as defined in section 123B.36,
95.28 	subdivision 1, paragraph (a), to be eligible to fully
95.29 	participate in extracurricular activities on the same basis as
95.30 	public school students.
95.31 	(b) Extracurricular activities have all of the following
95.32 	characteristics:
95.33 	(1) they are not offered for school credit nor required for
95.34 	graduation;
95.35 	(2) they are generally conducted outside school hours, or
95.36 	if partly during school hours, at times agreed by the
96.1 	participants, and approved by school authorities;
96.2 	(3) the content of the activities is determined primarily
96.3 	by the pupil participants under the guidance of a staff member
96.4 	or other adult.
96.5 	(c) If the board does not take charge of and control
96.6 	extracurricular activities, these activities shall be
96.7 	self-sustaining with all expenses, except direct salary costs
96.8 	and indirect costs of the use of school facilities, met by dues,
96.9 	admissions, or other student fund-raising events.  The general
96.10 	fund must reflect only those salaries directly related to and
96.11 	readily identified with the activity and paid by public funds.
96.12 	Other revenues and expenditures for extra curricular activities
96.13 	must be recorded according to the "Manual of Instruction for
96.14 	Uniform Student Activities Accounting for Minnesota School
96.15 	Districts and Area Vocational-Technical Colleges." Manual for
96.16 	Activity Fund Accounting.Extracurricular activities not under
96.17 	board control must have an annual financial audit and must also
96.18 	be audited annually for compliance with this section.
96.19 	(d) If the board takes charge of and controls
96.20 	extracurricular activities, any or all costs of these activities
96.21 	may be provided from school revenues and all revenues and
96.22 	expenditures for these activities shall be recorded in the same
96.23 	manner as other revenues and expenditures of the district.
96.24 	(e) If the board takes charge of and controls
96.25 	extracurricular activities, the teachers or pupils in the
96.26 	district must not participate in such activity, nor shall the
96.27 	school name or any allied name be used in connection therewith,
96.28 	except by consent and direction of the board.

96.29 	Sec. 55. Minnesota Statutes 2004, section 123B.88, is
96.30 	amended by adding a subdivision to read:
96.31 		Subd. 3a.Pupil transportation safety committee. (a) A
96.32 	school board may establish a pupil transportation safety
96.33 	committee.  The chair of the pupil transportation safety
96.34 	committee is the district's school transportation safety
96.35 	director.  The school board shall appoint the other members of
96.36 	the pupil transportation safety committee.  Membership may
97.1 	include parents, school bus drivers, representatives of school
97.2 	bus companies, local law enforcement officials, other school
97.3 	district staff, and representatives from other units of local
97.4 	government.
97.5 	(b) The duties of the pupil transportation safety committee
97.6 	include:  (1) reviewing and recommending changes to the
97.7 	district's pupil transportation safety policy required under
97.8 	subdivision 1; and (2) developing a comprehensive plan for the
97.9 	safe transportation of students who face hazardous
97.10 	transportation conditions.  The comprehensive hazardous
97.11 	transportation plan shall consider safety factors including the
97.12 	types of roads that students must cross, the speed of traffic on
97.13 	those roads, the age of the students, and any other factors as
97.14 	determined by the committee.
97.15 	(c) The pupil transportation safety committee must hold at
97.16 	least one public meeting before adopting its comprehensive plan
97.17 	for transporting students who face hazardous transportation
97.18 	conditions.
97.19 	(d) Any recommended changes to the district's pupil
97.20 	transportation safety policy and the comprehensive plan for
97.21 	hazardous transportation must be submitted to the school board.
97.22 	
EFFECTIVE DATE. This section is effective the day
97.23 	following final enactment.

97.24 	Sec. 56. Minnesota Statutes 2004, section 124D.09,
97.25 	subdivision 12, is amended to read:
97.26 		Subd. 12.Credits.  A pupil may enroll in a course under
97.27 	this section for either secondary credit or postsecondary
97.28 	credit.  At the time a pupil enrolls in a course, the pupil
97.29 	shall designate whether the course is for secondary or
97.30 	postsecondary credit.  A pupil taking several courses may
97.31 	designate some for secondary credit and some for postsecondary
97.32 	credit.  A pupil must not audit a course under this section.
97.33 	A district shall grant academic credit to a pupil enrolled
97.34 	in a course for secondary credit if the pupil successfully
97.35 	completes the course.  Seven quarter or four semester college
97.36 	credits equal at least one full year of high school credit.
98.1 	Fewer college credits may be prorated.  A district must also
98.2 	grant academic credit to a pupil enrolled in a course for
98.3 	postsecondary credit if secondary credit is requested by a
98.4 	pupil.  If no comparable course is offered by the district, the
98.5 	district must, as soon as possible, notify the commissioner, who
98.6 	shall determine the number of credits that shall be granted to a
98.7 	pupil who successfully completes a course.  If a comparable
98.8 	course is offered by the district, the school board shall grant
98.9 	a comparable number of credits to the pupil.  If there is a
98.10 	dispute between the district and the pupil regarding the number
98.11 	of credits granted for a particular course, the pupil may appeal
98.12 	the board's decision to the commissioner.  The commissioner's
98.13 	decision regarding the number of credits shall be final.
98.14 	The secondary credits granted to a pupil must be counted
98.15 	toward the graduation requirements and subject area requirements
98.16 	of the district.  Evidence of successful completion of each
98.17 	course and secondary credits granted must be included in the
98.18 	pupil's secondary school record.  A pupil shall provide the
98.19 	school with a copy of the pupil's grade in each course taken for
98.20 	secondary credit under this section.  Upon the request of a
98.21 	pupil, the pupil's secondary school record must also include
98.22 	evidence of successful completion and credits granted for a
98.23 	course taken for postsecondary credit.  In either case, the
98.24 	record must indicate that the credits were earned at a
98.25 	postsecondary institution.
98.26 	If a pupil enrolls in a postsecondary institution after
98.27 	leaving secondary school, the postsecondary institution must
98.28 	award postsecondary credit for any course successfully completed
98.29 	for secondary credit at that institution.  Other postsecondary
98.30 	institutions may award, after a pupil leaves secondary school,
98.31 	postsecondary credit for any courses successfully completed
98.32 	under this section.  An institution may not charge a pupil for
98.33 	the award of credit.
98.34 	The Board of Trustees of the Minnesota State Colleges and
98.35 	Universities and the Board of Regents of the University of
98.36 	Minnesota must, and private nonprofit and proprietary
99.1 	postsecondary institutions, should award postsecondary credit
99.2 	for any successfully completed courses in a program certified by
99.3 	the National Alliance of Concurrent Enrollment Partnerships
99.4 	offered according to an agreement under subdivision 10.

99.5 	Sec. 57. Minnesota Statutes 2004, section 124D.095,
99.6 	subdivision 8, is amended to read:
99.7 		Subd. 8.Financial arrangements.  (a) For a student
99.8 	enrolled in an on-line learning course, the department must
99.9 	calculate average daily membership and make payments according
99.10 	to this subdivision.
99.11 	(b) The initial on-line learning average daily membership
99.12 	equals 1/12 for each semester course or a proportionate amount
99.13 	for courses of different lengths.  The adjusted on-line learning
99.14 	average daily membership equals the initial on-line learning
99.15 	average daily membership times .88.
99.16 	(c) No on-line learning average daily membership shall be
99.17 	generated if:  (1) the student does not complete the on-line
99.18 	learning course, or (2) the student is enrolled in on-line
99.19 	learning provided by the enrolling district and the student was
99.20 	enrolled in a Minnesota public school for the school year before
99.21 	the school year in which the student first enrolled in on-line
99.22 	learning.
99.23 	(d) On-line learning average daily membership under this
99.24 	subdivision for a student currently enrolled in a Minnesota
99.25 	public school and who was enrolled in a Minnesota public school
99.26 	for the school year before the school year in which the student
99.27 	first enrolled in on-line learning shall be used only for
99.28 	computing average daily membership according to section 126C.05,
99.29 	subdivision 19, paragraph (a), clause (ii), and for computing
99.30 	on-line learning aid according to section 126C.24 124D.096.
99.31 	(e) On-line learning average daily membership under this
99.32 	subdivision for students not included in paragraph (c) or (d)
99.33 	shall be used only for computing average daily membership
99.34 	according to section 126C.05, subdivision 19, paragraph (a),
99.35 	clause (ii), and for computing payments under paragraphs (f) and
99.36 	(g).
100.1 	(f) Subject to the limitations in this subdivision, the
100.2 	department must pay an on-line learning provider an amount equal
100.3 	to the product of the adjusted on-line learning average daily
100.4 	membership for students under paragraph (e) times the student
100.5 	grade level weighting under section 126C.05, subdivision 1,
100.6 	times the formula allowance.
100.7 	(g) The department must pay each on-line learning provider
100.8 	100 percent of the amount in paragraph (f) within 45 days of
100.9 	receiving final enrollment and course completion information
100.10 	each quarter or semester.
100.11 	
EFFECTIVE DATE. This section is effective for revenue for
100.12 	fiscal year 2006.

100.13 	Sec. 58. Minnesota Statutes 2004, section 124D.10,
100.14 	subdivision 4, is amended to read:
100.15 		Subd. 4.Formation of school.  (a) A sponsor may
100.16 	authorize one or more licensed teachers under section 122A.18,
100.17 	subdivision 1, to operate a charter school subject to approval
100.18 	by the commissioner.  A board must vote on charter school
100.19 	application for sponsorship no later than 90 days after
100.20 	receiving the application.  After 90 days, the applicant may
100.21 	apply to the commissioner.  If a board elects not to sponsor a
100.22 	charter school, the applicant may appeal the board's decision to
100.23 	the commissioner.  The commissioner who may elect to sponsor the
100.24 	charter school or assist the applicant in finding an eligible
100.25 	sponsor.  The school must be organized and operated as a
100.26 	cooperative under chapter 308A or nonprofit corporation under
100.27 	chapter 317A and the provisions under the applicable chapter
100.28 	shall apply to the school except as provided in this section.
100.29 	Notwithstanding sections 465.717 and 465.719, a school district
100.30 	may create a corporation for the purpose of creating a charter
100.31 	school.
100.32 	(b) Before the operators may form and operate a school, the
100.33 	sponsor must file an affidavit with the commissioner stating its
100.34 	intent to authorize a charter school.  The affidavit must state
100.35 	the terms and conditions under which the sponsor would authorize
100.36 	a charter school and how the sponsor intends to oversee the
101.1 	fiscal and student performance of the charter school and to
101.2 	comply with the terms of the written contract between the
101.3 	sponsor and the charter school board of directors under
101.4 	subdivision 6.  The commissioner must approve or disapprove the
101.5 	sponsor's proposed authorization within 60 90 days of receipt of
101.6 	the affidavit.  Failure to obtain commissioner approval
101.7 	precludes a sponsor from authorizing the charter school that was
101.8 	the subject of the affidavit.
101.9 	(c) The operators authorized to organize and operate a
101.10 	school, before entering into a contract or other agreement for
101.11 	professional or other services, goods, or facilities, must
101.12 	incorporate as a cooperative under chapter 308A or as a
101.13 	nonprofit corporation under chapter 317A and must establish a
101.14 	board of directors composed of at least five members until a
101.15 	timely election for members of the charter school board of
101.16 	directors is held according to the school's articles and
101.17 	bylaws.  A charter school board of directors must be composed of
101.18 	at least five members.  Any staff members who are employed at
101.19 	the school, including teachers providing instruction under a
101.20 	contract with a cooperative, and all parents of children
101.21 	enrolled in the school may participate in the election for
101.22 	members of the school's board of directors.  Licensed teachers
101.23 	employed at the school, including teachers providing instruction
101.24 	under a contract with a cooperative, must be a majority of the
101.25 	members of the board of directors before the school completes
101.26 	its third year of operation, unless the commissioner waives the
101.27 	requirement for a majority of licensed teachers on the board.
101.28 	Board of director meetings must comply with chapter 13D.
101.29 	(d) The granting or renewal of a charter by a sponsoring
101.30 	entity must not be conditioned upon the bargaining unit status
101.31 	of the employees of the school.
101.32 	(e) A sponsor may authorize the operators of a charter
101.33 	school to expand the operation of the charter school to
101.34 	additional sites or to add additional grades at the school
101.35 	beyond those described in the sponsor's application as approved
101.36 	by the commissioner only after submitting a supplemental
102.1 	application to the commissioner in a form and manner prescribed
102.2 	by the commissioner.  The supplemental application must provide
102.3 	evidence that:
102.4 	(1) the expansion of the charter school is supported by
102.5 	need and projected enrollment;
102.6 	(2) the charter school is fiscally sound;
102.7 	(3) the sponsor supports the expansion; and
102.8 	(4) the building of the additional site meets all health
102.9 	and safety requirements to be eligible for lease aid.
102.10 	(f) The commissioner annually must provide timely financial
102.11 	management training to newly elected members of a charter school
102.12 	board of directors and ongoing training to other members of a
102.13 	charter school board of directors.  Training must address ways
102.14 	to:
102.15 	(1) proactively assess opportunities for a charter school
102.16 	to maximize all available revenue sources;
102.17 	(2) establish and maintain complete, auditable records for
102.18 	the charter school;
102.19 	(3) establish proper filing techniques;
102.20 	(4) document formal actions of the charter school,
102.21 	including meetings of the charter school board of directors;
102.22 	(5) properly manage and retain charter school and student
102.23 	records;
102.24 	(6) comply with state and federal payroll record-keeping
102.25 	requirements; and
102.26 	(7) address other similar factors that facilitate
102.27 	establishing and maintaining complete records on the charter
102.28 	school's operations.
102.29 	
EFFECTIVE DATE. This section is effective for the
102.30 	2005-2006 school year and later.

102.31 	Sec. 59. Minnesota Statutes 2004, section 124D.10,
102.32 	subdivision 6, is amended to read:
102.33 		Subd. 6.Contract.  The sponsor's authorization for a
102.34 	charter school must be in the form of a written contract signed
102.35 	by the sponsor and the board of directors of the charter
102.36 	school.  The contract must be completed within 90 days of the
103.1 	commissioner's approval of the sponsor's proposed authorization.
103.2 	The contract for a charter school must be in writing and contain
103.3 	at least the following:
103.4 	(1) a description of a program that carries out one or more
103.5 	of the purposes in subdivision 1;
103.6 	(2) specific outcomes pupils are to achieve under
103.7 	subdivision 10;
103.8 	(3) admission policies and procedures;
103.9 	(4) management and administration of the school;
103.10 	(5) requirements and procedures for program and financial
103.11 	audits;
103.12 	(6) how the school will comply with subdivisions 8, 13, 16,
103.13 	and 23;
103.14 	(7) assumption of liability by the charter school;
103.15 	(8) types and amounts of insurance coverage to be obtained
103.16 	by the charter school;
103.17 	(9) the term of the contract, which may be up to three
103.18 	years; and 
103.19 	(10) if the board of directors or the operators of the
103.20 	charter school provide special instruction and services for
103.21 	children with a disability under sections 125A.03 to 125A.24,
103.22 	and 125A.65, a description of the financial parameters within
103.23 	which the charter school will operate to provide the special
103.24 	instruction and services to children with a disability; and 
103.25 	(11) the process and criteria the sponsor intends to use to
103.26 	monitor and evaluate the fiscal and student performance of the
103.27 	charter school, consistent with subdivision 15.
103.28 	
EFFECTIVE DATE. This section is effective for the
103.29 	2005-2006 school year and later.

103.30 	Sec. 60. Minnesota Statutes 2004, section 124D.10,
103.31 	subdivision 15, is amended to read:
103.32 		Subd. 15.Review and comment. (a) The department must
103.33 	review and comment on the evaluation, by the sponsor, of the
103.34 	performance of a charter school before the charter school's
103.35 	contract is renewed for another contract term.  The sponsor must
103.36 	submit to the commissioner timely information for the review and
104.1 	comment.
104.2 	(b) A sponsor shall monitor and evaluate the fiscal and
104.3 	student performance of the school, and may for this purpose
104.4 	annually assess a charter school:  (1) in its first, second, or
104.5 	third year of operation up to $30 per student up to a maximum of
104.6 	$10,000; and (2) in its fourth or a subsequent year of operation
104.7 	up to $10 per student up to a maximum of $3,500. The
104.8 	information for the review and comment shall be reported by the
104.9 	sponsor to the commissioner of education in a timely manner.
104.10 	
EFFECTIVE DATE. This section is effective for the
104.11 	2005-2006 school year and later.

104.12 	Sec. 61. Minnesota Statutes 2004, section 124D.10,
104.13 	subdivision 23, is amended to read:
104.14 		Subd. 23.Causes for nonrenewal or termination of charter
104.15 	school contract.  (a) The duration of the contract with a
104.16 	sponsor must be for the term contained in the contract according
104.17 	to subdivision 6.  The sponsor may or may not renew a contract
104.18 	at the end of the term for any ground listed in paragraph (b).
104.19 	A sponsor may unilaterally terminate a contract during the term
104.20 	of the contract for any ground listed in paragraph (b).  At
104.21 	least 60 days before not renewing or terminating a contract, the
104.22 	sponsor shall notify the board of directors of the charter
104.23 	school of the proposed action in writing.  The notice shall
104.24 	state the grounds for the proposed action in reasonable detail
104.25 	and that the charter school's board of directors may request in
104.26 	writing an informal hearing before the sponsor within 14 days of
104.27 	receiving notice of nonrenewal or termination of the contract.
104.28 	Failure by the board of directors to make a written request for
104.29 	a hearing within the 14-day period shall be treated as
104.30 	acquiescence to the proposed action.  Upon receiving a timely
104.31 	written request for a hearing, the sponsor shall give reasonable
104.32 	notice to the charter school's board of directors of the hearing
104.33 	date.  The sponsor shall conduct an informal hearing before
104.34 	taking final action.  The sponsor shall take final action to
104.35 	renew or not renew a contract by the last day of classes in the
104.36 	school year.  If the sponsor is a local board, the school's
105.1 	board of directors may appeal the sponsor's decision to the
105.2 	commissioner.
105.3 	(b) A contract may be terminated or not renewed upon any of
105.4 	the following grounds:
105.5 	(1) failure to meet the requirements for pupil performance
105.6 	contained in the contract;
105.7 	(2) failure to meet generally accepted standards of fiscal
105.8 	management;
105.9 	(3) violations of law; or
105.10 	(4) other good cause shown.
105.11 	If a contract is terminated or not renewed under this
105.12 	paragraph, the school must be dissolved according to the
105.13 	applicable provisions of chapter 308A or 317A, except when the
105.14 	commissioner approves the decision of a different eligible
105.15 	sponsor to authorize the charter school.
105.16 	(c) If at the end of a contract term, either the sponsor or
105.17 	the charter school board of directors wants to voluntarily
105.18 	terminate the contract, a change in sponsors is allowed if the
105.19 	commissioner approves the decision of a different eligible
105.20 	sponsor to authorize the charter school.  The party intending to
105.21 	terminate the contract must notify the other party and the
105.22 	commissioner of its intent at least 90 days before the date on
105.23 	which the contract ends.  The sponsor that is a party to the
105.24 	existing contract at least must inform the approved different
105.25 	eligible sponsor about the fiscal and student performance of the
105.26 	school.  If no different eligible sponsor is approved, the
105.27 	school must be dissolved according to applicable law and the
105.28 	terms of the contract.
105.29 	(d) The commissioner, after providing reasonable notice to
105.30 	the board of directors of a charter school and the existing
105.31 	sponsor, and after providing an opportunity for a public
105.32 	hearing, may terminate the existing sponsorial relationship if
105.33 	the charter school has a history of:
105.34 	(1) financial mismanagement; or
105.35 	(2) repeated violations of the law.
105.36 	
EFFECTIVE DATE. This section is effective for the
106.1 	2005-2006 school year and later.

106.2 	Sec. 62. Minnesota Statutes 2004, section 124D.11,
106.3 	subdivision 1, is amended to read:
106.4 		Subdivision 1.General education revenue.  (a) General
106.5 	education revenue must be paid to a charter school as though it
106.6 	were a district.  The general education revenue for each
106.7 	adjusted marginal cost pupil unit is the state average general
106.8 	education revenue per pupil unit, plus the referendum
106.9 	equalization aid allowance in the pupil's district of residence,
106.10 	minus an amount equal to the product of the formula allowance
106.11 	according to section 126C.10, subdivision 2, times .0485,
106.12 	calculated without basic skills revenue, extended time revenue,
106.13 	alternative teacher compensation revenue, transition revenue,
106.14 	and transportation sparsity revenue, plus basic skills revenue,
106.15 	extended time revenue, basic alternative teacher compensation
106.16 	aid according to section 126C.10, subdivision 34,and transition
106.17 	revenue as though the school were a school district. The
106.18 	general education revenue for each extended time marginal cost
106.19 	pupil unit equals $4,378.
106.20 	(b) Notwithstanding paragraph (a), for charter schools in
106.21 	the first year of operation, general education revenue shall be
106.22 	computed using the number of adjusted pupil units in the current
106.23 	fiscal year.

106.24 	Sec. 63. Minnesota Statutes 2004, section 124D.11,
106.25 	subdivision 2, is amended to read:
106.26 		Subd. 2.Transportation revenue.  Transportation revenue
106.27 	must be paid to a charter school that provides transportation
106.28 	services according to section 124D.10, subdivision 16, according
106.29 	to this subdivision.  Transportation aid shall equal
106.30 	transportation revenue.
106.31 	In addition to the revenue under subdivision 1, a charter
106.32 	school providing transportation services must receive general
106.33 	education aid for each pupil unit equal to the sum of the
106.34 	product of (i) an amount equal to the product of the formula
106.35 	allowance according to section 126C.10, subdivision 2, times
106.36 	.0485, plus the transportation sparsity allowance for the school
107.1 	district in which the charter school is located times (ii) the
107.2 	adjusted marginal cost pupil units, plus the product of $223
107.3 	times the extended time marginal cost pupil units.

107.4 	Sec. 64. Minnesota Statutes 2004, section 124D.11,
107.5 	subdivision 6, is amended to read:
107.6 		Subd. 6.Other aid, grants, revenue.  (a) A charter
107.7 	school is eligible to receive other aids, grants, and revenue
107.8 	according to chapters 120A to 129C, as though it were a district.
107.9 	(b) Notwithstanding paragraph (a), a charter school may not
107.10 	receive aid, a grant, or revenue if a levy is required to obtain
107.11 	the money, or if the aid, grant, or revenue replaces levy
107.12 	revenue that is not general education revenue,except as
107.13 	otherwise provided in this section.
107.14 	(c) Federal aid received by the state must be paid to the
107.15 	school, if it qualifies for the aid as though it were a school
107.16 	district.
107.17 	(d) A charter school may receive money from any source for
107.18 	capital facilities needs.  In the year-end report to the
107.19 	commissioner of education, the charter school shall report the
107.20 	total amount of funds received from grants and other outside
107.21 	sources.

107.22 	Sec. 65. [124D.4531] CAREER AND TECHNICAL LEVY.
107.23 		Subdivision 1.Career and technical levy. (a) A district
107.24 	with a career and technical program approved under this section
107.25 	for the fiscal year in which the levy is certified may levy an
107.26 	amount equal to the lesser of:
107.27 	(1) $80 times the district's average daily membership in
107.28 	grades 10 through 12 for the fiscal year in which the levy is
107.29 	certified; or 
107.30 	(2) 25 percent of approved expenditures in the fiscal year
107.31 	in which the levy is certified for the following:
107.32 	(i) salaries paid to essential, licensed personnel
107.33 	providing direct instructional services to students in that
107.34 	fiscal year for services rendered in the district's approved
107.35 	career and technical education programs;
107.36 	(ii) contracted services provided by a public or private
108.1 	agency other than a Minnesota school district or cooperative
108.2 	center under subdivision 7;
108.3 	(iii) necessary travel between instructional sites by
108.4 	licensed career and technical education personnel;
108.5 	(iv) necessary travel by licensed career and technical
108.6 	education personnel for vocational student organization
108.7 	activities held within the state for instructional purposes;
108.8 	(v) curriculum development activities that are part of a
108.9 	five-year plan for improvement based on program assessment;
108.10 	(vi) necessary travel by licensed career and technical
108.11 	education personnel for noncollegiate credit-bearing
108.12 	professional development; and 
108.13 	(vii) specialized vocational instructional supplies.
108.14 	(b) Up to ten percent of a district's career and technical
108.15 	levy may be spent on equipment purchases.  Districts using the
108.16 	career and technical levy for equipment purchases must report to
108.17 	the department on the improved learning opportunities for
108.18 	students that result from the investment in equipment.
108.19 	(c) The district must recognize the full amount of this
108.20 	levy as revenue for the fiscal year in which it is certified.
108.21 		Subd. 2.Allocation from cooperative centers and
108.22 	intermediate districts. For purposes of this section, a
108.23 	cooperative center or an intermediate district must allocate its
108.24 	approved expenditures for career and technical education
108.25 	programs among participating districts.
108.26 		Subd. 3.Levy guarantee. Notwithstanding subdivision 1,
108.27 	the career and technical education levy for a district is not
108.28 	less than the lesser of:
108.29 	(1) the district's career and technical education levy
108.30 	authority for the previous fiscal year; or 
108.31 	(2) 100 percent of the approved expenditures for career and
108.32 	technical programs included in subdivision 1, paragraph (b), for
108.33 	the fiscal year in which the levy is certified.
108.34 		Subd. 4.District reports. Each district or cooperative
108.35 	center must report data to the department for all career and
108.36 	technical education programs as required by the department to
109.1 	implement the career and technical levy formula.
109.2 	
EFFECTIVE DATE. This section is effective for taxes
109.3 	payable in 2008.

109.4 	Sec. 66. Minnesota Statutes 2004, section 124D.66,
109.5 	subdivision 3, is amended to read:
109.6 		Subd. 3.Eligible services.  (a) Assurance of mastery
109.7 	programs may provide direct instructional services to an
109.8 	eligible pupil, or a group of eligible pupils, under the
109.9 	following conditions in paragraphs (b) to (d).
109.10 	(b) Instruction may be provided at one or more grade levels
109.11 	from kindergarten to grade 8 and for students in grades 9
109.12 	through 12 who were enrolled in grade 8 before the 2005-2006
109.13 	school year and have failed the basic skills tests, or were
109.14 	enrolled in grade 8 in the 2005-2006 school year and later and
109.15 	who have failed the Minnesota Comprehensive Assessments
109.16 	(MCA-IIs) in reading, mathematics, or writing as required for
109.17 	high school graduation under section 120B.02.  If an assessment
109.18 	of pupils' needs within a district demonstrates that the
109.19 	eligible pupils in grades kindergarten to grade 8 are being
109.20 	appropriately served, a district may serve eligible pupils in
109.21 	grades 9 to 12.
109.22 	(c) Instruction must be provided under the supervision of
109.23 	the eligible pupil's regular classroom teacher.  Instruction may
109.24 	be provided by the eligible pupil's classroom teacher, by
109.25 	another teacher, by a team of teachers, or by an education
109.26 	assistant or aide.  A special education teacher may provide
109.27 	instruction, but instruction that is provided under this section
109.28 	is not eligible for aid under section 125A.76.
109.29 	(d) The instruction that is provided must differ from the
109.30 	initial instruction the pupil received in the regular classroom
109.31 	setting.  The instruction may differ by presenting different
109.32 	curriculum than was initially presented in the regular classroom
109.33 	or by presenting the same curriculum:
109.34 	(1) at a different rate or in a different sequence than it
109.35 	was initially presented;
109.36 	(2) using different teaching methods or techniques than
110.1 	were used initially; or
110.2 	(3) using different instructional materials than were used
110.3 	initially.

