1.1 	A bill for an act
1.2 	relating to state government; environment, natural resources, and energy 
1.3 	finance; appropriating money for environment and natural resources; authorizing 
1.4 	sale of gift cards and certificates; establishing composting competitive grant 
1.5 	program; modifying regulation of storm water discharges; modifying waste 
1.6 	management reporting requirements and creating a work group; requiring 
1.7 	nonresident all-terrain vehicle state trail pass; modifying horse trail and state 
1.8 	park pass requirements; requiring disclosure of certain chemicals in children's 
1.9 	products by manufacturers; requiring plastic yard waste bags to be compostable 
1.10 	and establishing labeling standards; authorizing uses of the Hennepin County 
1.11 	solid and hazardous waste fund; modifying greenhouse gas emissions provisions 
1.12 	and requiring a registry; establishing and authorizing fees; providing for 
1.13 	disposition of certain fees; modifying and establishing assessments for certain 
1.14 	regulatory expenses; providing for fish consumption advisories in different 
1.15 	languages; limiting use of certain funds; requiring reports; appropriating 
1.16 	money to Department of Commerce and Public Utilities Commission to finance 
1.17 	activities related to commerce and energy; modifying provisions related to 
1.18 	Telecommunications Access Minnesota assessments, insurance audits, insurers 
1.19 	and insurance products, certain financial institutions, regulated activities related 
1.20 	to certain mortgage transactions and professionals, and debt management and 
1.21 	debt settlement services; providing penalties and remedies; appropriating and 
1.22 	allocating federal stimulus money for various energy programs;amending 
1.23 	Minnesota Statutes 2008, sections 45.011, subdivision 1; 45.027, subdivision 1; 
1.24 	46.04, subdivision 1; 46.05; 46.131, subdivision 2; 47.58, subdivision 1; 47.60, 
1.25 	subdivisions 1, 3, 6; 48.21; 58.05, subdivision 3; 58.06, subdivision 2; 58.126; 
1.26 	58.13, subdivision 1; 60A.124; 60A.14, subdivision 1; 60B.03, subdivision 15; 
1.27 	60L.02, subdivision 3; 61B.19, subdivision 4; 61B.28, subdivisions 4, 8; 67A.01; 
1.28 	67A.06; 67A.07; 67A.14, subdivisions 1, 7; 67A.18, subdivision 1; 84.0835, 
1.29 	subdivision 3; 84.415, subdivision 5, by adding a subdivision; 84.63; 84.631; 
1.30 	84.632; 84.788, subdivision 3; 84.922, subdivision 1a; 85.015, subdivision 1b; 
1.31 	85.053, subdivision 10; 85.46, subdivisions 3, 4, 7; 93.481, subdivisions 1, 3, 5, 
1.32 	7; 97A.075, subdivision 1; 103G.301, subdivisions 2, 3; 115.03, subdivision 5c; 
1.33 	115.073; 115.56, subdivision 4; 115.77, subdivision 1; 115A.1314, subdivision 2; 
1.34 	115A.557, subdivision 3; 115A.931; 116.07, subdivision 4d; 116.41, subdivision 
1.35 	2; 116C.834, subdivision 1; 116D.045; 216B.62, subdivisions 3, 4, 5, by 
1.36 	adding a subdivision; 216H.10, subdivision 7; 216H.11; 325E.311, subdivision 
1.37 	6; 332A.02, subdivisions 5, 8, 9, 10, 13, by adding a subdivision; 332A.04, 
1.38 	subdivision 6; 332A.08; 332A.10; 332A.11, subdivision 2; 332A.14; Laws 2002, 
1.39 	chapter 220, article 8, section 15; Laws 2007, chapter 57, article 1, section 
2.1 	4, subdivision 2; Laws 2008, chapter 363, article 5, section 4, subdivision 
2.2 	7; proposing coding for new law in Minnesota Statutes, chapters 60A; 61A; 
2.3 	67A; 84; 93; 115A; 116; 216H; 325E; 383B; proposing coding for new law as 
2.4 	Minnesota Statutes, chapter 332B; repealing Minnesota Statutes 2008, sections 
2.5 	60A.129; 61B.19, subdivision 6; 67A.14, subdivision 5; 67A.17; 67A.19; Laws 
2.6 	2008, chapter 363, article 5, section 30; Minnesota Rules, parts 2675.2180; 
2.7 	2675.7100; 2675.7110; 2675.7120; 2675.7130; 2675.7140.
2.8 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

2.9 	ARTICLE 1
2.10 	ENVIRONMENT AND NATURAL RESOURCES FINANCE

2.11	Section 1. SUMMARY OF APPROPRIATIONS.
 	
2.12 	The amounts shown in this section summarize direct appropriations, by fund, made 
2.13 	in this act.

2.14			2010
		2011
		Total
	
2.15	General
	$
	115,234,000
	$
	114,459,000
	$
	229,693,000
	
2.16
2.17	State Government Special 
Revenue
		48,000
		48,000
		96,000
	
2.18	Environmental
		70,644,000
		70,904,000
		141,548,000
	
2.19	Natural Resources
		81,408,000
		80,308,000
		161,716,000
	
2.20	Game and Fish
		93,942,000
		93,792,000
		187,734,000
	
2.21	Remediation
		11,186,000
		11,186,000
		22,372,000
	
2.22	Permanent School
		200,000
		200,000
		400,000
	
2.23	Total
	$
	372,662,000
	$
	370,897,000
	$
	743,559,000

2.24	Sec. 2. ENVIRONMENT AND NATURAL RESOURCES APPROPRIATIONS.
 	
2.25 	The sums shown in the columns marked "Appropriations" are appropriated to the 
2.26 	agencies and for the purposes specified in this act. The appropriations are from the general 
2.27 	fund, or another named fund, and are available for the fiscal years indicated for each 
2.28 	purpose. The figures "2010" and "2011" used in this act mean that the appropriations 
2.29 	listed under them are available for the fiscal year ending June 30, 2010, or June 30, 2011, 
2.30 	respectively. "The first year" is fiscal year 2010. "The second year" is fiscal year 2011. 
2.31 	"The biennium" is fiscal years 2010 and 2011. Appropriations for the fiscal year ending 
2.32 	June 30, 2009, are effective the day following final enactment.

2.33				APPROPRIATIONS
	
2.34				Available for the Year
	
2.35				Ending June 30
	
2.36					2010
		2011

2.37	Sec. 3. POLLUTION CONTROL AGENCY

2.38	Subdivision 1.Total Appropriation
 	$
	92,369,000
	$
	92,129,000

3.1	Appropriations by Fund
	
3.2		2010
	2011
	
3.3	General
	10,591,000
	10,091,000
	
3.4
3.5	State Government 
Special Revenue
	48,000
	48,000
	
3.6	Environmental
	70,644,000
	70,904,000
	
3.7	Remediation
	11,086,000
	11,086,000
	
3.8 	The amounts that may be spent for each 
3.9 	purpose are specified in the following 
3.10 	subdivisions.
3.11 	The commissioner shall require the chief 
3.12 	financial officer or other financial staff to 
3.13 	display the agency's budget on the agency's 
3.14 	Web site in a manner that will allow citizens 
3.15 	to easily understand the value they are 
3.16 	getting for their money. The agency must 
3.17 	have an air permit and regulatory account, 
3.18 	water permit and regulatory account, and 
3.19 	solid waste permit and regulatory account to 
3.20 	track revenues and expenses.
3.21 	The proposed rules increasing permit fees 
3.22 	first noticed on June 16, 2008, are effective 
3.23 	July 1, 2009. The agency shall adopt 
3.24 	amended permit fee rules incorporating 
3.25 	these permit fee increases under Minnesota 
3.26 	Statutes, section 14.389. The commissioner 
3.27 	shall begin collecting the increased permit 
3.28 	fees on July 1, 2009, even if the rule 
3.29 	adoption process has not been completed. 
3.30 	Notwithstanding Minnesota Statutes, section 
3.31 	14.18, subdivision 2, the increased permit 
3.32 	fees reflecting the permit fee increases 
3.33 	in this section and the rule amendments 
3.34 	incorporating those permit fee increases do 
3.35 	not require further legislative approval.
4.1 	The commissioner shall adopt and implement 
4.2 	rules in compliance with Minnesota Statutes, 
4.3 	section 116.07, subdivision 4d, so that fees 
4.4 	are collected beginning January 1, 2011.
4.5 	A recipient of a grant funded by an 
4.6 	appropriation under this section shall display 
4.7 	on its Web site detailed information on 
4.8 	the expenditure of the grant funds, and 
4.9 	measurable outcomes as a result of the 
4.10 	expenditure of funds, and submit this 
4.11 	information to the agency by June 30 each 
4.12 	year. A recipient without an active Web site 
4.13 	shall report to the agency by June 30 each 
4.14 	year detailed information on the expenditure 
4.15 	of the grant funds, and measurable outcomes 
4.16 	as a result of the expenditure of funds. The 
4.17 	commissioner shall display the information 
4.18 	received by recipients under this paragraph 
4.19 	on the agency's Web site.

4.20	Subd. 2.Water
 		33,752,000
		33,252,000

4.21	Appropriations by Fund
	
4.22	General
	7,583,000
	7,083,000
	
4.23
4.24	State Government 
Special Revenue
	48,000
	48,000
	
4.25	Environmental
	26,121,000
	26,121,000
	
4.26 	$1,498,000 the first year and $1,498,000 
4.27 	the second year are for the clean water 
4.28 	partnership program. Priority shall be 
4.29 	given to projects preventing impairments 
4.30 	and degradation of lakes, rivers, streams, 
4.31 	and groundwater according to Minnesota 
4.32 	Statutes, section 114D.20, subdivision 2, 
4.33 	clause (4). Funds from this appropriation 
4.34 	may not be used to purchase or use 
4.35 	pesticides suspected of being endocrine 
4.36 	disruptors. To the extent possible, any 
5.1 	restoration conducted with money from this 
5.2 	appropriation must plant vegetation or sow 
5.3 	seed only of ecotypes native to Minnesota, 
5.4 	and preferably of the local ecotype, using a 
5.5 	high diversity of species originating from as 
5.6 	close to the restoration site as possible, and 
5.7 	protect existing native prairies from genetic 
5.8 	contamination. Any balance remaining in the 
5.9 	first year does not cancel and is available for 
5.10 	the second year.
5.11 	$2,324,000 the first year and $2,324,000 the 
5.12 	second year must be distributed as grants to 
5.13 	delegated counties to administer the county 
5.14 	feedlot program. Distribution of funds 
5.15 	must be as provided in Laws 2005, First 
5.16 	Special Session chapter 1, article 2, section 
5.17 	2, subdivision 2. The commissioner, in 
5.18 	consultation with the Minnesota Association 
5.19 	of County Feedlot Officers executive team, 
5.20 	may use up to five percent of the annual 
5.21 	appropriation for initiatives that will reduce 
5.22 	feedlot-related pollution hazards. Any 
5.23 	money remaining after the first year is 
5.24 	available for the second year.
5.25 	$335,000 the first year and $335,000 the 
5.26 	second year are for community technical 
5.27 	assistance and education, including grants 
5.28 	and technical assistance to communities for 
5.29 	local and basinwide water quality protection.
5.30 	$550,000 the first year and $550,000 the 
5.31 	second year are for challenge grants to 
5.32 	counties for subsurface sewage treatment 
5.33 	system (SSTS) inventories that will 
5.34 	determine the number of systems that are 
5.35 	failing or that pose an imminent health threat 
6.1 	and are located on riparian land or a lake 
6.2 	or near wetlands or other sensitive waters. 
6.3 	Counties must provide a nonstate match of 
6.4 	at least 50 percent that may be in cash or in 
6.5 	kind. The commissioner shall, by county, 
6.6 	report: the number of systems evaluated, the 
6.7 	number of systems determined to be failing 
6.8 	or that pose an imminent health threat located 
6.9 	on riparian land or a lake or near wetlands or 
6.10 	other sensitive waters, the number replaced 
6.11 	or soon to be replaced, and the gallons of 
6.12 	sewage that are prevented from threatening 
6.13 	waters. The commissioner shall develop 
6.14 	recommendations and a plan for directly 
6.15 	or indirectly inspecting and providing an 
6.16 	inventory for all subsurface sewage treatment 
6.17 	systems and submit a report to the chairs of 
6.18 	the legislative committees having primary 
6.19 	jurisdiction over environment and natural 
6.20 	resources policy and finance no later than 
6.21 	September 15, 2010. Direct inspection 
6.22 	methods shall include field verification of 
6.23 	each SSTS on riparian land or a lake or 
6.24 	near wetlands or other sensitive waters to 
6.25 	determine the owner, location, and which 
6.26 	systems are failing or are an imminent 
6.27 	health threat. A direct inspection shall not 
6.28 	be conducted without written permission 
6.29 	from the property owner. Indirect inspection 
6.30 	methods may include census-type data 
6.31 	collection to determine the owner and 
6.32 	location of each SSTS in the remaining 
6.33 	portion of each county. An SSTS with a valid 
6.34 	certificate of compliance may be considered 
6.35 	inventoried without further work.
7.1 	$405,000 the first year and $405,000 the 
7.2 	second year are for subsurface sewage 
7.3 	treatment system (SSTS) administration and 
7.4 	grants. Of this amount, $86,000 each year 
7.5 	is for assistance to counties through grants 
7.6 	for SSTS program administration. Any 
7.7 	unexpended balance in the first year does not 
7.8 	cancel but is available in the second year.
7.9 	$740,000 the first year and $740,000 the 
7.10 	second year are from the environmental 
7.11 	fund to address the need for continued 
7.12 	increased activity in the areas of new 
7.13 	technology review, technical assistance 
7.14 	for local governments, and enforcement 
7.15 	under Minnesota Statutes, sections 115.55 
7.16 	to 115.58, and to complete the requirements 
7.17 	of Laws 2003, chapter 128, article 1, section 
7.18 	165. Of this amount, $48,000 each year is for 
7.19 	administration of individual septic tank fees, 
7.20 	as provided in this article.
7.21 	$100,000 the first year and the $100,000 
7.22 	second year are for a grant to the Red River 
7.23 	Watershed Management Board to enhance 
7.24 	and expand existing river watch activities in 
7.25 	the Red River of the North and shall enhance 
7.26 	student understanding of the causes of 
7.27 	flooding, flood prevention, and the impacts 
7.28 	of flood waters on land and water resources. 
7.29 	The Red River Watershed Management 
7.30 	Board shall provide a report that includes 
7.31 	formal evaluation results from the river watch 
7.32 	program to the commissioners of education 
7.33 	and the Pollution Control Agency and to the 
7.34 	legislative committees with jurisdiction over 
7.35 	the environment and natural resources policy 
8.1 	and finance and K-12 policy and finance by 
8.2 	February 15, 2011.
8.3 	$7,540,000 the first year and $7,540,000 
8.4 	the second year are from the environmental 
8.5 	fund for completion of 20 percent of the 
8.6 	needed statewide assessments of surface 
8.7 	water quality and trends.
8.8 	$500,000 the first year is to develop minimal 
8.9 	impact design standards for urban storm 
8.10 	water runoff. This is a onetime appropriation 
8.11 	and is available until June 30, 2011. The 
8.12 	commissioner shall report to the chairs and 
8.13 	ranking minority members of the legislative 
8.14 	committees and divisions having primary 
8.15 	jurisdiction over environment and natural 
8.16 	resources policy and finance no later than 
8.17 	January 12, 2011, regarding the expenditure 
8.18 	of this appropriation.
8.19 	By October 1 each year, the commissioner 
8.20 	shall report to the chairs of the legislative 
8.21 	committees having primary jurisdiction 
8.22 	over environment and natural resources 
8.23 	policy and finance on the effectiveness of 
8.24 	enforcement actions in the previous fiscal 
8.25 	year in preventing water pollution.
8.26 	Notwithstanding Minnesota Statutes, section 
8.27 	16A.28, the appropriations encumbered on or 
8.28 	before June 30, 2011, as grants or contracts 
8.29 	for clean water partnership, SSTS's, surface 
8.30 	water and groundwater assessments, total 
8.31 	maximum daily loads, stormwater, and local 
8.32 	basinwide water quality protection in this 
8.33 	subdivision are available until June 30, 2013.

8.34	Subd. 3.Air
 		11,871,000
		12,131,000

9.1	Appropriations by Fund
	
9.2		2010
	2011
	
9.3	Environmental
	11,871,000
	12,131,000
	
9.4 	Up to $150,000 the first year and $150,000 
9.5 	the second year may be transferred from the 
9.6 	environmental fund to the small business 
9.7 	environmental improvement loan account 
9.8 	established in Minnesota Statutes, section 
9.9 	116.993.
9.10 	$200,000 the first year and $200,000 the 
9.11 	second year are from the environmental fund 
9.12 	for a monitoring program under Minnesota 
9.13 	Statutes, section 116.454.
9.14 	$125,000 the first year and $125,000 the 
9.15 	second year are from the environmental fund 
9.16 	for monitoring ambient air for hazardous 
9.17 	pollutants in the metropolitan area.
9.18 	An agency report on the level of fine 
9.19 	particulate matter in Minnesota's air must 
9.20 	compare measured levels with a 24-hour 
9.21 	PM 2.5 standard of 13 to 14 micrograms 
9.22 	per cubic meter and an annual PM 2.5 
9.23 	standard of 30 to 35 micrograms per cubic 
9.24 	meter, as recommended by the Particulate 
9.25 	Matter Review Panel of the Environmental 
9.26 	Protection Agency's Clean Air Scientific 
9.27 	Advisory Committee in its June 2005 report, 
9.28 	EPA's Review of the National Ambient Air 
9.29 	Quality Standards for Particulate Matter 
9.30 	(Second Draft PM Staff Paper, January 
9.31 	2005).

9.32	Subd. 4.Land
 		18,502,000
		18,502,000

9.33	Appropriations by Fund
	
9.34	General
	500,000
	500,000
	
10.1	Environmental
	6,916,000
	6,916,000
	
10.2	Remediation
	11,086,000
	11,086,000
	
10.3 	All money for environmental response, 
10.4 	compensation, and compliance in the 
10.5 	remediation fund not otherwise appropriated 
10.6 	is appropriated to the commissioners of the 
10.7 	Pollution Control Agency and agriculture 
10.8 	for purposes of Minnesota Statutes, section 
10.9 	115B.20, subdivision 2, clauses (1), (2), 
10.10 	(3), (6), and (7). At the beginning of each 
10.11 	fiscal year, the two commissioners shall 
10.12 	jointly submit an annual spending plan to 
10.13 	the commissioner of finance that maximizes 
10.14 	the utilization of resources and appropriately 
10.15 	allocates the money between the two 
10.16 	departments. This appropriation is available 
10.17 	until June 20, 2011.
10.18 	$3,616,000 the first year and $3,616,000 the 
10.19 	second year are from the petroleum tank fund 
10.20 	to be transferred to the remediation fund for 
10.21 	purposes of the leaking underground storage 
10.22 	tank program to protect the land.
10.23 	$252,000 the first year and $252,000 the 
10.24 	second year are from the remediation fund to 
10.25 	be transferred to the Department of Health for 
10.26 	private water supply monitoring and health 
10.27 	assessment costs in areas contaminated 
10.28 	by unpermitted mixed municipal solid 
10.29 	waste disposal facilities and drinking water 
10.30 	advisories and public information activities 
10.31 	for areas contaminated by hazardous releases.
10.32 	$500,000 each year is for environmental 
10.33 	health tracking and biomonitoring of a 
10.34 	representative sample of the population 
10.35 	including indigenous people and people of 
11.1 	color. Of this amount, $450,000 each year is 
11.2 	for transfer to the Department of Health.

11.3
11.4	Subd. 5.Environmental Assistance and 
Cross-Media
 		26,850,000
		26,850,000

11.5	Appropriations by Fund
	
11.6	General
	1,114,000
	1,114,000
	
11.7	Environmental
	25,736,000
	25,736,000
	
11.8 	$14,500,000 each year is from the 
11.9 	environmental fund for SCORE block grants 
11.10 	to counties.
11.11 	$500,000 the first year and $500,000 the 
11.12 	second year are from the environmental 
11.13 	fund for composting grants under Minnesota 
11.14 	Statutes, section 115A.559, and are available 
11.15 	until June 30, 2011. This amount is added to 
11.16 	the agency base.
11.17 	$245,000 the first year and $245,000 the 
11.18 	second year are from the environmental fund 
11.19 	for the toxic chemical in children's products 
11.20 	activity. Up to $133,000 of the amount each 
11.21 	year may be transferred to the commissioner 
11.22 	of health. This is a onetime appropriation.
11.23 	Any unencumbered grant and loan balances 
11.24 	in the first year do not cancel but are available 
11.25 	for grants and loans in the second year.
11.26 	All money deposited in the environmental 
11.27 	fund for the metropolitan solid waste 
11.28 	landfill fee in accordance with Minnesota 
11.29 	Statutes, section 473.843, and not otherwise 
11.30 	appropriated, is appropriated for the purposes 
11.31 	of Minnesota Statutes, section 115B.39.
11.32 	Notwithstanding Minnesota Statutes, section 
11.33 	16A.28, the appropriations encumbered on 
11.34 	or before June 30, 2011, as contracts or 
11.35 	grants for surface water and groundwater 
12.1 	assessments; environmental assistance 
12.2 	awarded under Minnesota Statutes, section 
12.3 	115A.0716; technical and research assistance 
12.4 	under Minnesota Statutes, section 115A.152; 
12.5 	technical assistance under Minnesota 
12.6 	Statutes, section 115A.52; and pollution 
12.7 	prevention assistance under Minnesota 
12.8 	Statutes, section 115D.04, are available until 
12.9 	June 30, 2013.
12.10 	Before the governor makes budget 
12.11 	recommendations to the legislature in 2011, 
12.12 	the commissioner must report on revenues 
12.13 	received and expenditures made under 
12.14 	Minnesota Statutes, section 115A.1314, 
12.15 	subdivision 2, during fiscal years 2010 
12.16 	and 2011 to determine if fees collected are 
12.17 	covering the costs of the program.

12.18	Subd. 6.Administrative Support
 		1,394,000
		1,394,000
	
12.19 	The commissioner may transfer money from 
12.20 	the environmental fund to the remediation 
12.21 	fund as necessary for the purposes of the 
12.22 	remediation fund under Minnesota Statutes, 
12.23 	section 116.155, subdivision 2.

12.24	Sec. 4. NATURAL RESOURCES

12.25	Subdivision 1.Total Appropriation
 	$
	246,432,000
	$
	245,182,000

12.26	Appropriations by Fund
	
12.27		2010
	2011
	
12.28	General
	75,980,000
	75,980,000
	
12.29	Natural Resources
	76,210,000
	75,110,000
	
12.30	Game and Fish
	93,942,000
	93,792,000
	
12.31	Remediation
	100,000
	100,000
	
12.32	Permanent School
	200,000
	200,000
	
12.33 	The amounts that may be spent for each 
12.34 	purpose are specified in the following 
12.35 	subdivisions.
13.1 	To the extent possible, any restoration 
13.2 	conducted with money appropriated in this 
13.3 	section must plant vegetation or sow seed 
13.4 	only of ecotypes native to Minnesota, and 
13.5 	preferably of the local ecotype, using a high 
13.6 	diversity of species originating from as 
13.7 	close to the restoration site as possible, and 
13.8 	protect existing native prairies from genetic 
13.9 	contamination.
13.10 	A recipient of a grant funded by an 
13.11 	appropriation under this section shall display 
13.12 	on its Web site detailed information on 
13.13 	the expenditure of the grant funds, and 
13.14 	measurable outcomes as a result of the 
13.15 	expenditure of funds, and submit this 
13.16 	information to the department by June 30 
13.17 	each year. A recipient without an active 
13.18 	Web site shall report to the department by 
13.19 	June 30 each year detailed information on 
13.20 	the expenditure of the grant funds, and 
13.21 	measurable outcomes as a result of the 
13.22 	expenditure of funds. The commissioner 
13.23 	shall display the information received by 
13.24 	recipients under this paragraph on the 
13.25 	department's Web site.
13.26 	The commissioner shall require the chief 
13.27 	financial officer or other financial staff 
13.28 	to display the department's budget on the 
13.29 	department's Web site in a manner that will 
13.30 	allow citizens to easily understand the value 
13.31 	they are getting for their money.

13.32
13.33	Subd. 2.Land and Mineral Resources 
Management
 		10,398,000
		10,398,000

13.34	Appropriations by Fund
	
13.35	General
	3,351,000
	3,351,000
	
13.36	Natural Resources
	5,461,000
	5,461,000
	
14.1	Game and Fish
	1,386,000
	1,386,000
	
14.2	Permanent School
	200,000
	200,000
	
14.3 	$1,202,000 the first year and $1,202,000 
14.4 	the second year are from the mining 
14.5 	administration account in the natural 
14.6 	resources fund to cover the costs associated 
14.7 	with issuing mining permits.
14.8 	$612,000 each year is from the dedicated 
14.9 	receipts account in the natural resources fund 
14.10 	to cover the costs associated with issuing 
14.11 	licenses for land and water crossings and 
14.12 	road easements.
14.13 	$351,000 the first year and $351,000 the 
14.14 	second year are for iron ore cooperative 
14.15 	research. Of this amount, $200,000 each year 
14.16 	is from the minerals management account 
14.17 	in the natural resources fund. $175,500 the 
14.18 	first year and $175,500 the second year are 
14.19 	available only as matched by $1 of nonstate 
14.20 	money for each $1 of state money. The 
14.21 	match may be cash or in-kind.
14.22 	$86,000 the first year and $86,000 the 
14.23 	second year are for minerals cooperative 
14.24 	environmental research, of which $43,000 
14.25 	the first year and $43,000 the second year are 
14.26 	available only as matched by $1 of nonstate 
14.27 	money for each $1 of state money. The 
14.28 	match may be cash or in-kind.
14.29 	$2,696,000 the first year and $2,696,000 
14.30 	the second year are from the minerals 
14.31 	management account in the natural resources 
14.32 	fund for use as provided in Minnesota 
14.33 	Statutes, section 93.2236, paragraph (c), 
14.34 	for mineral resource management, projects 
14.35 	to enhance future mineral income, and 
15.1 	projects to promote new mineral resource 
15.2 	opportunities.
15.3 	$200,000 the first year and $200,000 the 
15.4 	second year are from the state forest suspense 
15.5 	account in the permanent school fund to 
15.6 	accelerate land exchanges, land sales, and 
15.7 	commercial leasing of school trust lands and 
15.8 	to identify, evaluate, and lease construction 
15.9 	aggregate located on school trust lands. This 
15.10 	appropriation is to be used for securing 
15.11 	maximum long-term economic return 
15.12 	from the school trust lands consistent with 
15.13 	fiduciary responsibilities and sound natural 
15.14 	resources conservation and management 
15.15 	principles.

15.16	Subd. 3.Water Resources Management
 		11,772,000
		11,772,000

15.17	Appropriations by Fund
	
15.18	General
	11,492,000
	11,492,000
	
15.19	Natural Resources
	280,000
	280,000
	
15.20 	$11,109,000 the first year and $11,109,000 
15.21 	the second year are for:
15.22 	(1) public waters protection by managing 
15.23 	and regulating activities through floodplain 
15.24 	management, shoreland management, 
15.25 	public waters permitting, and outreach and 
15.26 	education;
15.27 	(2) water supply management by ensuring 
15.28 	appropriate sources of water are available for 
15.29 	current and future generations through water 
15.30 	appropriation permitting, public water supply 
15.31 	planning, and water use reporting; and
15.32 	(3) hydrologic information that supports 
15.33 	decision making by providing technical 
15.34 	services through technical surface water 
15.35 	and groundwater studies, dam safety and 
16.1 	maintenance, regional hydrogeologic 
16.2 	assessments, lake level monitoring, stream 
16.3 	flow monitoring, ground water monitoring, 
16.4 	surveying, climatology, and environmental 
16.5 	review.
16.6 	By January 15, 2010, the commissioner 
16.7 	shall submit a report evaluating and 
16.8 	recommending options to provide for the 
16.9 	long-term protection of the state's surface 
16.10 	water and groundwater resources and 
16.11 	the funding of programs to provide this 
16.12 	protection.
16.13 	$280,000 the first year and $280,000 the 
16.14 	second year are for grants for up to 50 
16.15 	percent of the cost of implementation of 
16.16 	the Red River mediation agreement. The 
16.17 	commissioner shall submit a report to the 
16.18 	chairs of the legislative committees having 
16.19 	primary jurisdiction over environment and 
16.20 	natural resources policy and finance on the 
16.21 	accomplishments achieved with the grants 
16.22 	by January 15, 2012.
16.23 	$103,000 the first year and $103,000 
16.24 	the second year are to assist the Red 
16.25 	River Watershed Management Board and 
16.26 	watershed districts in constructing flood 
16.27 	protection farmstead ring levees in the Red 
16.28 	River watershed. If the appropriation for 
16.29 	either year is insufficient, the appropriation 
16.30 	for the other year is available for it.
16.31 	By October 1, 2009, the commissioner shall 
16.32 	develop a plan for the development of an 
16.33 	adequate groundwater level monitoring 
16.34 	network of wells in the 11-county 
16.35 	metropolitan area. The commissioner, 
17.1 	working with the Metropolitan Council, 
17.2 	the Department of Homeland Security, and 
17.3 	the commissioner of the Pollution Control 
17.4 	Agency, shall design the network so that 
17.5 	the wells can be used to identify threats to 
17.6 	groundwater quality and institute practices to 
17.7 	protect the groundwater from degradation. 
17.8 	The network must be sufficient to ensure 
17.9 	that water use in the metropolitan area 
17.10 	does not harm ecosystems, degrade water 
17.11 	quality, or compromise the ability of future 
17.12 	generations to meet their own needs. The 
17.13 	plan should include recommendations on 
17.14 	the necessary payment rates for users of the 
17.15 	system expressed in cents per gallon for well 
17.16 	drilling, operation, and maintenance.

17.17	Subd. 4.Forest Management
 		39,359,000
		38,259,000

17.18	Appropriations by Fund
	
17.19	General
	25,952,000
	25,952,000
	
17.20	Natural Resources
	12,193,000
	11,093,000
	
17.21	Game and Fish
	1,214,000
	1,214,000
	
17.22 	$2,000,000 each year is to maintain forest 
17.23 	management operations. This is a onetime 
17.24 	appropriation.
17.25 	$500,000 the first year and $500,000 the 
17.26 	second year are reductions in the private 
17.27 	forest landowner assistance program.
17.28 	$950,000 the first year and $950,000 
17.29 	the second year are from the heritage 
17.30 	enhancement account in the game and fish 
17.31 	fund to maintain and expand the ecological 
17.32 	classification system program on state forest 
17.33 	lands and prevent the introduction and spread 
17.34 	of invasive species on state lands. This is a 
17.35 	onetime appropriation.
18.1 	$7,217,000 the first year and $7,217,000 
18.2 	the second year are for prevention, 
18.3 	presuppression, and suppression costs of 
18.4 	emergency firefighting and other costs 
18.5 	incurred under Minnesota Statutes, section 
18.6 	88.12. If the appropriation for either 
18.7 	year is insufficient to cover all costs of 
18.8 	presuppression and suppression, the amount 
18.9 	necessary to pay for these costs during the 
18.10 	biennium is appropriated from the general 
18.11 	fund.
18.12 	By November 15 of each year, the 
18.13 	commissioner of natural resources shall 
18.14 	submit a report to the chairs of the house 
18.15 	and senate committees and divisions having 
18.16 	jurisdiction over environment and natural 
18.17 	resources finance, identifying all firefighting 
18.18 	costs incurred and reimbursements received 
18.19 	in the prior fiscal year. These appropriations 
18.20 	may not be transferred. Any reimbursement 
18.21 	of firefighting expenditures made to the 
18.22 	commissioner from any source other than 
18.23 	federal mobilizations shall be deposited into 
18.24 	the general fund.
18.25 	$12,193,000 the first year and $11,093,000 
18.26 	the second year are from the forest 
18.27 	management investment account in the 
18.28 	natural resources fund for only the purposes 
18.29 	specified in Minnesota Statutes, section 
18.30 	89.039, subdivision 2.
18.31 	$780,000 the first year and $780,000 the 
18.32 	second year are for the Forest Resources 
18.33 	Council for implementation of the 
18.34 	Sustainable Forest Resources Act. 

18.35	Subd. 5.Parks and Trails Management
 		68,522,000
		68,522,000

19.1	Appropriations by Fund
	
19.2	General
	23,207,000
	23,207,000
	
19.3	Natural Resources
	43,121,000
	43,121,000
	
19.4	Game and Fish
	2,194,000
	2,194,000
	
19.5 	$1,400,000 the first year and $1,400,000 the 
19.6 	second year are from the water recreation 
19.7 	account in the natural resources fund for 
19.8 	enhancing public water access facilities. 
19.9 	Of this amount, $100,000 is a onetime 
19.10 	appropriation to provide downloadable 
19.11 	GPS coordinates and river gauge data 
19.12 	interpretation. The base appropriation is 
19.13 	$1,300,000.
19.14 	The appropriation in Laws 2003, chapter 
19.15 	128, article 1, section 5, subdivision 6, from 
19.16 	the water recreation account in the natural 
19.17 	resources fund for a cooperative project with 
19.18 	the United States Army Corps of Engineers 
19.19 	to develop the Mississippi Whitewater Park 
19.20 	is available until June 30, 2011. The project 
19.21 	must be designed to prevent the spread of 
19.22 	aquatic invasive species.
19.23 	$3,996,000 the first year and $3,996,000 the 
19.24 	second year are from the natural resources 
19.25 	fund for state park and recreation area 
19.26 	operations. This appropriation is from the 
19.27 	revenue deposited in the natural resources 
19.28 	fund under Minnesota Statutes, section 
19.29 	297A.94, paragraph (e), clause (2).
19.30 	$8,424,000 the first year and $8,424,000 
19.31 	the second year are from the snowmobile 
19.32 	trails and enforcement account in the 
19.33 	natural resources fund for the snowmobile 
19.34 	grants-in-aid program. This additional 
19.35 	money may be used for new grant-in-aid 
20.1 	trails. Any unencumbered balance does not 
20.2 	cancel at the end of the first year and is 
20.3 	available for the second year.
20.4 	$400,000 the first year and $400,000 the 
20.5 	second year are from the snowmobile account 
20.6 	in the natural resources fund for operation 
20.7 	and maintenance of state trails and increased 
20.8 	oversight and training for the grant-in-aid 
20.9 	program. This is a onetime appropriation.
20.10 	$1,360,000 the first year and $1,360,000 
20.11 	the second year are from the natural 
20.12 	resources fund for the off-highway vehicle 
20.13 	grants-in-aid program. Of this amount, 
20.14 	$1,110,000 each year is from the all-terrain 
20.15 	vehicle account; $150,000 each year is from 
20.16 	the off-highway motorcycle account; and 
20.17 	$100,000 each year is from the off-road 
20.18 	vehicle account. Any unencumbered balance 
20.19 	does not cancel at the end of the first year 
20.20 	and is available for the second year.
20.21 	$760,000 the first year and $760,000 the 
20.22 	second year are from the natural resources 
20.23 	fund for state trail operations. This 
20.24 	appropriation is from the revenue deposited 
20.25 	in the natural resources fund under Minnesota 
20.26 	Statutes, section 297A.94, paragraph (e), 
20.27 	clause (2).

20.28	Subd. 6.Fish and Wildlife Management
 		68,557,000
		68,407,000

20.29	Appropriations by Fund
	
20.30	General
	2,323,000
	2,323,000
	
20.31	Natural Resources
	2,096,000
	2,096,000
	
20.32	Game and Fish
	64,138,000
	63,988,000
	
20.33 	$220,000 the first year and $220,000 the 
20.34 	second year are from the nongame wildlife 
21.1 	account in the natural resources fund for gray 
21.2 	wolf management and research.
21.3 	$285,000 the first year and $285,000 the 
21.4 	second year are from the walleye stamp 
21.5 	account in the game and fish fund for the 
21.6 	purposes specified under Minnesota Statutes, 
21.7 	section 97A.075, subdivision 6.
21.8 	$600,000 the first year and $600,000 the 
21.9 	second year are to accelerate wildlife health 
21.10 	programs. This is a onetime appropriation.
21.11 	$1,860,000 the first year and $1,860,000 the 
21.12 	second year are from the wildlife acquisition 
21.13 	surcharge account for only the purposes 
21.14 	specified in Minnesota Statutes, section 
21.15 	97A.071, subdivision 2a. This appropriation 
21.16 	is available until spent.
21.17 	$8,167,000 the first year and $8,167,000 
21.18 	the second year are from the heritage 
21.19 	enhancement account in the game and 
21.20 	fish fund only for activities specified in 
21.21 	Minnesota Statutes, section 297A.94, 
21.22 	paragraph (e), clause (1). Of this amount, at 
21.23 	least 80 percent must be used to purchase 
21.24 	or restore land, and of this, over half must 
21.25 	be used for restoration. Notwithstanding 
21.26 	Minnesota Statutes, section 297A.94, five 
21.27 	percent of this appropriation may be used for 
21.28 	expanding hunter and angler recruitment and 
21.29 	retention. This appropriation may be used to 
21.30 	leverage other funds and to provide fish and 
21.31 	wildlife technical assistance for shallow lake 
21.32 	management and restoration and stream and 
21.33 	lake shoreland and habitat improvement and 
21.34 	maintenance on private lands.
22.1 	Notwithstanding Minnesota Statutes, section 
22.2 	84.943, $13,000 the first year and $13,000 
22.3 	the second year from the critical habitat 
22.4 	private sector matching account may be used 
22.5 	to publicize the critical habitat license plate 
22.6 	match program.
22.7 	$830,000 the first year and $830,000 the 
22.8 	second year are from the trout and salmon 
22.9 	management account for only the purposes 
22.10 	specified in Minnesota Statutes, section 
22.11 	97A.075, subdivision 3.
22.12 	$1,553,000 the first year and $1,553,000 
22.13 	the second year are from the deer habitat 
22.14 	improvement account for only the purposes 
22.15 	specified in Minnesota Statutes, section 
22.16 	97A.075, subdivision 1, paragraph (b).
22.17 	$890,000 the first year and $890,000 the 
22.18 	second year are from the deer and bear 
22.19 	management account for only the purposes 
22.20 	specified in Minnesota Statutes, section 
22.21 	97A.075, subdivision 1, paragraph (c).
22.22 	$700,000 the first year and $700,000 the 
22.23 	second year are from the waterfowl habitat 
22.24 	improvement account for only the purposes 
22.25 	specified in Minnesota Statutes, section 
22.26 	97A.075, subdivision 2.
22.27 	$925,000 the first year and $925,000 the 
22.28 	second year are from the pheasant habitat 
22.29 	improvement account for only the purposes 
22.30 	specified in Minnesota Statutes, section 
22.31 	97A.075, subdivision 4.
22.32 	$192,000 the first year and $192,000 the 
22.33 	second year are from the wild turkey 
22.34 	management account for only the purposes 
22.35 	specified in Minnesota Statutes, section 
23.1 	97A.075, subdivision 5. Of this amount, 
23.2 	$8,000 the first year and $8,000 the second 
23.3 	year are appropriated from the game and 
23.4 	fish fund for transfer to the wild turkey 
23.5 	management account for purposes specified 
23.6 	in Minnesota Statutes, section 97A.075, 
23.7 	subdivision 5.
23.8 	Notwithstanding Minnesota Statutes, section 
23.9 	16A.28, the appropriations encumbered 
23.10 	under contract on or before June 30, 2011, for 
23.11 	aquatic restoration grants and wildlife habitat 
23.12 	grants are available until June 30, 2012.

23.13	Subd. 7.Ecological Services
 		14,475,000
		14,475,000

23.14	Appropriations by Fund
	
23.15	General
	6,530,000
	6,530,000
	
23.16	Natural Resources
	3,994,000
	3,994,000
	
23.17	Game and Fish
	3,951,000
	3,951,000
	
23.18 	$1,223,000 the first year and $1,223,000 the 
23.19 	second year are from the nongame wildlife 
23.20 	management account in the natural resources 
23.21 	fund for the purpose of nongame wildlife 
23.22 	management. Notwithstanding Minnesota 
23.23 	Statutes, section 290.431, $100,000 the first 
23.24 	year and $100,000 the second year may be 
23.25 	used for nongame information, education, 
23.26 	and promotion.
23.27 	$1,636,000 the first year and $1,636,000 
23.28 	the second year are from the heritage 
23.29 	enhancement account in the game and 
23.30 	fish fund for only the purposes specified 
23.31 	in Minnesota Statutes, section 297A.94, 
23.32 	paragraph (e), clause (1).
23.33 	$2,142,000 the first year and $2,142,000 
23.34 	the second year are from the invasive 
23.35 	species account and $500,000 each year is 
24.1 	appropriated from the game and fish fund to 
24.2 	the invasive species account for management, 
24.3 	public awareness, assessment and monitoring 
24.4 	research, law enforcement, and water access 
24.5 	inspection to prevent the spread of invasive 
24.6 	species; management of invasive plants in 
24.7 	public waters; and management of terrestrial 
24.8 	invasive species on state-administered lands. 
24.9 	Funds from this appropriation may not be 
24.10 	used to purchase or use pesticides suspected 
24.11 	of being endocrine disruptors. 

24.12	Subd. 8.Enforcement
 		31,519,000
		31,519,000

24.13	Appropriations by Fund
	
24.14	General
	2,918,000
	2,918,000
	
24.15	Natural Resources
	8,531,000
	8,531,000
	
24.16	Game and Fish
	19,970,000
	19,970,000
	
24.17	Remediation
	100,000
	100,000
	
24.18 	$1,082,000 the first year and $1,082,000 the 
24.19 	second year are from the water recreation 
24.20 	account in the natural resources fund for 
24.21 	grants to counties for boat and water safety.
24.22 	$315,000 the first year and $315,000 the 
24.23 	second year are from the snowmobile 
24.24 	trails and enforcement account in the 
24.25 	natural resources fund for grants to local 
24.26 	law enforcement agencies for snowmobile 
24.27 	enforcement activities.
24.28 	$1,164,000 the first year and $1,164,000 
24.29 	the second year are from the heritage 
24.30 	enhancement account in the game and 
24.31 	fish fund for only the purposes specified 
24.32 	in Minnesota Statutes, section 297A.94, 
24.33 	paragraph (e), clause (1).
24.34 	$510,000 the first year and $510,000 
24.35 	the second year are from the natural 
25.1 	resources fund for grants to county law 
25.2 	enforcement agencies for off-highway 
25.3 	vehicle enforcement and public education 
25.4 	activities based on off-highway vehicle use 
25.5 	in the county. Of this amount, $498,000 each 
25.6 	year is from the all-terrain vehicle account; 
25.7 	$11,000 each year is from the off-highway 
25.8 	motorcycle account; and $1,000 each year 
25.9 	is from the off-road vehicle account. The 
25.10 	county enforcement agencies may use 
25.11 	money received under this appropriation 
25.12 	to make grants to other local enforcement 
25.13 	agencies within the county that have a high 
25.14 	concentration of off-highway vehicle use. Of 
25.15 	this appropriation, $25,000 each year is for 
25.16 	administration of these grants.

25.17	Subd. 9.Operations Support
 		1,830,000
		1,830,000

25.18	Appropriations by Fund
	
25.19	General
	207,000
	207,000
	
25.20	Natural Resources
	534,000
	534,000
	
25.21	Game and Fish
	1,089,000
	1,089,000
	
25.22 	The commissioner may redirect the general 
25.23 	fund reduction of $1,933,000 in fiscal year 
25.24 	2010 and $1,933,000 in fiscal year 2011, to 
25.25 	other subdivisions of this section. No grants 
25.26 	may be reduced. The commissioner shall 
25.27 	report by October 1, 2011, to the chairs of 
25.28 	the legislative committees having primary 
25.29 	jurisdiction over environment and natural 
25.30 	resources policy and finance regarding any 
25.31 	redirection and what department outcomes 
25.32 	were affected by the redirection.
25.33 	$320,000 the first year and $320,000 the 
25.34 	second year are from the natural resources 
25.35 	fund for grants to be divided equally between 
25.36 	the city of St. Paul for the Como Zoo 
26.1 	and Conservatory and the city of Duluth 
26.2 	for the Duluth Zoo. This appropriation 
26.3 	is from the revenue deposited to the fund 
26.4 	under Minnesota Statutes, section 297A.94, 
26.5 	paragraph (e), clause (5).

26.6
26.7	Sec. 5. BOARD OF WATER AND SOIL 
RESOURCES
 	$
	16,493,000
	$
	16,218,000
	
26.8 	$3,856,000 the first year and $3,856,000 the 
26.9 	second year are for natural resources block 
26.10 	grants to local governments. The board may 
26.11 	reduce the amount of the natural resources 
26.12 	block grant to a county by an amount equal to 
26.13 	any reduction in the county's general services 
26.14 	allocation to a soil and water conservation 
26.15 	district from the county's previous year 
26.16 	allocation when the board determines that 
26.17 	the reduction was disproportionate. Grants 
26.18 	must be matched with a combination of local 
26.19 	cash or in-kind contributions. The base 
26.20 	grant portion related to water planning must 
26.21 	be matched by an amount as specified by 
26.22 	Minnesota Statutes, section 103B.3369.
26.23 	$3,506,000 the first year and $3,506,000 
26.24 	the second year are for grants requested 
26.25 	by soil and water conservation districts for 
26.26 	general purposes, nonpoint engineering, 
26.27 	and implementation of the reinvest in 
26.28 	Minnesota conservation reserve program. 
26.29 	Upon approval of the board, expenditures 
26.30 	may be made from these appropriations for 
26.31 	supplies and services benefiting soil and 
26.32 	water conservation districts. Any district 
26.33 	requesting a grant under this paragraph shall 
26.34 	maintain a Web page that publishes, at a 
26.35 	minimum, its annual plan, annual report, 
27.1 	annual audit, and annual budget, including 
27.2 	membership dues and meeting notices and 
27.3 	minutes.
27.4 	$500,000 the first year and $500,00 the 
27.5 	second year are for feedlot water quality 
27.6 	grants for feedlots under 300 animal units 
27.7 	where there are impaired waters.
27.8 	$1,169,000 the first year and $1,169,000 
27.9 	the second year are for grants to soil and 
27.10 	water conservation districts for cost-sharing 
27.11 	contracts for erosion control and related 
27.12 	water quality management.
27.13 	$1,200,000 the first year and $1,200,000 the 
27.14 	second year are for grants for cost sharing 
27.15 	contracts to establish and maintain vegetation 
27.16 	buffers and restored native prairie.
27.17 	$200,000 the first year and $200,000 
27.18 	the second year are available for county 
27.19 	cooperative weed management programs and 
27.20 	to restore native plants in selected invasive 
27.21 	species management sites by providing 
27.22 	local native seeds and plants to landowners 
27.23 	for implementation. This appropriation is 
27.24 	available until expended. If the appropriation 
27.25 	in either year is insufficient, the appropriation 
27.26 	in the other year is available for it. Any 
27.27 	unencumbered balance in the board's 
27.28 	program of grants does not cancel at the 
27.29 	end of the first year and is available for the 
27.30 	second year for the same grant program. 
27.31 	Notwithstanding Minnesota Statutes, section 
27.32 	103C.501, a balance in the board's cost-share 
27.33 	program is available for $150,000 each year 
27.34 	for evaluating and reporting on performance, 
27.35 	financial, and activity information of local 
28.1 	water management entities as provided for 
28.2 	in Minnesota Statutes, section 103B.102. 
28.3 	Notwithstanding Minnesota Statutes, section 
28.4 	103C.501, the board may shift cost-share 
28.5 	funds in this section and may adjust the 
28.6 	technical and administrative assistance 
28.7 	portion of the grant funds to leverage 
28.8 	federal or other nonstate funds or to address 
28.9 	high-priority needs identified in local water 
28.10 	management plans.
28.11 	$500,000 the first year and $500,000 the 
28.12 	second year are for implementation and 
28.13 	enforcement of the Wetland Conservation 
28.14 	Act. The board must make available 
28.15 	information about these activities on the 
28.16 	board's Web site.
28.17 	$60,000 each year is for staff to monitor and 
28.18 	enforce wetland replacement, wetland bank 
28.19 	sites, and the Wetland Conservation Act. The 
28.20 	board must include in its biennial report to 
28.21 	the legislature information on all state and 
28.22 	local units of government, including special 
28.23 	purpose districts and impacts on wetlands 
28.24 	in the state. This information must be made 
28.25 	available on the board's Web site.
28.26 	$340,000 the first year and $340,000 the 
28.27 	second year are for cost-share grants to local 
28.28 	governments for public drainage records 
28.29 	modernization.
28.30 	$212,000 in each year is to provide assistance 
28.31 	to local drainage management officials and 
28.32 	for the costs of the Drainage Work Group.
28.33 	$90,000 the first year and $90,000 the second 
28.34 	year are for a grant to the Red River Basin 
28.35 	Commission for water quality and floodplain 
29.1 	management, including administration of 
29.2 	programs. The commission shall submit 
29.3 	a report to the chairs of the legislative 
29.4 	committees having primary jurisdiction 
29.5 	over environment and natural resources 
29.6 	policy and finance on the accomplishments 
29.7 	achieved with this appropriation by January 
29.8 	15, 2012. If the appropriation in either year 
29.9 	is insufficient, the appropriation in the other 
29.10 	year is available for it.
29.11 	$90,000 each year is to the Minnesota River 
29.12 	Basin Joint Powers Board, also known as 
29.13 	the Minnesota River Board, for operating 
29.14 	expenses to measure and report the results of 
29.15 	projects in the 12 major watersheds within 
29.16 	the Minnesota River basin. This amount 
29.17 	may be matched by nonstate funds. The 
29.18 	board shall submit a report to the chairs of 
29.19 	the legislative committees with jurisdiction 
29.20 	over environment and natural resources 
29.21 	policy and finance on a plan to transition to 
29.22 	self-sufficiency.
29.23 	$136,000 the first year and $136,000 
29.24 	the second year are for a grant to Area 
29.25 	II, Minnesota River Basin Projects, 
29.26 	for floodplain management, including 
29.27 	administration of programs.
29.28 	The appropriations for grants in this 
29.29 	section are available until expended. If an 
29.30 	appropriation for grants in either year is 
29.31 	insufficient, the appropriation in the other 
29.32 	year is available for it.
29.33 	To the extent possible, any restoration 
29.34 	conducted with money appropriated in this 
29.35 	section must plant vegetation or sow seed 
30.1 	only of ecotypes native to Minnesota, and 
30.2 	preferably of the local ecotype, using a high 
30.3 	diversity of species originating from as 
30.4 	close to the restoration site as possible, and 
30.5 	protect existing native prairies from genetic 
30.6 	contamination.
30.7 	A recipient of a grant funded by an 
30.8 	appropriation under this section shall display 
30.9 	on its Web site detailed information on 
30.10 	the expenditure of the grant funds, and 
30.11 	measurable outcomes as a result of the 
30.12 	expenditure of funds, and submit this 
30.13 	information to the board by June 30 each 
30.14 	year. A recipient without an active Web site 
30.15 	shall report to the board by June 30 each year 
30.16 	detailed information on the expenditure of 
30.17 	the grant funds, and measurable outcomes 
30.18 	as a result of the expenditure of funds. The 
30.19 	board shall display the information received 
30.20 	by recipients under this paragraph on the 
30.21 	board's Web site.
30.22 	The board shall require the chief financial 
30.23 	officer or other financial staff to display the 
30.24 	board's budget on the board's Web site in 
30.25 	a manner that will allow citizens to easily 
30.26 	understand the value they are getting for their 
30.27 	money.

30.28	Sec. 6. METROPOLITAN COUNCIL
 	$
	8,377,000
	$
	8,377,000

30.29	Appropriations by Fund
	
30.30		2010
	2011
	
30.31	General
	3,807,000
	3,807,000
	
30.32	Natural Resources
	4,570,000
	4,570,000
	
30.33 	$3,807,000 the first year and $3,807,000 
30.34 	the second year are for metropolitan area 
30.35 	regional parks operation and maintenance 
31.1 	according to Minnesota Statutes, section 
31.2 	473.351.
31.3 	$4,570,000 the first year and $4,570,000 the 
31.4 	second year are from the natural resources 
31.5 	fund for metropolitan area regional parks 
31.6 	and trails maintenance and operations. This 
31.7 	appropriation is from the revenue deposited 
31.8 	in the natural resources fund under Minnesota 
31.9 	Statutes, section 297A.94, paragraph (e), 
31.10 	clause (3).

31.11
31.12	Sec. 7. MINNESOTA CONSERVATION 
CORPS
 	$
	965,000
	$
	965,000

31.13	Appropriations by Fund
	
31.14		2010
	2011
	
31.15	General
	475,000
	475,000
	
31.16	Natural Resources
	490,000
	490,000
	
31.17 	The Minnesota Conservation Corps may 
31.18 	receive money appropriated from the 
31.19 	natural resources fund under this section 
31.20 	only as provided in an agreement with the 
31.21 	commissioner of natural resources.

31.22	Sec. 8. ZOOLOGICAL BOARD
 	$
	6,839,000
	$
	6,839,000

31.23	Appropriations by Fund
	
31.24		2010
	2011
	
31.25	General
	6,701,000
	6,701,000
	
31.26	Natural Resources
	138,000
	138,000
	
31.27 	$138,000 the first year and $138,000 the 
31.28 	second year are from the natural resources 
31.29 	fund from the revenue deposited under 
31.30 	Minnesota Statutes, section 297A.94, 
31.31 	paragraph (e), clause (5).

31.32
31.33	Sec. 9. SCIENCE MUSEUM OF 
MINNESOTA
 	$
	1,187,000
	$
	1,187,000

32.1 	Sec. 10. Minnesota Statutes 2008, section 84.0835, subdivision 3, is amended to read:
32.2 		Subd. 3.Citation authority. Employees designated by the commissioner under 
32.3 	subdivision 1 may issue citations, as specifically authorized under this subdivision, for 
32.4 	violations of:
32.5 	(1) sections 85.052, subdivision 3 (payment of camping fees in state parks), 
32.6 	85.45, subdivision 1 (cross-country ski pass), and85.46 (horse trail pass), and 84.9275 
32.7 	(nonresident all-terrain vehicle state trail pass); 
32.8 	(2) rules relating to hours and days of operation, restricted areas, noise, fireworks, 
32.9 	environmental protection, fires and refuse, pets, picnicking, camping and dispersed 
32.10 	camping, nonmotorized uses, construction of unauthorized permanent trails, mooring of 
32.11 	boats, fish cleaning, swimming, storage and abandonment of personal property, structures 
32.12 	and stands, animal trespass, state park individual and group motor vehicle permits, 
32.13 	licensed motor vehicles, designated roads, and snowmobile operation off trails;
32.14 	(3) rules relating to off-highway vehicle registration, display of registration numbers, 
32.15 	required equipment, operation restrictions, off-trail use for hunting and trapping, and 
32.16 	operation in lakes, rivers, and streams;
32.17 	(4) rules relating to off-highway vehicle and snowmobile operation causing damage 
32.18 	or in closed areas within the Richard J. Dorer Memorial Hardwood State Forest;
32.19 	(5) rules relating to parking, snow removal, and damage on state forest roads; and
32.20 	(6) rules relating to controlled hunting zones on major wildlife management units.

32.21 	EFFECTIVE DATE. This section is effective January 1, 2010.

32.22 	Sec. 11. [84.0854] GIFT CARD AND CERTIFICATE SALES; RECEIPTS; 
32.23 	TRANSFERS; APPROPRIATION.
32.24 		Subdivision 1.Sales authorized; gift cards and certificates. The commissioner 
32.25 	may sell gift cards and certificates that can be used to purchase licenses, permits, products, 
32.26 	or services sold by the commissioner. Gift cards and certificates are valid until they are 
32.27 	redeemed. The commissioner may advertise the availability of this program and items 
32.28 	offered for sale under this section.
32.29 		Subd. 2.Receipts; disposition. Proceeds of gift card and certificate sales shall be 
32.30 	deposited in an account in the special revenue fund. When gift cards or certificates are 
32.31 	redeemed, funds shall be transferred to the appropriate account or fund based on the 
32.32 	license, permit, product, or service purchased. Money in the gift card and certificate 
32.33 	account shall accrue interest, which shall be credited to the account. Interest on funds in 
32.34 	the account is appropriated to the commissioner to help cover the cost of administering 
32.35 	the gift card and certificate program. Money from gift cards and certificates sold but 
33.1 	unredeemed after three years shall be transferred to the various accounts and funds 
33.2 	receiving revenue from purchases of licenses, permits, products, or services purchased 
33.3 	with gift card or certificate redemptions in the last two fiscal years. Funds shall be 
33.4 	distributed based on the dollar value of cards redeemed for the various licenses, permits, 
33.5 	products, or services on a pro rata basis.
33.6 		Subd. 3.Exemption from rulemaking. This section is not subject to the 
33.7 	rulemaking provisions of chapter 14 and section 14.386 does not apply.

33.8 	Sec. 12. Minnesota Statutes 2008, section 84.415, subdivision 5, is amended to read:
33.9 		Subd. 5.Fee Fees; disposition. (a) In the event the construction of such lines causes 
33.10 	damage to timber or other property of the state on or along the same, the license or permit 
33.11 	shall also provide for payment to the commissioner of finance of the amount thereof as 
33.12 	may be determined by the commissioner.
33.13 	(b) The application fee specified in Minnesota Rules, chapter 6135, is credited 
33.14 	to the general fund.
33.15 	All money received under such licenses or permits(c) The utility crossing fees 
33.16 	specified in Minnesota Rules, chapter 6135, shall be credited to the fund to which other 
33.17 	income or proceeds of sale from such land would be credited, if provision therefor be 
33.18 	made by law, otherwise to the general fund.
33.19 	(d) Money received under subdivision 6 must be deposited in the land management 
33.20 	account in the natural resources fund. Money in the land management account of the 
33.21 	natural resources fund is appropriated to the commissioner of natural resources to cover 
33.22 	the costs incurred for issuing and monitoring utility licenses.

33.23 	Sec. 13. Minnesota Statutes 2008, section 84.415, is amended by adding a subdivision 
33.24 	to read:
33.25 		Subd. 6.Supplemental application fee and monitoring fee. (a) In addition to 
33.26 	the application fee and utility crossing fees specified in Minnesota Rules, chapter 6135, 
33.27 	the commissioner of natural resources shall assess the applicant for a utility license the 
33.28 	following fees:
33.29 	(1) a supplemental application fee of $1,500 for a public water crossing license and 
33.30 	a supplemental application fee of $4,500 for a public lands crossing license, to cover 
33.31 	reasonable costs for reviewing the application and preparing the license; and
33.32 	(2) a monitoring fee to cover the projected reasonable costs for monitoring the 
33.33 	construction of the utility line and preparing special terms and conditions of the license 
34.1 	to ensure proper construction. The commissioner must give the applicant an estimate of 
34.2 	the monitoring fee before the applicant submits the fee.
34.3 	(b) The applicant shall pay fees under this subdivision to the commissioner of 
34.4 	natural resources. The commissioner shall not issue the license until the applicant has 
34.5 	paid all fees in full.
34.6 	(c) Upon completion of construction, the commissioner shall refund any remaining 
34.7 	balance left between the fee assessed for monitoring and the amount used by the 
34.8 	commissioner in monitoring the construction of the utility line. The commissioner shall 
34.9 	not return the application fees, even if the application is withdrawn or denied.

34.10 	Sec. 14. Minnesota Statutes 2008, section 84.63, is amended to read:
34.11 	84.63 CONVEYANCE OF INTERESTS IN LANDS TO STATE AND 
34.12 	FEDERAL GOVERNMENTS.
34.13 	(a) Notwithstanding any existing law to the contrary, the commissioner of natural 
34.14 	resources is hereby authorized on behalf of the state to convey to the United States 
34.15 	or to the state of Minnesota or any of its subdivisions, upon state-owned lands under 
34.16 	the administration of the commissioner of natural resources, permanent or temporary 
34.17 	easements for specified periods or otherwise for trails, highways, roads including 
34.18 	limitation of right of access from the lands to adjacent highways and roads, flowage for 
34.19 	development of fish and game resources, stream protection, flood control, and necessary 
34.20 	appurtenances thereto, such conveyances to be made upon such terms and conditions 
34.21 	including provision for reversion in the event of non-user as the commissioner of natural 
34.22 	resources may determine.
34.23 	(b) In addition to the fee for the market value of the easement, the commissioner of 
34.24 	natural resources shall assess the applicant the following fees:
34.25 	(1) an application fee of $2,000 to cover reasonable costs for reviewing the 
34.26 	application and preparing the easement; and
34.27 	(2) a monitoring fee to cover the projected reasonable costs for monitoring the 
34.28 	construction of the easement and preparing special terms and conditions for the easement. 
34.29 	The commissioner must give the applicant an estimate of the monitoring fee before the 
34.30 	applicant submits the fee.
34.31 	(c) The applicant shall pay these fees to the commissioner of natural resources. 
34.32 	The commissioner shall not issue the easement until the applicant has paid in full the 
34.33 	application fee, the monitoring fee, and the market value payment for the easement.
34.34 	(d) Upon completion of construction, the commissioner shall refund any remaining 
34.35 	balance left between the monitoring fee assessed and the amount used by the commissioner 
35.1 	in monitoring the construction of the easement. The commissioner shall not return the 
35.2 	application fee, even if the application is withdrawn or denied.
35.3 	(e) Money received under paragraph (b) must be deposited in the land management 
35.4 	account in the natural resources fund. Money in the land management account of the 
35.5 	natural resources fund is appropriated to the commissioner of natural resources to cover 
35.6 	the reasonable costs incurred for issuing and monitoring easements.

35.7 	Sec. 15. Minnesota Statutes 2008, section 84.631, is amended to read:
35.8 	84.631 ROAD EASEMENTS ACROSS STATE LANDS.
35.9 	(a) Except as provided in section 85.015, subdivision 1b, the commissioner, on 
35.10 	behalf of the state, may convey a road easement across state land under the commissioner's 
35.11 	jurisdiction other than school trust land, to a private person requesting an easement for 
35.12 	access to property owned by the person only if the following requirements are met: (1) 
35.13 	there are no reasonable alternatives to obtain access to the property; and (2) the exercise 
35.14 	of the easement will not cause significant adverse environmental or natural resource 
35.15 	management impacts.
35.16 	(b) The commissioner shall:
35.17 	(1) require the applicant to pay the market value of the easement;
35.18 	(2) provide that the easement reverts to the state in the event of nonuse; and
35.19 	(3) impose other terms and conditions of use as necessary and appropriate under 
35.20 	the circumstances.
35.21 	(c) An applicant shall submit aan application fee of up to $2,000 with each 
35.22 	application for a road easement across state land. The commissioner must give the 
35.23 	applicant an estimate of the costs of the road easement before the applicant submits the 
35.24 	fee. The application fee is nonrefundable, even if the application is withdrawn or denied.
35.25 	(d) In addition to the payment for the market value of the easement and the 
35.26 	application fee, the commissioner of natural resources shall assess the applicant a 
35.27 	monitoring fee to cover the projected reasonable costs for monitoring the construction 
35.28 	of the easement and preparing special terms and conditions for the easement. The 
35.29 	commissioner must give the applicant an estimate of the monitoring fee before the 
35.30 	applicant submits the fee. The applicant shall pay the application and monitoring fees to 
35.31 	the commissioner of natural resources. The commissioner shall not issue the easement 
35.32 	until the applicant has paid in full the application fee, the monitoring fee, and the market 
35.33 	value payment for the easement. 
36.1 	(e) Upon completion of construction, the commissioner shall refund any remaining 
36.2 	balance left between the monitoring fee assessed and the amount used by the commissioner 
36.3 	in monitoring the construction of the easement.
36.4 	(f) Fees collected under paragraphparagraphs (c) and (d) must be deposited in the 
36.5 	land management account in the natural resources fund. Money in the land management 
36.6 	account of the natural resources fund is appropriated to the commissioner of natural 
36.7 	resources to cover the reasonable costs incurred under this section.

36.8 	Sec. 16. Minnesota Statutes 2008, section 84.632, is amended to read:
36.9 	84.632 CONVEYANCE OF UNNEEDED STATE EASEMENTS.
36.10 	(a) Notwithstanding section 92.45, the commissioner of natural resources may, 
36.11 	in the name of the state, release all or part of an easement acquired by the state upon 
36.12 	application of a landowner whose property is burdened with the easement if the easement 
36.13 	is not needed for state purposes.  
36.14 	(b) All or part of an easement may be released by payment of consideration of not 
36.15 	less than $500, to be determined by the commissioner the market value of the easement. 
36.16 	The release must be in a form approved by the attorney general.
36.17 	(c) Money received for release of the easement under paragraph (b) must be credited 
36.18 	to the account from which money was expended for purchase of the easement. If there is 
36.19 	no specific account, the money must be credited to the land acquisition account established 
36.20 	in section 94.165.  
36.21 	(d) In addition to payment under paragraph (b), the commissioner of natural 
36.22 	resources shall assess a landowner who applies for a release under this section an 
36.23 	application fee of $2,000 for reviewing the application and preparing the release of 
36.24 	easement. The applicant shall pay the application fee to the commissioner of natural 
36.25 	resources. The commissioner shall not issue the release of easement until the applicant 
36.26 	has paid the application fee in full. The commissioner shall not return the application fee, 
36.27 	even if the application is withdrawn or denied.
36.28 	(e) Money received under paragraph (d) must be deposited in the land management 
36.29 	account in the natural resources fund. Money in the land management account of the 
36.30 	natural resources fund is appropriated to the commissioner of natural resources to cover 
36.31 	the reasonable costs incurred under this section.