110.4 	Sec. 67. Minnesota Statutes 2004, section 124D.74,
110.5 	subdivision 1, is amended to read:
110.6 		Subdivision 1.Program described.  American Indian
110.7 	education programs are programs in public elementary and
110.8 	secondary schools, nonsectarian nonpublic, community,
110.9 	tribal, charter,or alternative schools enrolling American
110.10 	Indian children designed to:
110.11 	(1) support postsecondary preparation for pupils;
110.12 	(2) support the academic achievement of American Indian
110.13 	students with identified focus to improve reading and mathematic
110.14 	skills;
110.15 	(3) make the curriculum more relevant to the needs,
110.16 	interests, and cultural heritage of American Indian pupils;
110.17 	(4) provide positive reinforcement of the self-image of
110.18 	American Indian pupils;
110.19 	(5) develop intercultural awareness among pupils, parents,
110.20 	and staff; and
110.21 	(6) supplement, not supplant, state and federal educational
110.22 	and cocurricular programs.
110.23 	Program components may include:  development of support
110.24 	components for students in the areas of academic achievement,
110.25 	retention, and attendance; development of support components for
110.26 	staff, including in-service training and technical assistance in
110.27 	methods of teaching American Indian pupils; research projects,
110.28 	including experimentation with and evaluation of methods of
110.29 	relating to American Indian pupils; provision of personal and
110.30 	vocational counseling to American Indian pupils; modification of
110.31 	curriculum, instructional methods, and administrative procedures
110.32 	to meet the needs of American Indian pupils; and supplemental
110.33 	instruction in American Indian language, literature, history,
110.34 	and culture.  Districts offering programs may make contracts for
110.35 	the provision of program components by establishing cooperative
110.36 	liaisons with tribal programs and American Indian social service
111.1 	agencies.  These programs may also be provided as components of
111.2 	early childhood and family education programs.

111.3 	Sec. 68. Minnesota Statutes 2004, section 124D.81,
111.4 	subdivision 1, is amended to read:
111.5 		Subdivision 1.Grants; procedures.  Each fiscal year the
111.6 	commissioner of education must make grants to no fewer than six
111.7 	American Indian education programs.  At least three programs
111.8 	must be in urban areas and at least three must be on or near
111.9 	reservations.  The board of a local district, a participating
111.10 	school or a group of boards may develop a proposal for grants in
111.11 	support of American Indian education programs.  Proposals may
111.12 	provide for contracts for the provision of program components by
111.13 	nonsectarian nonpublic, community, tribal, charter,or
111.14 	alternative schools.  The commissioner shall prescribe the form
111.15 	and manner of application for grants, and no grant shall be made
111.16 	for a proposal not complying with the requirements of sections
111.17 	124D.71 to 124D.82. The commissioner must submit all proposals
111.18 	to the state Advisory Committee on American Indian Education
111.19 	Programs for its recommendations concerning approval,
111.20 	modification, or disapproval and the amounts of grants to
111.21 	approved programs.

111.22 	Sec. 69. Minnesota Statutes 2004, section 124D.84,
111.23 	subdivision 1, is amended to read:
111.24 		Subdivision 1.Awards.  The commissioner, with the advice
111.25 	and counsel of the Minnesota Indian Education Committee,may
111.26 	award scholarships to any Minnesota resident student who is of
111.27 	one-fourth or more Indian ancestry, who has applied for other
111.28 	existing state and federal scholarship and grant programs, and
111.29 	who, in the opinion of the commissioner, has the capabilities to
111.30 	benefit from further education.  Scholarships must be for
111.31 	accredited degree programs in accredited Minnesota colleges or
111.32 	universities or for courses in accredited Minnesota business,
111.33 	technical, or vocational schools.  Scholarships may also be
111.34 	given to students attending Minnesota colleges that are in
111.35 	candidacy status for obtaining full accreditation, and are
111.36 	eligible for and receiving federal financial aid programs.
112.1 	Students are also eligible for scholarships when enrolled as
112.2 	students in Minnesota higher education institutions that have
112.3 	joint programs with other accredited higher education
112.4 	institutions.  Scholarships shall be used to defray the total
112.5 	cost of education including tuition, incidental fees, books,
112.6 	supplies, transportation, other related school costs and the
112.7 	cost of board and room and shall be paid directly to the college
112.8 	or school concerned where the student receives federal financial
112.9 	aid.  The total cost of education includes all tuition and fees
112.10 	for each student enrolling in a public institution and the
112.11 	portion of tuition and fees for each student enrolling in a
112.12 	private institution that does not exceed the tuition and fees at
112.13 	a comparable public institution.  Each student shall be awarded
112.14 	a scholarship based on the total cost of the student's education
112.15 	and a federal standardized need analysis.  Applicants are
112.16 	encouraged to apply for all other sources of financial aid. The
112.17 	amount and type of each scholarship shall be determined through
112.18 	the advice and counsel of the Minnesota Indian education
112.19 	committee.
112.20 	When an Indian student satisfactorily completes the work
112.21 	required by a certain college or school in a school year the
112.22 	student is eligible for additional scholarships, if additional
112.23 	training is necessary to reach the student's educational and
112.24 	vocational objective.  Scholarships may not be given to any
112.25 	Indian student for more than five years of study without special
112.26 	recommendation of the Minnesota Indian Education Committee.

112.27 	Sec. 70. Minnesota Statutes 2004, section 126C.457, is
112.28 	amended to read:
112.29 	126C.457 CAREER AND TECHNICAL LEVY.
112.30 	For taxes payable in 2006 and 2007,a school district may
112.31 	levy an amount equal to the greater of (1) $10,000, or (2) the
112.32 	district's fiscal year 2001 entitlement for career and technical
112.33 	aid under Minnesota Statutes 2000, section 124D.453.  The
112.34 	district must recognize the full amount of this levy as revenue
112.35 	for the fiscal year in which it is certified.  Revenue received
112.36 	under this section must be reserved and used only for career and
113.1 	technical programs.

113.2 	Sec. 71. [127A.095] IMPLEMENTATION OF NO CHILD LEFT
113.3 	BEHIND ACT.
113.4 		Subdivision 1.Continued implementation. The Department
113.5 	of Education shall continue to implement the federal No Child
113.6 	Left Behind Act, Public Law 107-110, without interruption.
113.7 		Subd. 2.No child left behind review. (a) The
113.8 	legislature intends to require the Department of Education to
113.9 	conduct a comprehensive review of the consolidated state plan
113.10 	the state submitted to the federal Department of Education to
113.11 	implement the No Child Left Behind Act.  The Minnesota
113.12 	Department of Education shall seek waivers under paragraph (b).
113.13 	If the Department of Education is unable to obtain waivers under
113.14 	paragraph (b), it should recommend in its report under paragraph
113.15 	(b) whether the state should opt out of the No Child Left Behind
113.16 	Act.
113.17 	(b) The commissioner, by January 15, 2007, shall report to
113.18 	the house of representatives and senate committees having
113.19 	jurisdiction over kindergarten through grade 12 education policy
113.20 	and finance whether the department has received approval from
113.21 	the federal Department of Education to:
113.22 	(1) allow the state to develop a plan for determining
113.23 	adequate yearly progress that uses multiple measures of student
113.24 	achievement that include value-added measurement of student
113.25 	achievement in addition to standardized test results to evaluate
113.26 	school and student performance;
113.27 	(2) exclude from sanctions a school that is classified as
113.28 	not having made adequate yearly progress due solely to different
113.29 	subgroups testing below proficient levels for at least two
113.30 	consecutive years;
113.31 	(3) allow the state to average three years of data for the
113.32 	purposes of identifying a school for improvement;
113.33 	(4) allow the state to use No Child Left Behind Act money
113.34 	to provide supplemental education services only in the academic
113.35 	subject area that causes a school to miss adequate yearly
113.36 	progress;
114.1 	(5) exclude from sanctions schools that have not made
114.2 	adequate yearly progress due solely to a subgroup of students
114.3 	with disabilities not testing at a proficient level;
114.4 	(6) identify a school as not making adequate yearly
114.5 	progress only after the school has missed the adequate yearly
114.6 	progress targets in the same subject and subgroup for two
114.7 	consecutive years;
114.8 	(7) limit the score of a student within multiple subgroups
114.9 	to the smallest subgroup in which that student is included when
114.10 	calculating adequate yearly progress;
114.11 	(8) determine when to hold schools accountable for
114.12 	including a student with limited English proficiency in adequate
114.13 	yearly progress calculations; and 
114.14 	(9) use a fully computer-adaptive test for purposes of
114.15 	compliance with the No Child Left Behind Act.
114.16 		Subd. 3.Department of finance certification. If the
114.17 	federal Department of Education does not transmit to the
114.18 	commissioner of education its approval of the conditions in
114.19 	subdivision 2, paragraph (b), the commissioner of finance shall
114.20 	certify and report to the legislature annually beginning January
114.21 	1, 2008, the amount of federal revenue, if any, that the federal
114.22 	government may withhold as a result of a potential state
114.23 	decision to discontinue implementation of the No Child Left
114.24 	Behind Act.  The report shall also specify the intended purpose
114.25 	of the federal revenue and the amount of revenue that the
114.26 	federal government may withhold from the state, each school
114.27 	district, and each charter school in each fiscal year.
114.28 	
EFFECTIVE DATE. This section is effective the day
114.29 	following final enactment.

114.30 	Sec. 72. Minnesota Statutes 2004, section 127A.47,
114.31 	subdivision 8, is amended to read:
114.32 		Subd. 8.Charter schools.  (a) The general education aid
114.33 	for districts must be adjusted for each pupil attending a
114.34 	charter school under section 124D.10.  The adjustments must be
114.35 	made according to this subdivision.
114.36 	(b) General education aid paid to a district in which a
115.1 	charter school not providing transportation according to section
115.2 	124D.10, subdivision 16, is located must be increased by an
115.3 	amount equal to the sum of:
115.4 	(1) the product of: (1) (i) the sum of an amount equal to
115.5 	the product of the formula allowance according to section
115.6 	126C.10, subdivision 2, times .0485, plus the transportation
115.7 	sparsity allowance for the district; times (2) (ii) the adjusted
115.8 	marginal cost pupil units attributable to the pupil; plus 
115.9 	(2) the product of $223 and the extended time marginal cost
115.10 	pupil units attributable to the pupil.

115.11 	Sec. 73. Minnesota Statutes 2004, section 128C.05, is
115.12 	amended by adding a subdivision to read:
115.13 		Subd. 3.Exemption. The appropriate regional committee
115.14 	must hear a request for a waiver to allow a nonresident student
115.15 	to participate in another district when that participation
115.16 	affects a school's classification for interscholastic athletic
115.17 	activities.  The regional committee must review requests for
115.18 	waivers and make timely recommendations to the Minnesota State
115.19 	High School League Board of Directors.

115.20 	Sec. 74. Minnesota Statutes 2004, section 128C.12,
115.21 	subdivision 1, is amended to read:
115.22 		Subdivision 1.Dues and events revenue. (a) The state
115.23 	auditor annually must examine the accounts of, and audit all
115.24 	money paid to, the State High School League by its members.  The
115.25 	audit must include financial and compliance issues.  The state
115.26 	auditor audit must also audit include all money derived from any
115.27 	event sponsored by the league. League audits must include
115.28 	audits of administrative regions of the league.  The league and
115.29 	its administrative regions may not contract with private
115.30 	auditors.  The scope of the state auditor's examinations of the
115.31 	league must be agreed upon by the board and the state auditor,
115.32 	provided that all requirements of this section must be met.
115.33 	(b) The administrative regions of the league may contract
115.34 	with the state auditor or with a private certified public
115.35 	accountant for the audit required by this section.  If a private
115.36 	certified public accountant performs the audit, the state
116.1 	auditor may require additional information from the private
116.2 	certified public accountant as the state auditor deems in the
116.3 	public interest.  The state auditor may accept the audit or make
116.4 	additional examinations as the state auditor deems to be in the
116.5 	public interest.
116.6 	
EFFECTIVE DATE. This section is effective the day
116.7 	following final enactment.

116.8 	Sec. 75. Minnesota Statutes 2004, section 128C.12,
116.9 	subdivision 3, is amended to read:
116.10 		Subd. 3.Copies.  The state auditor board must file
116.11 	copies of the financial and compliance audit report with the
116.12 	commissioner of education and the director of the Legislative
116.13 	Reference Library.
116.14 	
EFFECTIVE DATE. This section is effective the day
116.15 	following final enactment.

116.16 	Sec. 76. [129C.105] BOARD MEETINGS BY TELEPHONE OR OTHER
116.17 	ELECTRONIC MEANS.
116.18 	(a) Notwithstanding section 13D.01 and if complying with
116.19 	section 13D.02 is impractical, the Board of the Perpich Center
116.20 	for Arts Education may conduct a meeting of its members by
116.21 	telephone or other electronic means when:
116.22 	(1) all members of the board participating in the meeting,
116.23 	wherever the members' physical locations, can hear one another
116.24 	and all discussion and testimony;
116.25 	(2) members of the public present at the regular meeting
116.26 	location of the board can hear all discussion and testimony and
116.27 	all votes of members of the board;
116.28 	(3) at least one member of the board is physically present
116.29 	at the regular meeting location; and 
116.30 	(4) all votes are conducted by roll call, so each member's
116.31 	vote on each issue can be identified and recorded.
116.32 	(b) Each member of the board participating in a meeting by
116.33 	telephone or other electronic means is considered present at the
116.34 	meeting for purposes of determining a quorum and participating
116.35 	in all proceedings.
116.36 	(c) If telephone or other electronic means is used to
117.1 	conduct a meeting, the board, to the extent practical, shall
117.2 	allow a person to monitor the meeting electronically from a
117.3 	remote location.  The board may require the person making such a
117.4 	connection to pay for documented marginal costs that the board
117.5 	incurs as a result of the additional connection.
117.6 	(d) If telephone or other electronic means is used to
117.7 	conduct a regular, special, or emergency meeting, the board
117.8 	shall provide notice of the regular meeting location, of the
117.9 	fact that some members may participate by telephone or other
117.10 	electronic means, and of the provisions of paragraph (c).  The
117.11 	timing and method of providing notice is governed by section
117.12 	13D.04.

117.13 	EFFECTIVE DATE. This section is effective the day
117.14 	following final enactment.

117.15 	Sec. 77. [138.911] MINNESOTA HUMANITIES COMMISSION.
117.16 		Subdivision 1.Establishment. The Minnesota Humanities
117.17 	Commission, a nonprofit organization, is established to advance
117.18 	the study of the humanities and enhance the work of schools,
117.19 	colleges, and cultural organizations throughout the state.
117.20 		Subd. 2.Reports. The Minnesota Humanities Commission
117.21 	shall report to the legislature by September 1 of each year on
117.22 	the use of state funds appropriated to the commission.  The
117.23 	report shall include an itemized account of the programs and
117.24 	projects supported and the source of money for each.  The report
117.25 	shall show actual expenditures for the fiscal year ending the
117.26 	preceding June 30 and proposed expenditures for the fiscal year
117.27 	beginning the preceding July 1.
117.28 		Subd. 3.Humanities center. (a) The Minnesota Humanities
117.29 	Commission may establish a humanities center to ensure balance
117.30 	in public education and in the cultural life of the state, and
117.31 	to improve humanities education through the establishment of two
117.32 	institutes:  the Minnesota Institute for Lifelong Learning and
117.33 	the Minnesota Institute for the Advancement of Teaching.
117.34 	(b) The humanities center may transport people and
117.35 	resources to small towns, rural communities, and urban settings
117.36 	to provide grants, technical assistance, and high-quality
118.1 	educational and cultural programs to schools and community
118.2 	organizations throughout Minnesota.
118.3 	(c) The Minnesota Institute for the Advancement of Teaching
118.4 	may conduct seminars and other activities for the recognition of
118.5 	the teaching profession and the advancement of teaching in
118.6 	Minnesota.
118.7 	
EFFECTIVE DATE. This section is effective the day
118.8 	following final enactment.

118.9 	Sec. 78. [171.176] REVOCATION OR SUSPENSION; SCHOOL
118.10 	ATTENDANCE.
118.11 	The commissioner of public safety may not link or condition
118.12 	issuing, suspending, or revoking a person's license to operate a
118.13 	motor vehicle to attendance at a secondary school.

118.14 	Sec. 79. Minnesota Statutes 2004, section 260C.201,
118.15 	subdivision 1, as amended by Laws 2005, chapter 159, article 2,
118.16 	section 16, is amended to read:
118.17 		Subdivision 1.Dispositions. (a) If the court finds that
118.18 	the child is in need of protection or services or neglected and
118.19 	in foster care, it shall enter an order making any of the
118.20 	following dispositions of the case:
118.21 	(1) place the child under the protective supervision of the
118.22 	responsible social services agency or child-placing agency in
118.23 	the home of a parent of the child under conditions prescribed by
118.24 	the court directed to the correction of the child's need for
118.25 	protection or services:
118.26 	(i) the court may order the child into the home of a parent
118.27 	who does not otherwise have legal custody of the child, however,
118.28 	an order under this section does not confer legal custody on
118.29 	that parent;
118.30 	(ii) if the court orders the child into the home of a
118.31 	father who is not adjudicated, he must cooperate with paternity
118.32 	establishment proceedings regarding the child in the appropriate
118.33 	jurisdiction as one of the conditions prescribed by the court
118.34 	for the child to continue in his home; and
118.35 	(iii) the court may order the child into the home of a
118.36 	noncustodial parent with conditions and may also order both the
119.1 	noncustodial and the custodial parent to comply with the
119.2 	requirements of a case plan under subdivision 2; or
119.3 	(2) transfer legal custody to one of the following:
119.4 	(i) a child-placing agency; or
119.5 	(ii) the responsible social services agency.  In making a
119.6 	foster care placement for a child whose custody has been
119.7 	transferred under this subdivision, the agency shall make an
119.8 	individualized determination of how the placement is in the
119.9 	child's best interests using the consideration for relatives and
119.10 	the best interest factors in section 260C.212, subdivision 2,
119.11 	paragraph (b); or
119.12 	(3) order a trial home visit without modifying the transfer
119.13 	of legal custody to the responsible social services agency under
119.14 	clause (2).  Trial home visit means the child is returned to the
119.15 	care of the parent or guardian from whom the child was removed
119.16 	for a period not to exceed six months.  During the period of the
119.17 	trial home visit, the responsible social services agency:
119.18 	(i) shall continue to have legal custody of the child,
119.19 	which means the agency may see the child in the parent's home,
119.20 	at school, in a child care facility, or other setting as the
119.21 	agency deems necessary and appropriate;
119.22 	(ii) shall continue to have the ability to access
119.23 	information under section 260C.208;
119.24 	(iii) shall continue to provide appropriate services to
119.25 	both the parent and the child during the period of the trial
119.26 	home visit;
119.27 	(iv) without previous court order or authorization, may
119.28 	terminate the trial home visit in order to protect the child's
119.29 	health, safety, or welfare and may remove the child to foster
119.30 	care;
119.31 	(v) shall advise the court and parties within three days of
119.32 	the termination of the trial home visit when a visit is
119.33 	terminated by the responsible social services agency without a
119.34 	court order; and
119.35 	(vi) shall prepare a report for the court when the trial
119.36 	home visit is terminated whether by the agency or court order
120.1 	which describes the child's circumstances during the trial home
120.2 	visit and recommends appropriate orders, if any, for the court
120.3 	to enter to provide for the child's safety and stability.  In
120.4 	the event a trial home visit is terminated by the agency by
120.5 	removing the child to foster care without prior court order or
120.6 	authorization, the court shall conduct a hearing within ten days
120.7 	of receiving notice of the termination of the trial home visit
120.8 	by the agency and shall order disposition under this subdivision
120.9 	or conduct a permanency hearing under subdivision 11 or 11a.
120.10 	The time period for the hearing may be extended by the court for
120.11 	good cause shown and if it is in the best interests of the child
120.12 	as long as the total time the child spends in foster care
120.13 	without a permanency hearing does not exceed 12 months.;
120.14 	(4) if the child has been adjudicated as a child in need of
120.15 	protection or services because the child is in need of special
120.16 	services or care to treat or ameliorate a physical or mental
120.17 	disability, the court may order the child's parent, guardian, or
120.18 	custodian to provide it.  The court may order the child's health
120.19 	plan company to provide mental health services to the child.
120.20 	Section 62Q.535 applies to an order for mental health services
120.21 	directed to the child's health plan company.  If the health
120.22 	plan, parent, guardian, or custodian fails or is unable to
120.23 	provide this treatment or care, the court may order it
120.24 	provided.  Absent specific written findings by the court that
120.25 	the child's disability is the result of abuse or neglect by the
120.26 	child's parent or guardian, the court shall not transfer legal
120.27 	custody of the child for the purpose of obtaining special
120.28 	treatment or care solely because the parent is unable to provide
120.29 	the treatment or care.  If the court's order for mental health
120.30 	treatment is based on a diagnosis made by a treatment
120.31 	professional, the court may order that the diagnosing
120.32 	professional not provide the treatment to the child if it finds
120.33 	that such an order is in the child's best interests; or
120.34 	(5) if the court believes that the child has sufficient
120.35 	maturity and judgment and that it is in the best interests of
120.36 	the child, the court may order a child 16 years old or older to
121.1 	be allowed to live independently, either alone or with others as
121.2 	approved by the court under supervision the court considers
121.3 	appropriate, if the county board, after consultation with the
121.4 	court, has specifically authorized this dispositional
121.5 	alternative for a child.
121.6 	(b) If the child was adjudicated in need of protection or
121.7 	services because the child is a runaway or habitual truant, the
121.8 	court may order any of the following dispositions in addition to
121.9 	or as alternatives to the dispositions authorized under
121.10 	paragraph (a):
121.11 	(1) counsel the child or the child's parents, guardian, or
121.12 	custodian;
121.13 	(2) place the child under the supervision of a probation
121.14 	officer or other suitable person in the child's own home under
121.15 	conditions prescribed by the court, including reasonable rules
121.16 	for the child's conduct and the conduct of the parents,
121.17 	guardian, or custodian, designed for the physical, mental, and
121.18 	moral well-being and behavior of the child; or with the consent
121.19 	of the commissioner of corrections, place the child in a group
121.20 	foster care facility which is under the commissioner's
121.21 	management and supervision;
121.22 	(3) subject to the court's supervision, transfer legal
121.23 	custody of the child to one of the following:
121.24 	(i) a reputable person of good moral character.  No person
121.25 	may receive custody of two or more unrelated children unless
121.26 	licensed to operate a residential program under sections 245A.01
121.27 	to 245A.16; or
121.28 	(ii) a county probation officer for placement in a group
121.29 	foster home established under the direction of the juvenile
121.30 	court and licensed pursuant to section 241.021;
121.31 	(4) require the child to pay a fine of up to $100.  The
121.32 	court shall order payment of the fine in a manner that will not
121.33 	impose undue financial hardship upon the child;
121.34 	(5) require the child to participate in a community service
121.35 	project;
121.36 	(6) order the child to undergo a chemical dependency
122.1 	evaluation and, if warranted by the evaluation, order
122.2 	participation by the child in a drug awareness program or an
122.3 	inpatient or outpatient chemical dependency treatment program;
122.4 	(7) if the court believes that it is in the best interests
122.5 	of the child and or of public safety that the child's driver's
122.6 	license or instruction permit be canceled, the court may order
122.7 	the commissioner of public safety to cancel the child's license
122.8 	or permit for any period up to the child's 18th birthday.  If
122.9 	the child does not have a driver's license or permit, the court
122.10 	may order a denial of driving privileges for any period up to
122.11 	the child's 18th birthday.  The court shall forward an order
122.12 	issued under this clause to the commissioner, who shall cancel
122.13 	the license or permit or deny driving privileges without a
122.14 	hearing for the period specified by the court.  At any time
122.15 	before the expiration of the period of cancellation or denial,
122.16 	the court may, for good cause, order the commissioner of public
122.17 	safety to allow the child to apply for a license or permit, and
122.18 	the commissioner shall so authorize;
122.19 	(8) order that the child's parent or legal guardian deliver
122.20 	the child to school at the beginning of each school day for a
122.21 	period of time specified by the court; or
122.22 	(9) require the child to perform any other activities or
122.23 	participate in any other treatment programs deemed appropriate
122.24 	by the court.
122.25 	To the extent practicable, the court shall enter a
122.26 	disposition order the same day it makes a finding that a child
122.27 	is in need of protection or services or neglected and in foster
122.28 	care, but in no event more than 15 days after the finding unless
122.29 	the court finds that the best interests of the child will be
122.30 	served by granting a delay.  If the child was under eight years
122.31 	of age at the time the petition was filed, the disposition order
122.32 	must be entered within ten days of the finding and the court may
122.33 	not grant a delay unless good cause is shown and the court finds
122.34 	the best interests of the child will be served by the delay.
122.35 	(c) If a child who is 14 years of age or older is
122.36 	adjudicated in need of protection or services because the child
123.1 	is a habitual truant and truancy procedures involving the child
123.2 	were previously dealt with by a school attendance review board
123.3 	or county attorney mediation program under section 260A.06 or
123.4 	260A.07, the court shall order a cancellation or denial of
123.5 	driving privileges under paragraph (b), clause (7), for any
123.6 	period up to the child's 18th birthday.
123.7 	(d) In the case of a child adjudicated in need of
123.8 	protection or services because the child has committed domestic
123.9 	abuse and been ordered excluded from the child's parent's home,
123.10 	the court shall dismiss jurisdiction if the court, at any time,
123.11 	finds the parent is able or willing to provide an alternative
123.12 	safe living arrangement for the child, as defined in Laws 1997,
123.13 	chapter 239, article 10, section 2.
123.14 	(e) When a parent has complied with a case plan ordered
123.15 	under subdivision 6 and the child is in the care of the parent,
123.16 	the court may order the responsible social services agency to
123.17 	monitor the parent's continued ability to maintain the child
123.18 	safely in the home under such terms and conditions as the court
123.19 	determines appropriate under the circumstances.

123.20 	Sec. 80. BOARD OF SCHOOL ADMINISTRATORS; RULEMAKING
123.21 	AUTHORITY.
 123.22 	On or before June 30, 2007, the Board of School
123.23 	Administrators may adopt expedited rules under Minnesota
123.24 	Statutes, section 14.389, to make technical revisions and
123.25 	clarifications to Minnesota Rules, chapter 3512.

123.26 	Sec. 81. COLLEGE PREPARATION STANDARDS.
 123.27 	(a) The Higher Education Advisory Council must convene a
123.28 	working group to develop standards describing the skills and
123.29 	knowledge a high school graduate must have at entry into
123.30 	postsecondary education in order to successfully graduate from
123.31 	college.  The standards must, to the extent possible, be
123.32 	applicable for all postsecondary education but may describe
123.33 	differences in the skills and knowledge necessary for success in
123.34 	different higher education institutions and programs.  The
123.35 	standards need not be comprehensive but must, at a minimum, be
123.36 	the essential skills and knowledge that will enable a student to
124.1 	succeed in college.  The Higher Education Services Office must
124.2 	provide staff for the working group.
124.3 	(b) The Higher Education Advisory Council must submit the
124.4 	standards to the commissioner of education no later than January
124.5 	15, 2006.  No later than March 15, 2006, the commissioner of
124.6 	education must report, to the chairs of the legislative
124.7 	committees with jurisdiction over kindergarten through grade 12
124.8 	education policy and finance and higher education policy and
124.9 	finance, its recommendations regarding the changes, if any, that
124.10 	must be made in Minnesota's academic standards in order to
124.11 	ensure that Minnesota high school graduates meet the college
124.12 	readiness standards established by the Higher Education Advisory
124.13 	Council.
124.14 	(c) The Higher Education Advisory Council must invite the
124.15 	University of Minnesota, Minnesota State Colleges and
124.16 	Universities, representatives of private colleges, and other
124.17 	private postsecondary institutions, to participate in the
124.18 	working group and may invite other individuals or entities to
124.19 	participate.  The Higher Education Advisory Council and its
124.20 	working group may collaborate with the Minnesota P-16 Education
124.21 	Partnership in developing the college readiness standards.

124.22 	Sec. 82. MINNESOTA COMPREHENSIVE ASSESSMENTS; RULES.
 124.23 	The commissioner of education shall adopt rules on or
124.24 	before January 1, 2006, to implement the Minnesota Comprehensive
124.25 	Assessments Second Edition (MCA-IIs) in reading, mathematics,
124.26 	and writing.  For purposes of state and local high school
124.27 	graduation requirements, the rules must include criteria
124.28 	enabling school districts to:
124.29 	(1) appropriately accommodate a student who fails but seeks
124.30 	to pass the Minnesota Comprehensive Assessments Second Edition;
124.31 	and 
124.32 	(2) exempt a disabled student, consistent with the
124.33 	student's individualized education plan, or an English language
124.34 	learner from the Minnesota Comprehensive Assessments Second
124.35 	Edition or administer an alternative assessment either to a
124.36 	disabled student, consistent with the student's individualized
125.1 	education plan, or to an English language learner.