36.32 	Sec. 17. Minnesota Statutes 2008, section 84.788, subdivision 3, is amended to read:
36.33 		Subd. 3.Application; issuance; reports. (a) Application for registration or 
36.34 	continued registration must be made to the commissioner or an authorized deputy registrar 
37.1 	of motor vehicles in a form prescribed by the commissioner. The form must state the name 
37.2 	and address of every owner of the off-highway motorcycle.
37.3 	(b) A person who purchases from a retail dealer an off-highway motorcycle shall 
37.4 	make application for registration to the dealer at the point of sale. The dealer shall issue a 
37.5 	dealer temporary 21-day registration permit to each purchaser who applies to the dealer 
37.6 	for registration. The dealer shall submit the completed registration applications and fees 
37.7 	to the deputy registrar at least once each week. No fee may be charged by a dealer to a 
37.8 	purchaser for providing the temporary permit.
37.9 	(c) Upon receipt of the application and the appropriate fee, the commissioner 
37.10 	or deputy registrar shall issue to the applicant, or provide to the dealer, an assigned 
37.11 	registration number or a commissioner or deputy registrar temporary 21-day permit. Once 
37.12 	issued, the registration number must be affixed to the motorcycle according to paragraph 
37.13 	(f). A dealer subject to paragraph (b) shall provide the registration materials or temporary 
37.14 	permit to the purchaser within the 21-day temporary permit period.
37.15 	(d) The commissioner shall develop a registration system to register vehicles under 
37.16 	this section. A deputy registrar of motor vehicles acting under section 168.33, is also a 
37.17 	deputy registrar of off-highway motorcycles. The commissioner of natural resources 
37.18 	in agreement with the commissioner of public safety may prescribe the accounting 
37.19 	and procedural requirements necessary to ensure efficient handling of registrations 
37.20 	and registration fees. Deputy registrars shall strictly comply with the accounting and 
37.21 	procedural requirements.
37.22 	(e) In addition to other fees prescribed by law, a filing fee of $4.50 is charged for 
37.23 	each off-highway motorcycle registration renewal, duplicate or replacement registration 
37.24 	card, and replacement decal and a filing fee of $7 is charged for each off-highway 
37.25 	motorcycle registration and registration transfer issued by:
37.26 	(1) a deputy registrar and must be deposited in the treasury of the jurisdiction where 
37.27 	the deputy is appointed, or kept if the deputy is not a public official; or
37.28 	(2) the commissioner and must be deposited in the state treasury and credited to the 
37.29 	off-highway motorcycle account.
37.30 	(f) Unless exempted in paragraph (g), the owner of an off-highway motorcycle must 
37.31 	display a registration decal issued by the commissioner. If the motorcycle is licensed as 
37.32 	a motor vehicle, a registration decal must be affixed on the upper left corner of the rear 
37.33 	license plate. If the motorcycle is not licensed as a motor vehicle, the decal must be 
37.34 	attached on the side of the motorcycle and may be attached to the fork tube. The decal 
37.35 	must be attached in a manner so that it is visible while a rider is on the motorcycle. The 
38.1 	issued decals must be of a size to work within the constraints of the electronic licensing 
38.2 	system, not to exceed three inches high and three inches wide.
38.3 	(g) Display of a registration decal is not required for an off-highway motorcycle:
38.4 	(1) while being operated on private property; or
38.5 	(2) while competing in a closed-course competition event.
38.6 	(h) Registration decals for vehicles under this section or any other vehicle registered 
38.7 	by the Department of Natural Resources must be manufactured in Minnesota.

38.8 	Sec. 18. Minnesota Statutes 2008, section 84.922, subdivision 1a, is amended to read:
38.9 		Subd. 1a.Exemptions. All-terrain vehicles exempt from registration are:
38.10 	(1) vehicles owned and used by the United States, the state, another state, or a 
38.11 	political subdivision;
38.12 	(2) vehicles registered in another state or country that have not been in this state for 
38.13 	more than 30 consecutive days; 
38.14 	(3) vehicles that:
38.15 	(i) are owned by a resident of another state or country that does not require 
38.16 	registration of all-terrain vehicles;
38.17 	(ii) have not been in this state for more than 30 consecutive days; and
38.18 	(iii) are operated on state and grant-in-aid trails by a nonresident possessing a 
38.19 	nonresident all-terrain vehicle state trail pass;
38.20 	(3) (4) vehicles used exclusively in organized track racing events; and
38.21 	(4) (5) vehicles that are 25 years old or older and were originally produced as a 
38.22 	separate identifiable make by a manufacturer.

38.23 	EFFECTIVE DATE. This section is effective January 1, 2010.

38.24 	Sec. 19. [84.9275] NONRESIDENT ALL-TERRAIN VEHICLE STATE TRAIL 
38.25 	PASS.
38.26 		Subdivision 1.Pass required; fee. (a) A nonresident may not operate an all-terrain 
38.27 	vehicle on a state or grant-in-aid all-terrain vehicle trail unless the operator carries a valid 
38.28 	nonresident all-terrain vehicle state trail pass in immediate possession. The pass must 
38.29 	be available for inspection by a peace officer, a conservation officer, or an employee 
38.30 	designated under section 84.0835.
38.31 	(b) The commissioner of natural resources shall issue a pass upon application and 
38.32 	payment of a $20 fee. The pass is valid from January 1 through December 31. Fees 
38.33 	collected under this section, except for the issuing fee for licensing agents, shall be 
38.34 	deposited in the state treasury and credited to the all-terrain vehicle account in the natural 
39.1 	resources fund and, except for the electronic licensing system commission established by 
39.2 	the commissioner under section 84.027, subdivision 15, must be used for grants-in-aid to 
39.3 	counties and municipalities for all-terrain vehicle organizations to construct and maintain 
39.4 	all-terrain vehicle trails and use areas.
39.5 	(c) A nonresident all-terrain vehicle state trail pass is not required for:
39.6 	(1) an all-terrain vehicle that is owned and used by the United States, another state, 
39.7 	or a political subdivision thereof that is exempt from registration under section 84.922, 
39.8 	subdivision 1a; or
39.9 	(2) a person operating an all-terrain vehicle only on the portion of a trail that is 
39.10 	owned by the person or the person's spouse, child, or parent.
39.11 		Subd. 2.License agents. The commissioner may appoint agents to issue and sell 
39.12 	nonresident all-terrain vehicle state trail passes. The commissioner may revoke the 
39.13 	appointment of an agent at any time. The commissioner may adopt additional rules as 
39.14 	provided in section 97A.485, subdivision 11. An agent shall observe all rules adopted 
39.15 	by the commissioner for accounting and handling of passes pursuant to section 97A.485, 
39.16 	subdivision 11. An agent shall promptly deposit and remit all money received from the 
39.17 	sale of the passes, exclusive of the issuing fee, to the commissioner.
39.18 		Subd. 3.Issuance of passes. The commissioner and agents shall issue and sell 
39.19 	nonresident all-terrain vehicle state trail passes. The commissioner shall also make the 
39.20 	passes available through the electronic licensing system established under section 84.027, 
39.21 	subdivision 15.
39.22 		Subd. 4.Agent's fee. In addition to the fee for a pass, an issuing fee of $1 per pass 
39.23 	shall be charged. The issuing fee may be retained by the seller of the pass. Issuing fees for 
39.24 	passes issued by the commissioner shall be deposited in the all-terrain vehicle account in 
39.25 	the natural resources fund and retained for the operation of the electronic licensing system.
39.26 		Subd. 5.Duplicate passes. The commissioner and agents shall issue a duplicate 
39.27 	pass to persons whose pass is lost or destroyed using the process established under section 
39.28 	97A.405, subdivision 3, and rules adopted thereunder. The fee for a duplicate nonresident 
39.29 	all-terrain vehicle state trail pass is $2, with an issuing fee of 50 cents.

39.30 	EFFECTIVE DATE. This section is effective January 1, 2010.

39.31 	Sec. 20. Minnesota Statutes 2008, section 85.015, subdivision 1b, is amended to read:
39.32 		Subd. 1b.Easements for ingress and egress. (a) Notwithstanding section 
39.33 	16A.695, when a trail is established under this section, a private property owner who has a 
39.34 	preexisting right of ingress and egress over the trail right-of-way is granted, without 
39.35 	charge, a permanent easement for ingress and egress purposes only. The easement is 
40.1 	limited to the preexisting crossing and reverts to the state upon abandonment. Nothing 
40.2 	in this subdivision is intended to diminish or alter any written or recorded easement that 
40.3 	existed before the state acquired the land for the trail. 
40.4 	(b) The commissioner of natural resources shall assess the applicant an application 
40.5 	fee of $2,000 for reviewing the application and preparing the easement. The applicant 
40.6 	shall pay the application fee to the commissioner of natural resources. The commissioner 
40.7 	shall not issue the easement until the applicant has paid the application fee in full. The 
40.8 	commissioner shall not return the application fee, even if the application is withdrawn 
40.9 	or denied.
40.10 	(c) Money received under paragraph (b) must be deposited in the land management 
40.11 	account in the natural resources fund. Money in the land management account of the 
40.12 	natural resources fund is appropriated to the commissioner of natural resources to cover 
40.13 	the reasonable costs incurred under this section.

40.14 	Sec. 21. Minnesota Statutes 2008, section 85.053, subdivision 10, is amended to read:
40.15 		Subd. 10.Free entrance; totally and permanently disabled veterans. The 
40.16 	commissioner shall issue an annual park permit for no charge for to any veteran with a 
40.17 	total and permanent service-connected disability, as determined by the United States 
40.18 	Department of Veterans Affairs, who presents each year a copy of their determination 
40.19 	letter to a park attendant or commissioner's designee. For the purposes of this section, 
40.20 	"veteran"with a total and permanent service-connected disability" means a resident who 
40.21 	has a total and permanent service-connected disability as adjudicated by the United States 
40.22 	Veterans Administration or by the retirement board of one of the several branches of the 
40.23 	armed forces has the meaning given in section 197.447.

40.24 	EFFECTIVE DATE. This section is effective July 1, 2009, for state park permits 
40.25 	issued on or after that date.

40.26 	Sec. 22. Minnesota Statutes 2008, section 85.46, subdivision 3, is amended to read:
40.27 		Subd. 3.Issuance. The commissioner of natural resources and agents shall issue 
40.28 	and sell horse trail passes. The pass shall include the applicant's signature and other 
40.29 	information deemed necessary by the commissioner. To be valid, a daily or annual pass 
40.30 	must be signed by the person riding, leading, or driving the horse, and a commercial 
40.31 	annual pass must be signed by the owner of the commercial trail riding facility.

40.32 	EFFECTIVE DATE. This section is effective January 1, 2010.

41.1 	Sec. 23. Minnesota Statutes 2008, section 85.46, subdivision 4, is amended to read:
41.2 		Subd. 4.Pass fees. (a) The fee for an annual horse trail pass is $20 for an individual 
41.3 	16 years of age and over. The fee shall be collected at the time the pass is purchased. 
41.4 	Annual passes are valid for one year beginning January 1 and ending December 31.
41.5 	(b) The fee for a daily horse trail pass is $4 for an individual 16 years of age and 
41.6 	over. The fee shall be collected at the time the pass is purchased. The daily pass is valid 
41.7 	only for the date designated on the pass form.
41.8 	(c) The fee for a commercial annual horse trail pass is $200 and includes issuance 
41.9 	of 15 passes. Additional or individual commercial annual horse trail passes may be 
41.10 	purchased by the commercial trail riding facility owner at a fee of $20 each. Commercial 
41.11 	annual horse trail passes are valid for one year beginning January 1 and ending December 
41.12 	31 and may be affixed to the horse tack, saddle, or person. Commercial annual horse trail 
41.13 	passes are not transferable. For the purposes of this section, a "commercial trail riding 
41.14 	facility" is an operation where horses are used for riding instruction or other equestrian 
41.15 	activities for hire.

41.16 	EFFECTIVE DATE. This section is effective January 1, 2010.

41.17 	Sec. 24. Minnesota Statutes 2008, section 85.46, subdivision 7, is amended to read:
41.18 		Subd. 7.Duplicate horse trail passes. The commissioner of natural resources and 
41.19 	agents shall issue a duplicate pass to a person or commercial trail riding facility owner 
41.20 	whose pass is lost or destroyed using the process established under section 97A.405, 
41.21 	subdivision 3, and rules adopted thereunder. The fee for a duplicate horse trail pass is $2, 
41.22 	with an issuing fee of 50 cents.

41.23 	EFFECTIVE DATE. This section is effective January 1, 2010.

41.24 	Sec. 25. Minnesota Statutes 2008, section 93.481, subdivision 1, is amended to read:
41.25 		Subdivision 1.Prohibition against mining without permit; application for 
41.26 	permit. Except as provided in this subdivision, after June 30, 1975, no person shall 
41.27 	engage in or carry out a mining operation for metallic minerals within the state unless the 
41.28 	person has first obtained a permit to mine from the commissioner. Any person engaging 
41.29 	in or carrying out a mining operation as of the effective date of the rules promulgated
41.30 	adopted under section 93.47 shall apply for a permit to mine within 180 days after the 
41.31 	effective date of such rules. Any such existing mining operation may continue during the 
41.32 	pendency of the application for the permit to mine. The person applying for a permit shall 
42.1 	apply on forms prescribed by the commissioner and shall submit such information as the 
42.2 	commissioner may require, including but not limited to the following: 
42.3 	(a) (1) a proposed plan for the reclamation or restoration, or both, of any mining 
42.4 	area affected by mining operations to be conducted on and after the date on which permits 
42.5 	are required for mining under this section;
42.6 	(b) (2) a certificate issued by an insurance company authorized to do business in 
42.7 	the United States that the applicant has a public liability insurance policy in force for 
42.8 	the mining operation for which the permit is sought, or evidence that the applicant has 
42.9 	satisfied other state or federal self-insurance requirements, to provide personal injury 
42.10 	and property damage protection in an amount adequate to compensate any persons who 
42.11 	might be damaged as a result of the mining operation or any reclamation or restoration 
42.12 	operations connected with the mining operation;
42.13 	(3) an application fee of:
42.14 	(i) $25,000 for a permit to mine for a taconite mining operation;
42.15 	(ii) $50,000 for a permit to mine for a nonferrous metallic minerals operation;
42.16 	(iii) $10,000 for a permit to mine for a scram mining operation; or
42.17 	(iv) $5,000 for a permit to mine for a peat operation;
42.18 	(c) (4) a bond which may be required pursuant to section 93.49; and 
42.19 	(d) (5) a copy of the applicant's advertisement of the ownership, location, and 
42.20 	boundaries of the proposed mining area and reclamation or restoration operations, which 
42.21 	advertisement shall be published in a legal newspaper in the locality of the proposed site 
42.22 	at least once a week for four successive weeks before the application is filed, except that if 
42.23 	the application is for a permit to conduct lean ore stockpile removal the advertisement 
42.24 	need be published only once.

42.25 	Sec. 26. Minnesota Statutes 2008, section 93.481, subdivision 3, is amended to read:
42.26 		Subd. 3.Term of permit; amendment. A permit issued by the commissioner 
42.27 	pursuant to this section shall be granted for the term determined necessary by the 
42.28 	commissioner for the completion of the proposed mining operation, including reclamation 
42.29 	or restoration. A permit may be amended upon written application to the commissioner. 
42.30 	A permit amendment application fee must be submitted with the written application. The 
42.31 	permit amendment application fee is ten percent of the amount provided for in subdivision 
42.32 	1, clause (3), for an application for the applicable permit to mine. If the commissioner 
42.33 	determines that the proposed amendment constitutes a substantial change to the permit, 
42.34 	the person applying for the amendment shall publish notice in the same manner as for a 
42.35 	new permit, and a hearing shall be held if written objections are received in the same 
43.1 	manner as for a new permit. An amendment may be granted by the commissioner if the 
43.2 	commissioner determines that lawful requirements have been met.

43.3 	Sec. 27. Minnesota Statutes 2008, section 93.481, subdivision 5, is amended to read:
43.4 		Subd. 5.Assignment. A permit may not be assigned or otherwise transferred 
43.5 	without the written approval of the commissioner. A permit assignment application fee 
43.6 	must be submitted with the written application. The permit assignment application fee 
43.7 	is ten percent of the amount provided for in subdivision 1, clause (3), for an application 
43.8 	for the applicable permit to mine.

43.9 	Sec. 28. Minnesota Statutes 2008, section 93.481, subdivision 7, is amended to read:
43.10 		Subd. 7.Mining administration account. The mining administration account is 
43.11 	established as an account in the natural resources fund. Ferrous mining administrative Fees 
43.12 	charged to owners, operators, or managers of mines under sections 93.481 and 93.482 shall 
43.13 	be credited to the account and may be appropriated to the commissioner to cover the costs 
43.14 	of providing and monitoring permits to mine ferrous metals under this section. Interest 
43.15 	accruing from investment of the account remains with the account until appropriated.

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

43.17 	Sec. 29. [93.482] RECLAMATION FEES.
43.18 		Subdivision 1.Annual permit to mine fee. (a) The commissioner shall charge 
43.19 	every person holding a permit to mine an annual permit fee. The fee is payable to the 
43.20 	commissioner by June 30 of each year, beginning in 2009.
43.21 	(b) The annual permit to mine fee for a taconite mining operation is $60,000 if the 
43.22 	operation had production within the past calendar year to the year in which payment is due 
43.23 	and $30,000 if there has been no production within the past calendar year.
43.24 	(c) The annual permit to mine fee for a nonferrous metallic minerals mining 
43.25 	operation is $75,000 if the operation had production within the past calendar year to the 
43.26 	year in which payment is due and $37,500 if there has been no production within the 
43.27 	past calendar year.
43.28 	(d) The annual permit to mine fee for a scram mining operation is $5,000 if the 
43.29 	operation had production within the past calendar year to the year in which payment is due 
43.30 	and $2,500 if there has been no production within the past calendar year.
43.31 	(e) The annual permit to mine fee for a peat mining operation is $1,000 if the 
43.32 	operation had production within the past calendar year to the year in which payment is due 
43.33 	and $500 if there has been no production within the past calendar year.
44.1 		Subd. 2.Supplemental application fee for taconite and nonferrous metallic 
44.2 	minerals mining operation. (a) In addition to the application fee specified in section 
44.3 	93.481, the commissioner shall assess a person submitting an application for a permit to 
44.4 	mine for a taconite or a nonferrous metallic minerals mining operation the reasonable 
44.5 	costs for reviewing the application and preparing the permit to mine. For nonferrous 
44.6 	metallic minerals mining, the commissioner shall assess reasonable costs for monitoring 
44.7 	construction of the mining facilities.
44.8 	(b) The commissioner must give the applicant an estimate of the supplemental 
44.9 	application fee under this subdivision. The estimate must include a brief description 
44.10 	of the tasks to be performed and the estimated cost of each task. The application fee 
44.11 	under section 93.481 shall be subtracted from the estimate of costs to determine the 
44.12 	supplemental application fee.
44.13 	(c) The applicant and the commissioner shall enter into a written agreement to cover 
44.14 	the estimated costs to be incurred by the commissioner.
44.15 	(d) The commissioner shall not issue the permit to mine until the applicant has 
44.16 	paid all fees in full. Upon completion of construction of a nonferrous metallic minerals 
44.17 	facility, the commissioner shall refund any remaining balance between the fee assessed 
44.18 	for monitoring construction and the amount used by the commissioner in monitoring 
44.19 	construction of the mining facilities.
44.20 		Subd. 3.Reclamation fee on taconite iron ore produced. (a) For the purposes 
44.21 	of this subdivision:
44.22 	(1) "fee owner" means a person having any right, title, or interest in any minerals 
44.23 	or mineral rights in this state from which taconite iron ore is mined. Fee owner does not 
44.24 	include the United States, the state, or the University of Minnesota; 
44.25 	(2) "taconite iron ore" means a ferruginous chert or ferruginous slate in the form of 
44.26 	compact siliceous rock, in which the iron oxide is so finely disseminated that substantially 
44.27 	all of the iron bearing particles of merchantable grade are smaller than 20 mesh; and
44.28 	(3) "ton" means a gross ton of 2,240 pounds.
44.29 	(b) A fee owner is subject to a reclamation fee of $.0075 per ton of taconite iron ore 
44.30 	mined from the minerals or mineral rights owned by the fee owner.
44.31 	(c) The fee owner shall make payment to the commissioner no later than January 
44.32 	20 of each calendar year for ore removed during the previous calendar year. The fee 
44.33 	owner is liable for the payment of the reclamation fee. The fee owner may enter into an 
44.34 	agreement with the mining operator to make the payment on their behalf from royalties 
44.35 	due and owing or other financial terms.

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

45.1 	Sec. 30. Minnesota Statutes 2008, section 97A.075, subdivision 1, is amended to read:
45.2 		Subdivision 1.Deer, bear, and lifetime licenses. (a) For purposes of this 
45.3 	subdivision, "deer license" means a license issued under section 97A.475, subdivisions 2, 
45.4 	clauses (5), (6), (7), (11), (13), (15), (16), and (17), and 3, clauses (2), (3), (4), (9), (11), 
45.5 	(12), and (13), and licenses issued under section 97B.301, subdivision 4. 
45.6 	(b) $2 from each annual deer license and $2 annually from the lifetime fish and 
45.7 	wildlife trust fund, established in section 97A.4742, for each license issued under section 
45.8 	97A.473, subdivision 4, shall be credited to the deer management account and shall be 
45.9 	used for deer habitat improvement or deer management programs. 
45.10 	(c) $1 from each annual deer license and each bear license and $1 annually from 
45.11 	the lifetime fish and wildlife trust fund, established in section 97A.4742, for each license 
45.12 	issued under section 97A.473, subdivision 4, shall be credited to the deer and bear 
45.13 	management account and shall be used for deer and bear management programs, including 
45.14 	a computerized licensing system. 
45.15 	(d) Fifty cents from each deer license is credited to the emergency deer feeding 
45.16 	and wild cervidae health management account and is appropriated for emergency deer 
45.17 	feeding and wild cervidae health management. Money appropriated for emergency 
45.18 	deer feeding and wild cervidae health management is available until expended. When 
45.19 	the unencumbered balance in the appropriation for emergency deer feeding and wild 
45.20 	cervidae health management at the end of a fiscal year exceeds $2,500,000 for the first 
45.21 	time, $750,000 is canceled to the unappropriated balance of the game and fish fund.
45.22 	The commissioner must inform the legislative chairs of the natural resources finance 
45.23 	committees every two years on how the money for emergency deer feeding and wild 
45.24 	cervidae health management has been spent. 
45.25 	Thereafter, When the unencumbered balance in the appropriation for emergency 
45.26 	deer feeding and wild cervidae health management exceeds $2,500,000 at the end of a 
45.27 	fiscal year, the unencumbered balance in excess of $2,500,000 is canceled and available 
45.28 	for deer and bear management programs and computerized licensing.

45.29 	Sec. 31. Minnesota Statutes 2008, section 103G.301, subdivision 2, is amended to read:
45.30 		Subd. 2.Permit application fees. (a) A permit application fee to defray the costs of 
45.31 	receiving, recording, and processing the application must be paid for a permit authorized 
45.32 	under this chapter and for each request to amend or transfer an existing permit. Fees 
45.33 	established under this subdivision, unless specified in paragraph (c), shall be compliant 
45.34 	with section 16A.1285.
46.1 	(b) The fee for a project appropriatingProposed projects that require water in excess 
46.2 	of 100 million gallons per year must be assessed fees to recover the reasonable costs 
46.3 	of preparing and processing the permit, including costsincurred to evaluate the project 
46.4 	and the costs incurred for environmental review. Fees collected under this paragraph 
46.5 	must be credited to an account in the natural resources fund and are appropriated to the 
46.6 	commissioner for fiscal years 2008 and 2009.
46.7 	(c) The fee to apply for a permit to appropriate water, other than a permit subject 
46.8 	to thein addition to any fee under paragraph (b); a permit to construct or repair a dam 
46.9 	that is subject to dam safety inspection; or a state general permit or to apply for the state 
46.10 	water bank program is $150. The application fee for a permit to work in public waters or 
46.11 	to divert waters for mining must be at least $150, but not more than $1,000, according to a 
46.12 	schedule of fees adopted under section 16A.1285.

46.13 	Sec. 32. Minnesota Statutes 2008, section 103G.301, subdivision 3, is amended to read:
46.14 		Subd. 3.Field inspection fees. (a) In addition to the application fee, the 
46.15 	commissioner may charge a field inspection fee for:
46.16 	(1) projects requiring a mandatory environmental assessment under chapter 116D;
46.17 	(2) projects undertaken without a required permit or application; and
46.18 	(3) projects undertaken in excess of limitations established in an issued permit.
46.19 	(b) The fee must be at least $100 but not more than actual inspection costs.
46.20 	(c) The fee is to cover actual costs related to a permit applied for under this chapter 
46.21 	or for a project undertaken without proper authorization.
46.22 	(d) The commissioner shall establish a schedule of field inspection fees under section 
46.23 	16A.1285. The schedule must include actual costs related to field inspection, including 
46.24 	investigations of the area affected by the proposed activity, analysis of the proposed 
46.25 	activity, consultant services, and subsequent monitoring, if any, of the activity authorized 
46.26 	by the permit. Fees collected under this subdivision must be credited to an account in the 
46.27 	natural resources fund and are appropriated to the commissioner.

46.28 	Sec. 33. Minnesota Statutes 2008, section 115.03, subdivision 5c, is amended to read:
46.29 		Subd. 5c.Regulation of storm water discharges. (a) The agency may issue a 
46.30 	general permit to any category or subcategory of point source storm water discharges 
46.31 	that it deems administratively reasonable and efficient without making any findings 
46.32 	under agency rules. Nothing in this subdivision precludes the agency from requiring an 
46.33 	individual permit for a point source storm water discharge if the agency finds that it is 
46.34 	appropriate under applicable legal or regulatory standards.
47.1 	(b) Pursuant to this paragraph, the legislature authorizes the agency to adopt and 
47.2 	enforce rules regulating point source storm water discharges. No further legislative 
47.3 	approval is required under any other legal or statutory provision whether enacted before or 
47.4 	after May 29, 2003.
47.5 	(c) The agency may develop performance standards, design standards, or other 
47.6 	tools to enable and promote the implementation of low-impact development and other 
47.7 	storm water management techniques. For the purposes of this section, "low-impact 
47.8 	development" means an approach to storm water management that mimics a site's natural 
47.9 	hydrology as the landscape is developed. Using the low-impact development approach, 
47.10 	storm water is managed on-site and the rate and volume of predevelopment storm water 
47.11 	reaching receiving waters is unchanged. The calculation of predevelopment hydrology is 
47.12 	based on native soil and vegetation.

47.13 	Sec. 34. Minnesota Statutes 2008, section 115.073, is amended to read:
47.14 	115.073 ENFORCEMENT FUNDING.
47.15 	Except as provided in section 115C.05, all money recovered by the state under this 
47.16 	chapter and chapters 115A and 116, including civil penalties and money paid under an 
47.17 	agreement, stipulation, or settlement, excluding money paid for past due fees or taxes, 
47.18 	up to the amount appropriated for implementation of Laws 1991, chapter 347, must be 
47.19 	deposited in the state treasury and credited to the environmental fund.  

47.20 	Sec. 35. Minnesota Statutes 2008, section 115.56, subdivision 4, is amended to read:
47.21 		Subd. 4.License fee. The fee for a license required under subdivision 2 is $100
47.22 	$200 per year. Revenue from the fees must be credited to the environmental fund and is 
47.23 	exempt from section 16A.1285.

47.24 	Sec. 36. Minnesota Statutes 2008, section 115.77, subdivision 1, is amended to read:
47.25 		Subdivision 1.Fees established. The following fees are established for the 
47.26 	purposes indicated: agency shall collect fees in amounts necessary, but no greater than the 
47.27 	amounts necessary, to cover the reasonable costs of reviewing applications and issuing 
47.28 	certifications.
47.29 	(1) application for examination, $32;
47.30 	(2) issuance of certificate, $23;
47.31 	(3) reexamination resulting from failure to pass an examination, $32;
47.32 	(4) renewal of certificate, $23;
47.33 	(5) replacement certificate, $10; and
48.1 	(6) reinstatement or reciprocity certificate, $40.

48.2 	Sec. 37. Minnesota Statutes 2008, section 115A.1314, subdivision 2, is amended to 
48.3 	read:
48.4 		Subd. 2.Creation of account; appropriations. (a) The electronic waste account 
48.5 	is established in the environmental fund. The commissioner of revenue must deposit 
48.6 	receipts from the fee established in subdivision 1 in the account. Any interest earned on 
48.7 	the account must be credited to the account. Money from other sources may be credited to 
48.8 	the account. Beginning in the second program year and continuing each program year 
48.9 	thereafter, as of the last day of each program year, the commissioner of revenue shall 
48.10 	determine the total amount of the variable fees that were collected. By July 15, 2009, and 
48.11 	each July 15 thereafter, the commissioner of the Pollution Control Agency shall inform 
48.12 	the commissioner of revenue of the amount necessary to operate the program in the new 
48.13 	program year. To the extent that the total fees collected by the commissioner of revenue
48.14 	in connection with this section exceed the amount the commissioner of the Pollution 
48.15 	Control Agency determines necessary to operate the program for the new program 
48.16 	year, the commissioner of revenue shall refund on a pro rata basis, to all manufacturers 
48.17 	who paid any fees for the previous program year, the amount of fees collected by the 
48.18 	commissioner of revenue in excess of the amount necessary to operate the program for the 
48.19 	new program year. No individual refund is required of amounts of $100 or less for a fiscal 
48.20 	year. Manufacturers who report collections less than 50 percent of their obligation for the 
48.21 	previous program year are not eligible for a refund. Amounts not refunded pursuant to this 
48.22 	paragraph shall remain in the account. The commissioner of revenue shall issue refunds 
48.23 	by August 10. In lieu of issuing a refund, the commissioner of revenue may grant credit 
48.24 	against a manufacturer's variable fee due by September 1.
48.25 	(b) Until June 30, 2009 2011, money in the account is annually appropriated to the 
48.26 	Pollution Control Agency:
48.27 	(1) for the purpose of implementing sections 115A.1312 to 115A.1330, including 
48.28 	transfer to the commissioner of revenue to carry out the department's duties under 
48.29 	section 115A.1320, subdivision 2, and transfer to the commissioner of administration for 
48.30 	responsibilities under section 115A.1324; and 
48.31 	(2) to the commissioner of the Pollution Control Agency to be distributed on a 
48.32 	competitive basis through contracts with counties outside the 11-county metropolitan 
48.33 	area, as defined in paragraph (c), and with private entities that collect for recycling 
48.34 	covered electronic devices in counties outside the 11-county metropolitan area, where the 
48.35 	collection and recycling is consistent with the respective county's solid waste plan, for 
49.1 	the purpose of carrying out the activities under sections 115A.1312 to 115A.1330. In 
49.2 	awarding competitive grants under this clause, the commissioner must give preference to 
49.3 	counties and private entities that are working cooperatively with manufacturers to help 
49.4 	them meet their recycling obligations under section 115A.1318, subdivision 1.
49.5 	(c) The 11-county metropolitan area consists of the counties of Anoka, Carver, 
49.6 	Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright.

49.7 	Sec. 38. Minnesota Statutes 2008, section 115A.557, subdivision 3, is amended to read:
49.8 		Subd. 3.Eligibility to receive money. (a) To be eligible to receive money 
49.9 	distributed by the commissioner under this section, a county shall within one year of 
49.10 	October 4, 1989:
49.11 	(1) create a separate account in its general fund to credit the money; and
49.12 	(2) set up accounting procedures to ensure that money in the separate account is 
49.13 	spent only for the purposes in subdivision 2.
49.14 	(b) In each following year, each county shall also:
49.15 	(1) have in place an approved solid waste management plan or master plan including 
49.16 	a recycling implementation strategy under section 115A.551, subdivision 7, and a 
49.17 	household hazardous waste management plan under section 115A.96, subdivision 6, 
49.18 	by the dates specified in those provisions; 
49.19 	(2) submit a report by April 1 of each year to the commissioner detailing for the 
49.20 	previous calendar year:
49.21 	(i) how the money was spent including, but not limited to, specific information on 
49.22 	the number of employees performing SCORE planning, oversight, and administration; the 
49.23 	percentage of those employees' total work time allocated to SCORE planning, oversight, 
49.24 	and administration; the specific duties and responsibilities of those employees; and the 
49.25 	amount of staff salary for these SCORE duties and responsibilities of the employees; and
49.26 	(ii) the resulting gains achieved in solid waste management practices; and
49.27 	(3) provide evidence to the commissioner that local revenue equal to 25 percent of 
49.28 	the money sought for distribution under this section will be spent for the purposes in 
49.29 	subdivision 2.
49.30 	(c) The commissioner shall withhold all or part of the funds to be distributed 
49.31 	to a county under this section if the county fails to comply with this subdivision and 
49.32 	subdivision 2.
49.33 	(d) The requirements for the report specified in paragraph (b), clause (2), that is due 
49.34 	April 1, 2010, shall be abbreviated in scope. The information collected shall be sufficient 
50.1 	for the commissioner to determine that counties have complied with the requirement 
50.2 	of this subdivision.

50.3 	Sec. 39. [115A.559] COMPOSTING COMPETITIVE GRANT PROGRAM.
50.4 		Subdivision 1.Grant program established. The commissioner shall make 
50.5 	competitive grants to political subdivisions to increase composting, reduce the amount of 
50.6 	organic wastes entering disposal facilities, and reduce the costs associated with hauling 
50.7 	waste by locating the composting site as close as possible to the site where the waste is 
50.8 	generated. To achieve the purpose of the grant program, the commissioner shall actively 
50.9 	recruit potential applicants beyond traditional solid waste professionals and organizations, 
50.10 	such as soil and water conservation districts and schools. Each grant must include an 
50.11 	educational component.
50.12 		Subd. 2.Application. (a) The commissioner must develop forms and procedures 
50.13 	for soliciting and reviewing applications for grants under this section.
50.14 	(b) The determination of whether to make a grant under this section is within the 
50.15 	discretion of the commissioner, subject to subdivision 4. The commissioner's decisions 
50.16 	are not subject to judicial review, except for abuse of discretion.
50.17 		Subd. 3.Priorities; eligible projects. (a) If applications for grants exceed the 
50.18 	available appropriations, grants must be made for projects that, in the commissioner's 
50.19 	judgment, provide the highest return in public benefits.
50.20 	(b) To be eligible to receive a grant, a project must:
50.21 	(1) be locally administered;
50.22 	(2) have measured outcomes; and
50.23 	(3) include at least one of the following elements:
50.24 	(i) the development of erosion control methods that use compost;
50.25 	(ii) activities to encourage on-site composting by homeowners; or
50.26 	(iii) activities to encourage composting by schools or public institutions.
50.27 		Subd. 4.Cancellation of grant. If a grant is awarded under this section and 
50.28 	funds are not encumbered for the grant within four years after the award date, the grant 
50.29 	must be canceled.

50.30 	Sec. 40. Minnesota Statutes 2008, section 115A.931, is amended to read:
50.31 	115A.931 YARD WASTE PROHIBITION.
50.32 	(a) Except as authorized by the agency, in the metropolitan area after January 1, 
50.33 	1990, and outside the metropolitan area after January 1, 1992, a person may not place 
50.34 	yard waste:
51.1 	(1) in mixed municipal solid waste;
51.2 	(2) in a disposal facility; or
51.3 	(3) in a resource recovery facility except for the purposes of reuse, composting, or 
51.4 	cocomposting.
51.5 	(b) [Renumbered 115A.03, subd. 38] 
51.6 	(c) On or after January 1, 2010, a person may not place yard waste or 
51.7 	source-separated compostable materials generated in a metropolitan county in a plastic bag 
51.8 	delivered to a transfer station or compost facility unless the bag meets all the specifications 
51.9 	in ASTM Standard Specification for Compostable Plastics (D6400). For purposes of this 
51.10 	paragraph, "metropolitan county" has the meaning given in section 473.121, subdivision 
51.11 	4, and "ASTM" has the meaning given in section 296A.01, subdivision 6.
51.12 	(d) A person who immediately empties a plastic bag containing yard waste or 
51.13 	source-separated compostable materials delivered to a transfer station or compost facility 
51.14 	and removes the plastic bag from the transfer station or compost facility is exempt from 
51.15 	paragraph (c).
51.16 	(e) Residents of a city of the first class that currently contracts for the collection of 
51.17 	yard waste are exempt from paragraph (c) until January 1, 2013, if, by that date, the 
51.18 	city implements a citywide source-separated compostable materials collection program 
51.19 	using durable carts.

51.20 	EFFECTIVE DATE. This section is effective January 1, 2010.

51.21 	Sec. 41. Minnesota Statutes 2008, section 116.07, subdivision 4d, is amended to read:
51.22 		Subd. 4d.Permit fees. (a) The agency may shall collect permit fees in amounts 
51.23 	not greater than those necessary, but no greater than the amounts necessary, to cover 
51.24 	the reasonable costs of developing, reviewing, and acting upon applications for agency 
51.25 	permits and implementing and enforcing the conditions of the permits pursuant to 
51.26 	agency rules. Permit fees shall not include the costs of litigation. The fee schedule 
51.27 	must reflect reasonable and routine direct and indirect costs associated with permitting, 
51.28 	implementation, and enforcement. The agency may impose an additional enforcement 
51.29 	fee to be collected for a period of up to two years to cover the reasonable costs of 
51.30 	implementing and enforcing the conditions of a permit under the rules of the agency. Any 
51.31 	money collected under this paragraph shall be deposited in the appropriate account in 
51.32 	the environmental fund.
51.33 	(b) Notwithstanding paragraph (a), the agency shall collect an annual fee from 
51.34 	the owner or operator of all stationary sources, emission facilities, emissions units, air 
51.35 	contaminant treatment facilities, treatment facilities, potential air contaminant storage 
52.1 	facilities, or storage facilities subject to the requirement to obtain a permit under 
52.2 	subchapter V of the federal Clean Air Act, United States Code, title 42, section 7401 et 
52.3 	seq., or section 116.081. The annual fee shall be used to pay for all direct and indirect 
52.4 	reasonable costs, including attorney general costs, required to develop and administer 
52.5 	the permit program requirements of subchapter V of the federal Clean Air Act, United 
52.6 	States Code, title 42, section 7401 et seq., and sections of this chapter and the rules 
52.7 	adopted under this chapter related to air contamination and noise. Those costs include the 
52.8 	reasonable costs of reviewing and acting upon an application for a permit; implementing 
52.9 	and enforcing statutes, rules, and the terms and conditions of a permit; emissions, ambient, 
52.10 	and deposition monitoring; preparing generally applicable regulations; responding to 
52.11 	federal guidance; modeling, analyses, and demonstrations; preparing inventories and 
52.12 	tracking emissions; and providing information to the public about these activities. 
52.13 	(c) The agency shall set fees that:
52.14 	(1) will result in the collection, in the aggregate, from the sources listed in paragraph 
52.15 	(b), of an amount not less than $25 per ton of each volatile organic compound; pollutant 
52.16 	regulated under United States Code, title 42, section 7411 or 7412 (section 111 or 112 
52.17 	of the federal Clean Air Act); and each pollutant, except carbon monoxide, for which a 
52.18 	national primary ambient air quality standard has been promulgated;
52.19 	(2) may result in the collection, in the aggregate, from the sources listed in paragraph 
52.20 	(b), of an amount not less than $25 per ton of each pollutant not listed in clause (1) that is 
52.21 	regulated under this chapter or air quality rules adopted under this chapter; and
52.22 	(3) shall collect, in the aggregate, from the sources listed in paragraph (b), the 
52.23 	amount needed to match grant funds received by the state under United States Code, title 
52.24 	42, section 7405 (section 105 of the federal Clean Air Act).
52.25 	The agency must not include in the calculation of the aggregate amount to be collected 
52.26 	under clauses (1) and (2) any amount in excess of 4,000 tons per year of each air pollutant 
52.27 	from a source. The increase in air permit fees to match federal grant funds shall be a 
52.28 	surcharge on existing fees. The commissioner may not collect the surcharge after the grant 
52.29 	funds become unavailable. In addition, the commissioner shall use nonfee funds to the 
52.30 	extent practical to match the grant funds so that the fee surcharge is minimized.
52.31 	(d) To cover the reasonable costs described in paragraph (b), the agency shall 
52.32 	provide in the rules promulgated under paragraph (c) for an increase in the fee collected 
52.33 	in each year by the percentage, if any, by which the Consumer Price Index for the most 
52.34 	recent calendar year ending before the beginning of the year the fee is collected exceeds 
52.35 	the Consumer Price Index for the calendar year 1989. For purposes of this paragraph the 
52.36 	Consumer Price Index for any calendar year is the average of the Consumer Price Index 
53.1 	for all-urban consumers published by the United States Department of Labor, as of the 
53.2 	close of the 12-month period ending on August 31 of each calendar year. The revision 
53.3 	of the Consumer Price Index that is most consistent with the Consumer Price Index for 
53.4 	calendar year 1989 shall be used.
53.5 	(e) Any money collected under paragraphs (b) to (d) must be deposited in the 
53.6 	environmental fund and must be used solely for the activities listed in paragraph (b).
53.7 	(f) Persons who wish to construct or expand a facility may offer to reimburse the 
53.8 	agency for the costs of staff overtime or consultant services needed to expedite permit 
53.9 	review. The reimbursement shall be in addition to fees imposed by law. When the agency 
53.10 	determines that it needs additional resources to review the permit application in an 
53.11 	expedited manner, and that expediting the review would not disrupt permitting program 
53.12 	priorities, the agency may accept the reimbursement. Reimbursements accepted by the 
53.13 	agency are appropriated to the agency for the purpose of reviewing the permit application. 
53.14 	Reimbursement by a permit applicant shall precede and not be contingent upon issuance 
53.15 	of a permit and shall not affect the agency's decision on whether to issue or deny a permit, 
53.16 	what conditions are included in a permit, or the application of state and federal statutes 
53.17 	and rules governing permit determinations.
53.18 	(g) The fees under this subdivision are exempt from section 16A.1285.

53.19 	Sec. 42. Minnesota Statutes 2008, section 116.41, subdivision 2, is amended to read:
53.20 		Subd. 2.Training and certification programs. The agency shall develop standards 
53.21 	of competence for persons operating and inspecting various classes of disposal facilities. 
53.22 	The agency shall conduct training programs for persons operating facilities for the 
53.23 	disposal of waste and for inspectors of such facilities, and may shall charge such fees as 
53.24 	are necessary to cover the actual costs of the training programs. All fees received shall be 
53.25 	paid into the state treasury and credited to the Pollution Control Agency training account 
53.26 	and are appropriated to the agency to pay expenses relating to the training of disposal 
53.27 	facility personnel.
53.28 	The agency shall require operators and inspectors of such facilities to obtain from 
53.29 	the agency a certificate of competence. The agency shall conduct examinations to test the 
53.30 	competence of applicants for certification, and shall require that certificates be renewed at 
53.31 	reasonable intervals. The agency may charge such fees as are necessary to cover the actual 
53.32 	costs of receiving and processing applications, conducting examinations, and issuing 
53.33 	and renewing certificates. Certificates shall not be required for a private individual for 
53.34 	land-spreading and associated interim and temporary storage of sewage sludge on property 
53.35 	owned or farmed by that individual.

54.1 	Sec. 43. [116.9401] DEFINITIONS.
54.2 	(a) For the purposes of sections 116.9401 to 116.9408, the following terms have 
54.3 	the meanings given them.
54.4 	(b) "Agency" means the Pollution Control Agency.
54.5 	(c) "Alternative" means a substitute process, product, material, chemical, strategy, 
54.6 	or combination of these that serves a functionally equivalent purpose to a chemical in a 
54.7 	children's product.
54.8 	(d) "Chemical" means a substance with a distinct molecular composition or a group 
54.9 	of structurally related substances and includes the breakdown products of the substance or 
54.10 	substances that form through decomposition, degradation, or metabolism.
54.11 	(e) "Chemical of high concern" means a chemical identified on the basis of credible 
54.12 	scientific evidence by a governmental entity or the United Nations' World Health 
54.13 	Organization as being known or suspected with a high degree of probability to:
54.14 	(1) harm the normal development of a fetus or child or cause other developmental 
54.15 	toxicity;
54.16 	(2) cause cancer, genetic damage, or reproductive harm;
54.17 	(3) disrupt the endocrine or hormone system;
54.18 	(4) damage the nervous system, immune system, or organs, or cause other systemic 
54.19 	toxicity;
54.20 	(5) be persistent, bioaccumulative, and toxic; or
54.21 	(6) be very persistent and very bioaccumulative.
54.22 	(f) "Child" means a person under 12 years of age.
54.23 	(g) "Children's product" means a consumer product intended for use by children, 
54.24 	such as baby products, toys, car seats, personal care products, and clothing.
54.25 	(h) "Commissioner" means the commissioner of the Pollution Control Agency. 
54.26 	(i) "Department" means the Department of Health.
54.27 	(j) "Distributor" means a person who sells consumer products to retail establishments 
54.28 	on a wholesale basis.
54.29 	(k) "Green chemistry" means an approach to designing and manufacturing products 
54.30 	in ways that minimize the use and generation of toxic substances.
54.31 	(l) "Manufacturer" means any person who manufactures a final consumer product 
54.32 	sold at retail or whose brand name is affixed to the consumer product. In the case of a 
54.33 	consumer product imported into the United States, manufacturer includes the importer 
54.34 	or domestic distributor of the consumer product if the person who manufactured or 
54.35 	assembled the consumer product or whose brand name is affixed to the consumer product 
54.36 	does not have a presence in the United States.
55.1 	(m) "Priority chemical" means a chemical identified by the commissioner as a 
55.2 	chemical of high concern that is contained in a children's product offered for sale in 
55.3 	Minnesota and meets the criteria in section 116.9403.
55.4 	(n) "Safer alternative" means an alternative whose potential to harm human health is 
55.5 	less than that of a priority chemical that it could replace.

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

55.7 	Sec. 44. [116.9402] IDENTIFICATION OF CHEMICALS OF HIGH CONCERN.
55.8 	(a) By July 1, 2010, the department shall, after consultation with the agency, publish 
55.9 	in the State Register and on the agency's Internet Web site a list of chemicals of high 
55.10 	concern.
55.11 	(b) The department must periodically review and revise the list of chemicals of high 
55.12 	concern at least every three years. The department may add chemicals to the list if the 
55.13 	chemical meets one or more of the criteria in section 116.9401, paragraph (e).
55.14 	(c) The department shall consider, among others, chemicals listed in the following 
55.15 	sources for possible inclusion on the list of chemicals of high concern:
55.16 	(1) chemicals identified as "Group 1 carcinogens" or "Group 2A carcinogens" by the 
55.17 	United Nations' World Health Organization, International Agency for Research on Cancer;
55.18 	(2) chemicals identified as "known to be a human carcinogen" and "reasonably 
55.19 	anticipated to be a human carcinogen" by the secretary of the United States Department 
55.20 	of Health and Human Services;
55.21 	(3) chemicals identified as "Group A carcinogens" or "Group B carcinogens" by the 
55.22 	United States Environmental Protection Agency;
55.23 	(4) chemicals identified as reproductive or developmental toxicants by: 
55.24 	(i) the United States Department of Health and Human Services, National 
55.25 	Toxicology Program, Center for the Evaluation of Risks to Human Reproduction; and
55.26 	(ii) the California Environmental Protection Agency, Office of Environmental Health 
55.27 	Hazard Assessment, pursuant to the California Health and Safety Code, Safe Drinking 
55.28 	Water and Toxic Enforcement Act of 1986, chapter 6.6, section 25249.8;
55.29 	(5) chemicals identified as known or likely endocrine disruptors through screening 
55.30 	or testing conducted in accordance with protocols developed by the United States 
55.31 	Environmental Protection Agency pursuant to the federal Food, Drug, and Cosmetic Act, 
55.32 	United States Code, title 21, section 346a(p), as amended by the federal Food Quality 
55.33 	Protection Act, Public Law 104-170, or the federal Safe Drinking Water Act, United States 
55.34 	Code, title 42, section 300j-17;
56.1 	(6) chemicals listed on the basis of endocrine-disrupting properties in Annex 
56.2 	XIV, List of Substances Subject to Authorisation, Regulation (EC) No 1907/2006 of 
56.3 	the European Parliament concerning the Registration, Evaluation, Authorisation, and 
56.4 	Restriction of Chemicals;
56.5 	(7) persistent, bioaccumulative, and toxic chemicals identified by:
56.6 	(i) the state of Washington Department of Ecology in Washington Administrative 
56.7 	Code, chapter 173-333; or
56.8 	(ii) the United States Environmental Protection Agency in Code of Federal 
56.9 	Regulations, title 40, part 372; and
56.10 	(8) a very persistent, very bioaccumulative chemical listed in Annex XIV, List of 
56.11 	Substances Subject to Authorisation, Regulation (EC) No 1907/2006 of the European 
56.12 	Parliament concerning the Registration, Evaluation, Authorisation, and Restriction of 
56.13 	Chemicals.
56.14 	(d) The department may consider chemicals listed by another state as harmful to 
56.15 	human health or the environment for possible inclusion in the list of chemicals of high 
56.16 	concern.

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

56.18 	Sec. 45. [116.9403] IDENTIFICATION OF PRIORITY CHEMICALS.
56.19 	The department, after consultation with the agency, may designate a chemical of 
56.20 	high concern as a priority chemical if the department finds that the chemical:
56.21 	(1) has been identified as a high-production volume chemical by the United States 
56.22 	Environmental Protection Agency; and
56.23 	(2) meets any of the following criteria:
56.24 	(i) the chemical has been found through biomonitoring to be present in human blood, 
56.25 	including umbilical cord blood, breast milk, urine, or other bodily tissues or fluids;
56.26 	(ii) the chemical has been found through sampling and analysis to be present in 
56.27 	household dust, indoor air, drinking water, or elsewhere in the home environment; or
56.28 	(iii) the chemical has been found through monitoring to be present in fish, wildlife, 
56.29 	or the natural environment.

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

56.31 	Sec. 46. [116.9404] IDENTIFICATION OF SAFER ALTERNATIVES.
57.1 		Subdivision 1.Department determination. The department shall determine 
57.2 	whether a safer alternative to a priority chemical is available and is a technically feasible 
57.3 	replacement for the priority chemical. In making this determination, the department:
57.4 	(1) must utilize information from current scientific literature, the Interstate 
57.5 	Chemicals Clearinghouse, manufacturers of children's products, and other sources it 
57.6 	deems appropriate;
57.7 	(2) may presume that an alternative is a safer alternative if the alternative is not 
57.8 	a chemical of high concern; and
57.9 	(3) may presume that a safer alternative is available if:
57.10 	(i) the sale of the children's product containing the priority chemical has been 
57.11 	prohibited by another state within the United States;
57.12 	(ii) the children's product containing the priority chemical is an item of apparel 
57.13 	or a novelty; or
57.14 	(iii) the alternative is sold in the United States.
57.15 		Subd. 2.Department designation. (a) If the department determines that a safer 
57.16 	alternative is available and is a technically feasible replacement for a priority chemical, 
57.17 	the department shall designate that priority chemical a Level 1 priority chemical. If the 
57.18 	department determines that current information does not indicate that a safer alternative is 
57.19 	available or is a technically feasible replacement for a priority chemical, the department 
57.20 	shall designate that chemical a Level 2 priority chemical. By February 1, 2011, the 
57.21 	department shall publish a list of Level 1 and Level 2 priority chemicals in the State 
57.22 	Register and on the department's Internet Web site and shall update the published list 
57.23 	whenever a new priority chemical is designated.
57.24 	(b) The department shall designate at least five priority chemicals as Level 1 or 
57.25 	Level 2 by July 1, 2011, and at least five additional priority chemicals as Level 1 or Level 
57.26 	2 by January 1, 2013.
57.27 	(c) The department shall, at least every two years:
57.28 	(1) review the list of chemicals of high concern and determine, which, if any, should 
57.29 	be designated Level 1 or Level 2 priority chemicals; and
57.30 	(2) review the reports submitted by manufacturers under section 116.9405 to 
57.31 	determine if any Level 2 priority chemicals should be designated as Level 1 priority 
57.32 	chemicals.

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

57.34 	Sec. 47. [116.9405] DISCLOSURE OF INFORMATION ON PRIORITY 
57.35 	CHEMICALS.
58.1 		Subdivision 1.Reporting of chemical use. Not later than 180 days after Level 1 
58.2 	and Level 2 priority chemicals are identified under section 116.9404, any person who is a 
58.3 	manufacturer or distributor of a children's product for sale in this state that contains a Level 
58.4 	1 or Level 2 priority chemical shall notify the agency of that fact in writing unless the 
58.5 	children's product is exempt under section 116.9406. This written notice must identify the 
58.6 	product, the number of units sold or distributed for sale in this state or nationally during the 
58.7 	previous calendar year, and the priority chemical or chemicals contained in the product.
58.8 		Subd. 2.Supplemental information. The manufacturer or distributor of a 
58.9 	children's product that contains a Level 1 or Level 2 priority chemical shall provide the 
58.10 	following additional information if requested by the agency:
58.11 	(1) information on the likelihood that the chemical will be released from the 
58.12 	children's product to the environment during the children's product's life cycle and the 
58.13 	extent to which users of the children's product are likely to be exposed to the chemical;
58.14 	(2) additional information regarding the potential for harm to human health from 
58.15 	specific uses of the priority chemical; and
58.16 	(3) an assessment of the availability, cost, feasibility, and performance, including 
58.17 	potential for harm to human health of alternatives to the priority chemical and the reason 
58.18 	the priority chemical is used in the manufacture of the children's product in lieu of 
58.19 	identified alternatives. If an assessment acceptable to the agency is not timely submitted as 
58.20 	determined by the agency, the agency may assess a fee on the manufacturer or distributor 
58.21 	to cover the costs to prepare an independent report on the availability of safer alternatives 
58.22 	by a contractor of the agency's choice.

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

58.24 	Sec. 48. [116.9406] APPLICABILITY.
58.25 	The requirements of sections 116.9401 to 116.9408 do not apply to:
58.26 	(1) chemicals in used children's products;
58.27 	(2) priority chemicals used in the manufacturing process, but that are not present 
58.28 	in the final product;
58.29 	(3) priority chemicals used in agricultural production;
58.30 	(4) motor vehicles as defined in chapter 168 or their component parts, except that the 
58.31 	use of priority chemicals in detachable car seats is not exempt;
58.32 	(5) priority chemicals generated solely as combustion by-products or that are present 
58.33 	in combustible fuels;
59.1 	(6) retailers, unless that retailer knowingly sells a children's product containing 
59.2 	a priority chemical after the effective date of its prohibition, of which that retailer has 
59.3 	received prior notification from a manufacturer, distributor, or the state;
59.4 	(7) pharmaceutical products or biologics;
59.5 	(8) a medical device as defined in the federal Food, Drug, and Cosmetic Act, United 
59.6 	States Code, title 21, section 321(h); 
59.7 	(9) food and food or beverage packaging, except a container containing baby food 
59.8 	or infant formula; 
59.9 	(10) consumer electronics products and electronic components, including but not 
59.10 	limited to personal computers; audio and video equipment; calculators; digital displays; 
59.11 	wireless phones; cameras; game consoles; printers; and handheld electronic and electrical 
59.12 	devices used to access interactive software or their associated peripherals; or products that 
59.13 	comply with the provisions of directive 2002/95/EC of the European Union, adopted by 
59.14 	the European Parliament and Council of the European Union now or hereafter in effect; or
59.15 	(11) outdoor sport equipment, including snowmobiles as defined in section 84.81, 
59.16 	subdivision 3; all-terrain vehicles as defined in section 84.92, subdivision 8; personal 
59.17 	watercraft as defined in section 86B.005, subdivision 14a; watercraft as defined in section 
59.18 	86B.005, subdivision 18; and off-highway motorcycles, as defined in section 84.787, 
59.19 	subdivision 7, and all attachments and repair parts for all of this equipment.

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

59.21 	Sec. 49. [116.9407] DONATIONS TO THE STATE.
59.22 	The commissioners of health and pollution control may accept donations, grants, 
59.23 	and other funds to carry out the purposes of sections 116.9401 to 116.9408. All such 
59.24 	donations, grants, and other funds must be accepted without preconditions regarding the 
59.25 	outcomes of the oversight processes set forth in sections 116.9401 to 116.9408.

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

59.27 	Sec. 50. [116.9408] PARTICIPATION IN INTERSTATE CHEMICALS 
59.28 	CLEARINGHOUSE.
59.29 	The agency may participate in an interstate chemicals clearinghouse to promote 
59.30 	safer chemicals in consumer products in cooperation with other states, including the 
59.31 	classification of chemicals in commerce; organizing and managing available data on 
59.32 	chemicals, including information on uses, hazards, and environmental and health 
60.1 	concerns; and producing and evaluating information on safer alternatives to specific uses 
60.2 	of chemicals of concern.

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

60.4 	Sec. 51. Minnesota Statutes 2008, section 116C.834, subdivision 1, is amended to read:
60.5 		Subdivision 1.Costs. All costs incurred by the state to carry out its responsibilities 
60.6 	under the compact and under sections 116C.833 to 116C.843 shall be paid by generators 
60.7 	of low-level radioactive waste in this state through fees assessed by the Pollution Control 
60.8 	Agency. Fees may be reasonably assessed on the basis of volume or degree of hazard of 
60.9 	the waste produced by a generator. Costs for which fees may be assessed include, but 
60.10 	are not limited to:  
60.11 	(1) the state contribution required to join the compact;
60.12 	(2) the expenses of the commission member and state agency costs incurred to 
60.13 	support the work of the Interstate Commission; and
60.14 	(3) regulatory costs.
60.15 	The fees are exempt from section 16A.1285.

60.16 	Sec. 52. Minnesota Statutes 2008, section 116D.045, is amended to read:
60.17 	116D.045 ENVIRONMENTAL IMPACT STATEMENTS; REVIEW COSTS.
60.18 		Subdivision 1.Assessment. (a) The board shall by rule adopt procedures to assess 
60.19 	the proposer of a specific action for reasonable costs of preparing and distributing an 
60.20 	environmental impact statement on that action required pursuant to section 116D.04. 
60.21 	Such The costs shall be determined by the responsible governmental unit pursuant to the 
60.22 	rules promulgated by the board. 
60.23 	(b) A responsible government unit shall assess the proposer of a specific action for 
60.24 	the reasonable costs of preparing and distributing an environmental assessment worksheet 
60.25 	on that action required under section 116D.04 in accordance with Minnesota Rules, parts 
60.26 	4410.6100 and 4410.6200, except that a local unit of government is exempt from paying 
60.27 	the equivalent of the first ten hours of the assessed reasonable costs of preparing and 
60.28 	distributing the environmental assessment worksheet. This paragraph is not subject to the 
60.29 	rulemaking provisions of chapter 14 and section 14.386 does not apply.
60.30 		Subd. 2.Modification. In the event of a disagreement between the proposer of the 
60.31 	action and the responsible governmental unit over the cost of an environmental impact 
60.32 	statement or environmental assessment worksheet, the responsible governmental unit shall 
61.1 	consult with the board, which may modify the cost or determine that the cost assessed by 
61.2 	the responsible governmental unit is reasonable.
61.3 		Subd. 3.Use of assessment. The responsible governmental unit shall assess the 
61.4 	project proposer for reasonable costs in preparing and distributing the environmental 
61.5 	impact statement or environmental assessment worksheet and the proposer shall pay the 
61.6 	assessed cost to the responsible governmental unit. Money received under this subdivision 
61.7 	by a responsible governmental unit may be retained by the unit for the same purposes. 
61.8 	Money received by a state agency must be credited to a special account and is appropriated 
61.9 	to the agency to cover the assessed costs incurred.
61.10 		Subd. 4.Partial cost to be paid. No responsible governmental unit shall commence 
61.11 	the preparation of an environmental impact statement or environmental assessment 
61.12 	worksheet until at least one-half of the assessed cost of the environmental impact statement 
61.13 	or environmental assessment worksheet is paid pursuant to subdivision 3. Other laws 
61.14 	notwithstanding, no state agency may issue any permits for the construction or operation 
61.15 	of a project for which an environmental impact statement or environmental assessment 
61.16 	worksheet is prepared until the assessed cost for the environmental impact statement or 
61.17 	environmental assessment worksheet has been paid in full.

61.18 	Sec. 53. [216H.021] GREENHOUSE GAS EMISSIONS REPORTING.
61.19 		Subdivision 1.Commissioner to establish reporting system and maintain 
61.20 	inventory. In order to measure the progress in meeting the goals of section 216H.02, 
61.21 	subdivision 1, and to provide information to develop strategies to achieve those goals, the 
61.22 	commissioner of the Pollution Control Agency shall establish a system for reporting and 
61.23 	maintaining an inventory of greenhouse gas emissions. The commissioner must consult 
61.24 	with the chief information officer of the Office of Enterprise Technology about system 
61.25 	design and operation. Greenhouse gas emissions include those emissions described in 
61.26 	section 216H.01, subdivision 2.
61.27 		Subd. 2.Reporting system design. (a) The commissioner shall, to the extent 
61.28 	practicable, design the system to coordinate with other regional or federal greenhouse gas 
61.29 	emissions-reporting and inventory systems. The coordination may, without limitation, 
61.30 	include the use of similar forms and reports, the sharing of information, and the use of 
61.31 	common facilities, systems, and databases.
61.32 	(b) The reporting system need not include all sources of emissions nor all amounts 
61.33 	of emissions but, at its outset, must include:
61.34 	(1) all stationary sources and other facilities required to obtain a permit under Title 
61.35 	V of the federal Clean Air Act, United States Code, title 42, section 7401 et. seq.; and
62.1 	(2) facilities whose annual carbon dioxide equivalent emissions, as defined in 
62.2 	section 216H.10, subdivision 3, exceed a threshold set by the commissioner at between 
62.3 	10,000 tons and 25,000 tons. The reporting threshold set by the commissioner must 
62.4 	be consistent with the goal of accurately tracking progress in attaining greenhouse 
62.5 	gas emissions-reduction goals and the need for emissions data to assist in developing 
62.6 	greenhouse gas emissions-reduction strategies.
62.7 	(c) In designing the greenhouse gas emissions reporting system, the commissioner 
62.8 	shall consider requiring the reporting of greenhouse gas emissions from transportation 
62.9 	fuels and greenhouse gas emissions from natural gas combustion that are not included 
62.10 	in reporting from stationary sources. In determining whether to include reporting of 
62.11 	these emissions, the commissioner must consider both the goal of accurately tracking 
62.12 	progress in attaining greenhouse gas emissions-reduction goals and the need for emissions 
62.13 	data to assist in developing greenhouse gas emissions-reduction strategies recommended 
62.14 	by the Minnesota Climate Change Advisory Group. If the commissioner decides that 
62.15 	transportation fuels and portions of natural gas combustion should not be included in 
62.16 	the initial emissions reporting system, the commissioner must report to the chairs and 
62.17 	ranking minority members of the senate and house of representatives committees with 
62.18 	primary jurisdiction over energy and environmental policy the reasons for that decision 
62.19 	and suggestions for steps that should be taken to allow their inclusion in the emissions 
62.20 	reporting system in the future.
62.21 	(d) A facility reporting greenhouse gas emissions under this section must maintain 
62.22 	the data used to create the reports for a minimum of five years.
62.23 		Subd. 3.Rules. The commissioner of the Pollution Control Agency may adopt rules 
62.24 	for the purposes of this section.

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

62.26 	Sec. 54. Minnesota Statutes 2008, section 216H.10, subdivision 7, is amended to read:
62.27 		Subd. 7. High-GWP greenhouse gas. "High-GWP greenhouse gas" means 
62.28 	hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride, nitrous trifluoride, and any 
62.29 	other gas the agency determines by rule to have a high global warming potential. 

62.30 	Sec. 55. Minnesota Statutes 2008, section 216H.11, is amended to read:
62.31 	216H.11 HIGH-GWP GREENHOUSE GAS REPORTING. 
62.32 		Subdivision 1. Gas manufacturers. Beginning October 1, 2008, and each year 
62.33 	thereafter, a manufacturer of a high-GWP greenhouse gas must report to the agency the 
63.1 	total amount of each high-GWP greenhouse gas sold to a purchaser in this state during 
63.2 	the previous year. 
63.3 		Subd. 2. Purchases. Beginning October 1, 2008, and each year thereafter, a person 
63.4 	in this state who purchases 500 10,000 metric tons or more carbon dioxide equivalent of a 
63.5 	high-GWP greenhouse gas for use or retail sale in this state must report to the agency, on a 
63.6 	form prescribed by the commissioner, the total amount of each high-GWP greenhouse gas 
63.7 	purchased for use or retail sale in this state during the previous year and the purpose for 
63.8 	which the gas was used. The commissioner may adopt rules under chapter 14 to establish 
63.9 	a different reporting threshold or to adopt specific reporting requirements for commercial 
63.10 	or industrial facilities that purchase high-GWP gases for use or retail sale in this state.
63.11 		Subd. 3. Acceptance of federal filing. With the approval of the commissioner, this 
63.12 	section may be satisfied by filing with the commissioner a copy of a greenhouse gas 
63.13 	emissions report filed with a federal agency or a regional or national greenhouse gas 
63.14 	registry, provided that the entity with which the report is filed requires the emissions 
63.15 	data to be verified.

63.16 	Sec. 56. [325E.046] STANDARDS FOR LABELING PLASTIC BAGS.
63.17 		Subdivision 1.Biodegradable label. A manufacturer, distributor, or wholesaler 
63.18 	may not offer for sale in this state a plastic bag labeled "biodegradable," "degradable," 
63.19 	or any form of those terms, or in any way imply that the bag will chemically decompose 
63.20 	into innocuous elements in a reasonably short period of time in a landfill, composting, or 
63.21 	other terrestrial environment unless a scientifically based standard for biodegradability is 
63.22 	developed and the bags are certified as meeting the standard. 
63.23 		Subd. 2.Compostable label. A manufacturer, distributor, or wholesaler may not 
63.24 	offer for sale in this state a plastic bag labeled "compostable" unless, at the time of sale, 
63.25 	the bag meets the ASTM Standard Specification for Compostable Plastics (D6400). Each 
63.26 	bag must be labeled to reflect that it meets the standard. For purposes of this subdivision, 
63.27 	"ASTM" has the meaning given in section 296A.01, subdivision 6.
63.28 		Subd. 3.Enforcement; civil penalty; injunctive relief. (a) A manufacturer, 
63.29 	distributor, or wholesaler who willfully violates this section is subject to a civil penalty 
63.30 	of $100 for each violation up to a maximum of $5,000 and may be enjoined from such 
63.31 	violations.
63.32 	(b) The attorney general may bring an action in the name of the state in a court of 
63.33 	competent jurisdiction for recovery of civil penalties or for injunctive relief as provided in 
63.34 	this subdivision. The attorney general may accept an assurance of discontinuance of acts 
63.35 	in violation of this section in the manner provided in section 8.31, subdivision 2b.

64.1 	EFFECTIVE DATE. This section is effective January 1, 2010.

64.2 	Sec. 57. [383B.236] WASTE MANAGEMENT BY HENNEPIN COUNTY.
64.3 	The Hennepin County Board of Commissioners may utilize money received from 
64.4 	the sale of energy and recovered materials, and placed in the county solid and hazardous 
64.5 	waste fund under section 473.811, subdivision 9, for program expenses of the Department 
64.6 	of Environmental Services, or the department or office succeeding to the functions of the 
64.7 	Department of Environmental Services. This authority shall be in addition to the authority 
64.8 	given in section 473.811, subdivision 9.