125.2 	Sec. 83. APPROPRIATIONS.
 125.3 		Subdivision 1.Department. The sums indicated in this
125.4 	section are appropriated from the general fund to the Department
125.5 	of Education for the fiscal years designated and include and
125.6 	supersede any amounts appropriated in Laws 2005, First Special
125.7 	Session chapter 2, or authorized by order of the Ramsey County
125.8 	District Court in Case No. C9-05-5928.
125.9 		Subd. 2.Charter school building lease aid. For building
125.10 	lease aid under Minnesota Statutes, section 124D.11, subdivision
125.11 	4:
125.12 	$25,465,000 .....2006 
125.13 	$30,929,000 .....2007 
125.14 	The 2006 appropriation includes $3,324,000 for 2005 and
125.15 	$22,141,000 for 2006.
125.16 	The 2007 appropriation includes $4,123,000 for 2006 and
125.17 	$26,806,000 for 2007.
125.18 		Subd. 3.Charter school startup aid. For charter school
125.19 	startup cost aid under Minnesota Statutes, section 124D.11:
125.20 	$1,393,000 .....2006 
125.21 	$3,185,000 .....2007 
125.22 	The 2006 appropriation includes $0 for 2005 and $1,393,000
125.23 	for 2006.
125.24 	The 2007 appropriation includes $259,000 for 2006 and
125.25 	$2,926,000 for 2007.
125.26 		Subd. 4.Integration aid. For integration aid under
125.27 	Minnesota Statutes, section 124D.86, subdivision 5:
125.28 	$57,801,000 .....2006 
125.29 	$57,536,000 .....2007 
125.30 	The 2006 appropriation includes $8,545,000 for 2005 and
125.31 	$49,256,000 for 2006.
125.32 	The 2007 appropriation includes $9,173,000 for 2006 and
125.33 	$48,363,000 for 2007.
125.34 		Subd. 5.Magnet school grants. For magnet school and
125.35 	program grants:
125.36 	$  750,000 .....2006 
126.1 	$  750,000 .....2007 
126.2 	These amounts may be used for magnet school programs under
126.3 	Minnesota Statutes, section 124D.88.
126.4 		Subd. 6.Interdistrict desegregation or integration
126.5 	transportation grants. For interdistrict desegregation or
126.6 	integration transportation grants under Minnesota Statutes,
126.7 	section 124D.87:
126.8 	$7,768,000 .....2006 
126.9 	$9,908,000 .....2007 
126.10 		Subd. 7.Success for the future. For American Indian
126.11 	success for the future grants under Minnesota Statutes, section
126.12 	124D.81:
126.13 	$2,137,000 .....2006 
126.14 	$2,137,000 .....2007 
126.15 	The 2006 appropriation includes $335,000 for 2005 and
126.16 	$1,802,000 for 2006.
126.17 	The 2007 appropriation includes $335,000 for 2006 and
126.18 	$1,802,000 for 2007.
126.19 		Subd. 8.American indian scholarships. For American
126.20 	Indian scholarships under Minnesota Statutes, section 124D.84:
126.21 	$1,875,000 .....2006 
126.22 	$1,875,000 .....2007 
126.23 		Subd. 9.American indian teacher preparation grants. For
126.24 	joint grants to assist American Indian people to become teachers
126.25 	under Minnesota Statutes, section 122A.63:
126.26 	$  190,000 .....2006 
126.27 	$  190,000 .....2007 
126.28 		Subd. 10.Tribal contract schools. For tribal contract
126.29 	school aid under Minnesota Statutes, section 124D.83:
126.30 	$2,389,000 .....2006 
126.31 	$2,603,000 .....2007 
126.32 	The 2006 appropriation includes $348,000 for 2005 and
126.33 	$2,041,000 for 2006.
126.34 	The 2007 appropriation includes $380,000 for 2006 and
126.35 	$2,223,000 for 2007.
126.36 		Subd. 11.Early childhood programs at tribal
127.1 	schools. For early childhood family education programs at
127.2 	tribal contract schools under Minnesota Statutes, section
127.3 	124D.83, subdivision 4:
127.4 	$   68,000 .....2006 
127.5 	$   68,000 .....2007 
127.6 		Subd. 12.Statewide testing. For statewide testing
127.7 	support under Minnesota Statutes, section 120B.30:
127.8 	$10,200,000 .....2006 
127.9 	$10,200,000 .....2007 
127.10 	Of this appropriation, $1,200,000 each year is for
127.11 	development of interactive science assessments.
127.12 		Subd. 13.Examination fees; teacher training and support
127.13 	programs. (a) For students' advanced placement and
127.14 	international baccalaureate examination fees under Minnesota
127.15 	Statutes, section 120B.13, subdivision 3, and the training and
127.16 	related costs for teachers and other interested educators under
127.17 	Minnesota Statutes, section 120B.13, subdivision 1:
127.18 	$4,500,000 .....2006 
127.19 	$4,500,000 .....2007 
127.20 	(b) The advanced placement program shall receive 75 percent
127.21 	of the appropriation each year and the international
127.22 	baccalaureate program shall receive 25 percent of the
127.23 	appropriation each year.  The department, in consultation with
127.24 	representatives of the advanced placement and international
127.25 	baccalaureate programs selected by the Advanced Placement
127.26 	Advisory Council and IBMN, respectively, shall determine the
127.27 	amounts of the expenditures each year for examination fees and
127.28 	training and support programs for each program.
127.29 	(c) Notwithstanding Minnesota Statutes, section 120B.13,
127.30 	subdivision 1, $375,000 each year is for teachers to attend
127.31 	subject matter summer training programs and follow-up support
127.32 	workshops approved by the advanced placement or international
127.33 	baccalaureate programs.  The amount of the subsidy for each
127.34 	teacher attending an advanced placement or international
127.35 	baccalaureate summer training program or workshop shall be the
127.36 	same.  The commissioner shall determine the payment process and
128.1 	the amount of the subsidy.
128.2 	(d) The commissioner shall pay all examination fees for all
128.3 	students of low-income families under Minnesota Statutes,
128.4 	section 120B.13, subdivision 3, and to the extent of available
128.5 	appropriations shall also pay examination fees for students
128.6 	sitting for an advanced placement examination, international
128.7 	baccalaureate examination, or both.
128.8 	Any balance in the first year does not cancel but is
128.9 	available in the second year.
128.10 		Subd. 14.First grade preparedness. For first grade
128.11 	preparedness grants under Minnesota Statutes, section 124D.081:
128.12 	$7,250,000 .....2006 
128.13 	$7,250,000 .....2007 
128.14 		Subd. 15.Collaborative urban educator. For the
128.15 	collaborative urban educator program:
128.16 	$  528,000 .....2006 
128.17 	$  528,000 .....2007 
128.18 	$210,000 each year is for the Southeast Asian teacher
128.19 	program at Concordia University, St. Paul; $159,000 each year is
128.20 	for the collaborative urban educator program at the University
128.21 	of St. Thomas; and $159,000 each year is for the Center for
128.22 	Excellence in Urban Teaching at Hamline University.  Grant
128.23 	recipients must collaborate with urban and nonurban school
128.24 	districts.
128.25 	Any balance in the first year does not cancel but is
128.26 	available in the second year.
128.27 		Subd. 16.Youth works program. For funding youth works
128.28 	programs under Minnesota Statutes, sections 124D.37 to 124D.45:
128.29 	$  900,000 .....2006 
128.30 	$  900,000 .....2007 
128.31 	A grantee organization may provide health and child care
128.32 	coverage to the dependents of each participant enrolled in a
128.33 	full-time youth works program to the extent such coverage is not
128.34 	otherwise available.
128.35 		Subd. 17.Student organizations. For student
128.36 	organizations:
129.1 	$725,000 .....2006 
129.2 	$725,000 .....2007 
129.3 	$40,000 each year is for student organizations serving
129.4 	health occupations.
129.5 	$38,000 each year is for student organizations serving
129.6 	service occupations.
129.7 	$88,000 each year is for student organizations serving
129.8 	trade and industry occupations.
129.9 	$84,000 each year is for student organizations serving
129.10 	business occupations.
129.11 	$131,000 each year is for student organizations serving
129.12 	agriculture occupations.
129.13 	$125,000 each year is for student organizations serving
129.14 	family and consumer science occupations.
129.15 	$95,000 each year is for student organizations serving
129.16 	marketing occupations.
129.17 		Subd. 18.Education planning and assessment program. For
129.18 	the Educational Planning and Assessment (EPAS) program under
129.19 	Minnesota Statutes, section 120B.128:
129.20 	$  829,000 .....2006 
129.21 	$  829,000 .....2007 
129.22 	Subd. 19.[COLLEGE LEVEL EXAMINATION PROGRAM (CLEP).] For
129.23 	the College Level Examination program (CLEP) under Minnesota
129.24 	Statutes, section 120B.131:
129.25 	$  825,000 .....2006 
129.26 	$1,650,000 .....2007 
129.27 		Subd. 20.Site decision-making program grants. For
129.28 	planning and implementation grants to five school sites and
129.29 	school boards that have reached preliminary board approval or
129.30 	entered into school site decision-making agreements under
129.31 	Minnesota Statutes, section 123B.04:
129.32 	$  250,000 .....2006 
129.33 	Any balance in the first year does not cancel but is
129.34 	available in the second year.  This is a onetime appropriation.
129.35 		Subd. 21.Best practices. (a) For best practices grants:
129.36 	$1,260,000 .....2006 
130.1 	$1,210,000 .....2007 
130.2 	(b) $400,000 each year is for a grant to the Minnesota
130.3 	Humanities Commission under Minnesota Statutes, section 138.911.
130.4 	(c) $150,000 each year is for a grant to the Minnesota
130.5 	Historical Society.
130.6 	(d) $160,000 each year is for a grant to A Chance to
130.7 	Grow/New Visions for the Minnesota Learning Resource Center's
130.8 	comprehensive training program for education professionals
130.9 	charged with helping children acquire basic reading and
130.10 	mathematic skills.
130.11 	(e) $50,000 in fiscal year 2006 is for schools mentoring
130.12 	schools under Minnesota Statutes, section 122A.628.  Any balance
130.13 	in the first year does not cancel but is available in the second
130.14 	year.
130.15 	(f) $400,000 each year is for the Principals' Leadership
130.16 	Institute under Minnesota Statutes, section 122A.74.
130.17 	(g) $100,000 each year is for the quantum opportunities
130.18 	program.

130.19 	Sec. 84. REPEALER.
 130.20 	(a) Minnesota Statutes 2004, section 124D.095, subdivision
130.21 	9, is repealed.
130.22 	(b) Minnesota Statutes 2004, section 128C.12, subdivision
130.23 	4, is repealed.

130.24 	EFFECTIVE DATE. This section, paragraph (a), is effective
130.25 	for revenue for fiscal year 2006.  This section, paragraph (b),
130.26 	is effective the day following final enactment.

130.27 	Sec. 85. EFFECTIVE DATE.
 130.28 	Any section in this article without a specified effective
130.29 	date is retroactively effective from July 1, 2005.

130.30 	ARTICLE 3
130.31 	SPECIAL PROGRAMS

130.32 	Section 1. Minnesota Statutes 2004, section 121A.66,
130.33 	subdivision 5, is amended to read:
130.34 		Subd. 5.Emergency.  "Emergency" means a situation in
130.35 	which immediate intervention is necessary to protect a pupil or
130.36 	other individual from physical injury or to prevent serious 
131.1 	property damage.

131.2 	Sec. 2. Minnesota Statutes 2004, section 121A.66, is
131.3 	amended by adding a subdivision to read:
131.4 		Subd. 6.Positive behavioral interventions and
131.5 	supports. "Positive behavioral interventions and supports"
131.6 	means those strategies used to improve the school environment
131.7 	and teach pupils skills likely to increase pupil ability to
131.8 	exhibit appropriate behaviors.

131.9 	Sec. 3. Minnesota Statutes 2004, section 121A.66, is
131.10 	amended by adding a subdivision to read:
131.11 		Subd. 7.Time-out. "Time-out" means:
131.12 	(1) a contingent observation, which is not a regulated
131.13 	intervention, and involves instructing the pupil to leave the
131.14 	school activity during the school day and not participate for a
131.15 	period of time, but to observe the activity and listen to the
131.16 	discussion from a time-out area within the same setting;
131.17 	(2) an exclusionary time-out, which is not a regulated
131.18 	intervention, and involves instructing the pupil to leave the
131.19 	school activity during the school day and not participate in or
131.20 	observe the classroom activity, but to go to another area from
131.21 	which the pupil may leave; or 
131.22 	(3) a locked time-out, which is a regulated intervention,
131.23 	and involves involuntarily removing the pupil from the school
131.24 	activity during the school day and placing the pupil in a
131.25 	specially designed and continuously supervised isolation room
131.26 	that the pupil is prevented from leaving.

131.27 	Sec. 4. Minnesota Statutes 2004, section 121A.67, is
131.28 	amended to read:
131.29 	121A.67 AVERSIVE AND DEPRIVATION PROCEDURES.
131.30 		Subdivision 1.Rules. The commissioner, after
131.31 	consultation with interested parent organizations and advocacy
131.32 	groups, the Minnesota Administrators for Special Education, the
131.33 	Minnesota Association of School Administrators, Education
131.34 	Minnesota, the Minnesota School Boards Association, the
131.35 	Minnesota Police Officers Association, a representative of a
131.36 	bargaining unit that represents paraprofessionals, the
132.1 	Elementary School Principals Association, and the Secondary
132.2 	School Principals Association,must adopt amend rules governing
132.3 	the use of aversive and deprivation procedures by school
132.4 	district employees or persons under contract with a school
132.5 	district.  The rules must:
132.6 	(1) promote the use of positive approaches behavioral
132.7 	interventions and supports and must not encourage or require the
132.8 	use of aversive or deprivation procedures;
132.9 	(2) require that planned application of aversive and
132.10 	deprivation procedures only be a part of an instituted after
132.11 	completing a functional behavior assessment and developing a
132.12 	behavior intervention plan that is included in or maintained
132.13 	with the individual education plan;
132.14 	(3) require parents or guardians to be notified after the
132.15 	use of educational personnel to notify a parent or guardian of a
132.16 	pupil with an individual education plan on the same day aversive
132.17 	or deprivation procedures are used in an emergency or in writing
132.18 	within two school days if district personnel are unable to
132.19 	provide same-day notice;
132.20 	(4) establish health and safety standards for the use of
132.21 	locked time-out procedures that require a safe environment,
132.22 	continuous monitoring of the child, ventilation, and adequate
132.23 	space, a locking mechanism that disengages automatically when
132.24 	not continuously engaged by school personnel, and full
132.25 	compliance with state and local fire and building codes,
132.26 	including state rules on time-out rooms; and 
132.27 	(5) contain a list of prohibited procedures;
132.28 	(6) consolidate and clarify provisions related to behavior
132.29 	intervention plans;
132.30 	(7) require school districts to register with the
132.31 	commissioner any room used for locked time-out, which the
132.32 	commissioner must monitor by making announced and unannounced
132.33 	on-site visits;
132.34 	(8) place a student in locked time-out only if the
132.35 	intervention is:
132.36 	(i) part of the comprehensive behavior intervention plan
133.1 	that is included in or maintained with the student's individual
133.2 	education plan, and the plan uses positive behavioral
133.3 	interventions and supports, and data support its continued use;
133.4 	or 
133.5 	(ii) used in an emergency for the duration of the emergency
133.6 	only; and 
133.7 	(9) require a providing school district or cooperative to
133.8 	establish an oversight committee composed of at least one member
133.9 	with training in behavioral analysis and other appropriate
133.10 	education personnel to annually review aggregate data regarding
133.11 	the use of aversive and deprivation procedures.
133.12 		Subd. 2.Removal by peace officer. If a pupil who has an
133.13 	individual education plan is restrained or removed from a
133.14 	classroom, school building, or school grounds by a peace officer
133.15 	at the request of a school administrator or a school staff
133.16 	person during the school day twice in a 30-day period, the
133.17 	pupil's individual education program team must meet to determine
133.18 	if the pupil's individual education plan is adequate or if
133.19 	additional evaluation is needed.
133.20 	
EFFECTIVE DATE. Subdivision 1 of this section is
133.21 	effective the day following final enactment.

133.22 	Sec. 5. Minnesota Statutes 2004, section 124D.11,
133.23 	subdivision 5, is amended to read:
133.24 		Subd. 5.Special education aid. (a) Except as provided
133.25 	in subdivision 2, special education aid must be paid to a
133.26 	charter school according to section 125A.76, as though it were a
133.27 	school district.
133.28 	(b) For fiscal year 2006,the charter school may charge
133.29 	tuition to the district of residence as follows:
133.30 	(1) if the charter school does not receive general
133.31 	education revenue on behalf of the student according to
133.32 	subdivision 1, tuition shall be charged as provided in section
133.33 	125A.11; or 
133.34 	(2) if the charter school receives general education
133.35 	revenue on behalf of the student according to subdivision 1,
133.36 	tuition shall be charged as provided in section 127A.47,
134.1 	subdivision 7, paragraph (d).
134.2 	(c) For fiscal year 2007 and later, the special education
134.3 	aid paid to the charter school shall be adjusted as follows:
134.4 	(1) if the charter school does not receive general
134.5 	education revenue on behalf of the student according to
134.6 	subdivision 1, the aid shall be adjusted as provided in section
134.7 	125A.11; or 
134.8 	(2) if the charter school receives general education
134.9 	revenue on behalf of the student according to subdivision 1, the
134.10 	aid shall be adjusted as provided in section 127A.47,
134.11 	subdivision 7, paragraph (d).

134.12 	Sec. 6. Minnesota Statutes 2004, section 124D.454,
134.13 	subdivision 5, is amended to read:
134.14 		Subd. 5.State total transition program-disabled
134.15 	revenue.  The state total transition program-disabled revenue
134.16 	for fiscal year 2000 equals $8,982,000.  The state total
134.17 	transition program-disabled revenue for fiscal year 2001 equals
134.18 	$8,966,000.  The state total transition program-disabled revenue
134.19 	for later fiscal years equals:
134.20 	(1) the state total transition program-disabled revenue for
134.21 	the preceding fiscal year; times
134.22 	(2) the program growth factor; times
134.23 	(3) the greater of one, or the ratio of the state total
134.24 	average daily membership for the current fiscal year to the
134.25 	state total average daily membership for the preceding fiscal
134.26 	year.
134.27 	
EFFECTIVE DATE. This section is effective for revenue for
134.28 	fiscal year 2008.

134.29 	Sec. 7. Minnesota Statutes 2004, section 125A.11,
134.30 	subdivision 1, is amended to read:
134.31 		Subdivision 1.Nonresident tuition rate; other costs.
 134.32 	(a) For fiscal year 2006,when a school district provides
134.33 	instruction and services outside the district of residence,
134.34 	board and lodging, and any tuition to be paid, shall be paid by
134.35 	the district of residence.  The tuition rate to be charged for
134.36 	any child with a disability, excluding a pupil for whom tuition
135.1 	is calculated according to section 127A.47, subdivision 7,
135.2 	paragraph (d),must be the sum of (1) the actual cost of
135.3 	providing special instruction and services to the child
135.4 	including a proportionate amount for capital outlay and debt
135.5 	service but not including any amount for special transportation
135.6 	and unreimbursed building lease and debt service costs for
135.7 	facilities used primarily for special education, plus (2) the
135.8 	amount of general education revenue and referendum aid
135.9 	attributable to the pupil, minus (3) the amount of special
135.10 	education aid for children with a disability received on behalf
135.11 	of that child, minus (4) if the pupil receives special
135.12 	instruction and services outside the regular classroom for more
135.13 	than 60 percent of the school day, the amount of general
135.14 	education revenue and referendum aid, excluding portions
135.15 	attributable to district and school administration, district
135.16 	support services, operations and maintenance, capital
135.17 	expenditures, and pupil transportation, attributable to that
135.18 	pupil for the portion of time the pupil receives instruction in
135.19 	the regular classroom.  If the boards involved do not agree upon
135.20 	the tuition rate, either board may apply to the commissioner to
135.21 	fix the rate. Notwithstanding chapter 14,the commissioner must
135.22 	then set a date for a hearing or request a written statement
135.23 	from each board, giving each board at least ten days' notice,
135.24 	and after the hearing or review of the written statements the
135.25 	commissioner must make an order fixing the tuition rate, which
135.26 	is binding on both school districts. General education revenue
135.27 	and referendum aid attributable to a pupil must be calculated
135.28 	using the resident district's average general education and
135.29 	referendum revenue per adjusted pupil unit.
135.30 	(b) For fiscal year 2007 and later, when a school district
135.31 	provides special instruction and services for a pupil with a
135.32 	disability as defined in section 125A.02 outside the district of
135.33 	residence, excluding a pupil for whom an adjustment to special
135.34 	education aid is calculated according to section 127A.47,
135.35 	subdivision 7, paragraph (e), special education aid paid to the
135.36 	resident district must be reduced by an amount equal to (1) the
136.1 	actual cost of providing special instruction and services to the
136.2 	pupil, including a proportionate amount for special
136.3 	transportation and unreimbursed building lease and debt service
136.4 	costs for facilities used primarily for special education, plus
136.5 	(2) the amount of general education revenue and referendum aid
136.6 	attributable to that pupil, minus (3) the amount of special
136.7 	education aid for children with a disability received on behalf
136.8 	of that child, minus (4) if the pupil receives special
136.9 	instruction and services outside the regular classroom for more
136.10 	than 60 percent of the school day, the amount of general
136.11 	education revenue and referendum aid, excluding portions
136.12 	attributable to district and school administration, district
136.13 	support services, operations and maintenance, capital
136.14 	expenditures, and pupil transportation, attributable to that
136.15 	pupil for the portion of time the pupil receives instruction in
136.16 	the regular classroom.  General education revenue and referendum
136.17 	aid attributable to a pupil must be calculated using the
136.18 	resident district's average general education revenue and
136.19 	referendum aid per adjusted pupil unit.  Special education aid
136.20 	paid to the district or cooperative providing special
136.21 	instruction and services for the pupil must be increased by the
136.22 	amount of the reduction in the aid paid to the resident
136.23 	district.  Amounts paid to cooperatives under this subdivision
136.24 	and section 127A.47, subdivision 7, shall be recognized and
136.25 	reported as revenues and expenditures on the resident school
136.26 	district's books of account under sections 123B.75 and 123B.76.
136.27 	If the resident district's special education aid is insufficient
136.28 	to make the full adjustment, the remaining adjustment shall be
136.29 	made to other state aid due to the district.
136.30 	(c) Notwithstanding paragraphs (a) and (b) and section
136.31 	127A.47, subdivision 7, paragraphs (d) and (e), a charter school
136.32 	where more than 30 percent of enrolled students receive special
136.33 	education and related services, an intermediate district, or a
136.34 	special education cooperative may apply to the commissioner for
136.35 	authority to charge the resident district an additional amount
136.36 	to recover any remaining unreimbursed costs of serving pupils
137.1 	with a disability.  The application must include a description
137.2 	of the costs and the calculations used to determine the
137.3 	unreimbursed portion to be charged to the resident district.
137.4 	Amounts approved by the commissioner under this paragraph must
137.5 	be included in the tuition billings or aid adjustments under
137.6 	paragraph (a) or (b), or section 127A.47, subdivision 7,
137.7 	paragraph (d) or (e), as applicable.
137.8 	
EFFECTIVE DATE. This section is effective retroactively
137.9 	from July 1, 2005, for revenue for fiscal year 2006.

137.10 	Sec. 8. Minnesota Statutes 2004, section 125A.24, is
137.11 	amended to read:
137.12 	125A.24 PARENT ADVISORY COUNCILS.
137.13 	In order to increase the involvement of parents of children
137.14 	with disabilities in district policy making and decision making,
137.15 	school districts must have a special education advisory council
137.16 	that is incorporated into the district's special education
137.17 	system plan.
137.18 	(1) This advisory council may be established either for
137.19 	individual districts or in cooperation with other districts who
137.20 	are members of the same special education cooperative.
137.21 	(2) A district may set up this council as a subgroup of an
137.22 	existing board, council, or committee.
137.23 	(3) At least half of the designated council members must be
137.24 	parents of students with a disability. When a nonpublic school
137.25 	is located in the district, the council must include at least
137.26 	one member who is a parent of a nonpublic school student with a
137.27 	disability, or an employee of a nonpublic school if no parent of
137.28 	a nonpublic school student with a disability is available to
137.29 	serve.  Each local council must meet no less than once each
137.30 	year.The number of members, frequency of meetings, and
137.31 	operational procedures are to be locally determined.

137.32 	Sec. 9. Minnesota Statutes 2004, section 125A.28, is
137.33 	amended to read:
137.34 	125A.28 STATE INTERAGENCY COORDINATING COUNCIL.
137.35 	An Interagency Coordinating Council of at least 17, but not
137.36 	more than 25 members is established, in compliance with Public
138.1 	Law 102-119, section 682.  The members must be appointed by the
138.2 	governor.  Council members must elect the council chair.  The
138.3 	representative of the commissioner may not serve as the chair.
138.4 	The council must be composed of at least five parents, including
138.5 	persons of color, of children with disabilities under age 12,
138.6 	including at least three parents of a child with a disability
138.7 	under age seven, five representatives of public or private
138.8 	providers of services for children with disabilities under age
138.9 	five, including a special education director, county social
138.10 	service director, local Head Start director, and a community
138.11 	health services or public health nursing administrator, one
138.12 	member of the senate, one member of the house of
138.13 	representatives, one representative of teacher preparation
138.14 	programs in early childhood-special education or other
138.15 	preparation programs in early childhood intervention, at least
138.16 	one representative of advocacy organizations for children with
138.17 	disabilities under age five, one physician who cares for young
138.18 	children with special health care needs, one representative each
138.19 	from the commissioners of commerce, education, health, human
138.20 	services, a representative from the state agency responsible for
138.21 	child care, and a representative from Indian health services or
138.22 	a tribal council.  Section 15.059, subdivisions 2 to 5, apply to
138.23 	the council.  The council must meet at least quarterly.
138.24 	The council must address methods of implementing the state
138.25 	policy of developing and implementing comprehensive,
138.26 	coordinated, multidisciplinary interagency programs of early
138.27 	intervention services for children with disabilities and their
138.28 	families.
138.29 	The duties of the council include recommending policies to
138.30 	ensure a comprehensive and coordinated system of all state and
138.31 	local agency services for children under age five with
138.32 	disabilities and their families.  The policies must address how
138.33 	to incorporate each agency's services into a unified state and
138.34 	local system of multidisciplinary assessment practices,
138.35 	individual intervention plans, comprehensive systems to find
138.36 	children in need of services, methods to improve public
139.1 	awareness, and assistance in determining the role of interagency
139.2 	early intervention committees.
139.3 	By September 1 On the date that Minnesota Part C Annual
139.4 	Performance Report is submitted to the federal Office of Special
139.5 	Education, the council must recommend to the governor and the
139.6 	commissioners of education, health, human services, commerce,
139.7 	and employment and economic development policies for a
139.8 	comprehensive and coordinated system.
139.9 	Notwithstanding any other law to the contrary, the State
139.10 	Interagency Coordinating Council expires on June 30, 2005 2009.

139.11 	Sec. 10. Minnesota Statutes 2004, section 125A.76,
139.12 	subdivision 4, is amended to read:
139.13 		Subd. 4.State total special education aid.  The state
139.14 	total special education aid for fiscal year 2004 equals
139.15 	$530,642,000.  The state total special education aid for fiscal
139.16 	year 2005 equals $529,164,000.  The state total special
139.17 	education aid for later fiscal years equals:
139.18 	(1) the state total special education aid for the preceding
139.19 	fiscal year; times
139.20 	(2) the program growth factor; times
139.21 	(3) the greater of one, or the ratio of the state total
139.22 	average daily membership for the current fiscal year to the
139.23 	state total average daily membership for the preceding fiscal
139.24 	year.
139.25 	
EFFECTIVE DATE. This section is effective for revenue for
139.26 	fiscal year 2008.