64.9 	Sec. 58. Laws 2002, chapter 220, article 8, section 15, is amended to read:
64.10 	Sec. 15. INCREASE TO WATER QUALITY PERMIT FEES.
 64.11 	(a) The pollution control agency shall collect water quality permit application and 
64.12 	annual fees that reflect the fees in Minnesota Rules, part 7002.0310, increased to the 
64.13 	amounts described in paragraphs (b) to (g).
64.14 	(b) The application fee for individual permits, general permits, and general industrial 
64.15 	stormwater permits is $240.
64.16 	(c) The annual fees for individual National Pollutant Discharge Elimination System 
64.17 	permits for major municipal facilities are as follows:
64.18 	Design Flow in Million Gallons Per Day Annual Fee 50 and over $175,750 20 to 
64.19 	49.99 $40,350 5 to 19.99 $14,350 Up to 4.99 $5,900 
64.20 	(d) The annual fees for individual National Pollutant Discharge Elimination System 
64.21 	permits for major nonmunicipal facilities are as follows:
64.22 	Design Flow in Million Gallons Per Day Annual Fee 20 to 49.99 $44,200 5 to 
64.23 	19.99 $18,250 Up to 4.99 $8,450 
64.24 	Cooling or mine pit dewatering (any flow) $16,900 
64.25 	(e) The annual fees for individual National Pollutant Discharge Elimination System 
64.26 	and State Disposal System permits for nonmajor municipal facilities with design flows 
64.27 	greater than 0.100 million gallons per day are $1,450.
64.28 	(f) The annual fees for general industrial stormwater permits are $280.
64.29 	(g) The annual fees for general National Pollutant Discharge Elimination System 
64.30 	and State Disposal System permits are $345.
64.31 	(h) The application and annual fees are not increased for general construction 
64.32 	stormwater permits and sanitary sewer extension permits. The annual fees are not 
64.33 	increased for National Pollutant Discharge Elimination System and State Disposal System 
65.1 	permits regulating municipal nonmajors with facility design flow of 0 to .100, sewage 
65.2 	sludge landspreading facilities, and nonmajor nonmunicipal facilities.
65.3 	(i) (h) The increased permit fees are effective July 1, 2002. The agency shall 
65.4 	adopt amended water quality permit fee rules incorporating the permit fee increases in 
65.5 	this subdivision under Minnesota Statutes, section 14.389. The pollution control agency 
65.6 	shall begin collecting the increased permit fees on July 1, 2002, even if the rule adoption 
65.7 	process has not been initiated or completed. Notwithstanding Minnesota Statutes, section 
65.8 	14.18, subdivision 2, the increased permit fees reflecting the permit fee increases in this 
65.9 	section and the rule amendments incorporating those permit fee increases do not require 
65.10 	further legislative approval.

65.11 	Sec. 59. Laws 2007, chapter 57, article 1, section 4, subdivision 2, is amended to read:

65.12
65.13	Subd. 2.Land and Mineral Resources 
Management
 		11,747,000
		11,272,000

65.14	Appropriations by Fund
	
65.15	General
	6,633,000
	6,230,000
	
65.16	Natural Resources
	3,551,000
	3,447,000
	
65.17	Game and Fish
	1,363,000
	1,395,000
	
65.18	Permanent School
	200,000
	200,000
	
65.19 	$475,000 the first year and $475,000 the 
65.20 	second year are for iron ore cooperative 
65.21 	research. Of this amount, $200,000 each year 
65.22 	is from the minerals management account in 
65.23 	the natural resources fund and $275,000 each 
65.24 	year is from the general fund. $237,500 the 
65.25 	first year and $237,500 the second year are 
65.26 	available only as matched by $1 of nonstate 
65.27 	money for each $1 of state money. The 
65.28 	match may be cash or in-kind.
65.29 	$86,000 the first year and $86,000 the 
65.30 	second year are for minerals cooperative 
65.31 	environmental research, of which $43,000 
65.32 	the first year and $43,000 the second year are 
65.33 	available only as matched by $1 of nonstate 
65.34 	money for each $1 of state money. The 
65.35 	match may be cash or in-kind.
66.1 	$2,800,000 the first year and $2,696,000 
66.2 	the second year are from the minerals 
66.3 	management account in the natural resources 
66.4 	fund for use as provided in Minnesota 
66.5 	Statutes, section 93.2236, paragraph (c).
66.6 	$200,000 the first year and $200,000 the 
66.7 	second year are from the state forest suspense 
66.8 	account in the permanent school fund to 
66.9 	accelerate land exchanges, land sales, and 
66.10 	commercial leasing of school trust lands and 
66.11 	to identify, evaluate, and lease construction 
66.12 	aggregate located on school trust lands. This 
66.13 	appropriation is to be used for securing 
66.14 	maximum long-term economic return 
66.15 	from the school trust lands consistent with 
66.16 	fiduciary responsibilities and sound natural 
66.17 	resources conservation and management 
66.18 	principles.
66.19 	$15,000 the first year is for a report 
66.20 	by February 1, 2008, to the house and 
66.21 	senate committees with jurisdiction over 
66.22 	environment and natural resources on 
66.23 	proposed minimum legal and conservation 
66.24 	standards that could be applied to 
66.25 	conservation easements acquired with public 
66.26 	money.
66.27 	$1,201,000 the first year and $701,000 the 
66.28 	second year are to support the land records 
66.29 	management system. Of this amount, 
66.30 	$326,000 the first year and $326,000 the 
66.31 	second year are from the game and fish fund 
66.32 	and $375,000 the first year and $375,000 the 
66.33 	second year are from the natural resources 
66.34 	fund. The unexpended balances are available 
66.35 	until June 30, 2011. The commissioner 
67.1 	must report to the legislative chairs on 
67.2 	environmental finance on the outcomes of 
67.3 	the land records management support.
67.4 	$500,000 the first year and $500,000 the 
67.5 	second year are for land asset management. 
67.6 	This is a onetime appropriation.

67.7 	Sec. 60. Laws 2008, chapter 363, article 5, section 4, subdivision 7, is amended to read:

67.8	Subd. 7.Fish and Wildlife Management
 		123,000
		119,000

67.9	Appropriations by Fund
	
67.10	General
	-0-
	(427,000)
	
67.11	Game and Fish
	123,000
	546,000
	
67.12 	$329,000 in 2009 is a reduction for fish and 
67.13 	wildlife management.
67.14 	$46,000 in 2009 is a reduction in the 
67.15 	appropriation for the Minnesota Shooting 
67.16 	Sports Education Center.
67.17 	$52,000 in 2009 is a reduction for licensing.
67.18 	$123,000 in 2008 and $246,000 in 2009 are 
67.19 	from the game and fish fund to implement 
67.20 	fish virus surveillance, prepare infrastructure 
67.21 	to handle possible outbreaks, and implement 
67.22 	control procedures for highest risk waters 
67.23 	and fish production operations. This is a 
67.24 	onetime appropriation.
67.25 	Notwithstanding Minnesota Statutes, section 
67.26 	297A.94, paragraph (e), $300,000 in 2009 
67.27 	is from the second year appropriation in 
67.28 	Laws 2007, chapter 57, article 1, section 4, 
67.29 	subdivision 7, from the heritage enhancement 
67.30 	account in the game and fish fund to study, 
67.31 	predesign, and design a shooting sports 
67.32 	facilities at the Vermillion Highlands Wildlife 
67.33 	Management Area authorized by Laws 2007, 
68.1 	chapter 57, article 1, section 168 facility in 
68.2 	the seven-county metropolitan area. This is 
68.3 	available onetime only and is available until 
68.4 	expended.
68.5 	$300,000 in 2009 is appropriated from the 
68.6 	game and fish fund for only activities that 
68.7 	improve, enhance, or protect fish and wildlife 
68.8 	resources. This is a onetime appropriation.

68.9 	Sec. 61. WORKING GROUP ON SCORE REPORTING.
 68.10 	By July 1, 2009, the commissioner of the Pollution Control Agency shall convene 
68.11 	a working group on SCORE reporting to review the requirements for counties to report 
68.12 	to the agency on activities funded under Minnesota Statutes, section 115A.557. The 
68.13 	commissioner shall appoint to the working group representatives from, at a minimum, 
68.14 	the following organizations: the Association of Minnesota Counties, the Solid Waste 
68.15 	Administrators Association, and the Solid Waste Management Coordinating Board. The 
68.16 	working group shall make recommendations to amend the reporting requirements under 
68.17 	Minnesota Statutes, section 115A.557, subdivision 3, in ways that reduce the resources 
68.18 	counties employ to collect the data reported, while ensuring that estimation methods used 
68.19 	to report data are consistent across counties and that the data reported are accurate and 
68.20 	useful as a guide to solid waste management policy makers. The working group shall 
68.21 	also make recommendations regarding the feasibility and desirability of multicounty 
68.22 	reporting of the data. The working group's recommendations must be presented in a 
68.23 	report submitted to the chairs and ranking minority members of the senate and house of 
68.24 	representatives committees with primary jurisdiction over solid waste policy no later 
68.25 	than December 15, 2009.

68.26 	Sec. 62. COMPOST REPORT.
 68.27 	By December 15, 2011, the commissioner of the Pollution Control Agency shall 
68.28 	report to the legislative committees with jurisdiction over environment and natural 
68.29 	resources policy on:
68.30 	(1) the mixed municipal solid waste diversion rates accomplished by the grant 
68.31 	program under Minnesota Statutes, section 115A.559;
68.32 	(2) participants in the grant program and the programs developed with grant funds; 
68.33 	and
69.1 	(3) the potential for new permanent programs based on results of projects funded 
69.2 	with grants issued under Minnesota Statutes, section 115A.559.

69.3 	Sec. 63. PRIORITY CHEMICAL REPORTS.
69.4 	(a) By January 15, 2010, the commissioner of health, in consultation with the 
69.5 	Pollution Control Agency, shall report to the chairs and ranking minority members 
69.6 	of the senate and house of representatives committees with primary jurisdiction over 
69.7 	environment and natural resources policy, commerce, and public health regarding the 
69.8 	progress on implementing Minnesota Statutes, sections 116.9401 to 116.9408.
69.9 	(b) By January 15, 2010, the commissioner of the Pollution Control Agency 
69.10 	shall report to the chairs and ranking minority members of the senate and house of 
69.11 	representatives committees with primary jurisdiction over environment and natural 
69.12 	resources policy, commerce, and public health on the agency's plans to implement 
69.13 	Minnesota Statutes, section 116.9405, and assess mechanisms to reduce and phase out the 
69.14 	use of priority chemicals in children's products, including potential funding mechanisms. 
69.15 	The report must include information on the progress of other states in reducing toxic 
69.16 	chemicals in children's products and recommend ways to promote product design that 
69.17 	incorporates the principles of green chemistry and life cycle analysis in order to protect 
69.18 	public health and the environment. In developing the report, the agency may consult 
69.19 	outside experts and groups working to reduce toxic chemicals in children's products in 
69.20 	Minnesota and nationally.

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

69.22 	Sec. 64. ENVIRONMENTAL REVIEW STREAMLINING REPORT.
 69.23 	By January 15, 2010, the commissioner of the Pollution Control Agency must 
69.24 	submit a report to the environment and natural resources policy and finance committees of 
69.25 	the house of representatives and senate on options to streamline the environmental review 
69.26 	process under chapter 116D. In preparing the report, the commissioner must consult 
69.27 	with state agencies, local government units, and business, agriculture, and environmental 
69.28 	advocacy organizations with an interest in the environmental review process. The report 
69.29 	must include options that will reduce the time required to complete environmental review 
69.30 	and the cost of the process to responsible governmental units and project proposers while 
69.31 	maintaining air, land, and water quality standards.

69.32 	Sec. 65. COMPENSATION OF GOVERNOR'S STAFF.
 70.1 	For fiscal years 2010 and 2011, the Department of Natural Resources, the Pollution 
70.2 	Control Agency, and the Board of Water and Soil Resources may not use funds 
70.3 	appropriated in this act or funds from any statutory or open appropriation to directly or 
70.4 	indirectly pay for the compensation costs of staff in the office of the governor.

70.5 	Sec. 66. FISH CONSUMPTION ADVISORIES.
 70.6 	The commissioner of natural resources, in cooperation with the commissioner of 
70.7 	health, shall ensure that fish consumption advisories are displayed in at least four different 
70.8 	languages, one of which must be English, to fairly represent the population of the state.

70.9 	Sec. 67. CARBON SEQUESTRATION FORESTRY REPORT.
 70.10 	The Minnesota Forest Resources Council shall review the Minnesota Climate 
70.11 	Change Advisory Group's recommendation to increase carbon sequestration in forests by 
70.12 	planting 1,000,000 acres of trees and shall submit a report to the chairs of the house of 
70.13 	representatives and senate committees with jurisdiction over energy and energy finance, 
70.14 	environment and natural resources, and environment and natural resources finance; the 
70.15 	governor; and the commissioner of natural resources by January 15, 2010. The report 
70.16 	shall, at a minimum, include recommendations on implementation and analysis of the 
70.17 	number and ownership of acres available for tree planting, the types of native species best 
70.18 	suited for planting, the availability of planting stock, and potential costs.

70.19 	Sec. 68. REPEALER.
 70.20 	Laws 2008, chapter 363, article 5, section 30, is repealed.

70.21 	ARTICLE 2
70.22 	ENERGY FINANCE

70.23	Section 1. SUMMARY OF APPROPRIATIONS.
 	
70.24 	The amounts shown in this section summarize direct appropriations, by fund, made 
70.25 	in this article.

70.26			2010
		2011
		Total
	
70.27	General
	$
	28,041,000
	$
	27,041,000
	$
	55,082,000
	
70.28	Petroleum Tank Cleanup
		1,084,000
		1,084,000
		2,168,000
	
70.29	Workers' Compensation
		751,000
		751,000
		1,502,000
	
70.30	Special Revenue
		300,000
		300,000
		600,000
	
70.31	Total
	$
	30,176,000
	$
	29,176,000
	$
	59,352,000

70.32	Sec. 2. ENERGY FINANCE APPROPRIATIONS.
 	
71.1 	The sums shown in the columns marked "Appropriations" are appropriated to the 
71.2 	agencies and for the purposes specified in this article. The appropriations are from the 
71.3 	general fund, or another named fund, and are available for the fiscal years indicated 
71.4 	for each purpose. The figures "2010" and "2011" used in this article mean that the 
71.5 	appropriations listed under them are available for the fiscal year ending June 30, 2010, or 
71.6 	June 30, 2011, respectively. "The first year" is fiscal year 2010. "The second year" is fiscal 
71.7 	year 2011. "The biennium" is fiscal years 2010 and 2011. Appropriations for the fiscal 
71.8 	year ending June 30, 2009, are effective the day following final enactment.

71.9				APPROPRIATIONS
	
71.10				Available for the Year
	
71.11				Ending June 30
	
71.12					2010
		2011

71.13	Sec. 3. DEPARTMENT OF COMMERCE

71.14	Subdivision 1.Total Appropriation
 	$
	24,743,000
	$
	23,743,000

71.15	Appropriations by Fund
	
71.16		2010
	2011
	
71.17	General
	22,608,000
	21,608,000
	
71.18	Petroleum Cleanup
	1,084,000
	1,084,000
	
71.19
71.20	Workers' 
Compensation
	751,000
	751,000
	
71.21	Special Revenue
	300,000
	300,000
	
71.22 	The amounts that may be spent for each 
71.23 	purpose are specified in the following 
71.24 	subdivisions.

71.25	Subd. 2.Financial Institutions
 		6,638,000
		6,638,000
	
71.26 	$1,000 each year is for consumer small loan 
71.27 	regulation modifications in article 7. This 
71.28 	appropriation is added to the department's 
71.29 	base.

71.30
71.31	Subd. 3.Petroleum Tank Release Cleanup 
Board
 		1,084,000
		1,084,000
	
71.32 	This appropriation is from the petroleum 
71.33 	tank release cleanup fund. The base funding 
71.34 	for this program ends June 30, 2012.

71.35	Subd. 4.Administrative Services
 		4,300,000
		4,300,000

72.1	Subd. 5.Telecommunications
 		1,010,000
		1,010,000

72.2	Subd. 6.Market Assurance
 		7,421,000
		7,421,000

72.3	Appropriations by Fund
	
72.4	General
	6,670,000
	6,670,000
	
72.5
72.6	Workers' 
Compensation
	751,000
	751,000

72.7	Subd. 7.Office of Energy Security
 		3,990,000
		2,990,000

72.8
72.9	Subd. 8.Telecommunications Access 
Minnesota
 		300,000
		300,000
	
72.10 	$300,000 the first year and $300,000 
72.11 	the second year are for transfer to the 
72.12 	commissioner of human services to 
72.13 	supplement the ongoing operational expenses 
72.14 	of the Minnesota Commission Serving 
72.15 	Deaf and Hard-of-Hearing People. This 
72.16 	appropriation is from the telecommunication 
72.17 	access Minnesota fund, and is added to 
72.18 	the commission's base. This appropriation 
72.19 	consolidates, and is not in addition to, 
72.20 	appropriation language from Laws 2006, 
72.21 	chapter 282, article 11, section 4, and 
72.22 	Laws 2007, chapter 57, article 2, section 3, 
72.23 	subdivision 7.

72.24	Sec. 4. PUBLIC UTILITIES COMMISSION
 	$
	5,433,000
	$
	5,433,000

72.25 	Sec. 5. Minnesota Statutes 2008, section 45.027, subdivision 1, is amended to read:
72.26 		Subdivision 1.General powers. In connection with the duties and responsibilities 
72.27 	entrusted to the commissioner, and Laws 1993, chapter 361, section 2, the commissioner 
72.28 	of commerce may:
72.29 	(1) make public or private investigations within or without this state as the 
72.30 	commissioner considers necessary to determine whether any person has violated or is 
72.31 	about to violate any law, rule, or order related to the duties and responsibilities entrusted 
72.32 	to the commissioner;
73.1 	(2) require or permit any person to file a statement in writing, under oath or otherwise 
73.2 	as the commissioner determines, as to all the facts and circumstances concerning the 
73.3 	matter being investigated;
73.4 	(3) hold hearings, upon reasonable notice, in respect to any matter arising out of the 
73.5 	duties and responsibilities entrusted to the commissioner;
73.6 	(4) conduct investigations and hold hearings for the purpose of compiling 
73.7 	information related to the duties and responsibilities entrusted to the commissioner;
73.8 	(5) examine the books, accounts, records, and files of every licensee, and of every 
73.9 	person who is engaged in any activity regulated; the commissioner or a designated 
73.10 	representative shall have free access during normal business hours to the offices and 
73.11 	places of business of the person, and to all books, accounts, papers, records, files, safes, 
73.12 	and vaults maintained in the place of business;
73.13 	(6) publish information which is contained in any order issued by the commissioner; 
73.14 	and
73.15 	(7) require any person subject to duties and responsibilities entrusted to the 
73.16 	commissioner, to report all sales or transactions that are regulated. The reports must 
73.17 	be made within ten days after the commissioner has ordered the report. The report is 
73.18 	accessible only to the respondent and other governmental agencies unless otherwise 
73.19 	ordered by a court of competent jurisdiction.; and
73.20 	(8) assess a licensee the necessary expenses of the investigation performed by the 
73.21 	department when an investigation is made by order of the commissioner. The cost of the 
73.22 	investigation shall be determined by the commissioner and is based on the salary cost 
73.23 	of investigators or assistants and at an average rate per day or fraction thereof so as to 
73.24 	provide for the total cost of the investigations. All money collected must be deposited 
73.25 	into the general fund.

73.26 	Sec. 6. Minnesota Statutes 2008, section 60A.14, subdivision 1, is amended to read:
73.27 		Subdivision 1.Fees other than examination fees. In addition to the fees and 
73.28 	charges provided for examinations, the following fees must be paid to the commissioner 
73.29 	for deposit in the general fund:
73.30 	(a) by township mutual fire insurance companies;
73.31 	(1) for filing certificate of incorporation $25 and amendments thereto, $10;
73.32 	(2) for filing annual statements, $15;
73.33 	(3) for each annual certificate of authority, $15;
73.34 	(4) for filing bylaws $25 and amendments thereto, $10;
74.1 	(b) by other domestic and foreign companies including fraternals and reciprocal 
74.2 	exchanges;
74.3 	(1) for filing an application for an initial certification of authority to be admitted 
74.4 	to transact business in this state, $1,500;
74.5 	(2) for filing certified copy of certificate of articles of incorporation, $100;
74.6 	(3) for filing annual statement, $225;
74.7 	(4) for filing certified copy of amendment to certificate or articles of incorporation, 
74.8 	$100;
74.9 	(5) for filing bylaws, $75 or amendments thereto, $75;
74.10 	(6) for each company's certificate of authority, $575, annually;
74.11 	(c) the following general fees apply:
74.12 	(1) for each certificate, including certified copy of certificate of authority, renewal, 
74.13 	valuation of life policies, corporate condition or qualification, $25;
74.14 	(2) for each copy of paper on file in the commissioner's office 50 cents per page, 
74.15 	and $2.50 for certifying the same;
74.16 	(3) for license to procure insurance in unadmitted foreign companies, $575;
74.17 	(4) for valuing the policies of life insurance companies, one cent per $1,000 of 
74.18 	insurance so valued, provided that the fee shall not exceed $13,000 per year for any 
74.19 	company. The commissioner may, in lieu of a valuation of the policies of any foreign life 
74.20 	insurance company admitted, or applying for admission, to do business in this state, accept 
74.21 	a certificate of valuation from the company's own actuary or from the commissioner of 
74.22 	insurance of the state or territory in which the company is domiciled;
74.23 	(5) for receiving and filing certificates of policies by the company's actuary, or by 
74.24 	the commissioner of insurance of any other state or territory, $50;
74.25 	(6) for each appointment of an agent filed with the commissioner, $10;
74.26 	(7) for filing forms, rates, and compliance certifications under section 60A.315, $90
74.27 	$140 per filing, or $75$125 per filing when submitted via electronic filing system. Filing 
74.28 	fees may be paid on a quarterly basis in response to an invoice. Billing and payment may 
74.29 	be made electronically;
74.30 	(8) for annual renewal of surplus lines insurer license, $300.
74.31 	The commissioner shall adopt rules to define filings that are subject to a fee.

74.32 	Sec. 7. Minnesota Statutes 2008, section 216B.62, subdivision 3, is amended to read:
74.33 		Subd. 3.Assessing all public utilities. The department and commission shall 
74.34 	quarterly, at least 30 days before the start of each quarter, estimate the total of their 
74.35 	expenditures in the performance of their duties relating to (1) public utilities under section 
75.1 	216A.085, sections 216A.085 and 216B.01 to 216B.67, other than amounts chargeable 
75.2 	to public utilities under subdivision 2 or, 6, and (2) alternative energy engineering 
75.3 	activity under section 216C.261 or 7. The remainder, except the amount assessed 
75.4 	against cooperatives and municipalities for alternative energy engineering activity under 
75.5 	subdivision 5, shall be assessed by the commission and department to the several public 
75.6 	utilities in proportion to their respective gross operating revenues from retail sales of gas 
75.7 	or electric service within the state during the last calendar year. The assessment shall be 
75.8 	paid into the state treasury within 30 days after the bill has been transmitted via mail, 
75.9 	personal delivery, or electronic service to the several public utilities, which shall constitute 
75.10 	notice of the assessment and demand of payment thereof. The total amount which may 
75.11 	be assessed to the public utilities, under authority of this subdivision, shall not exceed 
75.12 	one-sixth of one percent of the total gross operating revenues of the public utilities 
75.13 	during the calendar year from retail sales of gas or electric service within the state. The 
75.14 	assessment for the third quarter of each fiscal year shall be adjusted to compensate for the 
75.15 	amount by which actual expenditures by the commission and department for the preceding 
75.16 	fiscal year were more or less than the estimated expenditures previously assessed. 

75.17 	Sec. 8. Minnesota Statutes 2008, section 216B.62, subdivision 4, is amended to read:
75.18 		Subd. 4.Objections. Within 30 days after the date of the transmittal of any bill as 
75.19 	provided by subdivisions subdivision 2 and, 3, or 7, the public utility against which the bill 
75.20 	has been rendered may file with the commission objections setting out the grounds upon 
75.21 	which it is claimed the bill is excessive, erroneous, unlawful or invalid. The commission 
75.22 	shall within 60 days hold a hearing and issue an order in accordance with its findings. The 
75.23 	order shall be appealable in the same manner as other final orders of the commission.

75.24 	Sec. 9. Minnesota Statutes 2008, section 216B.62, subdivision 5, is amended to read:
75.25 		Subd. 5.Assessing cooperatives and municipals. The commission and department 
75.26 	may charge cooperative electric associations, generation and transmission cooperative 
75.27 	electric associations, municipal power agencies, and municipal electric utilities their 
75.28 	proportionate share of the expenses incurred in the review and disposition of resource 
75.29 	plans, adjudication of service area disputes, proceedings under section 216B.1691, 
75.30 	216B.2425, or 216B.243, and the costs incurred in the adjudication of complaints over 
75.31 	service standards, practices, and rates. Cooperative electric associations electing to 
75.32 	become subject to rate regulation by the commission pursuant to section 216B.026, 
75.33 	subdivision 4, are also subject to this section. Neither a cooperative electric association 
75.34 	nor a municipal electric utility is liable for costs and expenses in a calendar year in excess 
76.1 	of the limitation on costs that may be assessed against public utilities under subdivision 
76.2 	2. A cooperative electric association, generation and transmission cooperative electric 
76.3 	association, municipal power agency, or municipal electric utility may object to and appeal 
76.4 	bills of the commission and department as provided in subdivision 4.
76.5 	The department shall assess cooperatives and municipalities for the costs of 
76.6 	alternative energy engineering activities under section 216C.261. Each cooperative and 
76.7 	municipality shall be assessed in proportion that its gross operating revenues for the sale 
76.8 	of gas and electric service within the state for the last calendar year bears to the total of 
76.9 	those revenues for all public utilities, cooperatives, and municipalities.

76.10 	Sec. 10. Minnesota Statutes 2008, section 216B.62, is amended by adding a 
76.11 	subdivision to read:
76.12 		Subd. 7.Assessing all utilities. The department shall assess public utilities, 
76.13 	cooperative electric associations, and municipal utilities for the costs of activities under 
76.14 	chapter 216C. The department shall not assess for costs of grants, loans, or other aids or 
76.15 	for costs that can be recovered through other assessment authority. Each public utility, 
76.16 	cooperative, and municipal utility shall be assessed in the proportion that its gross 
76.17 	operating revenue for the sale of gas and electric service within the state for the last 
76.18 	calendar year bears to the total of those revenues for all public utilities, cooperatives, 
76.19 	and municipalities.

76.20 	ARTICLE 3
76.21 	ENERGY DEFINITIONS; GOALS; LEGISLATIVE REVIEW

76.22 	Section 1. FEDERAL STIMULUS FUNDING; GOAL OF ENERGY 
76.23 	PROGRAMS.
 76.24 		Subdivision 1.Definitions. For the purposes of articles 2 to 6, the following terms 
76.25 	have the meaning given them.
76.26 	(a) "Act" means the American Recovery and Reinvestment Act of 2009.
76.27 	(b) "Commissioner" means the commissioner of commerce.
76.28 	(c) "Stimulus funding" or "funding" means funding provided to the state under 
76.29 	the act for:
76.30 	(1) energy efficiency and conservation block grants authorized under subtitle E of 
76.31 	title V of the federal Energy Independence and Security Act of 2007, United States Code, 
76.32 	title 42, section 17151 et seq.;
77.1 	(2) the Weatherization Assistance Program authorized under part A of title IV of the 
77.2 	federal Energy Conservation and Production Act, United States Code, title 42, section 
77.3 	6861, et seq.; and
77.4 	(3) the State Energy Program authorized under part D of title III of the federal 
77.5 	Energy Policy and Conservation Act, United States Code, title 42, section 6321, et seq.
77.6 		Subd. 2.Stimulus funding allocation and use goals. To the extent allowed by 
77.7 	federal law and regulation and consistent with the purposes and principles of the act, 
77.8 	stimulus funding must be allocated and expended under articles 2 to 4 for activities that 
77.9 	best achieve the following goals:
77.10 	(1) job retention and creation;
77.11 	(2) improved energy efficiency and increased renewable energy production capacity;
77.12 	(3) coordination with and leveraging of other resources to increase the total benefits 
77.13 	derived from stimulus funding;
77.14 	(4) timely implementation of funded activities;
77.15 	(5) long-term sustainability of benefits derived from stimulus funds;
77.16 	(6) geographic distribution across the state; 
77.17 	(7) compliance with the disadvantaged business enterprise outreach requirements 
77.18 	in Minnesota Statutes, section 16C.16, subdivision 4; and
77.19 	(8) ensuring that projects are cost-effective and maximize energy savings per dollar 
77.20 	of stimulus funding expended.

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

77.22 	Sec. 2. LEGISLATIVE REVIEW.
 77.23 	The Office of Energy Security shall, prior to expending any stimulus funds, submit 
77.24 	to the chairs and ranking minority members of the senate and house of representatives 
77.25 	committees with primary jurisdiction over energy policy and finance the criteria it 
77.26 	proposes to use to rank the programs in articles 2 to 6 in order to allocate stimulus funding 
77.27 	among the programs. Comments on the proposed criteria must be submitted to the Office 
77.28 	of Energy Security within ten working days of receipt of the criteria. The Office of Energy 
77.29 	Security shall consider the comments before establishing the final allocation criteria, and 
77.30 	shall submit a report on the amount of stimulus funds allocated to each of the programs 
77.31 	under articles 2 to 6 the chairs and ranking minority members of the senate and house of 
77.32 	representatives committees with primary jurisdiction over energy policy and finance 
77.33 	within ten working days of establishing the stimulus funding allocations.

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

78.1 	ARTICLE 4
78.2 	ENERGY EFFICIENCY

78.3 	Section 1. WEATHERIZATION.
 78.4 		Subdivision 1.Allocation of funds. All stimulus funds for weatherization must be 
78.5 	allocated by the director of the Office of Energy Security, consistent with federal allocation 
78.6 	requirements and state allocation formulas in the state weatherization plan. Existing 
78.7 	providers of weatherization services must be fully utilized, consistent with effective 
78.8 	program delivery, before additional providers of weatherization services are added.
78.9 		Subd. 2.Rental units.  Programs that include rental units must be developed, 
78.10 	including developing procedures to increase low-income rental unit participation in 
78.11 	programs. Priority must be given to serving the largest number of new weatherization 
78.12 	clients consistent with federal eligibility requirements.
78.13 		Subd. 3.Background check. Any person offering employment to an individual 
78.14 	to conduct weatherization activities under this section shall request a criminal history 
78.15 	background check from the superintendent of the Bureau of Criminal Apprehension on that 
78.16 	individual. In order for an individual to be eligible for employment, the individual must 
78.17 	provide an executed criminal history consent form and a money order or check payable to 
78.18 	the Bureau of Criminal Apprehension in an amount equal to the actual cost to the Bureau 
78.19 	of Criminal Apprehension of conducting the background check. The superintendent of 
78.20 	the Bureau of Criminal Apprehension shall conduct the background check by retrieving 
78.21 	criminal history data maintained in the criminal justice information system computers.
78.22 		Subd. 4.Employment prohibited. An individual convicted of a violent crime, as 
78.23 	defined in section 611A.08, subdivision 6, or a crime against property may not be hired to 
78.24 	conduct weatherization activities under this section.

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

78.26 	Sec. 2. LOCAL GOVERNMENT AND SCHOOL DISTRICT BUILDING 
78.27 	RENOVATIONS.
 78.28 	The Office of Energy Security must coordinate the use of stimulus funds with the 
78.29 	local public building enhanced energy-efficiency program under Minnesota Statutes, 
78.30 	section 216C.43. The Office of Energy Security shall prioritize lighting upgrades, energy 
78.31 	recommissioning, and other cost-effective energy projects that are ready for immediate 
78.32 	implementation. Stimulus funds may be used for, but are not limited to, grants for a portion 
78.33 	of costs incurred by local governments to implement energy efficiency improvements 
78.34 	under the local public building enhanced energy-efficiency program. The Office of Energy 
79.1 	Security may require a local government, as a condition of receiving a grant, to commit to 
79.2 	implement future activities, including, but not limited to, staff training, that are designed 
79.3 	to create additional energy or operating savings to the local government. The Office of 
79.4 	Energy Security shall coordinate with the Department of Education to prioritize school 
79.5 	district projects for funding under this section, consistent with the principles of statewide 
79.6 	geographic distribution of projects, optimized energy savings, and an improved learning 
79.7 	environment for schoolchildren.

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

79.9 	Sec. 3. STATE GOVERNMENT BUILDINGS.
 79.10 	The Department of Administration shall develop a plan and procedures to select, 
79.11 	fund, and implement projects using stimulus funds. The plan and procedures shall 
79.12 	prioritize lighting upgrades, energy-efficient windows, energy recommissioning, and other 
79.13 	cost-effective energy projects that are ready for immediate implementation. Funds may be 
79.14 	used for, but are not limited to, grants for a portion of costs incurred by state agencies in 
79.15 	implementing energy efficiency improvements. The Department of Administration may 
79.16 	require a state agency, as a condition of receiving stimulus funds, to commit to implement 
79.17 	future activities, including, but not limited to, staff training, that are designed to create 
79.18 	additional energy or operating savings to the state agency.

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

79.20 	Sec. 4. RESIDENTIAL ENERGY EFFICIENCY PROGRAMS.
 79.21 	The Office of Energy Security shall coordinate with the Minnesota Housing Finance 
79.22 	Agency to use stimulus funds in conjunction with the Minnesota Housing Finance 
79.23 	Agency's existing financing programs to improve energy efficiency in dwellings.

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

79.25 	Sec. 5. TRAINING AND WORKFORCE DEVELOPMENT.
 79.26 	(a) The Department of Employment and Economic Development, in consultation 
79.27 	with the Office of Energy Security and the Office of Higher Education, shall develop a 
79.28 	plan and procedures to:
79.29 	(1) allocate stimulus funds to training programs to train energy professionals needed 
79.30 	to implement the energy programs described in sections 2 to 4, including but not limited to 
79.31 	energy auditors, energy managers, and building operators;
80.1 	(2) coordinate, oversee, and monitor the training and certification of energy 
80.2 	professionals; and
80.3 	(3) allocate stimulus funding for the purposes of clauses (1) and (2) and to training 
80.4 	providers.
80.5 	(b) Training strategies must be designed to meet the wide range of facilities 
80.6 	managers and building sizes and types, and must protect the occupational health and safety 
80.7 	of workers employed on these energy projects. Technical skills training must include 
80.8 	insulation, air sealing, and mechanical work.
80.9 	(c) The plan must include procedures to:
80.10 	(1) train individuals already employed in implementing energy programs;
80.11 	(2) recruit individuals to be trained to perform work in energy projects using 
80.12 	stimulus funding who are unemployed, especially targeting communities experiencing 
80.13 	disproportionately high rates of unemployment, including, but not limited to, low-income, 
80.14 	rural, or tribal communities and individuals in construction trades and crafts; and
80.15 	(3) ensure that the full capacity of current training providers is utilized, including, 
80.16 	but not limited to, opportunities industrialization centers, skilled trades labor unions, tribal 
80.17 	colleges or nonprofits working in tribal communities, community action partnerships, 
80.18 	utility companies, higher education institutions, and nonprofit organizations with 
80.19 	demonstrated expertise in energy efficiency.

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

80.21 	Sec. 6. ACCOUNTABILITY AND TRANSPARENCY REPORTING.
 80.22 	The director of the Office of Energy Security, after compiling information supplied 
80.23 	by the Departments of Administration, Education, and Employment and Economic 
80.24 	Development, and the Office of Higher Education, shall report on the progress of the 
80.25 	programs funded under articles 2 to 6 to the house of representatives and senate committees 
80.26 	with jurisdiction over energy finance and workforce development policy by September 1, 
80.27 	2009, January 15, 2010, April 1, 2010, and September 1, 2010. The report must include a 
80.28 	complete accounting of all stimulus funds spent on the programs funded under articles 2 to 
80.29 	6, to the extent allowable by state and federal law, including, but not limited to:
80.30 	(1) the specific projects funded, including the location, building owner, and project 
80.31 	manager;
80.32 	(2) the number of jobs retained or created by each project;
80.33 	(3) the total calculated and actual energy savings for each project;
80.34 	(4) the remaining balances in each stimulus fund;
80.35 	(5) the nonstimulus funding leveraged by stimulus funds for each project;
81.1 	(6) the training courses provided, including the location and provider of courses 
81.2 	offered, the funding source for each training course, and the total number of trainees; and
81.3 	(7) compliance with prevailing wage, veterans, and disadvantaged business 
81.4 	enterprise requirements.

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

81.6 	ARTICLE 5
81.7 	RENEWABLE ENERGY

81.8 	Section 1. RENEWABLE ENERGY GRANT PROGRAM.
 81.9 	(a) The commissioner of commerce shall establish a program to award grants to 
81.10 	energy projects that meet the following conditions:
81.11 	(1) the project qualifies as a community-based energy development (C-BED) project, 
81.12 	as defined in Minnesota Statutes, section 216B.1612, subdivision 2, paragraph (g);
81.13 	(2) for wind projects, the project is located in an area where the measured wind 
81.14 	resource is Class 4 or above;
81.15 	(3) the project begins commercial operation after July 1, 2009;
81.16 	(4) the project does not receive renewable energy payment incentives under 
81.17 	Minnesota Statutes, section 216C.41; and
81.18 	(5) the project meets any other conditions established under the American Recovery 
81.19 	and Reinvestment Act of 2009, Public Law 111-5, for use of these funds.
81.20 	(b) The department shall develop an application form, application review procedures, 
81.21 	criteria that projects must meet in order to be considered for a grant award, procedures 
81.22 	and guidelines for project monitoring and evaluation, and other administrative procedures 
81.23 	necessary to fully implement a grant program.
81.24 	(c) The maximum grant to a project is $500,000.
81.25 	(d) No more than two projects in a single county may receive a grant under this 
81.26 	section.
81.27 	(e) No C-BED qualifying owner may financially participate in more than one project 
81.28 	that receives a grant under this section.
81.29 	(f) Grant awards must be geographically dispersed throughout the state.

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

81.31 	Sec. 2. RENEWABLE ELECTRIC GENERATION FACILITY REBATES.
 81.32 	(a) The commissioner shall establish a program to award rebates to qualifying 
81.33 	facilities that generate electricity from a renewable source and that:
82.1 	(1) begin operation after July 1, 2009; 
82.2 	(2) meet all other conditions established under the act; and
82.3 	(3) provide electricity to:
82.4 	(i) a homeowner's primary residence; or
82.5 	(ii) a business, with 20 or fewer full-time employees.
82.6 	(b) The commissioner shall develop an application form, application review 
82.7 	procedures, criteria that projects must meet in order to be considered for a rebate, 
82.8 	procedures and guidelines for project monitoring and evaluation, and other administrative 
82.9 	procedures necessary to fully implement a rebate program.
82.10 	(c) The owner of a qualifying facility may apply to the commissioner for a rebate of 
82.11 	the lesser of $2,500 or 35 percent of the cost of the electric generation facility, including 
82.12 	installation costs.
82.13 	(d) The commissioner shall award rebates only from funds appropriated for that 
82.14 	purpose and to the extent of those appropriations. Grants must be made to applicants in 
82.15 	the order of the time of receipt of a complete application.
82.16 	(e) For purposes of this section:
82.17 	(1) "Qualifying facility" means an electric generation facility with a capacity of less 
82.18 	than 40 kilowatts that generates electricity from a renewable energy source.
82.19 	(2) "Renewable energy source" means:
82.20 	(i) solar;
82.21 	(ii) wind;
82.22 	(iii) hydroelectric;
82.23 	(iv) hydrogen, provided that after January 1, 2010, the hydrogen must be generated 
82.24 	from the resources listed in this clause; or
82.25 	(v) biomass, which includes, without limitation, landfill gas; an anaerobic digester 
82.26 	system; and the predominantly organic components of wastewater effluent, sludge, or 
82.27 	related by-products from publicly owned treatment works, but not including incineration 
82.28 	of wastewater sludge to produce electricity.

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

82.30 	Sec. 3. SOLAR ENERGY PROJECTS IN PUBLIC BUILDINGS AND 
82.31 	SCHOOLS.
 82.32 	(a) The commissioner shall establish a program to award grants to:
82.33 	(1) local units of government to pay the costs of installing solar energy projects to 
82.34 	generate energy used in public buildings; or
83.1 	(2) to school districts to pay the costs of installing solar energy projects to generate 
83.2 	energy used in K-12 schools.
83.3 	(b) To be eligible to receive a grant, a project must:
83.4 	(1) begin operation after July 1, 2009; and
83.5 	(2) meet all other conditions established under the act.
83.6 	(c) The commissioner shall develop an application form, application review 
83.7 	procedures, criteria that a project must meet in order to be considered for a grant award, 
83.8 	procedures and guidelines for project monitoring and evaluation, and other administrative 
83.9 	procedures necessary to fully implement a grant program.
83.10 	(d) In awarding grants, the commissioner must determine, at a minimum, the 
83.11 	following:
83.12 	(1) that the physical condition of the building is sufficient to support the efficient 
83.13 	operation of the solar energy project;
83.14 	(2) that there is no significant possibility that the building may close within ten 
83.15 	years, which determination, for a school, must be based on enrollment projections; and
83.16 	(3) that the projected cumulative energy savings exceed the grant amount within 15 
83.17 	years for a qualifying solar thermal project, and within 20 years for a photovoltaic device.
83.18 	(e) In awarding grants, the commissioner must also consider:
83.19 	(1) the reliability and cost-effectiveness of the solar technology to be installed;
83.20 	(2) the extent to which the proposal effectively coordinates with the conservation 
83.21 	and energy efficiency programs offered by the energy utilities serving the building in 
83.22 	which the project is located, and with the public building enhanced energy efficiency 
83.23 	program under section 216C.43, if applicable;
83.24 	(3) life cycle energy use reductions and greenhouse gas emissions reductions 
83.25 	projected per dollar of installed cost of the project; and
83.26 	(4) the geographic distribution of grant recipients throughout the state.
83.27 	(f) For the purposes of this section:
83.28 	(1) "public building" means any publicly owned building, sports arena, or other 
83.29 	facility of a county, city, or other local unit of government; and
83.30 	(2) "solar energy" means:
83.31 	(i) a photovoltaic device, as defined in Minnesota Statutes, section 216C.06, 
83.32 	subdivision 16; or
83.33 	(ii) a qualifying thermal project, as defined in Minnesota Statutes, section 
83.34 	216B.2411, subdivision 2, that includes modifications made to a distribution system to 
83.35 	distribute heating or cooling throughout a building.

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

84.1 	ARTICLE 6
84.2 	MISCELLANEOUS ENERGY PROGRAMS 

84.3 	Section 1. ENERGY PROGRAMS IN COMMERCIAL AND INDUSTRIAL 
84.4 	BUILDINGS.
 84.5 	(a) The commissioner shall establish a program to award grants to commercial 
84.6 	and industrial facilities for the purpose of installing energy-efficiency improvements or 
84.7 	creating renewable energy sources to generate electricity or to heat or cool a building. To 
84.8 	be eligible to receive a grant, a project must:
84.9 	(1) begin commercial operation after July 1, 2009; and
84.10 	(2) meet all other conditions established under the act.
84.11 	(b) The commissioner shall develop an application form, application review 
84.12 	procedures, criteria that a project must meet in order to be considered for a grant award, 
84.13 	procedures and guidelines for project monitoring and evaluation, and other administrative 
84.14 	procedures necessary to fully implement a grant program.
84.15 	(c) For the purposes of this section, "renewable energy source" means:
84.16 	(i) solar;
84.17 	(ii) wind;
84.18 	(iii) hydroelectric;
84.19 	(iv) hydrogen, provided that after January 1, 2010, the hydrogen must be generated 
84.20 	from the resources listed in this clause; or
84.21 	(v) biomass, which includes, without limitation, landfill gas; an anaerobic digester 
84.22 	system; and the predominantly organic components of wastewater effluent, sludge, or 
84.23 	related by-products from publicly owned treatment works, but not including incineration 
84.24 	of wastewater sludge to produce electricity.

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

84.26 	Sec. 2. ENERGY EDUCATION, TRAINING, AND DATA SYSTEMS.
 84.27 	The Office of Energy Security shall establish programs to work with teachers and 
84.28 	other energy experts to include energy issues in K-12 curricula; develop training and 
84.29 	certification programs for technicians to install and service wind and solar energy systems; 
84.30 	and upgrade data systems to enable accurate tracking of energy savings resulting from the 
84.31 	conservation improvement program and other state energy programs.

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

85.1 	Sec. 3. ENERGY EFFICIENCY GRANTS TO LOCAL GOVERNMENTS.
 85.2 	The Office of Energy Security shall establish a grant program to award grants to 
85.3 	local units of government to enhance energy efficiency and reduce energy use. Energy 
85.4 	efficiency and conservation block grant funds may be used for grants for planning, 
85.5 	consultant services, energy audits, implementing energy-efficient building codes and 
85.6 	inspection services, energy efficiency renovations, street lighting, and the installation of 
85.7 	renewable energy devices deployed on public buildings.

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

85.9 	ARTICLE 7
85.10 	OTHER ENERGY APPROPRIATIONS

85.11 	Section 1. WEATHERIZATION ASSISTANCE PROGRAM APPROPRIATION.
 85.12 	Of the funds available to the state of Minnesota from the federal stimulus funding for 
85.13 	the weatherization assistance program under the American Recovery and Reinvestment 
85.14 	Act of 2009, Public Law 111-5, $131,937,411 is appropriated to the commissioner of 
85.15 	commerce. The funds must be administered consistent with the requirements in article 4, 
85.16 	section 1.

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

85.18 	Sec. 2. ENERGY EFFICIENCY AND CONSERVATION BLOCK PROGRAM 
85.19 	APPROPRIATION.
 85.20 	Of the funds available to the state of Minnesota from the federal stimulus funding 
85.21 	for the Energy Efficiency and Conservation Block Grant Program under the American 
85.22 	Recovery and Reinvestment Act of 2009, Public Law 111-5, $10,644,100, is appropriated 
85.23 	to the commissioner of commerce. The appropriation must be distributed as follows:
85.24 	(1) $6,546,121 is for energy efficiency grants to local government in article 6, 
85.25 	section 3; and
85.26 	(2) $4,097,979, is for local government and school district buildings consistent 
85.27 	with the requirements in article 4, section 2.

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

85.29 	Sec. 3. STATE ENERGY PROGRAM APPROPRIATION.
 85.30 	Of the funds available to the state of Minnesota from the federal stimulus funding 
85.31 	for the State Energy Program under the American Recovery and Reinvestment Act of 
86.1 	2009, Public Law 111-5, $54,172,000 is appropriated to the commissioner of commerce. 
86.2 	Of this amount:
86.3 	(1) $10,650,000 is for local government and school district buildings consistent 
86.4 	with the requirements in article 4, section 2;
86.5 	(2) $8,000,000 is for state government buildings consistent with the requirements in 
86.6 	article 4, section 3;
86.7 	(3) $12,000,000 is for the residential energy financing program in article 4, section 4;
86.8 	(4) $12,000,000 is for renewable energy programs, including, but not limited to, the 
86.9 	programs specified in article 5;
86.10 	(6) $5,000,000 is for grants to commercial and industrial facilities for energy 
86.11 	efficiency and renewable energy projects in article 6, section 1;
86.12 	(7) $5,022,000 is for energy education, training, and information and data systems in 
86.13 	article 6, section 2; and
86.14 	(8) $1,500,000 is for a grant to the Board of Trustees of the Minnesota State Colleges 
86.15 	and Universities for the International Renewable Energy Technology Institute (IRETI) to 
86.16 	be located at Minnesota State University, Mankato, as a public and private partnership to 
86.17 	support applied research in renewable energy and energy efficiency to aid in the transfer of 
86.18 	technology from Sweden to Minnesota and to support technology commercialization from 
86.19 	companies located in Minnesota and throughout the world.

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

86.21 	ARTICLE 8
86.22 	DEPARTMENT OF COMMERCE; OTHER REGULATORY PROVISIONS

86.23 	Section 1. Minnesota Statutes 2008, section 47.58, subdivision 1, is amended to read:
86.24 		Subdivision 1.Definitions. For the purposes of this section, the terms defined in this 
86.25 	subdivision have the meanings given them.
86.26 	(a) "Reverse mortgage loan" means a loan:
86.27 	(1) Made to a borrower wherein the committed principal amount is paid to the 
86.28 	borrower in equal or unequal installments over a period of months or years, interest is 
86.29 	assessed, and authorized closing costs are incurred as specified in the loan agreement;
86.30 	(2) Which is secured by a mortgage on residential property owned solely by the 
86.31 	borrower; and
86.32 	(3) Which is due when the committed principal amount has been fully paid to the 
86.33 	borrower, or upon sale of the property securing the loan, or upon the death of the last 
87.1 	surviving borrower, or upon the borrower terminating use of the property as principal 
87.2 	residence so as to disqualify the property from the homestead credit given in chapter 290A.
87.3 	(b) "Lender" means any bank subject to chapter 48, credit union subject to chapter 
87.4 	52, savings bank organized and operated pursuant to chapter 50, savings association 
87.5 	subject to chapter 51A, any residential mortgage originator subject to chapter 58, or any 
87.6 	insurance company as defined in section 60A.02, subdivision 4. "Lender" also includes 
87.7 	any federally chartered bank supervised by the comptroller of the currency or federally 
87.8 	chartered savings association supervised by the Federal Home Loan Bank Board or 
87.9 	federally chartered credit union supervised by the National Credit Union Administration, 
87.10 	to the extent permitted by federal law.  
87.11 	(c) "Borrower" includes any natural person holding an interest in severalty or as joint 
87.12 	tenant or tenant-in-common in the property securing a reverse mortgage loan.
87.13 	(d) "Outstanding loan balance" means the current net amount of money owed by the 
87.14 	borrower to the lender whether or not that sum is suspended pursuant to the terms of the 
87.15 	reverse mortgage loan agreement or is immediately due and payable. The outstanding 
87.16 	loan balance is calculated by adding the current totals of the items described in clauses (1) 
87.17 	to (5) and subtracting the current totals of the item described in clause (6):
87.18 	(1) The sum of all payments made by the lender which are necessary to clear the 
87.19 	property securing the loan of any outstanding mortgage encumbrance or mechanics or 
87.20 	material supplier's lien.
87.21 	(2) The total disbursements made by the lender to date pursuant to the loan 
87.22 	agreement as formulated in accordance with subdivision 3.
87.23 	(3) All taxes, assessments, insurance premiums and other similar charges paid to 
87.24 	date by the lender pursuant to subdivision 6, which charges were not reimbursed by the 
87.25 	borrower within 60 days.
87.26 	(4) All actual closing costs which the borrower has deferred, if a deferral provision 
87.27 	is contained in the loan agreement as authorized by subdivision 7.
87.28 	(5) The total accrued interest to date, as authorized by subdivision 5.
87.29 	(6) All payments made by the borrower pursuant to subdivision 4.
87.30 	(e) "Actual closing costs" mean reasonable charges or sums ordinarily paid at the 
87.31 	time of closing for the following, whether or not retained by the lender:
87.32 	(1) Any insurance premiums on policies covering the mortgaged property including 
87.33 	but not limited to premiums for title insurance, fire and extended coverage insurance, flood 
87.34 	insurance, and private mortgage insurance.
87.35 	(2) Abstracting, title examination and search, and examination of public records 
87.36 	related to the mortgaged property.
88.1 	(3) The preparation and recording of any or all documents required by law or custom 
88.2 	for closing a reverse mortgage loan agreement.
88.3 	(4) Appraisal and survey of real property securing a reverse mortgage loan.
88.4 	(5) A single service charge, which service charge shall include any consideration, 
88.5 	not otherwise specified in this section as an "actual closing cost," paid by the borrower to 
88.6 	the lender for or in relation to the acquisition, making, refinancing or modification of a 
88.7 	reverse mortgage loan, and shall also include any consideration received by the lender 
88.8 	for making a commitment for a reverse mortgage loan, whether or not an actual loan 
88.9 	follows the commitment. The service charge shall not exceed one percent of the bona fide 
88.10 	committed principal amount of the reverse mortgage loan.
88.11 	(6) Charges and fees necessary for or related to the transfer of real property securing 
88.12 	a reverse mortgage loan or the closing of a reverse mortgage loan agreement paid by the 
88.13 	borrower and received by any party other than the lender.

88.14 	Sec. 2. Minnesota Statutes 2008, section 47.60, subdivision 1, is amended to read:
88.15 		Subdivision 1.Definitions. For purposes of this section, the terms defined have 
88.16 	the meanings given them:
88.17 	(a) "Consumer small loan" is a loan transaction in which cash is advanced to a 
88.18 	borrower for the borrower's own personal, family, or household purpose. A consumer 
88.19 	small loan is a short-term, unsecured loan to be repaid in a single installment. The cash 
88.20 	advance of a consumer small loan is equal to or less than $350. A consumer small loan 
88.21 	includes an indebtedness evidenced by but not limited to a promissory note or agreement 
88.22 	to defer the presentation of a personal check for a fee.
88.23 	(b) "Consumer small loan lender" is a financial institution as defined in section 
88.24 	47.59 or a person business entity registered with the commissioner and engaged in the 
88.25 	business of making consumer small loans. 

88.26 	Sec. 3. Minnesota Statutes 2008, section 47.60, subdivision 3, is amended to read:
88.27 		Subd. 3.Filing. Before a person business entity other than a financial institution 
88.28 	as defined by section 47.59 engages in the business of making consumer small loans to 
88.29 	Minnesota residents, the person business entity shall file with the commissioner as a 
88.30 	consumer small loan lender. The filing must be on a form prescribed by the commissioner 
88.31 	together with a fee of $250 for each place of business and contain the following 
88.32 	information in addition to the information required by the commissioner: 
88.33 	(1) evidence that the filer has available for the operation of the business at the 
88.34 	location specified, liquid assets of at least $50,000; and
89.1 	(2) a biographical statement on the principal person responsible for the operation 
89.2 	and management of the business to be certified.
89.3 	Revocation of the filing and the right to engage in the business of a consumer small 
89.4 	loan lender is the same as in the case of a regulated lender license in section 56.09. 
89.5 	For purposes of this subdivision, "business entity" includes one that does not have a 
89.6 	physical location in Minnesota that makes a consumer small loan electronically via the 
89.7 	Internet. 

89.8 	Sec. 4. Minnesota Statutes 2008, section 47.60, subdivision 6, is amended to read:
89.9 		Subd. 6.Penalties for violation. A person business entity or the person's entity's
89.10 	members, officers, directors, agents, and employees who violate or participate in the 
89.11 	violation of any of the provisions of this section may be liable in the same manner as in 
89.12 	section 56.19. 

89.13 	Sec. 5. Minnesota Statutes 2008, section 48.21, is amended to read:
89.14 	48.21 REAL ESTATE; RESTRICTIONS ON HOLDING.
89.15 		Subdivision 1.Specific restrictions. (a) A bank may purchase, carry as an asset, 
89.16 	and convey real estate only:
89.17 	(1) as provided for in section 47.10;  
89.18 	(2) if acquired through foreclosure of a mortgage given to it in good faith as security 
89.19 	for loans made by or money due to it;
89.20 	(3) if conveyed to it in satisfaction of debts previously contracted in good faith in 
89.21 	the course of its dealings;
89.22 	(4) if acquired by sale on execution or judgment of a court in its favor; or
89.23 	(5) if reasonably necessary to mitigate or avoid loss on a loan or investment 
89.24 	theretofore made.
89.25 	(b) Real estate acquired under clauses (2) to (5) shall be carried as an asset only in 
89.26 	accordance with rules the commissioner prescribes. The maximum period for holding 
89.27 	other real estate as an asset shall be five years, provided that upon application to the 
89.28 	commissioner, the commissioner may approve the possession of such real estate by a bank 
89.29 	for a period longer than five years, but not to exceed an additional five years, if:
89.30 	(1) the bank has made a good faith attempt to dispose of the real estate within the 
89.31 	initial five-year period; or
89.32 	(2) disposal within the initial five-year period would be detrimental to the bank.
89.33 		Subd. 2.Real estate holdings not bank liabilities. Real estate owned by a bank 
89.34 	as a result of actions authorized in clauses (2) to (5) of subdivision 1 and subsequently 
90.1 	sold to any buyer on a contract for deed may not be considered creating a liability to a 
90.2 	bank for purposes of section 48.24.  
90.3 		Subd. 3.Real estate holdings not sold; authority to write off. Notwithstanding 
90.4 	any rules of the commissioner to the contrary, if real estate owned by a bank pursuant to 
90.5 	clauses (2) to (5) of subdivision 1 is not sold or otherwise disposed of within the maximum 
90.6 	period established by rule by the commissioner, the bank may write off any remaining 
90.7 	balance at a rate not less than one-fifth of that balance each subsequent calendar year.

90.8 	Sec. 6. Minnesota Statutes 2008, section 58.05, subdivision 3, is amended to read:
90.9 		Subd. 3.Certificate of exemption. A person must obtain a certificate of exemption 
90.10 	from the commissioner to qualify as an exempt person under section 58.04, subdivision 1, 
90.11 	paragraph (c), a financial institution under clause (2), or by order of the commissioner 
90.12 	under clause (6); or under section 58.04, subdivision 2, paragraph (b), as a financial 
90.13 	institution under clause (3) (4), or by order of the commissioner under clause (7) (8). 

90.14 	Sec. 7. Minnesota Statutes 2008, section 58.06, subdivision 2, is amended to read:
90.15 		Subd. 2.Application contents. (a) The application must contain the name and 
90.16 	complete business address or addresses of the license applicant. The license applicant 
90.17 	must be a partnership, limited liability partnership, association, limited liability company, 
90.18 	corporation, or other form of business organization, and the application must contain the 
90.19 	names and complete business addresses of each partner, member, director, and principal 
90.20 	officer. The application must also include a description of the activities of the license 
90.21 	applicant, in the detail and for the periods the commissioner may require.
90.22 	(b) An A residential mortgage originator applicant must submit one of the following:
90.23 	(1) evidence which shows, to the commissioner's satisfaction, that either the federal 
90.24 	Department of Housing and Urban Development or the Federal National Mortgage 
90.25 	Association has approved the residential mortgage originator applicant as a mortgagee;
90.26 	(2) a surety bond or irrevocable letter of credit in the amount of not less than 
90.27 	$50,000 in a form approved by the commissioner, issued by an insurance company or bank 
90.28 	authorized to do so in this state. The bond or irrevocable letter of credit must be available 
90.29 	for the recovery of expenses, fines, and fees levied by the commissioner under this chapter 
90.30 	and for losses incurred by borrowers. The bond or letter of credit must be submitted with 
90.31 	the license application, and evidence of continued coverage must be submitted with each 
90.32 	renewal. Any change in the bond or letter of credit must be submitted for approval by the 
90.33 	commissioner within ten days of its execution; or
91.1 	(3) a copy of the residential mortgage originator applicant's most recent audited 
91.2 	financial statement, including balance sheet, statement of income or loss, statements of 
91.3 	changes in shareholder equity, and statement of changes in financial position. Financial 
91.4 	statements must be as of a date within 12 months of the date of application.
91.5 	(c) The application must also include all of the following:
91.6 	(1) an affirmation under oath that the applicant:
91.7 	(i) is in compliance with the requirements of section 58.125;
91.8 	(ii) will maintain a perpetual roster of individuals employed as residential mortgage 
91.9 	originators, including employees and independent contractors, which includes the date
91.10 	dates that mandatory testing, initial education was, and continuing education were
91.11 	completed. In addition, the roster must be made available to the commissioner on demand, 
91.12 	within three business days of the commissioner's request;
91.13 	(iii) will advise the commissioner of any material changes to the information 
91.14 	submitted in the most recent application within ten days of the change;
91.15 	(iv) will advise the commissioner in writing immediately of any bankruptcy petitions 
91.16 	filed against or by the applicant or licensee;
91.17 	(v) will maintain at all times either a net worth, net of intangibles, of at least 
91.18 	$250,000 or a surety bond or irrevocable letter of credit in the amount of at least $50,000;
91.19 	(vi) complies with federal and state tax laws; and
91.20 	(vii) complies with sections 345.31 to 345.60, the Minnesota unclaimed property 
91.21 	law;  
91.22 	(2) information as to the mortgage lending, servicing, or brokering experience of the 
91.23 	applicant and persons in control of the applicant;
91.24 	(3) information as to criminal convictions, excluding traffic violations, of persons in 
91.25 	control of the license applicant;
91.26 	(4) whether a court of competent jurisdiction has found that the applicant or persons 
91.27 	in control of the applicant have engaged in conduct evidencing gross negligence, fraud, 
91.28 	misrepresentation, or deceit in performing an act for which a license is required under 
91.29 	this chapter;
91.30 	(5) whether the applicant or persons in control of the applicant have been the subject 
91.31 	of: an order of suspension or revocation, cease and desist order, or injunctive order, or 
91.32 	order barring involvement in an industry or profession issued by this or another state or 
91.33 	federal regulatory agency or by the Secretary of Housing and Urban Development within 
91.34 	the ten-year period immediately preceding submission of the application; and
91.35 	(6) other information required by the commissioner.

92.1 	Sec. 8. Minnesota Statutes 2008, section 58.126, is amended to read:
92.2 	58.126 EDUCATION AND TESTING REQUIREMENT.
92.3 	(a) No individual shall engage in residential mortgage origination or make residential 
92.4 	mortgage loans, whether as an employee or independent contractor, before the completion 
92.5 	of 15 20 hours of educational training which has been approved by the commissioner, and 
92.6 	covering state and federal laws concerning residential mortgage lending.
92.7 	(b) In addition to the initial education requirements in paragraph (a), each individual 
92.8 	must also complete eight hours of continuing education annually. The education must 
92.9 	include:
92.10 	(1) three hours of federal law and regulations;
92.11 	(2) two hours of ethics, which must include fraud, consumer protection, and fair 
92.12 	lending; and 
92.13 	(3) two hours of standards governing nontraditional mortgage lending.
92.14 	(c) The commissioner may by rule establish testing requirements for individuals 
92.15 	subject to the requirements of paragraphs (a) and (b). An individual must satisfy the 
92.16 	testing requirements established by the commissioner before engaging in residential 
92.17 	mortgage loan origination or making residential mortgage loans.

92.18 	EFFECTIVE DATE. This section is effective September 1, 2009, and applies to 
92.19 	license applications and renewals made on or after that date.