139.27 	Sec. 11. Minnesota Statutes 2004, section 125A.79,
139.28 	subdivision 1, is amended to read:
139.29 		Subdivision 1.Definitions.  For the purposes of this
139.30 	section, the definitions in this subdivision apply.
139.31 	(a) "Unreimbursed special education cost" means the sum of
139.32 	the following:
139.33 	(1) expenditures for teachers' salaries, contracted
139.34 	services, supplies, equipment, and transportation services
139.35 	eligible for revenue under section 125A.76; plus
139.36 	(2) expenditures for tuition bills received under sections
140.1 	125A.03 to 125A.24 and 125A.65 for services eligible for revenue
140.2 	under section 125A.76, subdivision 2; minus
140.3 	(3) revenue for teachers' salaries, contracted services,
140.4 	supplies, and equipment under section 125A.76; minus
140.5 	(4) tuition receipts under sections 125A.03 to 125A.24 and
140.6 	125A.65 for services eligible for revenue under section 125A.76,
140.7 	subdivision 2.
140.8 	(b) "General revenue" means for fiscal year 1996, the sum
140.9 	of the general education revenue according to section 126C.10,
140.10 	subdivision 1, as adjusted according to section 127A.47,
140.11 	subdivision 7, plus the total referendum revenue according to
140.12 	section 126C.17, subdivision 4.  For fiscal years 1997 and
140.13 	later,"General revenue" means the sum of the general education
140.14 	revenue according to section 126C.10, subdivision 1, as adjusted
140.15 	according to section 127A.47, subdivisions 7 and 8, plus the
140.16 	total qualifying referendum revenue specified in paragraph (e) 
140.17 	minus transportation sparsity revenue minus total operating
140.18 	capital revenue.
140.19 	(c) "Average daily membership" has the meaning given it in
140.20 	section 126C.05.
140.21 	(d) "Program growth factor" means 1.02 for fiscal year
140.22 	2003, and 1.0 for fiscal year 2004 and later.
140.23 	(e) "Total qualifying referendum revenue" means two-thirds
140.24 	of the district's total referendum revenue for fiscal year 2006,
140.25 	one-third of the district's total referendum revenue for fiscal
140.26 	year 2007, and none of the district's total referendum revenue
140.27 	for fiscal year 2008 and later.
140.28 	
EFFECTIVE DATE. This section is effective for revenue for
140.29 	fiscal year 2006.

140.30 	Sec. 12. Minnesota Statutes 2004, section 125A.79,
140.31 	subdivision 6, is amended to read:
140.32 		Subd. 6.State total special education excess cost aid.
 140.33 	The state total special education excess cost aid for fiscal
140.34 	year 2004 equals $92,067,000.The state total special education
140.35 	excess cost aid for fiscal year 2005 equals $91,811,000. The
140.36 	state total special education excess cost aid equals
141.1 	$103,600,000 for fiscal year 2006 and $104,700,000 for fiscal
141.2 	year 2007.The state total special education excess cost aid
141.3 	for fiscal year 2006 2008 and later fiscal years equals:
141.4 	(1) the state total special education excess cost aid for
141.5 	the preceding fiscal year; times
141.6 	(2) the program growth factor; times
141.7 	(3) the greater of one, or the ratio of the state total
141.8 	average daily membership for the current fiscal year to the
141.9 	state total average daily membership for the preceding fiscal
141.10 	year.
141.11 	
EFFECTIVE DATE. This section is effective for revenue for
141.12 	fiscal year 2006.

141.13 	Sec. 13. Minnesota Statutes 2004, section 127A.45,
141.14 	subdivision 13, is amended to read:
141.15 		Subd. 13.Aid payment percentage.  Except as provided in
141.16 	subdivisions 11, 12, 12a, and 14, each fiscal year, all
141.17 	education aids and credits in this chapter and chapters 120A,
141.18 	120B, 121A, 122A, 123A, 123B, 124D, 125A, 125B, 126C, 134, and
141.19 	section 273.1392, shall be paid at 80 percent the current year
141.20 	aid payment percentage of the estimated entitlement during the
141.21 	fiscal year of the entitlement.  For the purposes of this
141.22 	subdivision, a district's estimated entitlement for special
141.23 	education excess cost aid under section 125A.79for fiscal year
141.24 	2005 equals 70 percent of the district's entitlement for the
141.25 	second prior fiscal year. For the purposes of this subdivision,
141.26 	a district's estimated entitlement for special education excess
141.27 	cost aid under section 125A.79 for fiscal year 2006 and later
141.28 	equals 74.0 percent of the district's entitlement for the
141.29 	current fiscal year.The final adjustment payment, according to
141.30 	subdivision 9, must be the amount of the actual entitlement,
141.31 	after adjustment for actual data, minus the payments made during
141.32 	the fiscal year of the entitlement.
141.33 	
EFFECTIVE DATE. This section is effective the day
141.34 	following final enactment and applies to aid payments for fiscal
141.35 	year 2005 and later.

141.36 	Sec. 14. Minnesota Statutes 2004, section 127A.47,
142.1 	subdivision 7, is amended to read:
142.2 		Subd. 7.Alternative attendance programs.  The general
142.3 	education aid and special education aid for districts must be
142.4 	adjusted for each pupil attending a nonresident district under
142.5 	sections 123A.05 to 123A.08, 124D.03, 124D.06, 124D.08, and
142.6 	124D.68.  The adjustments must be made according to this
142.7 	subdivision.
142.8 	(a) General education aid paid to a resident district must
142.9 	be reduced by an amount equal to the referendum equalization aid
142.10 	attributable to the pupil in the resident district.
142.11 	(b) General education aid paid to a district serving a
142.12 	pupil in programs listed in this subdivision must be increased
142.13 	by an amount equal to the referendum equalization aid
142.14 	attributable to the pupil in the nonresident district.
142.15 	(c) If the amount of the reduction to be made from the
142.16 	general education aid of the resident district is greater than
142.17 	the amount of general education aid otherwise due the district,
142.18 	the excess reduction must be made from other state aids due the
142.19 	district.
142.20 	(d) For fiscal year 2006,the district of residence must
142.21 	pay tuition to a district or an area learning center, operated
142.22 	according to paragraph (e) (f), providing special instruction
142.23 	and services to a pupil with a disability, as defined in section
142.24 	125A.02, or a pupil, as defined in section 125A.51, who is
142.25 	enrolled in a program listed in this subdivision.  The tuition
142.26 	must be equal to (1) the actual cost of providing special
142.27 	instruction and services to the pupil, including a proportionate
142.28 	amount for debt service and for capital expenditure facilities
142.29 	and equipment, and debt service but not including any amount for 
142.30 	special transportation and unreimbursed building lease and debt
142.31 	service costs for facilities used primarily for special
142.32 	education, minus (2) if the pupil receives special instruction
142.33 	and services outside the regular classroom for more than 60
142.34 	percent of the school day,the amount of general education
142.35 	revenue and referendum aid attributable to that pupil for the
142.36 	portion of time the pupil receives special instruction and
143.1 	services outside of the regular classroom, excluding portions
143.2 	attributable to district and school administration, district
143.3 	support services, operations and maintenance, capital
143.4 	expenditures, and pupil transportation, minus (3) special
143.5 	education aid but not including any amount for transportation,
143.6 	attributable to that pupil, that is received by the district
143.7 	providing special instruction and services. For purposes of
143.8 	this paragraph, general education revenue and referendum aid
143.9 	attributable to a pupil must be calculated using the serving
143.10 	district's average general education revenue and referendum aid
143.11 	per adjusted pupil unit.
143.12 	(e) For fiscal year 2007 and later, special education aid
143.13 	paid to a resident district must be reduced by an amount equal
143.14 	to (1) the actual cost of providing special instruction and
143.15 	services, including special transportation and unreimbursed
143.16 	building lease and debt service costs for facilities used
143.17 	primarily for special education, for a pupil with a disability,
143.18 	as defined in section 125A.02, or a pupil, as defined in section
143.19 	125A.51, who is enrolled in a program listed in this
143.20 	subdivision, minus (2) if the pupil receives special instruction
143.21 	and services outside the regular classroom for more than 60
143.22 	percent of the school day, the amount of general education
143.23 	revenue and referendum aid attributable to that pupil for the
143.24 	portion of time the pupil receives special instruction and
143.25 	services outside of the regular classroom, excluding portions
143.26 	attributable to district and school administration, district
143.27 	support services, operations and maintenance, capital
143.28 	expenditures, and pupil transportation, minus (3) special
143.29 	education aid attributable to that pupil, that is received by
143.30 	the district providing special instruction and services.  For
143.31 	purposes of this paragraph, general education revenue and
143.32 	referendum aid attributable to a pupil must be calculated using
143.33 	the serving district's average general education revenue and
143.34 	referendum aid per adjusted pupil unit.  Special education aid
143.35 	paid to the district or cooperative providing special
143.36 	instruction and services for the pupil, or to the fiscal agent
144.1 	district for a cooperative, must be increased by the amount of
144.2 	the reduction in the aid paid to the resident district.  If the
144.3 	resident district's special education aid is insufficient to
144.4 	make the full adjustment, the remaining adjustment shall be made
144.5 	to other state aids due to the district.
144.6 	(f) An area learning center operated by a service
144.7 	cooperative, intermediate district, education district, or a
144.8 	joint powers cooperative may elect through the action of the
144.9 	constituent boards to charge the resident district tuition for
144.10 	pupils rather than to have the general education revenue paid to
144.11 	a fiscal agent school district.  Except as provided in paragraph
144.12 	(d) or (e), the district of residence must pay tuition equal to
144.13 	at least 90 percent of the district average general education
144.14 	revenue per pupil unit minus an amount equal to the product of
144.15 	the formula allowance according to section 126C.10, subdivision
144.16 	2, times .0485, calculated without basic skills revenue and
144.17 	transportation sparsity revenue, times the number of pupil units
144.18 	for pupils attending the area learning center, plus the amount
144.19 	of compensatory revenue generated by pupils attending the area
144.20 	learning center.

144.21 	Sec. 15. Minnesota Statutes 2004, section 134.31, is
144.22 	amended by adding a subdivision to read:
144.23 		Subd. 6.Advisory committee. The commissioner shall
144.24 	appoint an advisory committee of five members to advise the
144.25 	staff of the Minnesota Library for the Blind and Physically
144.26 	Handicapped on long-range plans and library services.  Members
144.27 	shall be people who use the library.  Section 15.059 governs
144.28 	this committee except that the committee shall not expire.

144.29 	Sec. 16. Laws 2003, First Special Session chapter 9,
144.30 	article 3, section 20, subdivision 6, as amended by Laws 2004,
144.31 	chapter 272, article 1, section 16, is amended to read:
144.32 		Subd. 6.Special education; excess costs. For excess
144.33 	cost aid under Minnesota Statutes, section 125A.79, subdivision
144.34 	7:
144.35 	$92,605,000     .....     2004
144.36 	$92,799,000 $95,572,000.....     2005
145.1 	The 2004 appropriation includes $41,754,000 for 2003 and
145.2 	$50,851,000 for 2004.
145.3 	The 2005 appropriation includes $41,216,000 for 2004 and
145.4 	$51,583,000 $54,356,000 for 2005.
145.5 	Of the state total excess cost aid for fiscal year 2005,
145.6 	$150,000 shall be paid to Independent School District No. 2580,
145.7 	East Central, for unfunded special education costs that would
145.8 	otherwise be cross-subsidized with general education aid.  For
145.9 	purposes of Minnesota Statutes, section 125A.79, subdivision 7,
145.10 	the state total excess cost aid used in calculating district
145.11 	special education excess cost aid must be reduced by the amount
145.12 	paid to Independent School District No. 2580, East Central.
145.13 	
EFFECTIVE DATE. This section is effective retroactively
145.14 	from June 30, 2005.

145.15 	Sec. 17. TASK FORCE ON DELIVERY OF SPECIAL EDUCATION TO
145.16 	NONPUBLIC SCHOOL STUDENTS BY PUBLIC SCHOOL DISTRICTS.
 145.17 		Subdivision 1.Purpose; establishment. A task force on
145.18 	the delivery of special education services to nonpublic school
145.19 	students by public school districts shall be established to
145.20 	compare and evaluate how the individual needs of each child are
145.21 	being met, if services are provided in the least restrictive
145.22 	environment, and whether best practices and program efficiencies
145.23 	are being used in the specific areas of transportation, location
145.24 	of services, and shared time aid.
145.25 		Subd. 2.Members. The governor shall appoint the members
145.26 	of the task force from each of the following:
145.27 	(1) two members from the Department of Education, one
145.28 	representing special education programs and policy and one
145.29 	representing district finances;
145.30 	(2) two special education teachers with one member from a
145.31 	public school and one member from a nonpublic school;
145.32 	(3) two special education administrators with one member
145.33 	from a public school and one member from a nonpublic school;
145.34 	(4) two members with one from each of two special education
145.35 	advocacy organizations;
145.36 	(5) two parents of children receiving special education
146.1 	services with one member from a public school and one member
146.2 	from a nonpublic school;
146.3 	(6) two elementary school principals with one member from a
146.4 	public school and one member from a nonpublic school;
146.5 	(7) two superintendents with one member from a public
146.6 	school district and one member from a nonpublic school district;
146.7 	(8) two school business officials with one from a public
146.8 	school and one from a nonpublic school; and 
146.9 	(9) two school board officials with one from a public
146.10 	school and one from a nonpublic school.
146.11 	The task force may select additional members to work on the
146.12 	task force.  The commissioner of education shall provide
146.13 	necessary materials and assistance.
146.14 		Subd. 3.Report. The task force shall submit a report by
146.15 	January 15, 2006, to the house of representatives and senate
146.16 	committees having jurisdiction over education on the delivery of
146.17 	special education services to nonpublic school students by
146.18 	public school districts, to compare and evaluate how the
146.19 	individual needs of each child are being met in the least
146.20 	restrictive environment, and whether best practices and program
146.21 	efficiencies are being used.
146.22 		Subd. 4.Expiration. This section expires January 31,
146.23 	2006.
146.24 	
EFFECTIVE DATE. This section is effective the day
146.25 	following final enactment.

146.26 	Sec. 18. APPROPRIATIONS.
 146.27 		Subdivision 1.Department of education. The sums
146.28 	indicated in this section are appropriated from the general fund
146.29 	to the Department of Education for the fiscal years designated
146.30 	and include and supersede any amounts appropriated in Laws 2005,
146.31 	First Special Session chapter 2 or authorized by order of the
146.32 	Ramsey County District Court in Case No. C9-05-5928.
146.33 		Subd. 2.Special education; regular. For special
146.34 	education aid under Minnesota Statutes, section 125A.75:
146.35 	$528,846,000 .....2006 
146.36 	$527,446,000 .....2007 
147.1 	The 2006 appropriation includes $83,078,000 for 2005 and
147.2 	$445,768,000 for 2006.
147.3 	The 2007 appropriation includes $83,019,000 for 2006 and
147.4 	$444,427,000 for 2007.
147.5 		Subd. 3.Aid for children with disabilities. For aid
147.6 	under Minnesota Statutes, section 125A.75, subdivision 3, for
147.7 	children with disabilities placed in residential facilities
147.8 	within the district boundaries for whom no district of residence
147.9 	can be determined:
147.10 	$2,212,000 .....2006 
147.11 	$2,615,000 .....2007 
147.12 	If the appropriation for either year is insufficient, the
147.13 	appropriation for the other year is available.
147.14 		Subd. 4.Travel for home-based services. For aid for
147.15 	teacher travel for home-based services under Minnesota Statutes,
147.16 	section 125A.75, subdivision 1:
147.17 	$  187,000 .....2006 
147.18 	$  195,000 .....2007 
147.19 	The 2006 appropriation includes $28,000 for 2005 and
147.20 	$159,000 for 2006.
147.21 	The 2007 appropriation includes $29,000 for 2006 and
147.22 	$166,000 for 2007.
147.23 		Subd. 5.Special education; excess costs. For excess
147.24 	cost aid under Minnesota Statutes, section 125A.79, subdivision
147.25 	7:
147.26 	$102,083,000 .....2006 
147.27 	$104,286,000 .....2007 
147.28 	The 2006 appropriation includes $37,455,000 for 2005 and
147.29 	$64,628,000 for 2006.
147.30 	The 2007 appropriation includes $38,972,000 for 2006 and
147.31 	$65,314,000 for 2007.
147.32 		Subd. 6.Transition for disabled students. For aid for
147.33 	transition programs for children with disabilities under
147.34 	Minnesota Statutes, section 124D.454:
147.35 	$8,788,000 .....2006 
147.36 	$8,765,000 .....2007 
148.1 	The 2006 appropriation includes $1,380,000 for 2005 and
148.2 	$7,408,000 for 2006.
148.3 	The 2007 appropriation includes $1,379,000 for 2006 and
148.4 	$7,386,000 for 2007.
148.5 		Subd. 7.Court-placed special education revenue. For
148.6 	reimbursing serving school districts for unreimbursed eligible
148.7 	expenditures attributable to children placed in the serving
148.8 	school district by court action under Minnesota Statutes,
148.9 	section 125A.79, subdivision 4:
148.10 	$   65,000 .....2006 
148.11 	$   70,000 .....2007 
148.12 		Subd. 8.Special education out-of-state tuition. For
148.13 	special education out-of-state tuition according to Minnesota
148.14 	Statutes, section 125A.79, subdivision 8:
148.15 	$  250,000 .....2006 
148.16 	$  250,000 .....2007 

148.17 	Sec. 19. REPEALER.
 148.18 	Minnesota Statutes 2004, section 125A.75, subdivision 8, is
148.19 	repealed.

148.20 	Sec. 20. EFFECTIVE DATE.
 148.21 	Any section in this article without a specified effective
148.22 	date is retroactively effective from July 1, 2005.

148.23 	ARTICLE 4
148.24 	FACILITIES AND TECHNOLOGY

148.25 	Section 1. Minnesota Statutes 2004, section 123B.42, is
148.26 	amended by adding a subdivision to read:
148.27 		Subd. 1a.Curriculum; electronic components. A school
148.28 	district that provides curriculum to resident students that has
148.29 	both physical and electronic components must make the electronic
148.30 	component accessible to a resident student in a home school in
148.31 	compliance with sections 120A.22 and 120A.24 at the request of
148.32 	the student or the student's parent or guardian, provided that
148.33 	the district does not incur more than an incidental cost as a
148.34 	result of providing access electronically.

148.35 	Sec. 2. Minnesota Statutes 2004, section 123B.492, is
148.36 	amended to read:
149.1 	123B.492 SUPERVISED COMPETITIVE HIGH SCHOOL DIVING.
149.2 	Notwithstanding Minnesota Rules, part 4717.3750, any pool
149.3 	built before January 1, 1987, that was used for a one-meter
149.4 	board high school diving program during the 2000-2001 school
149.5 	year may be used for supervised competitive one-meter board high
149.6 	school diving.  Schools and school districts are strongly
149.7 	encouraged to use a pool for supervised competitive high school
149.8 	diving that meets the requirements of Minnesota Rules, part
149.9 	4717.3750.  A school or district using a pool for
149.10 	supervised training practice for competitive high school
149.11 	diving for either training practice or competition that does not
149.12 	meet the requirements of Minnesota Rules, part 4717.3750, must
149.13 	provide appropriate notice to parents and participants as to the
149.14 	type of variance from Minnesota Rules and risk it may present.

149.15 	Sec. 3. Minnesota Statutes 2004, section 123B.53,
149.16 	subdivision 1, is amended to read:
149.17 		Subdivision 1.Definitions.  (a) For purposes of this
149.18 	section, the eligible debt service revenue of a district is
149.19 	defined as follows:
149.20 	(1) the amount needed to produce between five and six
149.21 	percent in excess of the amount needed to meet when due the
149.22 	principal and interest payments on the obligations of the
149.23 	district for eligible projects according to subdivision 2,
149.24 	including the amounts necessary for repayment of energy loans
149.25 	according to section 216C.37 or sections 298.292 to 298.298,
149.26 	debt service loans and capital loans, lease purchase payments
149.27 	under section 126C.40, subdivision 2, alternative facilities
149.28 	levies under section 123B.59, subdivision 5, minus
149.29 	(2) the amount of debt service excess levy reduction for
149.30 	that school year calculated according to the procedure
149.31 	established by the commissioner.
149.32 	(b) The obligations in this paragraph are excluded from
149.33 	eligible debt service revenue:
149.34 	(1) obligations under section 123B.61;
149.35 	(2) the part of debt service principal and interest paid
149.36 	from the taconite environmental protection fund or northeast
150.1 	Minnesota economic protection trust;
150.2 	(3) obligations issued under Laws 1991, chapter 265,
150.3 	article 5, section 18, as amended by Laws 1992, chapter 499,
150.4 	article 5, section 24; and
150.5 	(4) obligations under section 123B.62.
150.6 	(c) For purposes of this section, if a preexisting school
150.7 	district reorganized under sections 123A.35 to 123A.43, 123A.46,
150.8 	and 123A.48 is solely responsible for retirement of the
150.9 	preexisting district's bonded indebtedness, capital loans or
150.10 	debt service loans, debt service equalization aid must be
150.11 	computed separately for each of the preexisting districts.
150.12 	(d) For purposes of this section, the adjusted net tax
150.13 	capacity determined according to section 127A.48 shall be
150.14 	adjusted to include a portion of the tax capacity of property
150.15 	generally exempted from ad valorem taxes under section 272.02,
150.16 	subdivisions 64 and 65, equal to the product of that tax
150.17 	capacity times the ratio of the eligible debt service revenue
150.18 	attributed to general obligation bonds to the total eligible
150.19 	debt service revenue of the district.

150.20 	Sec. 4. Minnesota Statutes 2004, section 123B.54, is
150.21 	amended to read:
150.22 	123B.54 DEBT SERVICE APPROPRIATION.
150.23 	(a) $28,367,000 $21,624,000 in fiscal year 2006 2008 and
150.24 	$25,560,000 $20,403,000 in fiscal year 2007 2009 and later are
150.25 	appropriated from the general fund to the commissioner of
150.26 	education for payment of debt service equalization aid under
150.27 	section 123B.53.
150.28 	(b) The appropriations in paragraph (a) must be reduced by
150.29 	the amount of any money specifically appropriated for the same
150.30 	purpose in any year from any state fund.

150.31 	Sec. 5. Minnesota Statutes 2004, section 123B.59,
150.32 	subdivision 3, is amended to read:
150.33 		Subd. 3.Bond authorization.  (a) A school district may
150.34 	issue general obligation bonds under this section to finance
150.35 	facilities plans approved by its board and the commissioner.
150.36 	Chapter 475, except sections 475.58 and 475.59, must be complied
151.1 	with.  The district may levy under subdivision 5 for the debt
151.2 	service revenue.  The authority to issue bonds under this
151.3 	section is in addition to any bonding authority authorized by
151.4 	this chapter, or other law.  The amount of bonding authority
151.5 	authorized under this section must be disregarded in calculating
151.6 	the bonding or net debt limits of this chapter, or any other law
151.7 	other than section 475.53, subdivision 4.
151.8 	(b) At least 20 days before a district issues bonds the
151.9 	earliest of solicitation of bids, the issuance of bonds, or the
151.10 	final certification of levies under this subdivision 5, it the
151.11 	district must publish notice of the intended projects, the
151.12 	amount of the bond issue, and the total amount of district
151.13 	indebtedness, and the commissioner's review and comment, if
151.14 	applicable.

151.15 	Sec. 6. Minnesota Statutes 2004, section 123B.59,
151.16 	subdivision 3a, is amended to read:
151.17 		Subd. 3a.Levy authorization.  (a) A school district may
151.18 	levy under this section to finance the portion of facilities
151.19 	plans approved by its board and the commissioner that are not
151.20 	financed through bond issues according to subdivision 3.
151.21 	(b) At least 20 days before a final district certification
151.22 	of levies under this subdivision 5, it the district must
151.23 	publish notice of the intended projects, including the total
151.24 	estimated project cost, and the commissioner's review and
151.25 	comment, if applicable.

151.26 	Sec. 7. [123B.591] DEFERRED MAINTENANCE REVENUE.
151.27 		Subdivision 1.Eligibility. An independent or special
151.28 	school district that does not qualify to participate in the
151.29 	alternative facilities bonding and levy under section 123B.59,
151.30 	subdivision 1, paragraph (a), is eligible to receive deferred
151.31 	maintenance revenue.
151.32 		Subd. 2.Deferred maintenance revenue. The deferred
151.33 	maintenance revenue for an eligible school district equals the
151.34 	product of $60 times the adjusted marginal cost pupil units for
151.35 	the school year times the lesser of one or the ratio of the
151.36 	district's average age of building space to 35 years.
152.1 		Subd. 3.Deferred maintenance levy. To obtain deferred
152.2 	maintenance revenue for fiscal year 2008 and later, a district
152.3 	may levy an amount not more than the product of its deferred
152.4 	maintenance revenue for the fiscal year times the lesser of one
152.5 	or the ratio of its adjusted net tax capacity per adjusted
152.6 	marginal cost pupil unit to $5,900.
152.7 		Subd. 4.Deferred maintenance aid. For fiscal year 2008
152.8 	and later, a district's deferred maintenance aid equals its
152.9 	deferred maintenance revenue minus its deferred maintenance levy
152.10 	times the ratio of the actual amount levied to the permitted
152.11 	levy.
152.12 		Subd. 5.Reserve account. Deferred maintenance revenue
152.13 	must be maintained in a reserve account within the general fund.
152.14 	Deferred maintenance revenue may be used only for expenditures
152.15 	that would be eligible for alternative facilities bonding and
152.16 	levy revenue under section 123B.59, subdivision 2, paragraph
152.17 	(a), if the district qualified for that revenue under section
152.18 	123B.59, subdivision 1, paragraph (a).
152.19 	
EFFECTIVE DATE. This section is effective for revenue for
152.20 	fiscal year 2008.

152.21 	Sec. 8. Minnesota Statutes 2004, section 123B.63,
152.22 	subdivision 2, is amended to read:
152.23 		Subd. 2.Uses of the account.  Money in the capital
152.24 	project referendum account must be used only for the purposes
152.25 	specified in section 126C.10, subdivision 14, for operating
152.26 	capital revenue, including the costs of acquisition and
152.27 	betterment for a project that has been reviewed under section
152.28 	123B.71 and has been approved according to subdivision 3.

152.29 	Sec. 9. Minnesota Statutes 2004, section 123B.71,
152.30 	subdivision 8, is amended to read:
152.31 		Subd. 8.Review and comment.  A school district, a
152.32 	special education cooperative, or a cooperative unit of
152.33 	government, as defined in section 123A.24, subdivision 2, must
152.34 	not initiate an installment contract for purchase or a lease
152.35 	agreement, hold a referendum for bonds, nor solicit bids for new
152.36 	construction, expansion, or remodeling of an educational
153.1 	facility that requires an expenditure in excess of $500,000 per
153.2 	school site prior to review and comment by the commissioner.
153.3 	The commissioner may exempt a facility maintenance project
153.4 	funded with general education aid and levy, alternative
153.5 	facilities bonding and levy program,or health and safety
153.6 	revenue from this provision after reviewing a written request
153.7 	from a school district describing the scope of work.  A school
153.8 	board shall not separate portions of a single project into
153.9 	components to avoid the requirements of this subdivision.

153.10 	Sec. 10. Minnesota Statutes 2004, section 123B.71,
153.11 	subdivision 9, is amended to read:
153.12 		Subd. 9.Information required.  A school board proposing
153.13 	to construct a facility described in subdivision 8 shall submit
153.14 	to the commissioner a proposal containing information including
153.15 	at least the following:
153.16 	(1) the geographic area and population to be served,
153.17 	preschool through grade 12 student enrollments for the past five
153.18 	years, and student enrollment projections for the next five
153.19 	years;
153.20 	(2) a list of existing facilities by year constructed,
153.21 	their uses, and an assessment of the extent to which alternate
153.22 	facilities are available within the school district boundaries
153.23 	and in adjacent school districts;
153.24 	(3) a list of the specific deficiencies of the facility
153.25 	that demonstrate the need for a new or renovated facility to be
153.26 	provided, and a list of the specific benefits that the new or
153.27 	renovated facility will provide to the students, teachers, and
153.28 	community users served by the facility;
153.29 	(4) the relationship of the project to any priorities
153.30 	established by the school district, educational cooperatives
153.31 	that provide support services, or other public bodies in the
153.32 	service area;
153.33 	(5) a specification of how the project will increase
153.34 	community use of the facility and whether and how the project
153.35 	will increase collaboration with other governmental or nonprofit
153.36 	entities;
154.1 	(6) a description of the project, including the
154.2 	specification of site and outdoor space acreage and square
154.3 	footage allocations for classrooms, laboratories, and support
154.4 	spaces; estimated expenditures for the major portions of the
154.5 	project; and the dates the project will begin and be completed;
154.6 	(7) a specification of the source of financing the project;
154.7 	the scheduled date for a bond issue or school board action; a
154.8 	schedule of payments, including debt service equalization aid;
154.9 	and the effect of a bond issue on local property taxes by the
154.10 	property class and valuation;
154.11 	(8) an analysis of how the proposed new or remodeled
154.12 	facility will affect school district operational or
154.13 	administrative staffing costs, and how the district's operating
154.14 	budget will cover any increased operational or administrative
154.15 	staffing costs;
154.16 	(9) a description of the consultation with local or state
154.17 	road and transportation officials on school site access and
154.18 	safety issues, and the ways that the project will address those
154.19 	issues;
154.20 	(10) a description of how indoor air quality issues have
154.21 	been considered and a certification that the architects and
154.22 	engineers designing the facility will have professional
154.23 	liability insurance;
154.24 	(11) as required under section 123B.72, for buildings
154.25 	coming into service after July 1, 2002, a certification that the
154.26 	plans and designs for the extensively renovated or new
154.27 	facility's heating, ventilation, and air conditioning systems
154.28 	will meet or exceed code standards; will provide for the
154.29 	monitoring of outdoor airflow and total airflow of ventilation
154.30 	systems; and will provide an indoor air quality filtration
154.31 	system that meets ASHRAE standard 52.1;
154.32 	(12) a specification of any desegregation requirements that
154.33 	cannot be met by any other reasonable means; and 
154.34 	(13) a specification, if applicable, of how the facility
154.35 	will utilize environmentally sustainable school facility design
154.36 	concepts; and 
155.1 	(14) a description of how the architects and engineers have
155.2 	considered the American National Standards Institute Acoustical
155.3 	Performance Criteria, Design Requirements and Guidelines for
155.4 	Schools of the maximum background noise level and reverberation
155.5 	times.
155.6 	
EFFECTIVE DATE. This section is effective July 1, 2006.

155.7 	Sec. 11. Minnesota Statutes 2004, section 123B.71,
155.8 	subdivision 12, is amended to read:
155.9 		Subd. 12.Publication. (a) At least 20 days but not more
155.10 	than 60 days before a referendum for bonds or solicitation of
155.11 	bids for a project that has received a positive or unfavorable
155.12 	review and comment under section 123B.70, the school board shall
155.13 	publish the commissioner's review and comment of that project in
155.14 	the legal newspaper of the district.  Supplementary information
155.15 	shall be available to the public.
155.16 	(b) The publication requirement in paragraph (a) does not
155.17 	apply to alternative facilities projects approved under section
155.18 	123B.59.  Publication for alternative facilities projects shall
155.19 	be as specified in section 123B.59, subdivisions 3 and 3a.

155.20 	Sec. 12. Minnesota Statutes 2004, section 124D.095,
155.21 	subdivision 2, is amended to read:
155.22 		Subd. 2.Definitions.  For purposes of this section, the
155.23 	following terms have the meanings given them.
155.24 	(a) "Online learning" is an interactive course or program
155.25 	that delivers instruction from a teacher to a student by
155.26 	computer; is combined with other traditional delivery methods
155.27 	that include frequent student assessment and may include actual
155.28 	teacher contact time; and meets or exceeds state academic
155.29 	standards.
155.30 	(b) "Online learning provider" is a school district, an
155.31 	intermediate school district,an organization of two or more
155.32 	school districts operating under a joint powers agreement, or a
155.33 	charter school located in Minnesota that provides online
155.34 	learning to students.
155.35 	(c) "Student" is a Minnesota resident enrolled in a school
155.36 	under section 120A.22, subdivision 4, in kindergarten through
156.1 	grade 12.
156.2 	(d) "Online learning student" is a student enrolled in an
156.3 	online learning course or program delivered by an online
156.4 	provider under paragraph (b).
156.5 	(e) "Enrolling district" means the school district or
156.6 	charter school in which a student is enrolled under section
156.7 	120A.22, subdivision 4, for purposes of compulsory attendance.

156.8 	Sec. 13. Minnesota Statutes 2004, section 124D.095,
156.9 	subdivision 4, is amended to read:
156.10 		Subd. 4.Online learning parameters.  (a) An online
156.11 	learning student must receive academic credit for completing the
156.12 	requirements of an online learning course or program.  Secondary
156.13 	credits granted to an online learning student must be counted
156.14 	toward the graduation and credit requirements of the enrolling
156.15 	district.  The enrolling district must apply the same graduation
156.16 	requirements to all students, including online learning
156.17 	students, and must continue to provide nonacademic services to
156.18 	online learning students.  If a student completes an online
156.19 	learning course or program that meets or exceeds a graduation
156.20 	standard or grade progression requirement at the enrolling
156.21 	district, that standard or requirement is met.  The enrolling
156.22 	district must use the same criteria for accepting online
156.23 	learning credits or courses as it does for accepting credits or
156.24 	courses for transfer students under section 124D.03, subdivision
156.25 	9.  The enrolling district may reduce the teacher contact time
156.26 	of an online learning student in proportion to the number of
156.27 	online learning courses the student takes from an online
156.28 	learning provider that is not the enrolling district.
156.29 	(b) An online learning student may:
156.30 	(1) enroll during a single school year in a maximum of 12
156.31 	semester-long courses or their equivalent delivered by an online
156.32 	learning provider or the enrolling district;
156.33 	(2) complete course work at a grade level that is different
156.34 	from the student's current grade level; and
156.35 	(3) enroll in additional courses with the online learning
156.36 	provider under a separate agreement that includes terms for
157.1 	payment of any tuition or course fees.
157.2 	(c) A student with a disability may enroll in an online
157.3 	learning course or program if the student's IEP team determines
157.4 	that online learning is appropriate education for the student.
157.5 	(d) An online learning student has the same access to the
157.6 	computer hardware and education software available in a school
157.7 	as all other students in the enrolling district.  An online
157.8 	learning provider must assist an online learning student whose
157.9 	family qualifies for the education tax credit under section
157.10 	290.0674 to acquire computer hardware and educational software
157.11 	for online learning purposes.
157.12 	(e) An enrolling district may offer online learning to its
157.13 	enrolled students.  Such online learning does not generate
157.14 	online learning funds under this section.  An enrolling district
157.15 	that offers online learning only to its enrolled students is not
157.16 	subject to the reporting requirements or review criteria under
157.17 	subdivision 7.  A teacher with a Minnesota license must assemble
157.18 	and deliver instruction to enrolled students receiving online
157.19 	learning from an enrolling district. The delivery of
157.20 	instruction occurs when the student interacts with the computer
157.21 	or the teacher and receives ongoing assistance and assessment of
157.22 	learning.The instruction may include curriculum developed by
157.23 	persons other than a teacher with a Minnesota license.
157.24 	(f) An online learning provider that is not the enrolling
157.25 	district is subject to the reporting requirements and review
157.26 	criteria under subdivision 7.  A teacher with a Minnesota
157.27 	license must assemble and deliver instruction to online learning
157.28 	students. The delivery of instruction occurs when the student
157.29 	interacts with the computer or the teacher and receives ongoing
157.30 	assistance and assessment of learning.The instruction may
157.31 	include curriculum developed by persons other than a teacher
157.32 	with a Minnesota license.  Unless the commissioner grants a
157.33 	waiver, a teacher providing online learning instruction must not
157.34 	instruct more than 40 students in any one online learning course
157.35 	or program.

157.36 	Sec. 14. Minnesota Statutes 2004, section 124D.095, is
158.1 	amended by adding a subdivision to read:
158.2 		Subd. 10.Online learning advisory council. (a) An
158.3 	online learning advisory council is established under section
158.4 	15.059, except that the term for each council member shall be
158.5 	three years.  The advisory council is composed of 12 members
158.6 	from throughout the state who have demonstrated experience with
158.7 	or interest in online learning.  The members of the council
158.8 	shall be appointed by the commissioner.  The advisory council
158.9 	shall bring to the attention of the commissioner any matters
158.10 	related to online learning and provide input to the department
158.11 	in matters related, but not restricted, to:
158.12 	(1) quality assurance;
158.13 	(2) teacher qualifications;
158.14 	(3) program approval;
158.15 	(4) special education;
158.16 	(5) attendance;
158.17 	(6) program design and requirements; and 
158.18 	(7) fair and equal access to programs.
158.19 	(b) The online learning advisory council under this
158.20 	subdivision expires June 30, 2008.

158.21 	Sec. 15. [125B.26] TELECOMMUNICATIONS/INTERNET ACCESS
158.22 	EQUITY AID.
158.23 		Subdivision 1.Costs to be submitted. (a) A district or
158.24 	charter school shall submit its actual
158.25 	telecommunications/Internet access costs for the previous fiscal
158.26 	year, adjusted for any e-rate revenue received, to the
158.27 	department by August 15 of each year as prescribed by the
158.28 	commissioner.  Costs eligible for reimbursement under this
158.29 	program are limited to the following:
158.30 	(1) ongoing or recurring telecommunications/Internet access
158.31 	costs associated with Internet access, data lines, and video
158.32 	links providing:
158.33 	(i) the equivalent of one data line, video link, or
158.34 	integrated data/video link that relies on a transport medium
158.35 	that operates at a minimum speed of 1.544 megabytes per second
158.36 	(T1) for each elementary school, middle school, or high school
159.1 	under section 120A.05, subdivisions 9, 11, and 13, including the
159.2 	recurring telecommunications line lease costs and ongoing
159.3 	Internet access service fees; or 
159.4 	(ii) the equivalent of one data line or video circuit, or
159.5 	integrated data/video link that relies on a transport medium
159.6 	that operates at a minimum speed of 1.544 megabytes per second
159.7 	(T1) for each district, including recurring telecommunications
159.8 	line lease costs and ongoing Internet access service fees;
159.9 	(2) recurring costs of contractual or vendor-provided
159.10 	maintenance on the school district's wide area network to the
159.11 	point of presence at the school building up to the router,
159.12 	codec, or other service delivery equipment located at the point
159.13 	of presence termination at the school or school district;
159.14 	(3) recurring costs of cooperative, shared arrangements for
159.15 	regional delivery of telecommunications/Internet access between
159.16 	school districts, postsecondary institutions, and public
159.17 	libraries including network gateways, peering points, regional
159.18 	network infrastructure, Internet2 access, and network support,
159.19 	maintenance, and coordination; and 
159.20 	(4) service provider installation fees for installation of
159.21 	new telecommunications lines or increased bandwidth.
159.22 	(b) Costs not eligible for reimbursement under this program
159.23 	include:
159.24 	(1) recurring costs of school district staff providing
159.25 	network infrastructure support;
159.26 	(2) recurring costs associated with voice and standard
159.27 	telephone service;
159.28 	(3) costs associated with purchase of network hardware,
159.29 	telephones, computers, or other peripheral equipment needed to
159.30 	deliver telecommunications access to the school or school
159.31 	district;
159.32 	(4) costs associated with laying fiber for
159.33 	telecommunications access;
159.34 	(5) costs associated with wiring school or school district
159.35 	buildings;
159.36 	(6) costs associated with purchase, installation, or
160.1 	purchase and installation of Internet filtering; and 
160.2 	(7) costs associated with digital content, including online
160.3 	learning or distance learning programming, and information
160.4 	databases.
160.5 		Subd. 2.E-rates. To be eligible for aid under this
160.6 	section, a district or charter school is required to file an
160.7 	e-rate application either separately or through its
160.8 	telecommunications access cluster and have a current technology
160.9 	plan on file with the department.  Discounts received on
160.10 	telecommunications expenditures shall be reflected in the costs
160.11 	submitted to the department for aid under this section.
160.12 		Subd. 3.Reimbursement criteria. The commissioner shall
160.13 	develop criteria for approving costs submitted by organized
160.14 	school districts and charter schools under subdivision 1.
160.15 		Subd. 4.District aid. For fiscal year 2006 and later, a
160.16 	district or charter school's Internet access equity aid equals
160.17 	the district or charter school's approved cost for the previous
160.18 	fiscal year according to subdivision 1 exceeding $15 times the
160.19 	district's adjusted marginal cost pupil units for the previous
160.20 	fiscal year or no reduction if the district is part of an
160.21 	organized telecommunications access cluster.  Equity aid must be
160.22 	distributed to the telecommunications access cluster for
160.23 	districts that are members of the cluster or to individual
160.24 	districts and charter schools not part of a telecommunications
160.25 	access cluster.
160.26 		Subd. 5.Telecommunications/internet access services for
160.27 	nonpublic schools. (a) Districts shall provide each year upon
160.28 	formal request by or on behalf of a nonpublic school, not
160.29 	including home schools, located in that district or area,
160.30 	ongoing or recurring telecommunications access services to the
160.31 	nonpublic school either through existing district providers or
160.32 	through separate providers.
160.33 	(b) The amount of district aid for telecommunications
160.34 	access services for each nonpublic school under this subdivision
160.35 	equals the lesser of:
160.36 	(1) 90 percent of the nonpublic school's approved cost for
161.1 	the previous fiscal year according to subdivision 1 exceeding
161.2 	$10 for fiscal year 2006 and later times the number of weighted
161.3 	pupils enrolled at the nonpublic school as of October 1 of the
161.4 	previous school year; or 
161.5 	(2) the product of the district's aid per pupil unit
161.6 	according to subdivision 4 times the number of weighted pupils
161.7 	enrolled at the nonpublic school as of October 1 of the previous
161.8 	school year.
161.9 	(c) For purposes of this subdivision, nonpublic school
161.10 	pupils shall be weighted by grade level using the weighting
161.11 	factors defined in section 126C.05, subdivision 1.
161.12 	(d) Each year, a district providing services under
161.13 	paragraph (a) may claim up to five percent of the aid determined
161.14 	in paragraph (b) for costs of administering this subdivision.
161.15 	No district may expend an amount for these telecommunications
161.16 	access services which exceeds the amount allocated under this
161.17 	subdivision.  The nonpublic school is responsible for the
161.18 	Internet access costs not covered by this section.
161.19 	(e) At the request of a nonpublic school, districts may
161.20 	allocate the amount determined in paragraph (b) directly to the
161.21 	nonpublic school to pay for or offset the nonpublic school's
161.22 	costs for telecommunications access services; however, the
161.23 	amount allocated directly to the nonpublic school may not exceed
161.24 	the actual amount of the school's ongoing or recurring
161.25 	telecommunications access costs.
161.26 		Subd. 6.Severability. If any portion of this section is
161.27 	found by a court to be unconstitutional, the remaining portions
161.28 	of the section shall remain in effect.

161.29 	Sec. 16. Minnesota Statutes 2004, section 126C.63,
161.30 	subdivision 5, is amended to read:
161.31 		Subd. 5.Levy.  "Levy" means a district's net debt
161.32 	service levy after the reduction of debt service equalization
161.33 	aid under section 123B.53, subdivision 6.  For taxes payable in
161.34 	2003 and later, each district's maximum effort debt service levy
161.35 	for purposes of subdivision 8, must be reduced by an equal
161.36 	number of percentage points if the commissioner of finance
162.1 	determines that the levy reduction will not result in a payment
162.2 	from the general fund in the state treasury according to section
162.3 	16A.641, as would be required under section 126C.72, subdivision
162.4 	3.  A district's levy that is adjusted under this section must
162.5 	not be reduced below 30.1 25 percent of the district's adjusted
162.6 	net tax capacity.

162.7 	Sec. 17. Minnesota Statutes 2004, section 126C.63,
162.8 	subdivision 8, is amended to read:
162.9 		Subd. 8.Maximum effort debt service levy.  (a) "Maximum
162.10 	effort debt service levy" means the lesser of:
162.11 	(1) a levy in whichever of the following amounts is
162.12 	applicable:
162.13 	(i) in any district receiving a debt service loan for a
162.14 	debt service levy payable in 2002 and thereafter, or granted a
162.15 	capital loan after January 1, 2002, a levy in total dollar
162.16 	amount computed at a rate of 40 32 percent of adjusted net tax
162.17 	capacity for taxes payable in 2002 and thereafter;
162.18 	(ii) in any district receiving a debt service loan for a
162.19 	debt service levy payable in 2001 or earlier, or granted a
162.20 	capital loan before January 2, 2001 2002, a levy in a total
162.21 	dollar amount computed at a rate of 32 28 percent of adjusted
162.22 	net tax capacity for taxes payable in 2002 and thereafter; or
162.23 	(2) a levy in any district for which a capital loan was
162.24 	approved prior to August 1, 1981, a levy in a total dollar
162.25 	amount equal to the sum of the amount of the required debt
162.26 	service levy and an amount which when levied annually will in
162.27 	the opinion of the commissioner be sufficient to retire the
162.28 	remaining interest and principal on any outstanding loans from
162.29 	the state within 30 years of the original date when the capital
162.30 	loan was granted.
162.31 	(b) The board in any district affected by the provisions of
162.32 	paragraph (a), clause (2), may elect instead to determine the
162.33 	amount of its levy according to the provisions of paragraph (a),
162.34 	clause (1).  If a district's capital loan is not paid within 30
162.35 	years because it elects to determine the amount of its levy
162.36 	according to the provisions of paragraph (a), clause (2), the
163.1 	liability of the district for the amount of the difference
163.2 	between the amount it levied under paragraph (a), clause (2),
163.3 	and the amount it would have levied under paragraph (a), clause
163.4 	(1), and for interest on the amount of that difference, must not
163.5 	be satisfied and discharged pursuant to Minnesota Statutes 1988,
163.6 	or an earlier edition of Minnesota Statutes if applicable,
163.7 	section 124.43, subdivision 4.

163.8 	Sec. 18. Minnesota Statutes 2004, section 128D.11,
163.9 	subdivision 9, is amended to read:
163.10 		Subd. 9.Net debt defined.  The net debt of the school
163.11 	district for the purposes of this limitation is the amount of
163.12 	bonds less the amount of all money and the face value of all
163.13 	securities then held as a sinking fund for the payment of such
163.14 	bonds, and shall not include school aid and tax anticipation
163.15 	certificates of indebtedness not in default or bonds issued to
163.16 	pay pension fund liabilities under section 475.52, subdivision 6.

163.17 	Sec. 19. Minnesota Statutes 2004, section 475.61,
163.18 	subdivision 4, is amended to read:
163.19 		Subd. 4.Surplus funds.  (a) All such taxes shall be
163.20 	collected and remitted to the municipality by the county
163.21 	treasurer as other taxes are collected and remitted, and shall
163.22 	be used only for payment of the obligations on account of which
163.23 	levied or to repay advances from other funds used for such
163.24 	payments, except that any surplus remaining in the debt service
163.25 	fund when the obligations and interest thereon are paid may be
163.26 	appropriated to any other general purpose by the municipality.
163.27 	However, for obligations authorized before July 1, 2005,the
163.28 	amount of any surplus remaining in the debt service fund of a
163.29 	school district when the obligations and interest thereon are
163.30 	paid shall be used to reduce the general fund levy levies 
163.31 	authorized pursuant to chapters 122A, 123A, 123B, 124D, and 126C
163.32 	and the state aids authorized pursuant to chapters 122A, 123A,
163.33 	123B, 124D, 125A, 126C, and 127A. For obligations authorized on
163.34 	July 1, 2005, or thereafter, the amount of any surplus remaining
163.35 	in the debt service fund of a school district when the
163.36 	obligations and interest thereon are paid in full may be
164.1 	appropriated to any other general purpose by the school district
164.2 	without any reduction in state aid or levies or may be used to
164.3 	reduce the general fund levies authorized under chapters 122A,
164.4 	123A, 123B, 124D, and 126C, and the state aids authorized under
164.5 	chapters 122A, 123A, 123B, 124D, 125A, 126C, and 127A.
164.6 	(b) If the district qualified for second tier debt service
164.7 	equalization aid in the last year that it qualified for debt
164.8 	service equalization aid, the reduction to state aids equals the
164.9 	lesser of (1) the amount of the surplus times the ratio of the
164.10 	district's second tier debt service equalization aid to the
164.11 	district's second tier debt service equalization revenue for the
164.12 	last year that the district qualified for debt service
164.13 	equalization aid; or (2) the district's cumulative amount of
164.14 	debt service equalization aid.
164.15 	(c) If the district did not qualify for second tier debt
164.16 	service equalization aid in the last year that it qualified for
164.17 	debt service equalization aid, the reduction to state aids
164.18 	equals the lesser of (1) the amount of the surplus times the
164.19 	ratio of the district's debt service equalization aid to the
164.20 	district's debt service equalization revenue for the last year
164.21 	that the district qualified for debt service equalization aid;
164.22 	or (2) the district's cumulative amount of debt service
164.23 	equalization aid.
164.24 	(d) The reduction to the general fund levy levies equals
164.25 	the total amount of the surplus minus the reduction to state
164.26 	aids.

164.27 	Sec. 20. Laws 1996, chapter 412, article 5, section 24, is
164.28 	amended to read:

164.29 	Sec. 24. BONDS PAID FROM TACONITE PRODUCTION TAX
164.30 	REVENUES.
 164.31 		Subdivision 1.Refunding bonds. The appropriation of
164.32 	funds from the distribution of taconite production tax revenues
164.33 	to the taconite environmental protection tax fund and the
164.34 	northeast Minnesota economic protection fund made by Laws 1988,
164.35 	chapter 718, article 7, sections 62 and 63, Laws 1989, chapter
164.36 	329, article 5, section 20, Laws 1990, chapter 604, article 8,
165.1 	section 13, Laws 1992, chapter 499, article 5, section 29, and
165.2 	by sections 18 to 20 Laws 1996, chapter 412, article 5, sections
165.3 	20 to 22, and Laws 2000, chapter 489, article 5, sections 24 to
165.4 	26, shall continue to apply to bonds issued under Minnesota
165.5 	Statutes, chapter 475, to refund bonds originally issued
165.6 	pursuant to those chapters.
165.7 		Subd. 2.Local payments. School districts that are
165.8 	required in Laws 1988, chapter 718, article 7, sections 62 and
165.9 	63, Laws 1989, chapter 329, article 5, section 20, Laws 1990,
165.10 	chapter 604, article 8, section 13, Laws 1992, chapter 499,
165.11 	article 5, section 29, and by sections 18 to 20 Laws 1996,
165.12 	chapter 412, article 5, sections 20 to 22, and Laws 2000,
165.13 	chapter 489, article 5, sections 24 to 26, to impose levies to
165.14 	pay debt service on the bonds issued under those provisions to
165.15 	the extent the principal and interest on the bonds is not paid
165.16 	by distributions from the taconite environmental protection fund
165.17 	and the northeast Minnesota economic protection trust, may pay
165.18 	their portion of the principal and interest from any funds
165.19 	available to them.  To the extent a school district uses funds
165.20 	other than the proceeds of a property tax levy to pay its share
165.21 	of the principal and interest on the bonds, the requirement to
165.22 	impose a property tax to pay the local share does not apply to
165.23 	the school district.

165.24 	Sec. 21. Laws 2003, First Special Session chapter 9,
165.25 	article 4, section 29, as amended by Laws 2003, First Special
165.26 	Session chapter 23, section 18, is amended to read:
165.27 	Sec. 29GARAGE LEASE LEVY; SARTELL.
 165.28 	For taxes payable in 2004, 2005, and 2006, and 2007,
165.29 	independent school district No. 740 748, Sartell, may levy up to
165.30 	$107,000 each year and for taxes payable in 2008 may levy up to
165.31 	$67,000 for the purpose of leasing a school bus storage
165.32 	facility.  The department of education shall include this levy
165.33 	in the calculation of eligible building lease levy under
165.34 	Minnesota Statutes, section 126C.40, subdivision 1.  This levy
165.35 	shall not allow the district to exceed the $90 $100 per resident
165.36 	pupil unit cap in that section.  The district is eligible to
166.1 	make this levy only if it sells its current school bus storage
166.2 	site to the city of Sartell and the district may not use this
166.3 	levy as part of a lease purchase agreement to replace its
166.4 	current school bus storage facility.

166.5 	Sec. 22. LEVY; GLENCOE-SILVER LAKE.
 166.6 	For taxes payable in 2006 only, Independent School District
166.7 	No. 2859, Glencoe-Silver Lake, may levy an amount up to $81,000.
166.8 	Of that amount, $64,000 is for recovering the cost of replacing
166.9 	a gymnasium floor at Lakeside Elementary School resulting from
166.10 	storm damage and $17,000 is for recovering the cost of the
166.11 	Lincoln Junior High School water service line and associated
166.12 	work.

166.13 	EFFECTIVE DATE. This section is effective for taxes
166.14 	payable in 2006.

166.15 	Sec. 23. LEASE LEVY; ADMINISTRATIVE SPACE, WACONIA.
 166.16 	Independent School District No. 110, Waconia, may lease
166.17 	administrative space under Minnesota Statutes, section 126C.40,
166.18 	subdivision 1, if the district can demonstrate to the
166.19 	commissioner's satisfaction that the administrative space is
166.20 	less expensive than instructional space that the district would
166.21 	otherwise lease.  The commissioner must deny this levy authority
166.22 	unless the district passes a resolution stating its intent to
166.23 	lease instructional space under Minnesota Statutes, section
166.24 	126C.40, subdivision 1, if the commissioner does not grant
166.25 	authority under this section.  The resolution must also certify
166.26 	that a lease of administrative space under this section is less
166.27 	expensive than the district's proposed instructional lease.
166.28 	Levy authority under this section shall not exceed the total
166.29 	levy authority under Minnesota Statutes, section 126C.40,
166.30 	subdivision 1, paragraph (e).

166.31 	EFFECTIVE DATE. This section is effective for revenue for
166.32 	taxes payable in 2006 through 2011.

166.33 	Sec. 24. RESIDENTIAL PROGRAM FACILITIES; WORTHINGTON.
 166.34 	Subject to Minnesota Statutes, section 16A.695, Independent
166.35 	School District No. 518, Worthington, may use the facilities
166.36 	provided under Laws 1994, chapter 643, section 14, subdivision
167.1 	8, as amended by Laws 1995, chapter 76, section 1, to provide
167.2 	adult foster care or child foster care services licensed by the
167.3 	commissioner of human services or for other special education
167.4 	purposes.

167.5 	Sec. 25. APPROPRIATIONS.
 167.6 		Subdivision 1.Department of education. The sums
167.7 	indicated in this section are appropriated from the general fund
167.8 	to the Department of Education for the fiscal years designated
167.9 	and include and supersede any amounts appropriated in Laws 2005,
167.10 	First Special Session chapter 2, or authorized by order of the
167.11 	Ramsey County District Court in case No. C9-05-5928.
167.12 		Subd. 2.Health and safety revenue. For health and
167.13 	safety aid according to Minnesota Statutes, section 123B.57,
167.14 	subdivision 5:
167.15 	$  802,000 .....2006 
167.16 	$  578,000 .....2007 
167.17 	The 2006 appropriation includes $211,000 for 2005 and
167.18 	$591,000 for 2006.
167.19 	The 2007 appropriation includes $109,000 for 2006 and
167.20 	$469,000 for 2007.
167.21 		Subd. 3.Debt service equalization. For debt service aid
167.22 	according to Minnesota Statutes, section 123B.53, subdivision 6:
167.23 	$25,654,000 .....2006 
167.24 	$24,134,000 .....2007 
167.25 	The 2006 appropriation includes $4,654,000 for 2005 and
167.26 	$21,000,000 for 2006.
167.27 	The 2007 appropriation includes $3,911,000 for 2006 and
167.28 	$20,223,000 for 2007.
167.29 		Subd. 4.Alternative facilities bonding aid. For
167.30 	alternative facilities bonding aid, according to Minnesota
167.31 	Statutes, section 123B.59, subdivision 1:
167.32 	$19,287,000 .....2006 
167.33 	$19,287,000 .....2007 
167.34 	The 2006 appropriation includes $3,028,000 for 2005 and
167.35 	$16,259,000 for 2006.
167.36 	The 2007 appropriation includes $3,028,000 for 2006 and
168.1 	$16,259,000 for 2007.
168.2 		Subd. 5.Equity in telecommunications access. For equity
168.3 	in telecommunications access:
168.4 	$3,750,000 .....2006 
168.5 	$3,750,000 .....2007 
168.6 	If the appropriation amount is insufficient, the
168.7 	commissioner shall reduce the reimbursement rate in Minnesota
168.8 	Statutes, section 125B.26, subdivisions 4 and 5, and the revenue
168.9 	for the fiscal years 2006 and 2007 shall be prorated.  The base
168.10 	for this program in fiscal year 2008 and later is $3,750,000.
168.11 	Any balance in the first year does not cancel but is available
168.12 	in the second year.
168.13 		Subd. 6.Emergency aid, red lake. For Independent School
168.14 	District No. 38, Red Lake, for onetime emergency aid to repair
168.15 	infrastructure damage to the Red Lake High School as a result of
168.16 	the March 21, 2005, school shooting:
168.17 	$   50,000 .....2006 
168.18 	The school district must submit proposed expenditures for
168.19 	these funds for review and comment approval under Minnesota
168.20 	Statutes, section 123B.71, before the commissioner releases the
168.21 	funds to the district.  The district must report the amount of
168.22 	its unreimbursed costs to the commissioner.