92.20 	Sec. 9. Minnesota Statutes 2008, section 58.13, subdivision 1, is amended to read:
92.21 		Subdivision 1. Generally. (a) No person acting as a residential mortgage originator 
92.22 	or servicer, including a person required to be licensed under this chapter, and no person 
92.23 	exempt from the licensing requirements of this chapter under section 58.04, except as 
92.24 	otherwise provided in paragraph (b), shall: 
92.25 	(1) fail to maintain a trust account to hold trust funds received in connection with a 
92.26 	residential mortgage loan; 
92.27 	(2) fail to deposit all trust funds into a trust account within three business days of 
92.28 	receipt; commingle trust funds with funds belonging to the licensee or exempt person; or 
92.29 	use trust account funds for any purpose other than that for which they are received; 
92.30 	(3) unreasonably delay the processing of a residential mortgage loan application, 
92.31 	or the closing of a residential mortgage loan. For purposes of this clause, evidence of 
92.32 	unreasonable delay includes but is not limited to those factors identified in section 47.206, 
92.33 	subdivision 7, clause (d); 
92.34 	(4) fail to disburse funds according to its contractual or statutory obligations; 
93.1 	(5) fail to perform in conformance with its written agreements with borrowers, 
93.2 	investors, other licensees, or exempt persons; 
93.3 	(6) charge a fee for a product or service where the product or service is not actually 
93.4 	provided, or misrepresent the amount charged by or paid to a third party for a product 
93.5 	or service; 
93.6 	(7) fail to comply with sections 345.31 to 345.60, the Minnesota unclaimed property 
93.7 	law; 
93.8 	(8) violate any provision of any other applicable state or federal law regulating 
93.9 	residential mortgage loans including, without limitation, sections 47.20 to 47.208, and 
93.10 	47.58; 
93.11 	(9) make or cause to be made, directly or indirectly, any false, deceptive, or 
93.12 	misleading statement or representation in connection with a residential loan transaction 
93.13 	including, without limitation, a false, deceptive, or misleading statement or representation 
93.14 	regarding the borrower's ability to qualify for any mortgage product; 
93.15 	(10) conduct residential mortgage loan business under any name other than that 
93.16 	under which the license or certificate of exemption was issued; 
93.17 	(11) compensate, whether directly or indirectly, coerce or intimidate an appraiser for 
93.18 	the purpose of influencing the independent judgment of the appraiser with respect to the 
93.19 	value of real estate that is to be covered by a residential mortgage or is being offered as 
93.20 	security according to an application for a residential mortgage loan; 
93.21 	(12) issue any document indicating conditional qualification or conditional approval 
93.22 	for a residential mortgage loan, unless the document also clearly indicates that final 
93.23 	qualification or approval is not guaranteed, and may be subject to additional review; 
93.24 	(13) make or assist in making any residential mortgage loan with the intent that the 
93.25 	loan will not be repaid and that the residential mortgage originator will obtain title to 
93.26 	the property through foreclosure; 
93.27 	(14) provide or offer to provide for a borrower, any brokering or lending services 
93.28 	under an arrangement with a person other than a licensee or exempt person, provided that 
93.29 	a person may rely upon a written representation by the residential mortgage originator that 
93.30 	it is in compliance with the licensing requirements of this chapter; 
93.31 	(15) claim to represent a licensee or exempt person, unless the person is an employee 
93.32 	of the licensee or exempt person or unless the person has entered into a written agency 
93.33 	agreement with the licensee or exempt person; 
93.34 	(16) fail to comply with the record keeping and notification requirements identified 
93.35 	in section 58.14 or fail to abide by the affirmations made on the application for licensure; 
94.1 	(17) represent that the licensee or exempt person is acting as the borrower's agent 
94.2 	after providing the nonagency disclosure required by section 58.15, unless the disclosure 
94.3 	is retracted and the licensee or exempt person complies with all of the requirements of 
94.4 	section 58.16; 
94.5 	(18) make, provide, or arrange for a residential mortgage loan that is of a lower 
94.6 	investment grade if the borrower's credit score or, if the originator does not utilize credit 
94.7 	scoring or if a credit score is unavailable, then comparable underwriting data, indicates 
94.8 	that the borrower may qualify for a residential mortgage loan, available from or through 
94.9 	the originator, that is of a higher investment grade, unless the borrower is informed that 
94.10 	the borrower may qualify for a higher investment grade loan with a lower interest rate 
94.11 	and/or lower discount points, and consents in writing to receipt of the lower investment 
94.12 	grade loan; 
94.13 	For purposes of this section, "investment grade" refers to a system of categorizing 
94.14 	residential mortgage loans in which the loans are: (i) commonly referred to as "prime" or 
94.15 	"subprime"; (ii) commonly designated by an alphabetical character with "A" being the 
94.16 	highest investment grade; and (iii) are distinguished by interest rate or discount points 
94.17 	or both charged to the borrower, which vary according to the degree of perceived risk 
94.18 	of default based on factors such as the borrower's credit, including credit score and 
94.19 	credit patterns, income and employment history, debt ratio, loan-to-value ratio, and prior 
94.20 	bankruptcy or foreclosure; 
94.21 	(19) make, publish, disseminate, circulate, place before the public, or cause to be 
94.22 	made, directly or indirectly, any advertisement or marketing materials of any type, or any 
94.23 	statement or representation relating to the business of residential mortgage loans that is 
94.24 	false, deceptive, or misleading; 
94.25 	(20) advertise loan types or terms that are not available from or through the licensee 
94.26 	or exempt person on the date advertised, or on the date specified in the advertisement. 
94.27 	For purposes of this clause, advertisement includes, but is not limited to, a list of sample 
94.28 	mortgage terms, including interest rates, discount points, and closing costs provided by 
94.29 	licensees or exempt persons to a print or electronic medium that presents the information 
94.30 	to the public; 
94.31 	(21) use or employ phrases, pictures, return addresses, geographic designations, or 
94.32 	other means that create the impression, directly or indirectly, that a licensee or other 
94.33 	person is a governmental agency, or is associated with, sponsored by, or in any manner 
94.34 	connected to, related to, or endorsed by a governmental agency, if that is not the case; 
94.35 	(22) violate section 82.49, relating to table funding; 
95.1 	(23) make, provide, or arrange for a residential mortgage loan all or a portion 
95.2 	of the proceeds of which are used to fully or partially pay off a "special mortgage" 
95.3 	unless the borrower has obtained a written certification from an authorized independent 
95.4 	loan counselor that the borrower has received counseling on the advisability of the 
95.5 	loan transaction. For purposes of this section, "special mortgage" means a residential 
95.6 	mortgage loan originated, subsidized, or guaranteed by or through a state, tribal, or 
95.7 	local government, or nonprofit organization, that bears one or more of the following 
95.8 	nonstandard payment terms which substantially benefit the borrower: (i) payments vary 
95.9 	with income; (ii) payments of principal or interest are not required or can be deferred under 
95.10 	specified conditions; (iii) principal or interest is forgivable under specified conditions; 
95.11 	or (iv) where no interest or an annual interest rate of two percent or less is charged in 
95.12 	connection with the loan. For purposes of this section, "authorized independent loan 
95.13 	counselor" means a nonprofit, third-party individual or organization providing homebuyer 
95.14 	education programs, foreclosure prevention services, mortgage loan counseling, or credit 
95.15 	counseling certified by the United States Department of Housing and Urban Development, 
95.16 	the Minnesota Home Ownership Center, the Minnesota Mortgage Foreclosure Prevention 
95.17 	Association, AARP, or NeighborWorks America; 
95.18 	(24) make, provide, or arrange for a residential mortgage loan without verifying 
95.19 	the borrower's reasonable ability to pay the scheduled payments of the following, as 
95.20 	applicable: principal; interest; real estate taxes; homeowner's insurance, assessments, 
95.21 	and mortgage insurance premiums. For loans in which the interest rate may vary, the 
95.22 	reasonable ability to pay shall be determined based on a fully indexed rate and a repayment 
95.23 	schedule which achieves full amortization over the life of the loan. For all residential 
95.24 	mortgage loans, the borrower's income and financial resources must be verified by tax 
95.25 	returns, payroll receipts, bank records, or other similarly reliable documents. 
95.26 	Nothing in this section shall be construed to limit a mortgage originator's or exempt 
95.27 	person's ability to rely on criteria other than the borrower's income and financial resources 
95.28 	to establish the borrower's reasonable ability to repay the residential mortgage loan, 
95.29 	including criteria established by the United States Department of Veterans Affairs or the 
95.30 	United States Department of Housing and Urban Development for interest rate reduction 
95.31 	refinancing loans or streamline loans, or criteria authorized or promulgated by the 
95.32 	Federal National Mortgage Association or Federal Home Loan Mortgage Corporation; 
95.33 	however, such other criteria must be verified through reasonably reliable methods and 
95.34 	documentation. The mortgage originator's analysis of the borrower's reasonable ability 
95.35 	to repay may include, but is not limited to, consideration of the following items, if 
95.36 	verified: (1) the borrower's current and expected income; (2) current and expected cash 
96.1 	flow; (3) net worth and other financial resources other than the consumer's equity in the 
96.2 	dwelling that secures the loan; (4) current financial obligations; (5) property taxes and 
96.3 	insurance; (6) assessments on the property; (7) employment status; (8) credit history; (9) 
96.4 	debt-to-income ratio; (10) credit scores; (11) tax returns; (12) pension statements; and 
96.5 	(13) employment payment records, provided that no mortgage originator shall disregard 
96.6 	facts and circumstances that indicate that the financial or other information submitted by 
96.7 	the consumer is inaccurate or incomplete. A statement by the borrower to the residential 
96.8 	mortgage originator or exempt person of the borrower's income and resources or sole 
96.9 	reliance on any single item listed above is not sufficient to establish the existence of the 
96.10 	income or resources when verifying the reasonable ability to pay. 
96.11 	(25) engage in "churning." As used in this section, "churning" means knowingly or 
96.12 	intentionally making, providing, or arranging for a residential mortgage loan when the 
96.13 	new residential mortgage loan does not provide a reasonable, tangible net benefit to the 
96.14 	borrower considering all of the circumstances including the terms of both the new and 
96.15 	refinanced loans, the cost of the new loan, and the borrower's circumstances; 
96.16 	(26) the first time a residential mortgage originator orally informs a borrower of the 
96.17 	anticipated or actual periodic payment amount for a first-lien residential mortgage loan 
96.18 	which does not include an amount for payment of property taxes and hazard insurance, 
96.19 	the residential mortgage originator must inform the borrower that an additional amount 
96.20 	will be due for taxes and insurance and, if known, disclose to the borrower the amount of 
96.21 	the anticipated or actual periodic payments for property taxes and hazard insurance. This 
96.22 	same oral disclosure must be made each time the residential mortgage originator orally 
96.23 	informs the borrower of a different anticipated or actual periodic payment amount change 
96.24 	from the amount previously disclosed. A residential mortgage originator need not make 
96.25 	this disclosure concerning a refinancing loan if the residential mortgage originator knows 
96.26 	that the borrower's existing loan that is anticipated to be refinanced does not have an 
96.27 	escrow account; or 
96.28 	(27) make, provide, or arrange for a residential mortgage loan, other than a reverse 
96.29 	mortgage pursuant to United States Code, title 15, chapter 41, if the borrower's compliance 
96.30 	with any repayment option offered pursuant to the terms of the loan will result in negative 
96.31 	amortization during any six-month period. 
96.32 	(b) Paragraph (a), clauses (24) through (27), do not apply to a state or federally 
96.33 	chartered bank, savings bank, or credit union, an institution chartered by Congress under 
96.34 	the Farm Credit Act, or to a person making, providing, or arranging a residential mortgage 
96.35 	loan originated or purchased by a state agency or a tribal or local unit of government. This 
96.36 	paragraph supersedes any inconsistent provision of this chapter. 

97.1 	Sec. 10. Minnesota Statutes 2008, section 60A.124, is amended to read:
97.2 	60A.124 INDEPENDENT AUDIT.
97.3 	The audit report of the independent certified public accountant that performs the 
97.4 	audit of an insurer's annual statement as required under section 60A.129 60A.1291, 
97.5 	subdivision 3 2, paragraph (a), should contain a statement as to whether anything, in 
97.6 	connection with their audit, came to their attention that caused them to believe that the 
97.7 	insurer failed to adopt and consistently apply the valuation procedure as required by 
97.8 	sections 60A.122 and 60A.123.  

97.9 	Sec. 11. [60A.1291] ANNUAL AUDIT.
97.10 		Subdivision 1.Definitions. The definitions in this subdivision apply to this section.
97.11 	(a) "Accountant" and "independent public accountant" mean an independent certified 
97.12 	public accountant or accounting firm in good standing with the American Institute of 
97.13 	Certified Public Accountants and in all states in which the accountant or firm is licensed 
97.14 	or is required to be licensed to practice. For Canadian and British companies, the term 
97.15 	means a Canadian-chartered or British-chartered accountant.
97.16 	(b) "Audit committee" means a committee or equivalent body established by the 
97.17 	board of directors of an entity for the purpose of overseeing the accounting and financial 
97.18 	reporting processes of an insurer or group of insurers, and audits of financial statements of 
97.19 	the insurer or group of insurers. The audit committee of any entity that controls a group of 
97.20 	insurers may be deemed to be the audit committee for one or more of these controlled 
97.21 	insurers solely for the purposes of this section at the election of the controlling person 
97.22 	under subdivision 15, paragraph (e). If an audit committee is not designated by the insurer, 
97.23 	the insurer's entire board of directors constitutes the audit committee.
97.24 	(c) "Indemnification" means an agreement of indemnity or a release from liability 
97.25 	where the intent or effect is to shift or limit in any manner the potential liability of the 
97.26 	person or firm for failure to adhere to applicable auditing or professional standards, 
97.27 	whether or not resulting in part from knowing of other misrepresentations made by the 
97.28 	insurer or its representatives.
97.29 	(d) "Independent board member" has the same meaning as described in subdivision 
97.30 	15, paragraph (c).
97.31 	(e) "Internal control over financial reporting" means a process effected by an entity's 
97.32 	board of directors, management and other personnel designed to provide reasonable 
97.33 	assurance regarding the reliability of the financial statements, for example, those items 
97.34 	specified in subdivision 4, paragraphs (a), clauses (2) to (6), (b), and (c), and includes 
97.35 	those policies and procedures that:
98.1 	(1) pertain to the maintenance of records that, in reasonable detail, accurately and 
98.2 	fairly reflect the transactions and dispositions of assets;
98.3 	(2) provide reasonable assurance that transactions are recorded as necessary to permit 
98.4 	preparation of the financial statements, for example, those items specified in subdivision 4, 
98.5 	paragraphs (a), clauses (2) to (6), (b), and (c), and that receipts and expenditures are being 
98.6 	made only in accordance with authorizations of management and directors; and
98.7 	(3) provide reasonable assurance regarding prevention or timely detection of 
98.8 	unauthorized acquisition, use or disposition of assets that could have a material effect on 
98.9 	the financial statements, for example, those items specified in subdivision 4, paragraphs 
98.10 	(a), clauses (2) to (6), (b), and (c).
98.11 	(f) "SEC" means the United States Securities and Exchange Commission.
98.12 	(g) "Section 404" means Section 404 of the Sarbanes-Oxley Act of 2002 and the 
98.13 	SEC's rules and regulations promulgated under it.
98.14 	(h) "Section 404 report" means management's report on "internal control over 
98.15 	financial reporting" as defined by the SEC and the related attestation report of the 
98.16 	independent certified public accountant as described in paragraph (a).
98.17 	(i) "SOX compliant entity" means an entity that either is required to be 
98.18 	compliant with, or voluntarily is compliant with, all of the following provisions of the 
98.19 	Sarbanes-Oxley Act of 2002: (i) the preapproval requirements of Section 201 (section 
98.20 	10A(i) of the Securities Exchange Act of 1934); (ii) the audit committee independence 
98.21 	requirements of Section 301 (section 10A(m)(3) of the Securities Exchange Act of 1934); 
98.22 	and (iii) the internal control over financial reporting requirements of Section 404 (Item 
98.23 	308 of SEC Regulation S-K).
98.24 		Subd. 2.Filing requirements. Every insurance company doing business in this 
98.25 	state, including fraternal benefit societies, reciprocal exchanges, service plan corporations 
98.26 	licensed pursuant to chapter 62C, and legal service plans licensed pursuant to chapter 
98.27 	62G, unless exempted by the commissioner pursuant to subdivision 9, paragraph (a), or by 
98.28 	subdivision 18, shall have an annual audit of the financial activities of the most recently 
98.29 	completed calendar year performed by an independent certified public accountant, and 
98.30 	shall file the report of this audit with the commissioner on or before June 1 for the 
98.31 	immediately preceding year ending December 31. The commissioner may require an 
98.32 	insurer to file an audited financial report earlier than June 1 with 90 days' advance notice 
98.33 	to the insurer.
98.34 	Extensions of the June 1 filing date may be granted by the commissioner for 30-day 
98.35 	periods upon a showing by the insurer and its independent certified public accountant of 
99.1 	the reasons for requesting the extension and a determination by the commissioner of good 
99.2 	cause for the extension.
99.3 	The request for extension must be submitted in writing not less than ten days before 
99.4 	the due date in sufficient detail to permit the commissioner to make an informed decision 
99.5 	with respect to the requested extension.
99.6 	If an extension is granted in accordance with this subdivision, a similar extension of 
99.7 	30 days is granted to the filing of management's report of internal control over financial 
99.8 	reporting.
99.9 	Every insurer required to file an annual audited financial report pursuant to this 
99.10 	subdivision shall designate a group of individuals as constituting its audit committee. The 
99.11 	audit committee of an entity that controls an insurer may be deemed to be the insurer's 
99.12 	audit committee for purposes of this subdivision at the election of the controlling person.
99.13 		Subd. 3.Exemptions. Foreign and alien insurers filing audited financial reports in 
99.14 	another state under the other state's requirements of audited financial reports which have 
99.15 	been found by the commissioner to be substantially similar to these requirements are 
99.16 	exempt from this subdivision if a copy of the audited financial report, communication of 
99.17 	internal control related matters noted in an audit, accountant's letter of qualifications, and 
99.18 	report on significant deficiencies in internal controls, which are filed with the other state, 
99.19 	are filed with the commissioner in accordance with the filing dates specified in subdivision 
99.20 	2 (Canadian insurers may submit accountants' reports as filed with the Canadian Dominion 
99.21 	Department of Insurance); and a copy of any notification of adverse financial condition 
99.22 	report filed with the other state is filed with the commissioner within the time specified 
99.23 	in subdivision 11. Foreign or alien insurers required to file management's report of 
99.24 	internal control over financial reporting in another state are exempt from filing the report 
99.25 	in this state provided the other state has substantially similar reporting requirements and 
99.26 	the report is filed with the commissioner of the other state within the time specified. 
99.27 	This subdivision does not prohibit or in any way limit the commissioner from ordering, 
99.28 	conducting, and performing examinations of insurers under the authority of this chapter.
99.29 		Subd. 4.Contents of annual audit; financial report. (a) The annual audited 
99.30 	financial report must report, in conformity with statutory accounting practices required 
99.31 	or permitted by the commissioner of insurance of the state of domicile, the financial 
99.32 	position of the insurer as of the end of the most recent calendar year and the results of 
99.33 	its operations, cash flows, and changes in capital and surplus for the year ended. The 
99.34 	annual audited financial report must include:
99.35 	(1) a report of an independent certified public accountant;
99.36 	(2) a balance sheet reporting admitted assets, liabilities, capital, and surplus;
100.1 	(3) a statement of operations;
100.2 	(4) a statement of cash flows;
100.3 	(5) a statement of changes in capital and surplus; and
100.4 	(6) notes to the financial statements.
100.5 	(b) The notes required under paragraph (a) are those required by the appropriate 
100.6 	National Association of Insurance Commissioners (NAIC) annual statement instructions 
100.7 	and National Association of Insurance Commissioners Accounting Practices and 
100.8 	Procedures Manual and include reconciliation of differences, if any, between the audited 
100.9 	statutory financial statements and the annual statement filed under section 60A.13, 
100.10 	subdivision 1, with a written description of the nature of these differences.
100.11 	(c) The financial statements included in the audited financial report must be prepared 
100.12 	in a form and using language and groupings substantially the same as the relevant sections 
100.13 	of the annual statement of the insurer filed with the commissioner. The financial statement 
100.14 	must be comparative, presenting the amounts as of December 31 of the current year and 
100.15 	the amounts as of the immediately preceding December 31. In the first year in which 
100.16 	an insurer is required to file an audited financial report, the comparative data may be 
100.17 	omitted. The amounts may be rounded to the nearest $1,000, and all immaterial amounts 
100.18 	may be combined.
100.19 		Subd. 5.Designation of independent certified public accountant. Each insurer 
100.20 	required by this section to file an annual audited financial report must notify the 
100.21 	commissioner in writing of the name and address of the independent certified public 
100.22 	accountant or accounting firm retained to conduct the annual audit within 60 days after 
100.23 	becoming subject to the annual audit requirement. The insurer shall obtain from the 
100.24 	accountant a letter which states that the accountant is aware of the provisions that relate 
100.25 	to accounting and financial matters in the insurance laws and the rules of the insurance 
100.26 	regulatory authority of the state of domicile. The letter shall affirm that the accountant will 
100.27 	express an opinion on the financial statements in terms of their conformity to the statutory 
100.28 	accounting practices prescribed or otherwise permitted by that insurance regulatory 
100.29 	authority, specifying the exceptions believed to be appropriate. A copy of the accountant's 
100.30 	letter shall be filed with the commissioner.
100.31 		Subd. 6.Report of disagreements. If an accountant who was the accountant for 
100.32 	the immediately preceding filed audited financial report is dismissed or resigns, the 
100.33 	insurer shall notify the commissioner of this event within five business days. Within 
100.34 	ten business days of this notification, the insurer shall also furnish the commissioner 
100.35 	with a separate letter stating whether in the 24 months preceding this event there were 
100.36 	any disagreements with the former accountant on any matter of accounting principles or 
101.1 	practices, financial statement disclosure, or auditing scope or procedure, which, if not 
101.2 	resolved to the satisfaction of the former accountant, would have caused that person to 
101.3 	make reference to the subject matter of the disagreement in connection with the opinion 
101.4 	on the financial statements. The disagreements required to be reported in response to this 
101.5 	subdivision include both those resolved to the former accountant's satisfaction and those 
101.6 	not resolved to the former accountant's satisfaction. Disagreements contemplated by this 
101.7 	subdivision are those disagreements between personnel of the insurer responsible for 
101.8 	presentation of its financial statements and personnel of the accounting firm responsible 
101.9 	for rendering its report. The insurer shall also in writing request the former accountant 
101.10 	to furnish a letter addressed to the insurer stating whether the accountant agrees with 
101.11 	the statements contained in the insurer's letter and, if not, stating the reasons for any 
101.12 	disagreement. The insurer shall furnish this responsive letter from the former accountant 
101.13 	to the commissioner together with its own.
101.14 		Subd. 7.Qualifications of independent certified public accountant. (a) The 
101.15 	commissioner shall not recognize any person or firm as a qualified independent certified 
101.16 	public accountant that is not in good standing with the American Institute of Certified 
101.17 	Public Accountants and in all states in which the accountant is licensed or is required 
101.18 	to be licensed to practice, or for a Canadian or British company, that is not a chartered 
101.19 	accountant. Except as otherwise provided, an independent certified public accountant must 
101.20 	be recognized as qualified as long as the person conforms to the standards of the person's 
101.21 	profession, as contained in the Code of Professional Conduct of the American Institute 
101.22 	of Certified Public Accountants and the Code of Professional Conduct of the Minnesota 
101.23 	Board of Public Accountancy or similar code and the person is properly licensed in good 
101.24 	standing with all required state boards of accountancy.
101.25 	(b) The lead or coordinating audit partner, having primary responsibility for the 
101.26 	audit, may not act in that capacity for more than five consecutive years. The person shall 
101.27 	be disqualified from acting in that or a similar capacity for the same company or its 
101.28 	insurance subsidiaries or affiliates for a period of five consecutive years. An insurer may 
101.29 	make application to the commissioner for relief from this rotation requirement on the 
101.30 	basis of unusual circumstances. This application must be made at least 30 days before 
101.31 	the end of the calendar year. The commissioner may consider the following factors in 
101.32 	determining if the relief should be granted:
101.33 	(1) number of partners, expertise of the partners, or the number of insurance clients 
101.34 	in the currently registered firm;
101.35 	(2) premium volume of the insurer; or
101.36 	(3) number of jurisdictions in which the insurer transacts business.
102.1 	The insurer shall file, with its annual statement filing, the approval for relief from this 
102.2 	paragraph with the states that it is licensed in or doing business in and with the NAIC. If 
102.3 	the nondomestic state accepts electronic filing with the NAIC, the insurer shall file the 
102.4 	approval in an electronic format acceptable to the NAIC.
102.5 	(c) The commissioner shall not recognize as a qualified independent certified public 
102.6 	accountant, nor accept an annual audited financial report, prepared in whole or in part by 
102.7 	an accountant who provides to an insurer, contemporaneously with the audit, the following 
102.8 	nonaudit services:
102.9 	(1) bookkeeping or other services related to the accounting records or financial 
102.10 	statements of the insurer;
102.11 	(2) financial information systems design and implementation;
102.12 	(3) appraisal or valuation services, fairness opinions, or contribution in-kind reports;
102.13 	(4) actuarially oriented advisory services involving the determination of amounts 
102.14 	recorded in the financial statements. The accountant may assist an insurer in understanding 
102.15 	the methods, assumptions, and inputs used in the determination of amounts recorded in the 
102.16 	financial statement only if it is reasonable to conclude that the services provided will not 
102.17 	be subject to audit procedures during an audit of the insurer's financial statements. An 
102.18 	accountant's actuary may also issue an actuarial opinion or certification on an insurer's 
102.19 	reserves if the following conditions have been met:
102.20 	(i) neither the accountant nor the accountant's actuary has performed any 
102.21 	management functions or made any management decisions;
102.22 	(ii) the insurer has competent personnel, or engages a third-party actuary, to estimate 
102.23 	the loss reserves for which management takes responsibility; and
102.24 	(iii) the accountant's actuary tests the reasonableness of the reserves after the 
102.25 	insurer's management has determined the amount of the loss reserves;
102.26 	(5) internal audit outsourcing services;
102.27 	(6) management functions or human resources;
102.28 	(7) broker or dealer, investment adviser, or investment banking services;
102.29 	(8) legal services or expert services unrelated to the audit; and
102.30 	(9) any other services that the commissioner determines, by rule, are impermissible.
102.31 	(d) The commissioner shall not recognize as a qualified independent certified public 
102.32 	accountant, nor accept any audited financial report, prepared in whole or in part by any 
102.33 	natural person who has been convicted of fraud, bribery, a violation of the Racketeer 
102.34 	Influenced and Corrupt Organizations Act, United States Code, title 18, sections 1961 to 
102.35 	1968, or any dishonest conduct or practices under federal or state law, has been found to 
102.36 	have violated the insurance laws of this state with respect to any previous reports submitted 
103.1 	under this section, or has demonstrated a pattern or practice of failing to detect or disclose 
103.2 	material information in previous reports filed under the provisions of this section.
103.3 	(e) The commissioner, after notice and hearing under chapter 14, may find that 
103.4 	the accountant is not qualified for purposes of expressing an opinion on the financial 
103.5 	statements in the annual audited financial report. The commissioner may require the 
103.6 	insurer to replace the accountant with another whose relationship with the insurer is 
103.7 	qualified within the meaning of this section.
103.8 		Subd. 8.Exemptions to qualifications of certified public accountant. (a) Insurers 
103.9 	having direct written and assumed premiums of less than $100,000,000 in any calendar 
103.10 	year may request an exemption from subdivision 7, paragraph (c). The insurer shall 
103.11 	file with the commissioner a written statement discussing the reasons why the insurer 
103.12 	should be exempt from these provisions. If the commissioner finds, upon review of this 
103.13 	statement, that compliance with this section would constitute a financial or organizational 
103.14 	hardship upon the insurer, an exemption may be granted.
103.15 	(b) A qualified independent certified public accountant who performs the audit 
103.16 	may engage in other nonaudit services, including tax services, that are not described in 
103.17 	subdivision 7, paragraph (c), only if the activity is approved in advance by the audit 
103.18 	committee, in accordance with paragraph (c).
103.19 	(c) All auditing services and nonaudit services provided to an insurer by the qualified 
103.20 	independent certified public accountant of the insurer must be preapproved by the audit 
103.21 	committee. The preapproval requirement is waived with respect to nonaudit services if 
103.22 	the insurer is a SOX compliant entity or a direct or indirect wholly owned subsidiary of a 
103.23 	SOX compliant entity or:
103.24 	(1) the aggregate amount of all such nonaudit services provided to the insurer 
103.25 	constitutes not more than five percent of the total amount of fees paid by the insurer to 
103.26 	its qualified independent certified public accountant during the fiscal year in which the 
103.27 	nonaudit services are provided;
103.28 	(2) the services were not recognized by the insurer at the time of the engagement to 
103.29 	be nonaudit services; and
103.30 	(3) the services are promptly brought to the attention of the audit committee and 
103.31 	approved before the completion of the audit by the audit committee or by one or more 
103.32 	members of the audit committee who are the members of the board of directors to whom 
103.33 	authority to grant such approvals has been delegated by the audit committee.
103.34 	(d) The audit committee may delegate to one or more designated members of the 
103.35 	audit committee the authority to grant the preapprovals required by paragraph (c). The 
104.1 	decisions of any member to whom this authority is delegated must be presented to the full 
104.2 	audit committee at each of its scheduled meetings.
104.3 	(e) The commissioner shall not recognize an independent certified public accountant 
104.4 	as qualified for a particular insurer if a member of the board, president, chief executive 
104.5 	officer, controller, chief financial officer, chief accounting officer, or any person serving in 
104.6 	an equivalent position for that insurer, was employed by the independent certified public 
104.7 	accountant and participated in the audit of that insurer during the one-year period preceding 
104.8 	the date that the most current statutory opinion is due. This paragraph applies only to 
104.9 	partners and senior managers involved in the audit. An insurer may make application to 
104.10 	the commissioner for relief from this paragraph on the basis of unusual circumstances.
104.11 	(f) The insurer shall file, with its annual statement filing, the approval for relief with 
104.12 	the states that it is licensed in or doing business in and the NAIC. If the nondomestic state 
104.13 	accepts electronic filing with the NAIC, the insurer shall file the approval in an electronic 
104.14 	format acceptable to the NAIC.
104.15 		Subd. 9.Consolidated or combined audits. (a) The commissioner may allow 
104.16 	an insurer to file consolidated or combined audited financial statements required by 
104.17 	subdivision 2, in lieu of separate annual audited financial statements, where it can be 
104.18 	demonstrated that an insurer is part of a group of insurance companies that has a pooling 
104.19 	or 100 percent reinsurance agreement which substantially affects the solvency and 
104.20 	integrity of the reserves of the insurer and the insurer cedes all of its direct and assumed 
104.21 	business to the pool. An affiliated insurance company not meeting these requirements may 
104.22 	be included in the consolidated or combined audited financial statements, if the company's 
104.23 	total admitted assets are less than five percent of the consolidated group's total admitted 
104.24 	assets. If these circumstances exist, then the company may file a written application to 
104.25 	file consolidated or combined audited financial statements. This application must be for 
104.26 	a specified period.
104.27 	(b) Upon written application by a domestic insurer, the commissioner may 
104.28 	authorize the domestic insurer to include additional affiliated insurance companies in the 
104.29 	consolidated or combined audited financial statements. A foreign insurer must obtain the 
104.30 	prior written authorization of the commissioner of its state of domicile in order to submit 
104.31 	an application for authority to file consolidated or combined audited financial statements. 
104.32 	This application must be for a specified period.
104.33 	(c) A consolidated annual audit filing must include a columnar consolidated or 
104.34 	combining worksheet. Amounts shown on the audited consolidated or combined financial 
104.35 	statement must be shown on the worksheet. Amounts for each insurer must be stated 
104.36 	separately. Noninsurance operations may be shown on the worksheet on a combined or 
105.1 	individual basis. Explanations of consolidating or eliminating entries must be shown on 
105.2 	the worksheet. A reconciliation of any differences between the amounts shown in the 
105.3 	individual insurer columns of the worksheet and comparable amounts shown on the annual 
105.4 	statement of the insurers must be included on the worksheet.
105.5 		Subd. 10.Scope of audit and report of independent certified public accountant.
 105.6 	Financial statements furnished pursuant to subdivision 4 must be examined by an 
105.7 	independent certified public accountant. The audit of the insurer's financial statements 
105.8 	must be conducted in accordance with generally accepted auditing standards. In 
105.9 	accordance with AICPA Statement on Auditing Standards (SAS) No. 109, Understanding 
105.10 	the Entity and its Environment and Assessing the Risks of Material Misstatement, or its 
105.11 	replacement, the independent certified public accountant should obtain an understanding 
105.12 	of internal control sufficient to plan the audit. To the extent required by SAS No. 109, 
105.13 	for those insurers required to file a management's report of internal control over financial 
105.14 	reporting pursuant to subdivision 17, the independent certified public accountant should 
105.15 	consider (as that term is defined in SAS No. 102, Defining Professional Requirements in 
105.16 	Statements on Auditing Standards or its replacement) the most recently available report in 
105.17 	planning and performing the audit of the statutory financial statements. Consideration 
105.18 	should be given to other procedures illustrated in the Financial Condition Examiners 
105.19 	Handbook promulgated by the National Association of Insurance Commissioners as the 
105.20 	independent certified public accountant deems necessary.
105.21 		Subd. 11.Notification of adverse financial condition. The insurer required to 
105.22 	furnish the annual audited financial report shall require the independent certified public 
105.23 	accountant to provide written notice within five business days to the board of directors of 
105.24 	the insurer or its audit committee of any determination by that independent certified public 
105.25 	accountant that the insurer has materially misstated its financial condition as reported to 
105.26 	the commissioner as of the balance sheet date currently under audit or that the insurer does 
105.27 	not meet the minimum capital and surplus requirement of sections 60A.07, 66A.32, and 
105.28 	66A.33 as of that date. An insurer required to file an annual audited financial report who 
105.29 	received a notification of adverse financial condition from the accountant shall file a 
105.30 	copy of the notification with the commissioner within five business days of the receipt 
105.31 	of the notification. The insurer shall provide the independent certified public accountant 
105.32 	making the notification with evidence of the report being furnished to the commissioner. 
105.33 	If the independent certified public accountant fails to receive the evidence within the 
105.34 	required five-day period, the independent certified public accountant shall furnish to the 
105.35 	commissioner a copy of the notification to the board of directors or its audit committee 
105.36 	within the next five business days. No independent certified public accountant is liable in 
106.1 	any manner to any person for any statement made in connection with this subdivision if 
106.2 	the statement is made in good faith in compliance with this subdivision. If the accountant 
106.3 	becomes aware of facts which might have affected the audited financial report after 
106.4 	the date it was filed, the accountant shall take the action prescribed by AU section 
106.5 	561, Subsequent Discovery of Facts Existing at the Date of the Auditor's Report of the 
106.6 	Professional Standards issued by the American Institute of Certified Public Accountants, 
106.7 	or its replacement.
106.8 		Subd. 12.Communication of internal control related matters noted in an 
106.9 	audit. In addition to the annual audited financial report, each insurer shall furnish the 
106.10 	commissioner with a written communication as to any unremediated material weaknesses 
106.11 	in its internal control over financial reporting noted during the audit. The communication 
106.12 	must be prepared by the accountant within 60 days after the filing of the annual audited 
106.13 	financial report, and must contain a description of any unremediated material weakness, as 
106.14 	the term material weakness is defined by SAS No. 115, Communicating Internal Control 
106.15 	Related Matters Identified in an Audit, as of December 31 immediately preceding so as 
106.16 	to coincide with the audited financial report discussed in subdivision 2 in the insurer's 
106.17 	internal control over financial reporting noted by the accountant during the course of their 
106.18 	audit of the financial statements. If no unremediated material weaknesses were noted, the 
106.19 	communication should so state.
106.20 	The insurer is required to provide a description of remedial actions taken or 
106.21 	proposed to correct unremediated material weaknesses, if the actions are not described in 
106.22 	the accountant's communication.
106.23 		Subd. 13.Accountant's letter of qualification. The accountant shall furnish the 
106.24 	insurer in connection with, and for inclusion in, the filing of the annual audited financial 
106.25 	report, a letter stating that the accountant is independent with respect to the insurer and 
106.26 	conforms to the standards of the accountant's profession as contained in the Code of 
106.27 	Professional Conduct of the American Institute of Certified Public Accountants and the 
106.28 	Code of Professional Conduct of the Minnesota Board of Accountancy or similar code; 
106.29 	the background and experience in general, and the experience in audits of insurers of the 
106.30 	staff assigned to the engagement and whether each is an independent certified public 
106.31 	accountant; that the accountant understands that the annual audited financial report and the 
106.32 	opinion on it will be filed in compliance with this statute and that the commissioner will 
106.33 	be relying on this information in the monitoring and regulation of the financial position of 
106.34 	insurers; that the accountant consents to the requirements of subdivision 14 and that the 
106.35 	accountant consents and agrees to make available for review by the commissioner, or the 
106.36 	commissioner's designee or appointed agent, the work papers, as defined in subdivision 
107.1 	14; a representation that the accountant is properly licensed in good standing by the 
107.2 	appropriate state licensing authorities and is a member in good standing in the American 
107.3 	Institute of Certified Public Accountants; and a representation that the accountant complies 
107.4 	with subdivision 7. Nothing in this section prohibits the accountant from utilizing staff 
107.5 	the accountant deems appropriate where use is consistent with the standards prescribed 
107.6 	by generally accepted auditing standards.
107.7 		Subd. 14.Availability and maintenance of independent certified public 
107.8 	accountants' work papers. Work papers are the records kept by the independent certified 
107.9 	public accountant of the procedures followed, tests performed, information obtained, and 
107.10 	conclusions reached pertinent to the independent certified public accountant's audit of the 
107.11 	financial statements of an insurer. Work papers may include audit planning documents, 
107.12 	work programs, analyses, memoranda, letters of confirmation and representation, 
107.13 	management letters, abstracts of company documents, and schedules or commentaries 
107.14 	prepared or obtained by the independent certified public accountant in the course of the 
107.15 	audit of the financial statements of an insurer and that support the accountant's opinion. 
107.16 	Every insurer required to file an audited financial report shall require the accountant, 
107.17 	through the insurer, to make available for review by the examiners the work papers 
107.18 	prepared in the conduct of the audit and any communications related to the audit between 
107.19 	the accountant and the insurer. The work papers must be made available at the offices of 
107.20 	the insurer, at the offices of the commissioner, or at any other reasonable place designated 
107.21 	by the commissioner. The insurer shall require that the accountant retain the audit work 
107.22 	papers and communications until the commissioner has filed a report on examination 
107.23 	covering the period of the audit but no longer than seven years after the period reported 
107.24 	upon, provided retention of the working papers beyond the seven years is not required by 
107.25 	other professional or regulatory requirements. In the conduct of the periodic review by 
107.26 	the examiners, it must be agreed that photocopies of pertinent audit work papers may be 
107.27 	made and retained by the commissioner. These copies shall be part of the commissioner's 
107.28 	work papers and must be given the same confidentiality as other examination work papers 
107.29 	generated by the commissioner.
107.30 		Subd. 15.Requirements for audit committee. (a) The audit committee must 
107.31 	be directly responsible for the appointment, compensation, and oversight of the work 
107.32 	of any accountant including resolution of disagreements between management and the 
107.33 	accountant regarding financial reporting for the purpose of preparing or issuing the audited 
107.34 	financial report or related work pursuant to this regulation. Each accountant shall report 
107.35 	directly to the audit committee.
108.1 	(b) Each member of the audit committee must be a member of the board of directors 
108.2 	of the insurer or a member of the board of directors of an entity elected pursuant to 
108.3 	paragraph (e) and subdivision 1, paragraph (b).
108.4 	(c) In order to be considered independent for purposes of this section, a member of 
108.5 	the audit committee may not, other than in his or her capacity as a member of the audit 
108.6 	committee, the board of directors, or any other board committee, accept any consulting, 
108.7 	advisory, or other compensatory fee from the entity or be an affiliated person of the entity 
108.8 	or any subsidiary of the entity. However, if law requires board participation by otherwise 
108.9 	nonindependent members, that law shall prevail and such members may participate in the 
108.10 	audit committee and be designated as independent for audit committee purposes, unless 
108.11 	they are an officer or employee of the insurer or one of its affiliates.
108.12 	(d) If a member of the audit committee ceases to be independent for reasons outside 
108.13 	the member's reasonable control, that person, with notice by the responsible entity to the 
108.14 	state, may remain an audit committee member of the responsible entity until the earlier of 
108.15 	the next annual meeting of the responsible entity or one year from the occurrence of the 
108.16 	event that caused the member to be no longer independent.
108.17 	(e) To exercise the election of the controlling person to designate the audit committee 
108.18 	for purposes of this section, the ultimate controlling person shall provide written notice to 
108.19 	the commissioners of the affected insurers. Notification must be made timely before the 
108.20 	issuance of the statutory audit report and include a description of the basis for the election. 
108.21 	The election can be changed through notice to the commissioner by the insurer, which 
108.22 	shall include a description of the basis for the change. The election remains in effect for 
108.23 	perpetuity, until rescinded.
108.24 	(f) The audit committee shall require the accountant that performs for an insurer any 
108.25 	audit required by this section to timely report to the audit committee in accordance with 
108.26 	the requirements of SAS No. 114, The Auditor's Communication with Those Charged 
108.27 	with Governance, including:
108.28 	(1) all significant accounting policies and material permitted practices;
108.29 	(2) all material alternative treatments of financial information within statutory 
108.30 	accounting principles that have been discussed with management officials of the insurer, 
108.31 	ramifications of the use of the alternative disclosures and treatments, and the treatment 
108.32 	preferred by the accountant; and 
108.33 	(3) other material written communications between the accountant and the 
108.34 	management of the insurer, such as any management letter or schedule of unadjusted 
108.35 	differences.
109.1 	(g) If an insurer is a member of an insurance holding company system, the reports 
109.2 	required by paragraph (f) may be provided to the audit committee on an aggregate basis 
109.3 	for insurers in the holding company system, provided that any substantial differences 
109.4 	among insurers in the system are identified to the audit committee.
109.5 	(h) The proportion of independent audit committee members shall meet or exceed 
109.6 	the following criteria:
109.7 	(1) for companies with prior calendar year direct written and assumed premiums $0 
109.8 	to $300,000,000, no minimum requirements;
109.9 	(2) for companies with prior calendar year direct written and assumed premiums 
109.10 	over $300,000,000 to $500,000,000, majority of members must be independent; and
109.11 	(3) for companies with prior calendar year direct written and assumed premiums 
109.12 	over $500,000,000, 75 percent or more must be independent.
109.13 	(i) An insurer with direct written and assumed premium, excluding premiums 
109.14 	reinsured with the Federal Crop Insurance Corporation and Federal Flood Program, less 
109.15 	than $500,000,000 may make application to the commissioner for a waiver from the 
109.16 	requirements of this subdivision based upon hardship. The insurer shall file, with its 
109.17 	annual statement filing, the approval for relief from this subdivision with the states that 
109.18 	it is licensed in or doing business in and the NAIC. If the nondomestic state accepts 
109.19 	electronic filing with the NAIC, the insurer shall file the approval in an electronic format 
109.20 	acceptable to the NAIC.
109.21 	This subdivision does not apply to foreign or alien insurers licensed in this state or 
109.22 	an insurer that is a SOX compliant entity or a direct or indirect wholly-owned subsidiary 
109.23 	of a SOX compliant entity.
109.24 		Subd. 16.Conduct of insurer in connection with the preparation of required 
109.25 	reports and documents. (a) No director or officer of an insurer shall, directly or indirectly:
109.26 	(1) make or cause to be made a materially false or misleading statement to an 
109.27 	accountant in connection with any audit, review, or communication required under this 
109.28 	section; or
109.29 	(2) omit to state, or cause another person to omit to state, any material fact necessary 
109.30 	in order to make statements made, in light of the circumstances under which the statements 
109.31 	were made, not misleading to an accountant in connection with any audit, review, or 
109.32 	communication required under this section.
109.33 	(b) No officer or director of an insurer, or any other person acting under the direction 
109.34 	thereof, shall directly or indirectly take any action to coerce, manipulate, mislead, or 
109.35 	fraudulently influence any accountant engaged in the performance of an audit pursuant to 
110.1 	this section if that person knew or should have known that the action, if successful, could 
110.2 	result in rendering the insurer's financial statements materially misleading.
110.3 	(c) For purposes of paragraph (b), actions that, "if successful, could result in 
110.4 	rendering the insurer's financial statements materially misleading" include, but are not 
110.5 	limited to, actions taken at any time with respect to the professional engagement period to 
110.6 	coerce, manipulate, mislead, or fraudulently influence an accountant:
110.7 	(1) to issue or reissue a report on an insurer's financial statements that is not 
110.8 	warranted in the circumstances due to material violations of statutory accounting 
110.9 	principles prescribed by the commissioner, generally accepted auditing standards, or 
110.10 	other professional or regulatory standards;
110.11 	(2) not to perform audit, review, or other procedures required by generally accepted 
110.12 	auditing standards or other professional standards;
110.13 	(3) not to withdraw an issued report; or
110.14 	(4) not to communicate matters to an insurer's audit committee.
110.15 		Subd. 17.Management's report of internal control over financial reporting.
 110.16 	(a) Every insurer required to file an audited financial report pursuant to this section that 
110.17 	has annual direct written and assumed premiums, excluding premiums reinsured with the 
110.18 	Federal Crop Insurance Corporation and Federal Flood Program, of $500,000,000 or 
110.19 	more, shall prepare a report of the insurer's or group of insurers' internal control over 
110.20 	financial reporting, as these terms are defined in subdivision 1. The report must be filed 
110.21 	with the commissioner along with the communication of internal control related matters 
110.22 	noted in an audit described under subdivision 12. Management's report of internal control 
110.23 	over financial reporting shall be as of December 31 immediately preceding.
110.24 	(b) Notwithstanding the premium threshold in paragraph (a), the commissioner may 
110.25 	require an insurer to file management's report of internal control over financial reporting if 
110.26 	the insurer is in any RBC level event, or meets any one or more of the standards of an 
110.27 	insurer deemed to be in hazardous financial condition as pursuant to sections 606.20 
110.28 	to 606.22.
110.29 	(c) An insurer or a group of insurers that is:
110.30 	(1) directly subject to Section 404;
110.31 	(2) part of a holding company system whose parent is directly subject to Section 404;
110.32 	(3) not directly subject to Section 404 but is a SOX compliant entity; or
110.33 	(4) a member of a holding company system whose parent is not directly subject to 
110.34 	Section 404 but is a SOX compliant entity;
110.35 	may file its or its parent's Section 404 report and an addendum in satisfaction of this 
110.36 	requirement provided that those internal controls of the insurer or group of insurers 
111.1 	having a material impact on the preparation of the insurer's or group of insurers' audited 
111.2 	statutory financial statements, consisting of those items included in subdivision 4, 
111.3 	paragraphs (a), clauses (2) to (6), (b), and (c), were included in the scope of the Section 
111.4 	404 report. The addendum shall be a positive statement by management that there are 
111.5 	no material processes with respect to the preparation of the insurer's or group of insurers' 
111.6 	audited statutory financial statements, consisting of those items included in subdivision 4, 
111.7 	paragraphs (a), clauses (2) to (6), (b), and (c), excluded from the Section 404 report. If 
111.8 	there are internal controls of the insurer or group of insurers that have a material impact on 
111.9 	the preparation of the insurer's or group of insurers' audited statutory financial statements 
111.10 	and those internal controls were not included in the scope of the Section 404 report, the 
111.11 	insurer or group of insurers may either file (i) a report under this subdivision, or (ii) the 
111.12 	Section 404 report and a report under this subdivision for those internal controls that have 
111.13 	a material impact on the preparation of the insurer's or group of insurers' audited statutory 
111.14 	financial statements not covered by the Section 404 report.
111.15 	(d) Management's report of internal control over financial reporting shall include:
111.16 	(1) a statement that management is responsible for establishing and maintaining 
111.17 	adequate internal control over financial reporting;
111.18 	(2) a statement that management has established internal control over financial 
111.19 	reporting and an assertion, to the best of management's knowledge and belief, after diligent 
111.20 	inquiry, as to whether its internal control over financial reporting is effective to provide 
111.21 	reasonable assurance regarding the reliability of financial statements in accordance with 
111.22 	statutory accounting principles;
111.23 	(3) a statement that briefly describes the approach or processes by which 
111.24 	management evaluated the effectiveness of its internal control over financial reporting;
111.25 	(4) a statement that briefly describes the scope of work that is included and whether 
111.26 	any internal controls were excluded;
111.27 	(5) disclosure of any unremediated material weaknesses in the internal control over 
111.28 	financial reporting identified by management as of December 31 immediately preceding. 
111.29 	Management is not permitted to conclude that the internal control over financial reporting 
111.30 	is effective to provide reasonable assurance regarding the reliability of financial statements 
111.31 	in accordance with statutory accounting principles if there is one or more unremediated 
111.32 	material weaknesses in its internal control over financial reporting;
111.33 	(6) a statement regarding the inherent limitations of internal control systems; and
111.34 	(7) signatures of the chief executive officer and the chief financial officer or 
111.35 	equivalent position or title.
112.1 	(e) Management shall document and make available upon financial condition 
112.2 	examination the basis upon which its assertions, required in paragraph (d), are made. 
112.3 	Management may base its assertions, in part, upon its review, monitoring, and testing of 
112.4 	internal controls undertaken in the normal course of its activities.
112.5 	(1) Management has discretion as to the nature of the internal control framework 
112.6 	used, and the nature and extent of documentation, in order to make its assertion in a 
112.7 	cost-effective manner and, as such, may include assembly of or reference to existing 
112.8 	documentation.
112.9 	(2) Management's report on internal control over financial reporting, required by 
112.10 	paragraph (a), and any documentation provided in support of the report during the course 
112.11 	of a financial condition examination, must be kept confidential by the Department of 
112.12 	Commerce.
112.13 		Subd. 18.Exemptions. (a) Upon written application of any insurer, the 
112.14 	commissioner may grant an exemption from compliance with the provisions of this 
112.15 	section. In order to receive an exemption, an insurer must demonstrate to the satisfaction 
112.16 	of the commissioner that compliance would constitute a financial or organizational 
112.17 	hardship upon the insurer. An exemption may be granted at any time and from time 
112.18 	to time for specified periods. Within ten days from the denial of an insurer's written 
112.19 	request for an exemption, the insurer may request in writing a hearing on its application 
112.20 	for an exemption. This hearing must be held in accordance with chapter 14. Upon written 
112.21 	application of any insurer, the commissioner may permit an insurer to file annual audited 
112.22 	financial reports on some basis other than a calendar year basis for a specified period. An 
112.23 	exemption may not be granted until the insurer presents an alternative method satisfying 
112.24 	the purposes of this section. Within ten days from a denial of a written request for an 
112.25 	exemption, the insurer may request in writing a hearing on its application. The hearing 
112.26 	must be held in accordance with chapter 14.
112.27 	(b) This section applies to all insurers, unless otherwise indicated, required to file 
112.28 	an annual audit by subdivision 2, except insurers having less than $1,000,000 of direct 
112.29 	written premiums in this state in any calendar year and fewer than 1,000 policyholders 
112.30 	or certificate holders of directly written policies nationwide at the end of the calendar 
112.31 	year, are exempt from this section for that year, unless the commissioner makes a 
112.32 	specific finding that compliance is necessary for the commissioner to carry out statutory 
112.33 	responsibilities, except that insurers having assumed premiums from reinsurance contracts 
112.34 	or treaties of $1,000,000 or more are not exempt.
112.35 		Subd. 19.Canadian and British companies. (a) In the case of Canadian and 
112.36 	British insurers, the annual audited financial report means the annual statement of total 
113.1 	business on the form filed by these companies with their domiciliary supervision authority 
113.2 	and duly audited by an independent chartered accountant.
113.3 	(b) For these insurers the letter required in subdivision 5 shall state that the 
113.4 	accountant is aware of the requirements relating to the annual audited statement filed 
113.5 	with the commissioner under subdivision 2, and shall affirm that the opinion expressed 
113.6 	is in conformity with those requirements.
113.7 		Subd. 20.Commercial mortgage loan valuation procedures. A report of the 
113.8 	independent certified public accountant that performs the audit of an insurer's annual 
113.9 	statement as required under subdivision 2, shall be filed and contain a statement as to 
113.10 	whether anything in connection with the audit came to the accountant's attention that 
113.11 	caused the accountant to believe that the insurer failed to adopt and consistently apply the 
113.12 	valuation procedures as required by sections 60A.122 and 60A.123. 
113.13 		Subd. 21.Examinations. (a) The commissioner or a designated representative shall 
113.14 	determine the nature, scope, and frequency of examinations under this section conducted 
113.15 	by examiners under section 60A.031. These examinations may cover all aspects of the 
113.16 	insurer's assets, condition, affairs, and operations and may include and be supplemented 
113.17 	by audit procedures performed by independent certified public accountants. Scheduling 
113.18 	of examinations will take into account all relevant matters with respect to the insurer's 
113.19 	condition, including results of the National Association of Insurance Commissioners, 
113.20 	Insurance Regulatory Information Systems, changes in management, results of market 
113.21 	conduct examinations, and audited financial reports. The type of examinations performed 
113.22 	by examiners under this section must be compliance examinations, targeted examinations, 
113.23 	and comprehensive examinations. 
113.24 	(b) Compliance examinations will consist of a review of the accountant's workpapers 
113.25 	defined under this section and a general review of the insurer's corporate affairs and 
113.26 	insurance operations to determine compliance with the Minnesota insurance laws and 
113.27 	the rules of the Department of Commerce. The examiners may perform alternative or 
113.28 	additional examination procedures to supplement those performed by the accountant 
113.29 	when the examiners determine that the procedures are necessary to verify the financial 
113.30 	condition of the insurer.
113.31 	(c) Targeted examinations may cover limited areas of the insurer's operations as 
113.32 	the commissioner may deem appropriate.
113.33 	(d) Comprehensive examinations will be performed when the report of the 
113.34 	accountant as provided for in subdivision 7, paragraph (b), the notification required by 
113.35 	subdivision 7, paragraph (c), the results of compliance or targeted examinations, or other 
114.1 	circumstances indicate in the judgment of the commissioner or a designated representative 
114.2 	that a complete examination of the condition and affairs of the insurer is necessary.
114.3 	(e) Upon completion of each targeted, compliance, or comprehensive examination, 
114.4 	the examiner appointed by the commissioner shall make a full and true report on the 
114.5 	results of the examination. Each report shall include a general description of the audit 
114.6 	procedures performed by the examiners and the procedures of the accountant that 
114.7 	the examiners may have utilized to supplement their examination procedures and the 
114.8 	procedures that were performed by the registered independent certified public accountant 
114.9 	if included as a supplement to the examination.
114.10 		Subd. 22.Penalties. An annual statement, report, or document related to the 
114.11 	business of insurance must not be filed with the commissioner or issued to the public if it 
114.12 	is signed by anyone who is represented in the instrument as an "accountant," unless the 
114.13 	person is qualified as defined by this section. A violation of this subdivision is a violation 
114.14 	of section 72A.19 and punishable in accordance with section 72A.25.