168.23 	Sec. 26. EFFECTIVE DATE.
 168.24 	Any section in this article without a specified effective
168.25 	date is retroactively effective from July 1, 2005.

168.26 	ARTICLE 5
168.27 	NUTRITION AND ACCOUNTING

168.28 	Section 1. Minnesota Statutes 2004, section 123B.75,
168.29 	subdivision 5, is amended to read:
168.30 		Subd. 5.Levy recognition.  (a) "School district tax
168.31 	settlement revenue" means the current, delinquent, and
168.32 	manufactured home property tax receipts collected by the county
168.33 	and distributed to the school district.
168.34 	(b) In June of 2003, the school district must recognize as
168.35 	revenue, in the fund for which the levy was made, the lesser of:
168.36 	(1) the sum of May, June, and July school district tax
169.1 	settlement revenue received in that calendar year, plus general
169.2 	education aid according to section 126C.13, subdivision 4,
169.3 	received in July and August of that calendar year; or 
169.4 	(2) the sum of:
169.5 	(i) 31 percent of the referendum levy certified according
169.6 	to section 126C.17, in calendar year 2000; plus 
169.7 	(ii) the entire amount of the levy certified in the prior
169.8 	calendar year according to section 124D.86, subdivision 4, for
169.9 	school districts receiving revenue under sections 124D.86,
169.10 	subdivision 3, clauses (1), (2), and (3); 126C.41, subdivisions
169.11 	1, 2, and 3, paragraphs (b), (c), and (d); 126C.43, subdivision
169.12 	2; 126C.457; and 126C.48, subdivision 6.
169.13 	(c) For fiscal year 2004 and later years, in June of each
169.14 	year, the school district must recognize as revenue, in the fund
169.15 	for which the levy was made, the lesser of:
169.16 	(1) the sum of May, June, and July school district tax
169.17 	settlement revenue received in that calendar year, plus general
169.18 	education aid according to section 126C.13, subdivision 4,
169.19 	received in July and August of that calendar year; or
169.20 	(2) the sum of:
169.21 	(i) the greater of 45 48.6 percent of the referendum levy
169.22 	certified according to section 126C.17, in the prior calendar
169.23 	year or 31 percent of the referendum levy certified according to
169.24 	section 126C.17, in calendar year 2000; plus
169.25 	(ii) the entire amount of the levy certified in the prior
169.26 	calendar year according to section 124D.86, subdivision 4, for
169.27 	school districts receiving revenue under sections 124D.86,
169.28 	subdivision 3, clauses (1), (2), and (3); 126C.41, subdivisions
169.29 	1, 2, and 3, paragraphs (b), (c), and (d); 126C.43, subdivision
169.30 	2; 126C.457; and 126C.48, subdivision 6; plus
169.31 	(iii) 45 48.6 percent of the amount of the levy certified
169.32 	in the prior calendar year for the school district's general and
169.33 	community service funds, plus or minus auditor's adjustments,
169.34 	not including levy portions that are assumed by the state, that
169.35 	remains after subtracting the referendum levy certified
169.36 	according to section 126C.17 and the amount recognized according
170.1 	to clause (ii).

170.2 	Sec. 2. Minnesota Statutes 2004, section 124D.111,
170.3 	subdivision 1, is amended to read:
170.4 		Subdivision 1.School lunch aid computation.  Each school
170.5 	year, the state must pay districts participating participants in
170.6 	the national school lunch program the amount of eight ten cents
170.7 	for each full paid, reduced, and free student lunch served to
170.8 	students in the district.
170.9 	
EFFECTIVE DATE. This section is effective for fiscal year
170.10 	2006.

170.11 	Sec. 3. Minnesota Statutes 2004, section 124D.111,
170.12 	subdivision 2, is amended to read:
170.13 		Subd. 2.Application. A school districts district,
170.14 	charter school, nonpublic school, or other participant in the
170.15 	national school lunch program shall apply to the department for
170.16 	this payment on forms provided by the department.
170.17 	
EFFECTIVE DATE. This section is effective for fiscal year
170.18 	2006.

170.19 	Sec. 4. Minnesota Statutes 2004, section 124D.118,
170.20 	subdivision 4, is amended to read:
170.21 		Subd. 4.Reimbursement.  In accordance with program
170.22 	guidelines, the commissioner shall reimburse each participating
170.23 	public or nonpublic school nine 14 cents for each half-pint of
170.24 	milk that is served to kindergarten students and is not part of
170.25 	a school lunch or breakfast reimbursed under section 124D.111 or
170.26 	124D.1158.
170.27 	
EFFECTIVE DATE. This section is effective for fiscal year
170.28 	2006.

170.29 	Sec. 5. Minnesota Statutes 2004, section 127A.45,
170.30 	subdivision 2, is amended to read:
170.31 		Subd. 2.Definitions.  (a) The term "other district
170.32 	receipts" means payments by county treasurers pursuant to
170.33 	section 276.10, apportionments from the school endowment fund
170.34 	pursuant to section 127A.33, apportionments by the county
170.35 	auditor pursuant to section 127A.34, subdivision 2, and payments
170.36 	to school districts by the commissioner of revenue pursuant to
171.1 	chapter 298.
171.2 	(b) The term "cumulative amount guaranteed" means the
171.3 	product of
171.4 	(1) the cumulative disbursement percentage shown in
171.5 	subdivision 3; times
171.6 	(2) the sum of
171.7 	(i) 80 percent the current year aid payment percentage of
171.8 	the estimated aid and credit entitlements paid according to
171.9 	subdivision 13; plus
171.10 	(ii) 100 percent of the entitlements paid according to
171.11 	subdivisions 11 and 12; plus
171.12 	(iii) the other district receipts.
171.13 	(c) The term "payment date" means the date on which state
171.14 	payments to districts are made by the electronic funds transfer
171.15 	method.  If a payment date falls on a Saturday, a Sunday, or a
171.16 	weekday which is a legal holiday, the payment shall be made on
171.17 	the immediately preceding business day.  The commissioner may
171.18 	make payments on dates other than those listed in subdivision 3,
171.19 	but only for portions of payments from any preceding payment
171.20 	dates which could not be processed by the electronic funds
171.21 	transfer method due to documented extenuating circumstances.
171.22 	
EFFECTIVE DATE. This section is effective for state aid
171.23 	payments for fiscal year 2006.

171.24 	Sec. 6. Minnesota Statutes 2004, section 127A.45,
171.25 	subdivision 10, is amended to read:
171.26 		Subd. 10.Payments to school nonoperating funds.  Each
171.27 	fiscal year state general fund payments for a district
171.28 	nonoperating fund must be made at 80 percent the current year
171.29 	aid payment percentage of the estimated entitlement during the
171.30 	fiscal year of the entitlement.  This amount shall be paid in 12
171.31 	equal monthly installments.  The amount of the actual
171.32 	entitlement, after adjustment for actual data, minus the
171.33 	payments made during the fiscal year of the entitlement must be
171.34 	paid prior to October 31 of the following school year.  The
171.35 	commissioner may make advance payments of debt service
171.36 	equalization aid for a district's debt service fund earlier than
172.1 	would occur under the preceding schedule if the district submits
172.2 	evidence showing a serious cash flow problem in the fund.  The
172.3 	commissioner may make earlier payments during the year and, if
172.4 	necessary, increase the percent of the entitlement paid to
172.5 	reduce the cash flow problem.
172.6 	
EFFECTIVE DATE. This section is effective for state aid
172.7 	payments for fiscal year 2006.

172.8 	Sec. 7. Minnesota Statutes 2004, section 127A.45,
172.9 	subdivision 14, is amended to read:
172.10 		Subd. 14.Nonpublic aids.  The state shall pay aid
172.11 	according to sections 123B.40 to 123B.48 for pupils attending
172.12 	nonpublic schools as follows:
172.13 	(1) an advance payment by November 30 equal to 80 percent 
172.14 	the current year aid payment percentage of the estimated
172.15 	entitlement for the current fiscal year; and
172.16 	(2) a final payment by October 31 of the following fiscal
172.17 	year, adjusted for actual data.
172.18 	If a payment advance to meet cash flow needs is requested
172.19 	by a district and approved by the commissioner, the state shall
172.20 	pay nonpublic pupil transportation aid according to section
172.21 	123B.92 by October 31.
172.22 	
EFFECTIVE DATE. This section is effective for state aid
172.23 	payments for fiscal year 2006.

172.24 	Sec. 8. Minnesota Statutes 2004, section 127A.45,
172.25 	subdivision 16, is amended to read:
172.26 		Subd. 16.Payments to third parties.  Notwithstanding
172.27 	subdivision 3, 80 percent the current year aid payment
172.28 	percentage of the amounts under section 123A.26, subdivision 3,
172.29 	shall be paid in equal installments on August 30, December 30,
172.30 	and March 30, with a 20 percent final adjustment payment on
172.31 	October 30 of the next fiscal year of the remaining amount.
172.32 	
EFFECTIVE DATE. This section is effective for state aid
172.33 	payments for fiscal year 2006.

172.34 	Sec. 9. FUND TRANSFERS.
 172.35 		Subdivision 1.Lake crystal-wellcome memorial.
 172.36 	Notwithstanding Minnesota Statutes, section 123B.79 or 123B.80,
173.1 	as of June 30, 2005, upon approval of the commissioner of
173.2 	education, Independent School District No. 2071, Lake
173.3 	Crystal-Wellcome Memorial, may permanently transfer up to
173.4 	$133,000 from its reserved account for handicapped access to its
173.5 	undesignated general fund balance.
173.6 		Subd. 2.Rockford. Notwithstanding Minnesota Statutes,
173.7 	sections 123B.79, 123B.80, and 475.61, subdivision 4,
173.8 	Independent School District No. 883, Rockford, as of June 30,
173.9 	2005, may permanently transfer up to $660,000 from its debt
173.10 	redemption fund to the undesignated balance of its general fund
173.11 	without making a levy reduction.
173.12 		Subd. 3.Russell. Notwithstanding Minnesota Statutes,
173.13 	section 123B.79 or 123B.80, as of June 30, 2005, Independent
173.14 	School District No. 418, Russell, may transfer up to $50,000
173.15 	from its reserved capital accounts in its general fund to its
173.16 	undesignated fund balance.
173.17 		Subd. 4.Ruthton. Notwithstanding Minnesota Statutes,
173.18 	section 123B.79 or 123B.80, as of June 30, 2005, Independent
173.19 	School District No. 584, Ruthton, may permanently transfer up to
173.20 	$140,000 from its reserved for operating capital account to the
173.21 	undesignated general fund balance.
173.22 		Subd. 5.Windom. Notwithstanding Minnesota Statutes,
173.23 	section 123B.79 or 123B.80, Independent School District No. 177,
173.24 	Windom, as of June 30, 2005, may permanently transfer up to
173.25 	$270,000 from its reserved for operating capital account to the
173.26 	undesignated balance in its general fund.
173.27 		Subd. 6.Chokio-alberta. Notwithstanding Minnesota
173.28 	Statutes, section 123B.79 or 123B.80, as of June 30, 2005,
173.29 	Independent School District No. 771, Chokio-Alberta, may
173.30 	permanently transfer up to $150,000 from its reserved operating
173.31 	capital account and up to $50,000 from its reserved account for
173.32 	disabled accessibility to the undesignated general fund balance.
173.33 		Subd. 7.Butterfield. Notwithstanding Minnesota
173.34 	Statutes, section 123B.79 or 123B.80, for calendar years 2005
173.35 	through 2007, as of June 30 of each year, Independent School
173.36 	District No. 836, Butterfield, may permanently transfer up to
174.1 	$50,000 from its reserved operating capital account in its
174.2 	general fund to its undesignated general fund balance and
174.3 	$60,000 from its reserved bus purchase account in its general
174.4 	fund to its undesignated general fund balance.  The total amount
174.5 	transferred for the three-year period must not total more than
174.6 	$50,000 from the reserved operating capital account and $60,000
174.7 	from the reserved bus purchase account.
174.8 		Subd. 8.Clinton-graceville-beardsley. Notwithstanding
174.9 	Minnesota Statutes, sections 123B.79, 123B.80, and 475.64,
174.10 	subdivision 4, as of June 30, 2005, Independent School District
174.11 	No. 2888, Clinton-Graceville-Beardsley may permanently transfer
174.12 	up to $244,000 from its reserved for disabled accessibility
174.13 	account to its unrestricted general fund account without making
174.14 	a levy reduction.
174.15 		Subd. 9.Hastings. Notwithstanding Minnesota Statutes,
174.16 	section 123A.27, as of June 30, 2005, Independent School
174.17 	District No. 200, Hastings, may permanently transfer up to
174.18 	$300,000 from its reserved account for instructional services
174.19 	from entities formed for cooperative services for special
174.20 	education and secondary vocational programs in its general fund
174.21 	to its unrestricted general fund account.
174.22 	Subd. 10.[M.A.C.C.R.A.Y.] Notwithstanding Minnesota
174.23 	Statutes, section 123B.79 or 123B.80, upon approval of the
174.24 	commissioner of education, as of June 30, 2005, Independent
174.25 	School District No. 2180, M.A.C.C.R.A.Y., may permanently
174.26 	transfer up to $230,000 from its reserved account for
174.27 	handicapped access to its undesignated general fund balance.
174.28 		Subd. 11.Mcleod west. Notwithstanding Minnesota
174.29 	Statutes, section 123B.79 or 123B.80, on or before June 30,
174.30 	2007, Independent School District No. 2887, McLeod West, may
174.31 	permanently transfer up to $200,000 from its reserved operating
174.32 	capital account in its general fund to the undesignated fund
174.33 	balance.
174.34 		Subd. 12.Win-e-mac. Notwithstanding Minnesota Statutes,
174.35 	section 123B.79 or 123B.80, as of June 30, 2005, Independent
174.36 	School District No. 2609, Win-E-Mac, may permanently transfer up
175.1 	to $87,000 from its reserved account for disabled accessibility
175.2 	to its reserved operating capital account in its general fund.
175.3 	
EFFECTIVE DATE. This section is retroactively effective
175.4 	from June 30, 2005.

175.5 	Sec. 10. DISABLED ACCESS LEVY AUTHORITY; EAST GRAND
175.6 	FORKS.
 175.7 	Notwithstanding the time limits established in Minnesota
175.8 	Statutes, section 123B.58, subdivision 3, Independent School
175.9 	District No. 595, East Grand Forks, may levy its remaining
175.10 	disabled access levy authority over five or fewer years.

175.11 	EFFECTIVE DATE. This section is effective the day
175.12 	following final enactment.

175.13 	Sec. 11. TAX BASE ADJUSTMENTS, FERTILE-BELTRAMI.
 175.14 	(a) Notwithstanding Minnesota Statutes, section 123B.61,
175.15 	the commissioner of education, when making offsetting levy
175.16 	adjustments between levy categories to ensure that each levy
175.17 	category is positive for Independent School District No. 599,
175.18 	Fertile-Beltrami, shall make such adjustments first between levy
175.19 	categories that are imposed on identical tax bases before making
175.20 	such adjustments between levy categories that are imposed on
175.21 	different tax bases.  The commissioner may make offsetting levy
175.22 	adjustments between the general fund and the debt service fund,
175.23 	if necessary.
175.24 	(b) The commissioner of education must make the offsetting
175.25 	levy adjustments according to the process in paragraph (a) until
175.26 	Independent School District No. 599, Fertile-Beltrami's current
175.27 	referendum authority, under Minnesota Statutes, section 126C.17,
175.28 	expires.

175.29 	Sec. 12. NONPROFIT GRANT AND CONTRACT DECISIONS.
 175.30 		Subdivision 1.Payment for continuing services. If a
175.31 	nonprofit corporation has provided services based on an
175.32 	appropriation to a state agency for the fiscal year ending June
175.33 	30, 2005, that names the nonprofit corporation or based on a
175.34 	grant award letter from a state agency to the nonprofit
175.35 	corporation for fiscal year 2005, and the state agency has
175.36 	delayed its final decision on whether to enter into a grant or
176.1 	contract with the same nonprofit corporation to provide
176.2 	essentially the same services for the fiscal year ending June
176.3 	30, 2006, pending enactment of an appropriation to continue
176.4 	paying for the services, then within 30 business days after the
176.5 	effective date of this section, the state agency must:
176.6 	(1) process the grant or contract with the nonprofit
176.7 	corporation; and 
176.8 	(2) issue payment to the nonprofit corporation for services
176.9 	already provided on and after July 1, 2005.
176.10 		Subd. 2.Contracts retroactive. A contract encumbered or
176.11 	a grant awarded by a state agency to a nonprofit corporation
176.12 	before September 1, 2005, for services rendered in the fiscal
176.13 	year ending June 30, 2006, is retroactive from the date that
176.14 	services of the kind covered by the contract or grant were first
176.15 	provided on or after July 1, 2005.
176.16 	
EFFECTIVE DATE. This section is effective the day
176.17 	following final enactment.

176.18 	Sec. 13. REIMBURSEMENT TO LOCAL GOVERNMENTS.
 176.19 	During the fiscal year beginning July 1, 2005, if a county
176.20 	or other local unit of government advances money from its own
176.21 	resources to carry out a program under state law for which it is
176.22 	authorized to spend money received from a state agency, and the
176.23 	advance of local money was made necessary because of a delay in
176.24 	the appropriation of state or federal money, the state agency
176.25 	administering the program must use the state or federal money,
176.26 	when it becomes available, to reimburse the local government for
176.27 	the advance of local money to pay obligations that would
176.28 	otherwise have been paid from the state or federal money.

176.29 	EFFECTIVE DATE. This section is effective the day
176.30 	following final enactment.

176.31 	Sec. 14. CONTRACT RETROACTIVITY.
 176.32 	A contract encumbered or a grant awarded by the
176.33 	commissioner of health, human services, or education before
176.34 	September 1, 2005, and not mandated by section 12 to be made
176.35 	retroactive, may be made retroactive from July 1, 2005.

176.36 	EFFECTIVE DATE. This section is effective the day
177.1 	following final enactment.

177.2 	Sec. 15. CARRYFORWARD.
 177.3 	Notwithstanding Minnesota Statutes, section 16A.28, or
177.4 	other law to the contrary, the unexpended and unencumbered
177.5 	balance of an appropriation from the general fund to a state
177.6 	agency or constitutional officer for operations, but not for
177.7 	grants, for the fiscal year ending June 30, 2005, does not lapse
177.8 	on that date and is available for the fiscal year ending June
177.9 	30, 2006.

177.10 	EFFECTIVE DATE. This section is retroactively effective
177.11 	from June 30, 2005.

177.12 	Sec. 16. LET'S GO FISHING APPROPRIATION.
 177.13 	Notwithstanding Minnesota Statutes, section 297A.94,
177.14 	paragraph (e), clause (1), $325,000 is appropriated from the
177.15 	revenue credited to the game and fish fund under Minnesota
177.16 	Statutes, section 297A.94, paragraph (e), clause (1), to the
177.17 	commissioner of natural resources for a grant to "Let's Go
177.18 	Fishing" of Minnesota to promote opportunities for fishing.  The
177.19 	grant recipient must report back to the commissioner by February
177.20 	1, 2006, on the use and results of the appropriation.  This is a
177.21 	onetime appropriation.

177.22 	EFFECTIVE DATE. This section is effective the day
177.23 	following final enactment.

177.24 	Sec. 17. APPROPRIATIONS.
 177.25 		Subdivision 1.Department of education. The sums
177.26 	indicated in this section are appropriated from the general fund
177.27 	to the Department of Education for the fiscal years designated
177.28 	and include and supersede any amounts appropriated in Laws 2005,
177.29 	First Special Session chapter 2, or authorized by order of
177.30 	Ramsey County District Court in Case No. C9-05-5928.
177.31 		Subd. 2.School lunch. For school lunch aid according to
177.32 	Minnesota Statutes, section 124D.111, and Code of Federal
177.33 	Regulations, title 7, section 210.17:
177.34 	$8,998,000 .....2006 
177.35 	$9,076,000 .....2007 
177.36 		Subd. 3.Traditional school breakfast; kindergarten
178.1 	milk. For traditional school breakfast aid and kindergarten
178.2 	milk under Minnesota Statutes, sections 124D.1158 and 124D.118:
178.3 	$4,878,000 .....2006 
178.4 	$4,968,000 .....2007 
178.5 		Subd. 4.Summer school service replacement aid. For
178.6 	summer food service replacement aid under Minnesota Statutes,
178.7 	section 124D.119:
178.8 	$  150,000 .....2006 
178.9 	$  150,000 .....2007 

178.10 	Sec. 18. EFFECTIVE DATE.
 178.11 	Any section in this article without a specified effective
178.12 	date is retroactively effective from July 1, 2005.

178.13 	ARTICLE 6
178.14 	LIBRARIES

178.15 	Section 1. DEPARTMENT OF EDUCATION; LIBRARY
178.16 	APPROPRIATIONS.
 178.17 		Subdivision 1.Department of education. The sums
178.18 	indicated in this section are appropriated from the general fund
178.19 	to the Department of Education for the fiscal years designated
178.20 	and include and supersede any amounts appropriated in Laws 2005,
178.21 	First Special Session chapter 2, or authorized by order of the
178.22 	Ramsey County District Court in case No. C9-05-5928.
178.23 		Subd. 2.Basic system support. For basic system support
178.24 	grants under Minnesota Statutes, section 134.355:
178.25 	$ 8,570,000 .....2006 
178.26 	$ 8,570,000 .....2007 
178.27 	The 2006 appropriation includes $1,345,000 for 2005 and
178.28 	$7,225,000 for 2006.
178.29 	The 2007 appropriation includes $1,345,000 for 2006 and
178.30 	$7,225,000 for 2007.
178.31 		Subd. 3.Multicounty, multitype library systems. For
178.32 	grants under Minnesota Statutes, sections 134.353 and 134.354,
178.33 	to multicounty, multitype library systems:
178.34 	$  903,000 .....2006 
178.35 	$  903,000 .....2007 
178.36 	The 2006 appropriation includes $141,000 for 2005 and
179.1 	$762,000 for 2006.
179.2 	The 2007 appropriation includes $141,000 for 2006 and
179.3 	$762,000 for 2007.
179.4 		Subd. 4.Electronic library for minnesota. For statewide
179.5 	licenses to online databases selected in cooperation with the
179.6 	Higher Education Services Office for school media centers,
179.7 	public libraries, state government agency libraries, and public
179.8 	or private college or university libraries:
179.9 	$  900,000 .....2006 
179.10 	$  900,000 .....2007 
179.11 	Any balance in the first year does not cancel but is
179.12 	available in the second year.
179.13 		Subd. 5.Regional library telecommunications aid. For
179.14 	regional library telecommunications aid under Minnesota
179.15 	Statutes, section 134.355:
179.16 	$1,200,000 .....2006 
179.17 	$1,200,000 .....2007 
179.18 	The 2006 appropriation includes $188,000 for 2005 and
179.19 	$1,012,000 for 2006.
179.20 	The 2007 appropriation includes $188,000 for 2006 and
179.21 	$1,012,000 for 2007.
179.22 	
EFFECTIVE DATE. This section is retroactively effective
179.23 	from July 1, 2005.

179.24 	ARTICLE 7
179.25 	EARLY CHILDHOOD EDUCATION

179.26 	Section 1. Minnesota Statutes 2004, section 121A.17,
179.27 	subdivision 1, is amended to read:
179.28 		Subdivision 1.Early childhood developmental screening.
 179.29 	Every school board must provide for a mandatory program of early
179.30 	childhood developmental screening for children at least once
179.31 	before school entrance, targeting children who are between 3-1/2 
179.32 	three and four years old.  This screening program must be
179.33 	established either by one board, by two or more boards acting in
179.34 	cooperation, by service cooperatives, by early childhood family
179.35 	education programs, or by other existing programs.  This
179.36 	screening examination is a mandatory requirement for a student
180.1 	to continue attending kindergarten or first grade in a public
180.2 	school.  A child need not submit to developmental screening
180.3 	provided by a board if the child's health records indicate to
180.4 	the board that the child has received comparable developmental
180.5 	screening from a public or private health care organization or
180.6 	individual health care provider. A student identification
180.7 	number, as defined by the commissioner of education, shall be
180.8 	assigned at the time of early childhood developmental screening
180.9 	or at the time of the provision of health records indicating a
180.10 	comparable screening.  Each school district must provide the
180.11 	essential data in accordance with section 125B.07, subdivision
180.12 	6, to the Department of Education.Districts are encouraged to
180.13 	reduce the costs of preschool developmental screening programs
180.14 	by utilizing volunteers and public or private health care
180.15 	organizations or individual health care providers in
180.16 	implementing the program.

180.17 	Sec. 2. Minnesota Statutes 2004, section 121A.17,
180.18 	subdivision 5, is amended to read:
180.19 		Subd. 5.Developmental screening program information.
 180.20 	The board must inform each resident family with a child eligible
180.21 	to participate in the developmental screening program about the
180.22 	availability of the program and the state's requirement that a
180.23 	child receive a developmental screening or provide health
180.24 	records indicating that the child received a comparable
180.25 	developmental screening from a public or private health care
180.26 	organization or individual health care provider not later than
180.27 	30 days after the first day of attending kindergarten in a
180.28 	public school. A school district must inform all resident
180.29 	families with eligible children under age seven that their
180.30 	children may receive a developmental screening conducted either
180.31 	by the school district or by a public or private health care
180.32 	organization or individual health care provider.

180.33 	Sec. 3. Minnesota Statutes 2004, section 121A.19, is
180.34 	amended to read:
180.35 	121A.19 DEVELOPMENTAL SCREENING AID.
180.36 	Each school year, the state must pay a district $40 $50 for
181.1 	each three-year-old child screened; $40 for each four-year-old
181.2 	child screened; and $30 for each five-year-old child screened by
181.3 	the district prior to kindergarten according to the requirements
181.4 	of section 121A.17.  If this amount of aid is insufficient, the
181.5 	district may permanently transfer from the general fund an
181.6 	amount that, when added to the aid, is sufficient.

181.7 	Sec. 4. Minnesota Statutes 2004, section 124D.135,
181.8 	subdivision 1, is amended to read:
181.9 		Subdivision 1.Revenue.  The revenue for early childhood
181.10 	family education programs for a school district equals $120 for
181.11 	fiscal years 2003 and 2004 and $96 for fiscal year 2005 and $104
181.12 	for fiscal year 2006 and later, times the greater of:
181.13 	(1) 150; or
181.14 	(2) the number of people under five years of age residing
181.15 	in the district on October 1 of the previous school year.

181.16 	Sec. 5. Minnesota Statutes 2004, section 124D.135,
181.17 	subdivision 5, is amended to read:
181.18 		Subd. 5.Use of revenue restricted.  Early childhood
181.19 	family education revenue may be used only for early childhood
181.20 	family education programs.  Not more than five percent of early
181.21 	childhood family education revenue, as defined in subdivision 7,
181.22 	may be used to administer early childhood family education
181.23 	programs.

181.24 	Sec. 6. Minnesota Statutes 2004, section 124D.15,
181.25 	subdivision 1, is amended to read:
181.26 		Subdivision 1.Establishment; purpose.  A district or a
181.27 	group of districts may establish a school readiness program
181.28 	for eligible children age three to kindergarten entrance.  The
181.29 	purpose of a school readiness program is to provide all eligible
181.30 	children adequate opportunities to participate in child
181.31 	development programs that enable the children to enter school
181.32 	with the necessary skills and behavior and family stability and
181.33 	support to progress and flourish prepare children to enter
181.34 	kindergarten.

181.35 	Sec. 7. Minnesota Statutes 2004, section 124D.15,
181.36 	subdivision 3, is amended to read:
182.1 		Subd. 3.Program eligibility requirements.  A school
182.2 	readiness program provider must include the following:
182.3 	(1) a comprehensive plan to anticipate and meet the needs
182.4 	of participating families by coordinating existing social
182.5 	services programs and by fostering collaboration among agencies
182.6 	or other community-based organizations and programs that provide
182.7 	a full range of flexible, family-focused services to families
182.8 	with young children assess each child's cognitive skills when
182.9 	the child enters and again before the child leaves the program
182.10 	to inform program planning and promote kindergarten readiness;
182.11 	(2) a development and learning component to help children
182.12 	develop appropriate social, cognitive, and physical skills, and
182.13 	emotional well-being;
182.14 	(3) health referral services to address children's medical,
182.15 	dental, mental health, and nutritional needs provide
182.16 	comprehensive program content based on early childhood research
182.17 	and professional practice that is focused on children's
182.18 	cognitive skills and development and prepares children for the
182.19 	transition to kindergarten;
182.20 	(4) (3) a nutrition component to meet children's daily
182.21 	nutritional needs arrange for early childhood screening and
182.22 	appropriate referral;
182.23 	(5) (4) parents' involvement in meeting children's
182.24 	educational, health, social service, and other needs involve
182.25 	parents in program planning and decision making;
182.26 	(6) (5) community outreach to ensure participation by
182.27 	families who represent the racial, cultural, and economic
182.28 	diversity of the community;coordinate with relevant
182.29 	community-based services; and 
182.30 	(7) (6) community-based staff and program resources,
182.31 	including interpreters, that reflect the racial and ethnic
182.32 	characteristics of the children participating in the program;
182.33 	and 
182.34 	(8) a literacy component to ensure that the literacy needs
182.35 	of parents are addressed through referral to and cooperation 
182.36 	cooperate with adult basic education programs and other adult
183.1 	literacy programs.

183.2 	Sec. 8. Minnesota Statutes 2004, section 124D.15, is
183.3 	amended by adding a subdivision to read:
183.4 		Subd. 3a.Application and reporting requirements. (a) A
183.5 	school readiness program provider must submit a biennial plan
183.6 	for approval by the commissioner before receiving aid under
183.7 	section 124D.16.  The plan must describe how the program meets
183.8 	the program requirements under subdivision 3.  A school district
183.9 	by April 1 must submit the plan for approval by the commissioner
183.10 	in the form and manner prescribed by the commissioner.  One-half
183.11 	the districts must first submit the plan by April 1, 2006, and
183.12 	one-half the districts must first submit the plan by April 1,
183.13 	2007, as determined by the commissioner.
183.14 	(b) Programs receiving school readiness funds annually must
183.15 	submit a report to the department.

183.16 	Sec. 9. Minnesota Statutes 2004, section 124D.15,
183.17 	subdivision 5, is amended to read:
183.18 		Subd. 5.Services with new or existing providers.  A
183.19 	district is encouraged to may contract with a public charter
183.20 	school or nonprofit community-based organization to provide
183.21 	eligible children developmentally appropriate services that meet
183.22 	the program requirements in subdivision 3.  In the alternative,
183.23 	a district may pay tuition or fees to place an eligible child in
183.24 	an existing program.  A district may establish a new program
183.25 	where no existing, reasonably accessible program meets the
183.26 	program requirements in subdivision 3. Districts must submit a
183.27 	copy of each contract to the commissioner with the biennial plan.
183.28 	Services may be provided in a site-based program or in the home
183.29 	of the child or a combination of both.  The district may not
183.30 	restrict participation to district residents.

183.31 	Sec. 10. Minnesota Statutes 2004, section 124D.15,
183.32 	subdivision 10, is amended to read:
183.33 		Subd. 10.Supervision.  A program provided by a board
183.34 	must be supervised by a licensed early childhood teacher, a
183.35 	certified early childhood educator, or a licensed parent
183.36 	educator. A program provided according to a contract between a
184.1 	district and a nonprofit organization or another private
184.2 	organization must be supervised and staffed according to the
184.3 	terms of the contract.

184.4 	Sec. 11. Minnesota Statutes 2004, section 124D.15,
184.5 	subdivision 12, is amended to read:
184.6 		Subd. 12.Program fees.  A district may must adopt a
184.7 	sliding fee schedule based on a family's income but must waive a
184.8 	fee for a participant unable to pay. The fees charged must be
184.9 	designed to enable eligible children of all socioeconomic levels
184.10 	to participate in the program.

184.11 	Sec. 12. Minnesota Statutes 2004, section 124D.15, is
184.12 	amended by adding a subdivision to read:
184.13 		Subd. 14.Assistance. The department must assist
184.14 	districts, upon request, with programs under this section.

184.15 	Sec. 13. Minnesota Statutes 2004, section 124D.16,
184.16 	subdivision 2, is amended to read:
184.17 		Subd. 2.Amount of aid.  (a) A district is eligible to
184.18 	receive school readiness aid for eligible prekindergarten pupils
184.19 	enrolled in a school readiness program under section 124D.15if
184.20 	the program biennial plan required by subdivision 1 section
184.21 	124D.15, subdivision 3a,has been approved by the commissioner.
184.22 	(b) For fiscal year 2002 and thereafter, a district must
184.23 	receive school readiness aid equal to:
184.24 	(1) the number of eligible four-year-old children in the
184.25 	district on October 1 for the previous school year times the
184.26 	ratio of 50 percent of the total school readiness aid for that
184.27 	year to the total number of eligible four-year-old children
184.28 	reported to the commissioner for the previous school year; plus
184.29 	(2) the number of pupils enrolled in the school district
184.30 	from families eligible for the free or reduced school lunch
184.31 	program for the second previous school year times the ratio of
184.32 	50 percent of the total school readiness aid for that year to
184.33 	the total number of pupils in the state from families eligible
184.34 	for the free or reduced school lunch program for the second 
184.35 	previous school year.

184.36 	Sec. 14. Minnesota Statutes 2004, section 124D.16,
185.1 	subdivision 3, is amended to read:
185.2 		Subd. 3.Use of aid.  School readiness aid shall be used
185.3 	only to provide a school readiness program and may be used to
185.4 	provide transportation.  Not more than five percent of the
185.5 	aid program revenue, as defined in subdivision 5,may be used
185.6 	for the cost of administering the program.  Aid must be used to
185.7 	supplement and not supplant local, state, and federal funding.
185.8 	Aid may not be used for instruction and services required under
185.9 	sections 125A.03 to 125A.24 and 125A.65. Aid may not be used to
185.10 	purchase land or construct buildings, but may be used to lease
185.11 	or renovate existing buildings.

185.12 	Sec. 15. [124D.175] MINNESOTA EARLY LEARNING FOUNDATION
185.13 	PROPOSAL.
185.14 	(a) The commissioner must implement an early childhood
185.15 	development grant program for low-income and other challenged
185.16 	families that increases the effectiveness and expands the
185.17 	capacity of public and nonpublic early childhood development
185.18 	programs, which may include child care programs, and leads to
185.19 	improved early childhood parent education and children's
185.20 	kindergarten readiness.  The program must include:
185.21 	(1) grant awards to existing early childhood development
185.22 	program providers that also provide parent education programs
185.23 	and to qualified providers proposing to implement pilot programs
185.24 	for this same purpose;
185.25 	(2) grant awards to enable low-income families to
185.26 	participate in these programs;
185.27 	(3) grant awards to improve overall programmatic quality;
185.28 	and 
185.29 	(4) an evaluation of the programmatic and financial
185.30 	efficacy of all these programs, which may be performed using
185.31 	measures of services, staffing, and management systems that
185.32 	provide consistent information about system performance, show
185.33 	trends, confirm successes, and identify potential problems in
185.34 	early childhood development programs.
185.35 	This grant program must not supplant existing early childhood
185.36 	development programs or child care funds.
186.1 	(b) The commissioner must contract with a private
186.2 	nonprofit, section 501(c)(3) organization to implement the
186.3 	requirements of paragraph (a).  The private nonprofit
186.4 	organization must be governed by a board of directors composed
186.5 	of members from the public and nonpublic sectors, where the
186.6 	nonpublic sector members compose a simple majority of board
186.7 	members and where the public sector members are state and local
186.8 	government officials, kindergarten through grade 12 or
186.9 	postsecondary educators, and early childhood providers appointed
186.10 	by the governor.  Membership on the board of directors by a
186.11 	state agency official are work duties for the official and are
186.12 	not a conflict of interest under section 43A.38.  The board of
186.13 	directors must appoint an executive director and must seek
186.14 	advice from geographically and ethnically diverse parents of
186.15 	young children and representatives of early childhood
186.16 	development providers, kindergarten through grade 12 and
186.17 	postsecondary educators, public libraries, and the business
186.18 	sector.  The board of directors is subject to the open meeting
186.19 	law under chapter 13D.  All other terms and conditions under
186.20 	which board members serve and operate must be described in the
186.21 	articles and bylaws of the organization.  The private nonprofit
186.22 	organization is not a state agency and is not subject to laws
186.23 	governing public agencies except the provisions of chapter 13,
186.24 	salary limits under section 15A.0815, subdivision 2, and audits
186.25 	by the legislative auditor under chapter 3 apply.
186.26 	(c) This section expires June 30, 2011.  If no state
186.27 	appropriation is made for purposes of this section, the
186.28 	commissioner must not implement paragraphs (a) and (b).

186.29 	Sec. 16. Minnesota Statutes 2004, section 179A.03,
186.30 	subdivision 14, as amended by Laws 2005, chapter 125, article 2,
186.31 	section 2, is amended to read:
186.32 		Subd. 14.Public employee or employee. "Public employee"
186.33 	or "employee" means any person appointed or employed by a public
186.34 	employer except:
186.35 	(a) elected public officials;
186.36 	(b) election officers;
187.1 	(c) commissioned or enlisted personnel of the Minnesota
187.2 	National Guard;
187.3 	(d) emergency employees who are employed for emergency work
187.4 	caused by natural disaster;
187.5 	(e) part-time employees whose service does not exceed the
187.6 	lesser of 14 hours per week or 35 percent of the normal work
187.7 	week in the employee's appropriate unit;
187.8 	(f) employees whose positions are basically temporary or
187.9 	seasonal in character and:  (1) are not for more than 67 working
187.10 	days in any calendar year; or (2) are not for more than 100
187.11 	working days in any calendar year and the employees are under
187.12 	the age of 22, are full-time students enrolled in a nonprofit or
187.13 	public educational institution prior to being hired by the
187.14 	employer, and have indicated, either in an application for
187.15 	employment or by being enrolled at an educational institution
187.16 	for the next academic year or term, an intention to continue as
187.17 	students during or after their temporary employment;
187.18 	(g) employees providing services for not more than two
187.19 	consecutive quarters to the Board of Trustees of the Minnesota
187.20 	State Colleges and Universities under the terms of a
187.21 	professional or technical services contract as defined in
187.22 	section 16C.08, subdivision 1;
187.23 	(h) employees of charitable hospitals as defined by section
187.24 	179.35, subdivision 3;
187.25 	(i) full-time undergraduate students employed by the school
187.26 	which they attend under a work-study program or in connection
187.27 	with the receipt of financial aid, irrespective of number of
187.28 	hours of service per week;
187.29 	(j) an individual who is employed for less than 300 hours
187.30 	in a fiscal year as an instructor in an adult vocational
187.31 	education program;
187.32 	(k) an individual hired by the Board of Trustees of the
187.33 	Minnesota State Colleges and Universities to teach one course
187.34 	for three or fewer credits for one semester in a year;
187.35 	(l) with respect to court employees:
187.36 	(1) personal secretaries to judges;
188.1 	(2) law clerks;
188.2 	(3) managerial employees;
188.3 	(4) confidential employees; and
188.4 	(5) supervisory employees;
188.5 	(m) with respect to employees of Hennepin Healthcare
188.6 	System, Inc., managerial, supervisory, and confidential
188.7 	employees.
188.8 	The following individuals are public employees regardless
188.9 	of the exclusions of clauses (e) and (f):
188.10 	(i) An employee hired by a school district or the Board of
188.11 	Trustees of the Minnesota State Colleges and Universities except
188.12 	at the university established in section 136F.13 or for
188.13 	community services or community education instruction offered on
188.14 	a noncredit basis:  (A) to replace an absent teacher or faculty
188.15 	member who is a public employee, where the replacement employee
188.16 	is employed more than 30 working days as a replacement for that
188.17 	teacher or faculty member; or (B) to take a teaching position
188.18 	created due to increased enrollment, curriculum expansion,
188.19 	courses which are a part of the curriculum whether offered
188.20 	annually or not, or other appropriate reasons; and 
188.21 	(ii) An employee hired for a position under clause (f)(1)
188.22 	if that same position has already been filled under clause
188.23 	(f)(1) in the same calendar year and the cumulative number of
188.24 	days worked in that same position by all employees exceeds 67
188.25 	calendar days in that year.  For the purpose of this paragraph,
188.26 	"same position" includes a substantially equivalent position if
188.27 	it is not the same position solely due to a change in the
188.28 	classification or title of the position; and 
188.29 	(iii) an early childhood family education teacher employed
188.30 	by a school district.

188.31 	Sec. 17. GRANTS TO PROMOTE KINDERGARTEN READINESS AND
188.32 	SUPPORT FAMILIES.
 188.33 		Subdivision 1.Administration. The commissioner of
188.34 	education shall award a planning grant for $50,000 to develop a
188.35 	project in Northwest Hennepin County that will promote the
188.36 	school readiness of children by coordinating and collaborating
189.1 	with community-based and neighborhood-based services that help
189.2 	stabilize at-risk families, and that support and assist parents
189.3 	in meeting the health and developmental needs of their children
189.4 	at the earliest possible age.
189.5 		Subd. 2.Program components. (a) Planning projects
189.6 	eligible for grant funding under this section must propose to:
189.7 	(1) collaborate and coordinate delivery of services with
189.8 	community organizations and agencies serving children and their
189.9 	families;
189.10 	(2) target services to families with children with services
189.11 	increasing based on financial needs;
189.12 	(3) build on existing services and coordinate a continuum
189.13 	of essential services, including, but not limited to, health
189.14 	services, family economic assistance, parent education and
189.15 	support, and preschool programs;
189.16 	(4) provide strategic outreach efforts to families using
189.17 	culturally specific social support, information, outreach, and
189.18 	other programs to promote healthy development of children and to
189.19 	help parents obtain the information, resources, and parenting
189.20 	skills needed to nurture and care for their children;
189.21 	(5) offer programs to expand public and private
189.22 	collaboration to promote the development of a coordinated and
189.23 	culturally specific system of services available to all
189.24 	families; and 
189.25 	(6) offer other programs or services to improve the health,
189.26 	development, and school readiness of children in target
189.27 	neighborhoods and communities.
189.28 		Subd. 3.Eligible grantees. An application for a grant
189.29 	may be submitted by a nonprofit organization, or consortium of
189.30 	nonprofit organizations, that demonstrates collaborative effort
189.31 	with at least one unit of local government.
189.32 		Subd. 4.Distribution. To the extent possible, the
189.33 	commissioner shall award a grant to applicants with experience
189.34 	or demonstrated ability in providing comprehensive,
189.35 	multidisciplinary, community-based programs with objectives
189.36 	similar to those listed in subdivision 2, or in providing other
190.1 	human services or social services programs using a
190.2 	multidisciplinary, community-based approach.
190.3 		Subd. 5.Applications. The application must be submitted
190.4 	on forms provided by the commissioner of education.  The grant
190.5 	application must include:
190.6 	(1) a description of the specific community that will be
190.7 	served under the program and the name, address, and a
190.8 	description of each community agency or agencies involved in the
190.9 	planning process;
190.10 	(2) a letter of intent from each community agency
190.11 	identified in clause (1) that indicates the agency's willingness
190.12 	to participate in the program planning; and 
190.13 	(3) a description of how public and private resources,
190.14 	including schools, health care facilities, government agencies,
190.15 	neighborhood organizations, and other resources, will be
190.16 	coordinated in the planning process.
190.17 		Subd. 6.Match. Each dollar of state money must be
190.18 	matched with 50 cents of nonstate money.  A program may match
190.19 	state money with in-kind contributions, including volunteer
190.20 	assistance.
190.21 		Subd. 7.Advisory committee. Each grantee must establish
190.22 	a program advisory board to advise the grantee on program
190.23 	design.  The board must include representatives of local units
190.24 	of government and representatives of the project area who
190.25 	reflect the geographic, cultural, racial, and ethnic diversity
190.26 	of that community.
190.27 	
EFFECTIVE DATE. This section is effective for revenue for
190.28 	fiscal year 2006.

190.29 	Sec. 18. COORDINATION OF EARLY CARE AND EDUCATION
190.30 	PROGRAMS.
 190.31 	(a) The commissioners of education, human services, and
190.32 	health shall identify how they will coordinate activities and
190.33 	resources, with input from local communities and tribal
190.34 	governments, including setting priorities, aligning policies,
190.35 	and leveraging existing resources to achieve the goal for
190.36 	increased school readiness of all Minnesota children.  The
191.1 	commissioners shall report on the progress made, which must
191.2 	include information on:
191.3 	(1) coordinating and disseminating resources and
191.4 	information on school readiness and early care and education,
191.5 	health and nutrition, including child mental health and family
191.6 	support to:
191.7 	(i) parents and families with children birth to age five
191.8 	through key entry points, such as women, infants, and children
191.9 	(WIC), family home visiting, child welfare, public and private
191.10 	health care providers, and other public programs; and 
191.11 	(ii) early care and education providers, public and private
191.12 	health care providers, foster care providers, temporary care
191.13 	providers, shelters, crisis nurseries, and other facilities
191.14 	providing long-term or temporary care for young children, birth
191.15 	to age five;
191.16 	(2) supporting families, schools, and communities in
191.17 	facilitating the transition of young children into the
191.18 	kindergarten environment;
191.19 	(3) identifying, coordinating, and sharing resources and
191.20 	strategies between state departments that address the cultural
191.21 	and linguistic needs of families served;
191.22 	(4) amending the state Medicaid plan to expand the use of
191.23 	the child and teen checkup funding for allowable child
191.24 	development services, such as outreach for early childhood
191.25 	screening, and streamlining the process for voluntary
191.26 	certification of school districts as child and teen checkup
191.27 	providers; and 
191.28 	(5) referring children ages three to five in the child
191.29 	welfare system to the Interagency Early Intervention System for
191.30 	a developmental screening and referral to services if problems
191.31 	are identified.
191.32 	(b) The commissioners shall report to the senate and house
191.33 	of representatives committees having jurisdiction over early
191.34 	care and education by March 1, 2006.

191.35 	Sec. 19. MELF PROGRESS REPORT.
 191.36 	Consistent with Minnesota Statutes, section 124D.175, the
192.1 	private nonprofit organization under contract with the
192.2 	commissioner of education must submit to the education policy
192.3 	and finance committees of the legislature by February 1, 2008,
192.4 	an interim progress report evaluating the programmatic and
192.5 	financial efficacy of the programs receiving grant awards.

192.6 	Sec. 20. APPROPRIATIONS.
 192.7 		Subdivision 1.Department of education. The sums
192.8 	indicated in this section are appropriated from the general fund
192.9 	to the Department of Education for the fiscal years designated
192.10 	and include and supersede any amounts appropriated in Laws 2005,
192.11 	First Special Session chapter 2 or authorized by order of the
192.12 	Ramsey County District Court in Case No. C9-05-5928.
192.13 		Subd. 2.School readiness. For revenue for school
192.14 	readiness programs under Minnesota Statutes, sections 124D.15
192.15 	and 124D.16:
192.16 	$9,020,000 .....2006 
192.17 	$9,042,000 .....2007 
192.18 	The 2006 appropriation includes $1,417,000 for 2005 and
192.19 	$7,603,000 for 2006.
192.20 	The 2007 appropriation includes $1,415,000 for 2006 and
192.21 	$7,627,000 for 2007.
192.22 		Subd. 3.Early childhood family education aid. For early
192.23 	childhood family education aid under Minnesota Statutes, section
192.24 	124D.135:
192.25 	$14,356,000 .....2006 
192.26 	$15,137,000 .....2007 
192.27 	The 2006 appropriation includes $1,861,000 for 2005 and
192.28 	$12,495,000 for 2006.
192.29 	The 2007 appropriation includes $2,327,000 for 2006 and
192.30 	$12,810,000 for 2007.
192.31 		Subd. 4.Health and developmental screening aid. For
192.32 	health and developmental screening aid under Minnesota Statutes,
192.33 	sections 121A.17 and 121A.19:
192.34 	$3,076,000 .....2006 
192.35 	$3,511,000 .....2007 
192.36 	The 2006 appropriation includes $417,000 for 2005 and
193.1 	$2,659,000 for 2006.
193.2 	The 2007 appropriation includes $494,000 for 2006 and
193.3 	$3,017,000 for 2007.
193.4 		Subd. 5.Head start program. For Head Start programs
193.5 	under Minnesota Statutes, section 119A.52:
193.6 	$19,100,000 .....2006 
193.7 	$19,100,000 .....2007 
193.8 		Subd. 6.Minnesota early learning foundation. For the
193.9 	purposes of Minnesota Statutes, section 124D.175:
193.10 	$ 1,000,000 .....2006 
193.11 	This is a onetime appropriation.  Any balance in the first
193.12 	year does not cancel but is available in the second year.
193.13 		Subd. 7.Kindergarten readiness and family support. For
193.14 	grants to promote kindergarten readiness and support families
193.15 	under section 26:
193.16 	$    50,000 .....2006 
193.17 	This appropriation is available until June 30, 2007.

193.18 	Sec. 21. REPEALER.
 193.19 	(a) Minnesota Statutes 2004, sections 124D.15, subdivisions
193.20 	2, 4, 6, 7, 8, 9, 11, and 13; and 124D.16, subdivision 4, are
193.21 	repealed retroactively effective from July 1, 2005.
193.22 	(b) Minnesota Statutes 2004, section 124D.16, subdivision
193.23 	1, is repealed effective July 1, 2006.

193.24 	EFFECTIVE DATE. This section is retroactively effective
193.25 	from July 1, 2005.

193.26 	Sec. 22. EFFECTIVE DATE.
 193.27 	Any section in this article without a specified effective
193.28 	date is retroactively effective from July 1, 2005.

193.29 	ARTICLE 8
193.30 	PREVENTION

193.31 	Section 1. Minnesota Statutes 2004, section 119A.46,
193.32 	subdivision 1, is amended to read:
193.33 		Subdivision 1.Definitions.  (a) The definitions in
193.34 	section 144.9501 and in this subdivision apply to this section.
193.35 	(b) "Eligible organization" means a lead contractor, city,
193.36 	board of health, community health department, community action
194.1 	agency as defined in section 119A.374, or community development
194.2 	corporation.
194.3 	(c) "Commissioner" means the commissioner of education 
194.4 	health, or the commissioner of the Minnesota Housing Finance
194.5 	Agency as authorized by section 462A.05, subdivision 15c.

194.6 	Sec. 2. Minnesota Statutes 2004, section 119A.46,
194.7 	subdivision 2, is amended to read:
194.8 		Subd. 2.Grants; administration.  Within the limits of
194.9 	the available appropriation, the commissioner must develop a
194.10 	swab team services program which may make demonstration and
194.11 	training grants to eligible organizations to train workers to
194.12 	provide swab team services and swab team services for
194.13 	residential property.  Grants may be awarded to nonprofit
194.14 	organizations to provide technical assistance and training to
194.15 	ensure quality and consistency within the statewide program.
194.16 	Grants must be awarded to help ensure full-time employment to
194.17 	workers providing swab team services and must be awarded for a
194.18 	two-year period.
194.19 	Grants awarded under this section must be made in
194.20 	consultation with the commissioners of the Department of Health
194.21 	and commissioner of the Housing Finance Agency,and
194.22 	representatives of neighborhood groups from areas at high risk
194.23 	for toxic lead exposure, a labor organization, the lead
194.24 	coalition, community action agencies, and the legal aid
194.25 	society.  The consulting team must review grant applications and
194.26 	recommend awards to eligible organizations that meet
194.27 	requirements for receiving a grant under this section.

194.28 	Sec. 3. Minnesota Statutes 2004, section 119A.46,
194.29 	subdivision 3, is amended to read:
194.30 		Subd. 3.Applicants.  (a) Interested eligible
194.31 	organizations may apply to the commissioner for grants under
194.32 	this section.  Two or more eligible organizations may jointly
194.33 	apply for a grant.  Priority shall be given to community action
194.34 	agencies in greater Minnesota and to either community action
194.35 	agencies or neighborhood based nonprofit organizations in cities
194.36 	of the first class.  Of the total annual appropriation, 12.5
195.1 	percent may be used for administrative purposes.  The
195.2 	commissioner may deviate from this percentage if a grantee can
195.3 	justify the need for a larger administrative allowance.  Of this
195.4 	amount, up to five percent may be used by the commissioner for
195.5 	state administrative purposes.  Applications must provide
195.6 	information requested by the commissioner, including at least
195.7 	the information required to assess the factors listed in
195.8 	paragraph (d).
195.9 	(b) The commissioner must coordinate with the commissioner
195.10 	of health who must consult with boards of health to provide swab
195.11 	team services for purposes of secondary prevention.  The
195.12 	priority for swab teams created by grants to eligible
195.13 	organizations under this section must be work assigned by the
195.14 	commissioner of health, or by a board of health if so designated
195.15 	by the commissioner of health, to provide secondary prevention
195.16 	swab team services to fulfill the requirements of section
195.17 	144.9504, subdivision 6, in response to a lead order.  Swab
195.18 	teams assigned work under this section by the commissioner, that
195.19 	are not engaged daily in fulfilling the requirements of section
195.20 	144.9504, subdivision 6, must deliver swab team services in
195.21 	response to elevated blood lead levels as defined in section
195.22 	144.9501, subdivision 9, where lead orders were not issued, and
195.23 	for purposes of primary prevention in census tracts known to be
195.24 	in areas at high risk for toxic lead exposure as described in
195.25 	section 144.9503, subdivision 2.
195.26 	(c) Any additional money must be used for grants to
195.27 	establish swab teams for primary prevention under section
195.28 	144.9503, in census tracts in areas at high risk for toxic lead
195.29 	exposure as determined under section 144.9503, subdivision 2.
195.30 	(d) In evaluating grant applications, the commissioner must
195.31 	consider the following criteria:
195.32 	(1) the use of lead contractors and lead workers for
195.33 	residential swab team services;
195.34 	(2) the participation of neighborhood groups and
195.35 	individuals, as swab team workers, in areas at high risk for
195.36 	toxic lead exposure;
196.1 	(3) plans for the provision of swab team services for
196.2 	primary and secondary prevention as required under subdivision
196.3 	4;
196.4 	(4) plans for supervision, training, career development,
196.5 	and postprogram placement of swab team members;
196.6 	(5) plans for resident and property owner education on lead
196.7 	safety;
196.8 	(6) plans for distributing cleaning supplies to area
196.9 	residents and educating residents and property owners on
196.10 	cleaning techniques;
196.11 	(7) sources of other funding and cost estimates for
196.12 	training, lead inspections, swab team services, equipment,
196.13 	monitoring, testing, and administration;
196.14 	(8) measures of program effectiveness;
196.15 	(9) coordination of program activities with other federal,
196.16 	state, and local public health, job training, apprenticeship,
196.17 	and housing renovation programs including programs under
196.18 	sections 116L.86 to 116L.881; and
196.19 	(10) prior experience in providing swab team services.

196.20 	Sec. 4. Minnesota Statutes 2004, section 119A.46,
196.21 	subdivision 8, is amended to read:
196.22 		Subd. 8.Testing and evaluation.  (a) Testing of the
196.23 	environment is not necessary by swab teams whose work is
196.24 	assigned by the commissioner of health or a designated board of
196.25 	health under section 144.9504.  The commissioner of health or
196.26 	designated board of health must share the analytical testing
196.27 	data collected on each residence for purposes of secondary
196.28 	prevention under section 144.9504 with the swab team workers in
196.29 	order to provide constructive feedback on their work and to the
196.30 	commissioner for the purposes set forth in paragraph (c).
196.31 	(b) For purposes of primary prevention evaluation, the
196.32 	following samples must be collected:  pretesting and posttesting
196.33 	of one noncarpeted floor dust lead sample and a notation of the
196.34 	extent and location of bare soil and of deteriorated lead-based
196.35 	paint.  The analytical testing data collected on each residence
196.36 	for purposes of primary prevention under section 144.9503 must
197.1 	be shared with the swab team workers in order to provide
197.2 	constructive feedback on their work and to the commissioner for
197.3 	the purposes set forth in paragraph (c).
197.4 	(c) The commissioner of health must establish a program in
197.5 	cooperation with the commissioner to collect appropriate data as
197.6 	required under paragraphs (a) and (b), in order to conduct an
197.7 	ongoing evaluation of swab team services for primary and
197.8 	secondary prevention.  Within the limits of available
197.9 	appropriations, the commissioner of health must conduct or
197.10 	contract with the commissioner,on up to 1,000 residences which
197.11 	have received primary or secondary prevention swab team
197.12 	services, a postremediation evaluation, on at least a quarterly
197.13 	basis for a period of at least two years for each residence.
197.14 	The evaluation must note the condition of the paint within the
197.15 	residence, the extent of bare soil on the grounds, and collect
197.16 	and analyze one noncarpeted floor dust lead sample.  The data
197.17 	collected must be evaluated to determine the efficacy of
197.18 	providing swab team services as a method of reducing lead
197.19 	exposure in young children.  In evaluating this data, the
197.20 	commissioner of health must consider city size, community
197.21 	location, historic traffic flow, soil lead level of the property
197.22 	by area or census tract, distance to industrial point sources
197.23 	that emit lead, season of the year, age of the housing, age and
197.24 	number of children living at the residence, the presence of pets
197.25 	that move in and out of the residence, and other relevant
197.26 	factors as the commissioner of health may determine.

197.27 	Sec. 5. Minnesota Statutes 2004, section 124D.20,
197.28 	subdivision 3, is amended to read:
197.29 		Subd. 3.General community education revenue.  The
197.30 	general community education revenue for a district equals $5.95
197.31 	for fiscal year 2003 and 2004 and $5.23 for fiscal year years 
197.32 	2005 and 2006 and $5.42 for fiscal year 2007 and later, times
197.33 	the greater of 1,335 or the population of the district.  The
197.34 	population of the district is determined according to section
197.35 	275.14.
197.36 	
EFFECTIVE DATE. This section is effective for revenue for
198.1 	fiscal year 2007.

198.2 	Sec. 6. Minnesota Statutes 2004, section 124D.20,
198.3 	subdivision 5, is amended to read:
198.4 		Subd. 5.Total community education levy.  To obtain total
198.5 	community education revenue, a district may levy the amount
198.6 	raised by a maximum tax rate of.985 .9 percent times the
198.7 	adjusted net tax capacity of the district.  If the amount of the
198.8 	total community education levy would exceed the total community
198.9 	education revenue, the total community education levy shall be
198.10 	determined according to subdivision 6.
198.11 	
EFFECTIVE DATE. This section is effective for revenue for
198.12 	fiscal year 2007.

198.13 	Sec. 7. REVISOR'S INSTRUCTION.
 198.14 	In the next edition of Minnesota Statutes, the revisor of
198.15 	statutes shall renumber Minnesota Statutes, section 119A.46, as
198.16 	section 144.9512 and make necessary cross-reference changes.

198.17 	Sec. 8. APPROPRIATION.
 198.18 		Subdivision 1.Department of education. The sums
198.19 	indicated in this section are appropriated from the general fund
198.20 	to the Department of Education for the fiscal years designated
198.21 	and include and supersede any amounts appropriated in Laws 2005,
198.22 	First Special Session chapter 2, or authorized by order of the
198.23 	Ramsey County District Court in case number C9-05-5928.
198.24 		Subd. 2.Community education aid. For community
198.25 	education aid under Minnesota Statutes, section 124D.20:
198.26 	$1,918,000 .....2006 
198.27 	$1,837,000 .....2007 
198.28 	The 2006 appropriation includes $390,000 for 2005 and
198.29 	$1,528,000 for 2006.
198.30 	The 2007 appropriation includes $284,000 for 2006 and
198.31 	$1,553,000 for 2007.
198.32 		Subd. 3.Adults with disabilities program aid. For
198.33 	adults with disabilities programs under Minnesota Statutes,
198.34 	section 124D.56:
198.35 	$  710,000 .....2006 
198.36 	$  710,000 .....2007 
199.1 	The 2006 appropriation includes $111,000 for 2005 and
199.2 	$599,000 for 2006.
199.3 	The 2007 appropriation includes $111,000 for 2006 and
199.4 	$599,000 for 2007.
199.5 		Subd. 4.Hearing-impaired adults. For programs for
199.6 	hearing-impaired adults under Minnesota Statutes, section
199.7 	124D.57:
199.8 	$   70,000 .....2006 
199.9 	$   70,000 .....2007 
199.10 		Subd. 5.School-age care revenue. For extended day aid
199.11 	under Minnesota Statutes, section 124D.22:
199.12 	$   17,000 .....2006 
199.13 	$    7,000 .....2007 
199.14 	The 2006 appropriation includes $4,000 for 2005 and $13,000
199.15 	for 2006.
199.16 	The 2007 appropriation includes $2,000 for 2006 and $5,000
199.17 	for 2007.

199.18 	Sec. 9. EFFECTIVE DATE.
 199.19 	Any section in this article without a specified effective
199.20 	date is retroactively effective from July 1, 2005.

199.21 	ARTICLE 9
199.22 	SELF-SUFFICIENCY AND LIFELONG LEARNING

199.23 	Section 1. Minnesota Statutes 2004, section 124D.52,
199.24 	subdivision 3, is amended to read:
199.25 		Subd. 3.Accounts; revenue; aid.  (a) Each district,
199.26 	group of districts, or private nonprofit organization providing
199.27 	adult basic education programs must establish and maintain a
199.28 	reserve account within the community service fund for the
199.29 	receipt and disbursement of all funds related to these
199.30 	programs.  All revenue received pursuant to this section must be
199.31 	utilized solely for the purposes of adult basic education
199.32 	programs.  State aid must not equal more than 100 percent of the
199.33 	unreimbursed expenses of providing these programs, excluding
199.34 	in-kind costs.
199.35 	(b) For purposes of paragraph (a), an adult basic education
199.36 	program may include as valid expenditures for the previous
200.1 	fiscal year program spending that occurs from July 1 to
200.2 	September 30 of the following year.  A program may carry over a
200.3 	maximum of 20 percent of its adult basic education aid revenue
200.4 	into the next fiscal year.  Program spending may only be counted
200.5 	for one fiscal year.
200.6 	(c) Notwithstanding section 123A.26 or any other law to the
200.7 	contrary, an adult basic education consortium providing an
200.8 	approved adult basic education program may be its own fiscal
200.9 	agent and is eligible to receive state-aid payments directly
200.10 	from the commissioner.

200.11 	Sec. 2. Minnesota Statutes 2004, section 124D.531,
200.12 	subdivision 1, is amended to read:
200.13 		Subdivision 1.State total adult basic education aid.
 200.14 	(a) The state total adult basic education aid for fiscal year
200.15 	2004 equals $34,388,000.  The state total adult basic education
200.16 	aid for fiscal year 2005 and later is $36,509,000. The state
200.17 	total adult basic education aid for fiscal year 2006 and later
200.18 	is $36,509,000 plus any amount that is not paid for during the
200.19 	previous fiscal year, as a result of adjustments under
200.20 	subdivision 4, paragraph (a), or section 124D.52, subdivision
200.21 	3.Beginning in fiscal year 2002, two percent of the state
200.22 	total adult basic education aid must be set aside for adult
200.23 	basic education supplemental service grants under section
200.24 	124D.522.
200.25 	(b) The state total adult basic education aid, excluding
200.26 	basic population aid, equals the difference between the amount
200.27 	computed in paragraph (a), and the state total basic population
200.28 	aid under subdivision 2.
200.29 	
EFFECTIVE DATE. This section is effective the day
200.30 	following final enactment and applies to revenue distributions
200.31 	for fiscal year 2006.

200.32 	Sec. 3. Minnesota Statutes 2004, section 124D.531,
200.33 	subdivision 4, is amended to read:
200.34 		Subd. 4.Adult basic education program aid limit.  (a)
200.35 	Notwithstanding subdivisions 2 and 3, the total adult basic
200.36 	education aid for a program per prior year contact hour must not
201.1 	exceed $21 per prior year contact hour computed under
201.2 	subdivision 3, clause (2).
201.3 	(b) For fiscal year 2004, the aid for a program under
201.4 	subdivision 3, clause (2), adjusted for changes in program
201.5 	membership, must not exceed the aid for that program under
201.6 	subdivision 3, clause (2), for fiscal year 2003 by more than the
201.7 	greater of eight percent or $10,000.
201.8 	(c) For fiscal year 2005, the aid for a program under
201.9 	subdivision 3, clause (2), adjusted for changes in program
201.10 	membership, must not exceed the sum of the aid for that program
201.11 	under subdivision 3, clause (2), and Laws 2003, First Special
201.12 	Session chapter 9, article 9, section 8, paragraph (a), for the
201.13 	preceding fiscal year by more than the greater of eight percent
201.14 	or $10,000.
201.15 	(d) For fiscal year 2006 and later, the aid for a program
201.16 	under subdivision 3, clause (2), adjusted for changes in program
201.17 	membership, must not exceed the aid for that program under
201.18 	subdivision 3, clause (2), for the first preceding fiscal year
201.19 	by more than the greater of eight percent or $10,000.
201.20 	(e) Adult basic education aid is payable to a program for
201.21 	unreimbursed costs occurring in the program year as defined in
201.22 	section 124D.52, subdivision 3.
201.23 	(f) Any adult basic education aid that is not paid to a
201.24 	program because of the program aid limitation under paragraph
201.25 	(a) must be added to the state total adult basic education aid
201.26 	for the next fiscal year under subdivision 1.  Any adult basic
201.27 	education aid that is not paid to a program because of the
201.28 	program aid limitations under paragraph (b), (c), or (d), must
201.29 	be reallocated among programs by adjusting the rate per contact
201.30 	hour under subdivision 3, clause (2).
201.31 	
EFFECTIVE DATE. This section is effective the day
201.32 	following final enactment and applies to revenue distributions
201.33 	for fiscal year 2006.

201.34 	Sec. 4. APPROPRIATIONS.
 201.35 		Subdivision 1.Department of education. The sums
201.36 	indicated in this section are appropriated from the general fund
202.1 	to the Department of Education for the fiscal years designated
202.2 	and include and supersede any amounts appropriated in Laws 2005,
202.3 	First Special Session chapter 2, or authorized by order of the
202.4 	Ramsey County District Court in Case No. C9-05-5928.
202.5 		Subd. 2.Adult basic education aid. For adult basic
202.6 	education aid under Minnesota Statutes:
202.7 	$36,518,000 .....2006 
202.8 	$36,540,000 .....2007 
202.9 	The 2006 appropriation includes $5,707,000 for 2005 and
202.10 	$30,811,000 for 2006.
202.11 	The 2007 appropriation includes $5,737,000 for 2006 and
202.12 	$30,803,000 for 2007.
202.13 		Subd. 3.Ged tests. For payment of 60 percent of the
202.14 	costs of GED tests under Laws 1993, chapter 224, article 4,
202.15 	section 44, subdivision 10:
202.16 	$  125,000 .....2006 
202.17 	$  125,000 .....2007 
202.18 		Subd. 4.Lead hazard reduction. For lead hazard
202.19 	reduction under Minnesota Statutes, section 119A.46:
202.20 	$  100,000 .....2006 
202.21 	$  100,000 .....2007 
202.22 	The commissioner of education may transfer this
202.23 	appropriation to the commissioner of health.

202.24 	Sec. 5. EFFECTIVE DATE.
 202.25 	Any section in this article without a specified effective
202.26 	date is retroactively effective from July 1, 2005.

202.27 	ARTICLE 10
202.28 	STATE AGENCIES

202.29 	Section 1. Minnesota Statutes 2004, section 122A.40,
202.30 	subdivision 5, as amended by Laws 2005, chapter 36, section 1,
202.31 	is amended to read:
202.32 		Subd. 5.Probationary period. (a) The first three
202.33 	consecutive years of a teacher's first teaching experience in
202.34 	Minnesota in a single district is deemed to be a probationary
202.35 	period of employment, and after completion thereof, the
202.36 	probationary period in each district in which the teacher is
203.1 	thereafter employed shall be one year.  The school board must
203.2 	adopt a plan for written evaluation of teachers during the
203.3 	probationary period.  Evaluation must occur at least three times
203.4 	each year for a teacher performing services on 120 or more
203.5 	school days, at least two times each year for a teacher
203.6 	performing services on 60 to 119 school days, and at least one
203.7 	time each year for a teacher performing services on fewer than
203.8 	60 school days.  Days devoted to parent-teacher conferences,
203.9 	teachers' workshops, and other staff development opportunities
203.10 	and days on which a teacher is absent from school must not be
203.11 	included in determining the number of school days on which a
203.12 	teacher performs services.  Except as otherwise provided in
203.13 	paragraph (b), during the probationary period any annual
203.14 	contract with any teacher may or may not be renewed as the
203.15 	school board shall see fit.  However, the board must give any
203.16 	such teacher whose contract it declines to renew for the
203.17 	following school year written notice to that effect before July
203.18 	1.  If the teacher requests reasons for any nonrenewal of a
203.19 	teaching contract, the board must give the teacher its reason in
203.20 	writing, including a statement that appropriate supervision was
203.21 	furnished describing the nature and the extent of such
203.22 	supervision furnished the teacher during the employment by the
203.23 	board, within ten days after receiving such request.  The school
203.24 	board may, after a hearing held upon due notice, discharge a
203.25 	teacher during the probationary period for cause, effective
203.26 	immediately, under section 122A.44.
203.27 	(b) A board must discharge a probationary teacher,
203.28 	effective immediately, upon receipt of notice under section
203.29 	122A.20, subdivision 1, paragraph (b), that the teacher's
203.30 	license has been revoked due to a conviction for child abuse or
203.31 	sexual abuse.
203.32 	(c) A probationary teacher whose first three years of
203.33 	consecutive employment are interrupted for active military
203.34 	service and who promptly resumes teaching consistent with
203.35 	federal reemployment timelines for uniformed service personnel
203.36 	under United States Code, title 38, section 4312(e), is
204.1 	considered to have a consecutive teaching experience for
204.2 	purposes of paragraph (a).
204.3 	(d) A probationary teacher must complete at least 60 days
204.4 	of teaching service each year during the probationary period.
204.5 	Days devoted to parent-teacher conferences, teachers' workshops,
204.6 	and other staff development opportunities and days on which a
204.7 	teacher is absent from school do not count as days of teaching
204.8 	service under this paragraph.

204.9 	Sec. 2. Minnesota Statutes 2004, section 122A.41,
204.10 	subdivision 2, as amended by Laws 2005, chapter 36, section 2,
204.11 	is amended to read:
204.12 		Subd. 2.Probationary period; discharge or demotion. (a)
204.13 	All teachers in the public schools in cities of the first class
204.14 	during the first three years of consecutive employment shall be
204.15 	deemed to be in a probationary period of employment during which
204.16 	period any annual contract with any teacher may, or may not, be
204.17 	renewed as the school board, after consulting with the peer
204.18 	review committee charged with evaluating the probationary
204.19 	teachers under subdivision 3, shall see fit.  The school site
204.20 	management team or the school board if there is no school site
204.21 	management team, shall adopt a plan for a written evaluation of
204.22 	teachers during the probationary period according to subdivision
204.23 	3.  Evaluation by the peer review committee charged with
204.24 	evaluating probationary teachers under subdivision 3 shall occur
204.25 	at least three times each year for a teacher performing services
204.26 	on 120 or more school days, at least two times each year for a
204.27 	teacher performing services on 60 to 119 school days, and at
204.28 	least one time each year for a teacher performing services on
204.29 	fewer than 60 school days.  Days devoted to parent-teacher
204.30 	conferences, teachers' workshops, and other staff development
204.31 	opportunities and days on which a teacher is absent from school
204.32 	shall not be included in determining the number of school days
204.33 	on which a teacher performs services.  The school board may,
204.34 	during such probationary period, discharge or demote a teacher
204.35 	for any of the causes as specified in this code.  A written
204.36 	statement of the cause of such discharge or demotion shall be
205.1 	given to the teacher by the school board at least 30 days before
205.2 	such removal or demotion shall become effective, and the teacher
205.3 	so notified shall have no right of appeal therefrom.
205.4 	(b) A probationary teacher whose first three years of
205.5 	consecutive employment are interrupted for active military
205.6 	service and who promptly resumes teaching consistent with
205.7 	federal reemployment timelines for uniformed service personnel
205.8 	under United States Code, title 38, section 4312(e), is
205.9 	considered to have a consecutive teaching experience for
205.10 	purposes of paragraph (a).
205.11 	(c) A probationary teacher must complete at least 60 days
205.12 	of teaching service each year during the probationary period.
205.13 	Days devoted to parent-teacher conferences, teachers' workshops,
205.14 	and other staff development opportunities and days on which a
205.15 	teacher is absent from school do not count as days of teaching
205.16 	service under this paragraph.

205.17 	Sec. 3. BOARD OF TEACHING REPORT.
 205.18 	By January 16, 2006, the Board of Teaching, in consultation
205.19 	with the Department of Education and other education
205.20 	stakeholders, must prepare and submit to the house of
205.21 	representatives and senate committees having jurisdiction over
205.22 	kindergarten through grade 12 education policy and finance:
205.23 	(1) proposed licensure requirements for teachers of
205.24 	interdisciplinary curriculum to facilitate learning in
205.25 	state-approved innovative schools and programs; and 
205.26 	(2) recommendations for accommodating the needs for
205.27 	appropriately licensed teachers in charter, alternative, small,
205.28 	and rural schools.

205.29 	Sec. 4. LICENSED STUDENT SUPPORT SERVICES.
 205.30 		Subdivision 1.Access to services. School districts and
205.31 	the Department of Education shall work to provide for students'
205.32 	educational achievement, to provide for student safety, and to
205.33 	enhance student physical, emotional, and social well-being by
205.34 	providing access to licensed student support services, such as
205.35 	licensed school nurses, licensed school counselors, licensed
205.36 	school social workers, licensed alcohol and drug abuse
206.1 	counselors, and licensed school psychologists.
206.2 		Subd. 2.Funding. School districts and the Department of
206.3 	Education shall explore opportunities for obtaining additional
206.4 	funds to improve students' access to needed licensed student
206.5 	support services including, at least, medical assistance
206.6 	reimbursements, local collaborative time study funds, federal
206.7 	funds, public health funds, and specifically designated funds.
206.8 		Subd. 3.Improving access. School districts and the
206.9 	Department of Education must consider nationally recommended
206.10 	licensed staff-to-student ratios, work loads, and best practices
206.11 	when working to improve student access to needed licensed
206.12 	student support services.

206.13 	Sec. 5. APPROPRIATIONS; DEPARTMENT OF EDUCATION.
 206.14 		Subdivision 1.Department of education. Unless otherwise
206.15 	indicated, the sums indicated in this section are appropriated
206.16 	from the general fund to the Department of Education for the
206.17 	fiscal years designated and include and supersede any amounts
206.18 	appropriated in Laws 2005, First Special Session chapter 2, or
206.19 	authorized by order of the Ramsey County District Court in case
206.20 	No. C9-05-5928.
206.21 		Subd. 2.Department. (a) For the Department of Education:
206.22 	$21,997,000 .....2006 
206.23 	$22,847,000 .....2007 
206.24 	Any balance in the first year does not cancel but is
206.25 	available in the second year.
206.26 	(b) $260,000 each year is for the Minnesota Children's
206.27 	Museum.
206.28 	(c) $41,000 each year is for the Minnesota Academy of
206.29 	Science.
206.30 	(d) $605,000 each year is for the Board of Teaching.
206.31 	(e) $160,000 each year is for the Board of School
206.32 	Administrators.
206.33 	(f) $300,000 in fiscal year 2006 and $1,150,000 in fiscal
206.34 	year 2007 are for the value-added index assessment model.
206.35 	(g) The expenditures of federal grants and aids as shown in
206.36 	the biennial budget document and its supplements are approved
207.1 	and appropriated and shall be spent as indicated.

207.2 	Sec. 6. APPROPRIATIONS; MINNESOTA STATE ACADEMIES.
 207.3 	The sums indicated in this section are appropriated from
207.4 	the general fund to the Minnesota State Academies for the Deaf
207.5 	and the Blind for the fiscal years designated and include and
207.6 	supersede any amounts appropriated in Laws 2005, First Special
207.7 	Session chapter 2, or authorized by order of the Ramsey County
207.8 	District Court in case No. C9-05-5928:
207.9 	$10,966,000 .....2006 
207.10 	$10,966,000 .....2007 
207.11 	Any balance in the first year does not cancel but is
207.12 	available in the second year.

207.13 	Sec. 7. APPROPRIATIONS; PERPICH CENTER FOR ARTS
207.14 	EDUCATION.
 207.15 	The sums indicated in this section are appropriated from
207.16 	the general fund to the Perpich Center for Arts Education for
207.17 	the fiscal years designated and include and supersede any
207.18 	amounts appropriated in Laws 2005, First Special Session chapter
207.19 	2, or authorized by order of the Ramsey County District Court in
207.20 	case No. C9-05-5928:
207.21 	$6,623,000 .....2006 
207.22 	$6,623,000 .....2007 
207.23 	Any balance in the first year does not cancel but is
207.24 	available in the second year.

207.25 	Sec. 8. EFFECTIVE DATE.
 207.26 	Sections 1 to 7 are retroactively effective from July 1,
207.27 	2005.

207.28 	ARTICLE 11
207.29 	TECHNICAL AND CONFORMING AMENDMENTS

207.30 	Section 1. Minnesota Statutes 2004, section 120B.31,
207.31 	subdivision 4, is amended to read:
207.32 		Subd. 4.Statistical adjustments.  In developing policies
207.33 	and assessment processes to hold schools and districts
207.34 	accountable for high levels of academic standards, including the
207.35 	profile of learning under section 120B.021, the commissioner
207.36 	shall aggregate student data over time to report student
208.1 	performance levels measured at the school district, regional, or
208.2 	statewide level.  When collecting and reporting the data, the
208.3 	commissioner shall:  (1) acknowledge the impact of significant
208.4 	demographic factors such as residential instability, the number
208.5 	of single parent families, parents' level of education, and
208.6 	parents' income level on school outcomes; and (2) organize and
208.7 	report the data so that state and local policy makers can
208.8 	understand the educational implications of changes in districts'
208.9 	demographic profiles over time.  Any report the commissioner
208.10 	disseminates containing summary data on student performance must
208.11 	integrate student performance and the demographic factors that
208.12 	strongly correlate with that performance.

208.13 	Sec. 2. Minnesota Statutes 2004, section 121A.41,
208.14 	subdivision 10, is amended to read:
208.15 		Subd. 10.Suspension.  "Suspension" means an action by
208.16 	the school administration, under rules promulgated by the school
208.17 	board, prohibiting a pupil from attending school for a period of
208.18 	no more than ten school days.  If a suspension is longer than
208.19 	five days, the suspending administrator must provide the
208.20 	superintendent with a reason for the longer suspension.  This
208.21 	definition does not apply to dismissal from school for one
208.22 	school day or less, except as provided in federal law for a
208.23 	student with a disability.  Each suspension action may include a
208.24 	readmission plan.  The readmission plan shall include, where
208.25 	appropriate, a provision for implementing alternative
208.26 	educational services upon readmission and may not be used to
208.27 	extend the current suspension.  Consistent with section
208.28 	125A.09 125A.091, subdivision 3 5, the readmission plan must not
208.29 	obligate a parent to provide a sympathomimetic medication for
208.30 	the parent's child as a condition of readmission.  The school
208.31 	administration may not impose consecutive suspensions against
208.32 	the same pupil for the same course of conduct, or incident of
208.33 	misconduct, except where the pupil will create an immediate and
208.34 	substantial danger to self or to surrounding persons or
208.35 	property, or where the district is in the process of initiating
208.36 	an expulsion, in which case the school administration may extend
209.1 	the suspension to a total of 15 days.  In the case of a student
209.2 	with a disability, the student's individual education plan team
209.3 	must meet immediately but not more than ten school days after
209.4 	the date on which the decision to remove the student from the
209.5 	student's current education placement is made.  The individual
209.6 	education plan team and other qualified personnel shall at that
209.7 	meeting:  conduct a review of the relationship between the
209.8 	child's disability and the behavior subject to disciplinary
209.9 	action; and determine the appropriateness of the child's
209.10 	education plan.
209.11 	The requirements of the individual education plan team
209.12 	meeting apply when:
209.13 	(1) the parent requests a meeting;
209.14 	(2) the student is removed from the student's current
209.15 	placement for five or more consecutive days; or
209.16 	(3) the student's total days of removal from the student's
209.17 	placement during the school year exceed ten cumulative days in a
209.18 	school year.  The school administration shall implement
209.19 	alternative educational services when the suspension exceeds
209.20 	five days.  A separate administrative conference is required for
209.21 	each period of suspension.

209.22 	Sec. 3. Minnesota Statutes 2004, section 124D.40, is
209.23 	amended to read:
209.24 	124D.40 YOUTH WORKS GRANTS.
209.25 		Subdivision 1.Application. An eligible organization
209.26 	interested in receiving a grant under sections 124D.39 to
209.27 	124D.44 may prepare and submit an application to the commission
209.28 	an application that complies with section 124D.41.
209.29 		Subd. 2.Grant authority. The commission must use any
209.30 	state appropriation and any available federal funds, including
209.31 	any grant received under federal law, to award grants to
209.32 	establish programs for youth works meeting the requirements of
209.33 	section 124D.41.  At least one grant each must be available for
209.34 	a metropolitan proposal, a rural proposal, and a statewide
209.35 	proposal.  If a portion of the suburban metropolitan area is not
209.36 	included in the metropolitan grant proposal, the statewide grant
210.1 	proposal must incorporate at least one suburban metropolitan
210.2 	area.  In awarding grants, the commission may select at least
210.3 	one residential proposal and one nonresidential proposal,
210.4 	provided the proposals meet or exceed the criteria in section
210.5 	124D.41.

210.6 	Sec. 4. Minnesota Statutes 2004, section 127A.41,
210.7 	subdivision 8, is amended to read:
210.8 		Subd. 8.Appropriation transfers.  (a) If a direct
210.9 	appropriation from the general fund to the department for any
210.10 	education aid or grant authorized in this chapter and chapters
210.11 	122A, 123A, 123B, 124D, 125A, 126C, and 134, excluding
210.12 	appropriations under sections 124D.135, 124D.16, 124D.20,
210.13 	124D.21,124D.22, 124D.52, 124D.531, 124D.54,124D.55, and
210.14 	124D.56, exceeds the amount required, the commissioner may
210.15 	transfer the excess to any education aid or grant appropriation
210.16 	that is insufficient.  However, section 126C.20 applies to a
210.17 	deficiency in the direct appropriation for general education
210.18 	aid.  Excess appropriations must be allocated proportionately
210.19 	among aids or grants that have insufficient appropriations.  The
210.20 	commissioner of finance shall make the necessary transfers among
210.21 	appropriations according to the determinations of the
210.22 	commissioner.  If the amount of the direct appropriation for the
210.23 	aid or grant plus the amount transferred according to this
210.24 	subdivision is insufficient, the commissioner shall prorate the
210.25 	available amount among eligible districts.  The state is not
210.26 	obligated for any additional amounts.
210.27 	(b) Transfers for aids paid under section 127A.45,
210.28 	subdivisions 12, paragraph (a), 12a, paragraph (a), and 13,
210.29 	shall be made during the fiscal year after the fiscal year of
210.30 	the entitlement.  Transfers for aids paid under section 127A.45,
210.31 	subdivisions 11, 12, paragraph (b), and 12a, paragraph (b),
210.32 	shall be made during the fiscal year of the appropriation.

210.33 	Sec. 5. Minnesota Statutes 2004, section 127A.45,
210.34 	subdivision 12, is amended to read:
210.35 		Subd. 12.Payment percentage for certain aids.  (a) One
210.36 	hundred percent of the aid for the current fiscal year must be
211.1 	paid for the following aids:  reimbursement for enrollment
211.2 	options transportation, according to sections 124D.03,
211.3 	subdivision 8, 124D.09, subdivision 22, and 124D.10; school
211.4 	lunch aid, according to section 124D.111; and hearing impaired
211.5 	support services aid, according to section 124D.57; and Indian
211.6 	postsecondary preparation grants according to section 124D.80.
211.7 	(b) One hundred percent of the aid for the current fiscal
211.8 	year, based on enrollment in the previous year, must be paid for
211.9 	the first grade preparedness program according to section
211.10 	124D.081.

211.11 	Sec. 6. EFFECTIVE DATE.
 211.12 	Sections 1 through 5 are retroactively effective from July
211.13 	1, 2005.