114.15 	EFFECTIVE DATE. (a) Domestic insurers retaining a certified public accountant 
114.16 	on the effective date of this section who qualify as independent shall comply with this 
114.17 	section for the year ending December 31, 2010, and each year thereafter unless the 
114.18 	commissioner permits otherwise.
114.19 	(b) Domestic insurers not retaining a certified public accountant on the effective 
114.20 	date of this section who qualifies as independent shall meet the following schedule for 
114.21 	compliance unless the commissioner permits otherwise.
114.22 	(1) As of December 31, 2010, file with the commissioner an audited financial report.
114.23 	(2) For the year ending December 31, 2010, and each year thereafter, such insurers 
114.24 	shall file with the commissioner all reports and communication required by this section.
114.25 	(c) Foreign insurers shall comply with this section for the year ending December 31, 
114.26 	2010, and each year thereafter, unless the commissioner permits otherwise.
114.27 	(d) The requirements of subdivision 7, paragraph (b), are in effect for audits of the 
114.28 	year beginning January 1, 2010, and thereafter.
114.29 	(e) The requirements of subdivision 15 are in effect January 1, 2010. An insurer or 
114.30 	group of insurers that is not required to have independent audit committee members or 
114.31 	only a majority of independent audit committee members, as opposed to a supermajority, 
114.32 	because the total written and assumed premium is below the threshold and subsequently 
114.33 	becomes subject to one of the independence requirements due to changes in premium has 
114.34 	one year following the year the threshold is exceeded, but not earlier than January 1, 
114.35 	2010, to comply with the independence requirements. Likewise, an insurer that becomes 
114.36 	subject to one of the independence requirements as a result of a business combination 
115.1 	has one calendar year following the date of acquisition or combination to comply with 
115.2 	the independence requirements.
115.3 	(f) An insurer or group of insurers that is not required to file a report because the total 
115.4 	written premium is below the threshold and subsequently becomes subject to the reporting 
115.5 	requirements has two years following the year the threshold is exceeded, but not earlier 
115.6 	than December 31, 2010, to file a report. Likewise, an insurer acquired in a business 
115.7 	combination has two calendar years following the date of acquisition or combination to 
115.8 	comply with the reporting requirements.
115.9 	(g) The requirements and provisions contained in this section are effective January 
115.10 	1, 2010, and thereafter.

115.11 	Sec. 12. Minnesota Statutes 2008, section 60B.03, subdivision 15, is amended to read:
115.12 		Subd. 15.Insolvency. "Insolvency" means:
115.13 	(a) For an insurer organized under sections 67A.01 to 67A.26, the inability to pay 
115.14 	any uncontested debt as it becomes due or any other loss within 30 days after the due date 
115.15 	specified in the first assessment notice issued pursuant to section 67A.17.  
115.16 	(b) For any other insurer, that it is unable to pay its debts or meet its obligations 
115.17 	as they mature or that its assets do not exceed its liabilities plus the greater of (1) any 
115.18 	capital and surplus required by law to be constantly maintained, or (2) its authorized and 
115.19 	issued capital stock. For purposes of this subdivision, "assets" includes one-half of the 
115.20 	maximum total assessment liability of the policyholders of the insurer, and "liabilities" 
115.21 	includes reserves required by law. For policies issued on the basis of unlimited assessment 
115.22 	liability, the maximum total liability, for purposes of determining solvency only, shall be 
115.23 	deemed to be that amount that could be obtained if there were 100 percent collection of an 
115.24 	assessment at the rate of ten mills per dollar of insurance written by it and in force.

115.25 	Sec. 13. Minnesota Statutes 2008, section 60L.02, subdivision 3, is amended to read:
115.26 		Subd. 3.Additional requirements. (a) In order to be eligible to be governed by 
115.27 	sections 60L.01 to 60L.15, the insurer must meet the requirements specified under this 
115.28 	subdivision.  
115.29 	(b) The insurer shall:
115.30 	(1) have been in continuous operation for a minimum of five years; and
115.31 	(2) maintain a minimum claims-paying, financial strength, or equivalent rating from 
115.32 	at least one nationally recognized statistical rating organization in one of the organization's 
115.33 	three highest rating categories for the time period during which sections 60L.01 to 60L.15
115.34 	apply to the insurer. For purposes of this subdivision, the rating must be based on a 
116.1 	review of the insurer by the nationally recognized statistical rating organization with the 
116.2 	cooperation of the insurer; must not depend on a guarantee or other credit enhancement 
116.3 	from another entity; and must not be modified or otherwise qualified to show dependence 
116.4 	of the rating on the performance or a contractual obligation of, or the insurer's affiliation 
116.5 	with, another insurer.  
116.6 	(c) The insurer or an affiliate, as defined in section 60D.15, subdivision 2, of the 
116.7 	insurer shall employ at least one individual as a professional investment manager for 
116.8 	the insurer's investments whom the board of directors or trustees of the insurer finds 
116.9 	is qualified on the basis of experience, education or training, competence, personal 
116.10 	integrity, and who conducts professional investment management activities in accordance 
116.11 	with the Code of Ethics and Standards of Professional Conduct of the Association for 
116.12 	Investment Management and Research. For purposes of complying with this paragraph, 
116.13 	an employee of an affiliate may only be used if they are responsible for managing the 
116.14 	insurer's investments.  
116.15 	(d) The board of directors of the insurer must annually adopt a resolution finding 
116.16 	that the insurer or an affiliate, as defined in section 60D.15, subdivision 2, of the insurer 
116.17 	has employed a professional investment manager for the insurer's investments with 
116.18 	sufficient expertise and has sufficient other resources to implement and monitor the 
116.19 	insurer's investment policies and strategies.  
116.20 	(e) In the report required under section 60A.129 60A.1291, subdivision 3 12, 
116.21 	paragraph (l), the insurer's independent auditor shall not have identified any significant 
116.22 	deficiencies in the insurer's internal control structure related to investments during any of 
116.23 	the five years immediately preceding the date on which sections 60L.01 to 60L.15 begin to 
116.24 	apply to the insurer, and as long as sections 60L.01 to 60L.15 apply to the insurer.  

116.25 	Sec. 14. [61A.258] PRENEED INSURANCE PRODUCTS; MINIMUM 
116.26 	MORTALITY STANDARDS FOR RESERVES AND NONFORFEITURE VALUES.
116.27 		Subdivision 1.Definitions. For the purposes of this section, the following terms 
116.28 	have the meanings given them:
116.29 	(1) "2001 CSO Mortality Table (2001 CSO)" means that mortality table, consisting 
116.30 	of separate rates of mortality for male and female lives, developed by the American 
116.31 	Academy of Actuaries CSO Task Force from the Valuation Basic Mortality Table 
116.32 	developed by the Society of Actuaries Individual Life Insurance Valuation Mortality 
116.33 	Task Force, and adopted by the National Association of Insurance Commissioners 
116.34 	(NAIC) in December 2002. The 2001 CSO Mortality Table (2001 CSO) is included in 
116.35 	the Proceedings of the NAIC (2nd Quarter 2002). Unless the context indicates otherwise, 
117.1 	the "2001 CSO Mortality Table (2001 CSO)" includes both the ultimate form of that 
117.2 	table and the select and ultimate form of that table and includes both the smoker and 
117.3 	nonsmoker mortality tables and the composite mortality tables. It also includes both the 
117.4 	age-nearest-birthday and age-last-birthday bases of the mortality tables;
117.5 	(2) "Ultimate 1980 CSO" means the Commissioners' 1980 Standard Ordinary Life 
117.6 	Valuation Mortality Tables (1980 CSO) without ten-year selection factors, incorporated 
117.7 	into the 1980 amendments to the NAIC Standard Valuation Law approved in December 
117.8 	1983; and
117.9 	(3) "preneed insurance" is any life insurance policy or certificate that is issued 
117.10 	in combination with, in support of, with an assignment to, or as a guarantee for a 
117.11 	prearrangement agreement for goods and services to be provided at the time of and 
117.12 	immediately following the death of the insured. Goods and services may include, but 
117.13 	are not limited to embalming, cremation, body preparation, viewing or visitation, coffin 
117.14 	or urn, memorial stone, and transportation of the deceased. The status of the policy or 
117.15 	contract as preneed insurance is determined at the time of issue in accordance with the 
117.16 	policy form filing.
117.17 		Subd. 2.Minimum valuation mortality standards. For preneed insurance 
117.18 	contracts, the minimum mortality standard for determining reserve liabilities and 
117.19 	nonforfeiture values for both male and female insureds shall be the Ultimate 1980 CSO.
117.20 		Subd. 3.Minimum valuation interest rate standards. (a) The interest rates used 
117.21 	in determining the minimum standard for valuation of preneed insurance shall be the 
117.22 	calendar year statutory valuation interest rates as defined in section 61A.25.
117.23 	(b) The interest rates used in determining the minimum standard for nonforfeiture 
117.24 	values for preneed insurance shall be the calendar year statutory nonforfeiture interest 
117.25 	rates as defined in section 61A.24.
117.26 		Subd. 4.Minimum valuation method standards. (a) The method used in 
117.27 	determining the standard for the minimum valuation of reserves of preneed insurance shall 
117.28 	be the method defined in section 61A.25.
117.29 	(b) The method used in determining the standard for the minimum nonforfeiture 
117.30 	values for preneed insurance shall be the method defined in section 61A.24.

117.31 	EFFECTIVE DATE; TRANSITION RULES. (a) This section is effective January 
117.32 	1, 2009, and applies to preneed insurance policies and certificates issued on or after that 
117.33 	date.
117.34 	(b) For preneed insurance policies issued on or after the effective date of this 
117.35 	section and before January 1, 2012, the 2001 CSO may be used as the minimum standard 
118.1 	for reserves and minimum standard for nonforfeiture benefits for both male and female 
118.2 	insureds.
118.3 	(c) If an insurer elects to use the 2001 CSO as a minimum standard for any policy 
118.4 	issued on or after the effective date of this section and before January 1, 2012, the insurer 
118.5 	shall provide, as a part of the actuarial opinion memorandum submitted in support of 
118.6 	the company's asset adequacy testing, an annual written notification to the domiciliary 
118.7 	commissioner. The notification shall include:
118.8 	(1) a complete list of all preneed policy forms that use the 2001 CSO as a minimum 
118.9 	standard;
118.10 	(2) a certification signed by the appointed actuary stating that the reserve 
118.11 	methodology employed by the company in determining reserves for the preneed policies 
118.12 	issued after the effective date and using the 2001 CSO as a minimum standard, develops 
118.13 	adequate reserves (For the purposes of this certification, the preneed insurance policies 
118.14 	using the 2001 CSO as a minimum standard cannot be aggregated with any other 
118.15 	policies.); and
118.16 	(3) supporting information regarding the adequacy of reserves for preneed insurance 
118.17 	policies issued after the effective date of this section and using the 2001 CSO as a 
118.18 	minimum standard for reserves.
118.19 	(d) Preneed insurance policies issued on or after January 1, 2012, must use the 
118.20 	Ultimate 1980 CSO in the calculation of minimum nonforfeiture values and minimum 
118.21 	reserves.

118.22 	Sec. 15. Minnesota Statutes 2008, section 61B.19, subdivision 4, is amended to read:
118.23 		Subd. 4.Limitation of benefits. The benefits for which the association may become 
118.24 	liable shall in no event exceed the lesser of:
118.25 	(1) the contractual obligations for which the insurer is liable or would have been 
118.26 	liable if it were not an impaired or insolvent insurer; or
118.27 	(2) subject to the limitation in clause (5), with respect to any one life, regardless of 
118.28 	the number of policies or contracts:
118.29 	(i) $300,000 $500,000 in life insurance death benefits, but not more than $100,000
118.30 	$130,000 in net cash surrender and net cash withdrawal values for life insurance;
118.31 	(ii) $300,000 $500,000 in health insurance benefits, including any net cash surrender 
118.32 	and net cash withdrawal values;
118.33 	(iii) $100,000 $250,000 in annuity net cash surrender and net cash withdrawal values;
118.34 	(iv) $300,000 $410,000 in present value of annuity benefits for structured settlement 
118.35 	annuities or for annuities in regard to which periodic annuity benefits, for a period of not 
119.1 	less than the annuitant's lifetime or for a period certain of not less than ten years, have 
119.2 	begun to be paid, on or before the date of impairment or insolvency; or
119.3 	(3) subject to the limitations in clauses (5) and (6), with respect to each individual 
119.4 	resident participating in a retirement plan, except a defined benefit plan, established under 
119.5 	section 401, 403(b), or 457 of the Internal Revenue Code of 1986, as amended through 
119.6 	December 31, 1992, covered by an unallocated annuity contract, or the beneficiaries 
119.7 	of each such individual if deceased, in the aggregate, $100,000 $250,000 in net cash 
119.8 	surrender and net cash withdrawal values;
119.9 	(4) where no coverage limit has been specified for a covered policy or benefit, the 
119.10 	coverage limit shall be $300,000 $500,000 in present value;
119.11 	(5) in no event shall the association be liable to expend more than $300,000
119.12 	$500,000 in the aggregate with respect to any one life under clause (2), items (i), (ii), (iii), 
119.13 	(iv), and clause (4), and any one individual under clause (3);
119.14 	(6) in no event shall the association be liable to expend more than $7,500,000
119.15 	$10,000,000 with respect to all unallocated annuities of a retirement plan, except a defined 
119.16 	benefit plan, established under section 401, 403(b), or 457 of the Internal Revenue Code 
119.17 	of 1986, as amended through December 31, 1992. If total claims from a plan exceed 
119.18 	$7,500,000 $10,000,000, the $7,500,000 $10,000,000 shall be prorated among the 
119.19 	claimants;
119.20 	(7) for purposes of applying clause (2)(ii) and clause (5), with respect only to 
119.21 	health insurance benefits, the term "any one life" applies to each individual covered by a 
119.22 	health insurance policy;
119.23 	(8) where covered contractual obligations are equal to or less than the limits stated in 
119.24 	this subdivision, the association will pay the difference between the covered contractual 
119.25 	obligations and the amount credited by the estate of the insolvent or impaired insurer, if 
119.26 	that amount has been determined or, if it has not, the covered contractual limit, subject 
119.27 	to the association's right of subrogation;
119.28 	(9) where covered contractual obligations exceed the limits stated in this subdivision, 
119.29 	the amount payable by the association will be determined as though the covered 
119.30 	contractual obligations were equal to those limits. In making the determination, the estate 
119.31 	shall be deemed to have credited the covered person the same amount as the estate would 
119.32 	credit a covered person with contractual obligations equal to those limits; or
119.33 	(10) the following illustrates how the principles stated in clauses (8) and (9) apply. 
119.34 	The example illustrated concerns hypothetical claims subject to the limit stated in clause 
119.35 	(2)(iii). The principles stated in clauses (8) and (9), and illustrated in this clause, apply 
119.36 	to claims subject to any limits stated in this subdivision.
120.1 	CONTRACTUAL OBLIGATIONS OF:

120.2					$50,000
			
120.3
120.4				Estate
		Guaranty 
Association
	
120.5
120.6	0% recovery 
from estate
			$ 0
			$ 50,000
	
120.7
120.8	25% recovery 
from estate
			$ 12,500
			$ 37,500
	
120.9120.10
	50% recovery 
from estate
			$ 25,000
			$ 25,000
	
120.11
120.12	75% recovery 
from estate
			$ 37,500
			$ 12,500
	
120.13					$100,000
			
120.14
120.15				Estate
		Guaranty 
Association
	
120.16
120.17	0% recovery 
from estate
			$ 0
			$ 100,000
	
120.18
120.19	25% recovery 
from estate
			$ 25,000
			$ 75,000
	
120.20
120.21	50% recovery 
from estate
			$ 50,000
			$ 50,000
	
120.22
120.23	75% recovery 
from estate
			$ 75,000
			$ 25,000
	
120.24					$200,000
			
120.25
120.26				Estate
		Guaranty 
Association
	
120.27
120.28	0% recovery 
from estate
			$ 0
			$ 100,000
	
120.29
120.30	25% recovery 
from estate
			$ 50,000
			$ 75,000
	
120.31
120.32	50% recovery 
from estate
			$ 100,000
			$ 50,000
	
120.33
120.34	75% recovery 
from estate
			$ 150,000
			$ 25,000
	
120.35 	For purposes of this subdivision, the commissioner shall determine the discount rate 
120.36 	to be used in determining the present value of annuity benefits.

120.37 	EFFECTIVE DATE. This section is effective the day following final enactment 
120.38 	and applies to member insurers who are first determined to be impaired or insolvent on or 
120.39 	after that date. Member insurers who are subject to an order of impairment in effect on the 
120.40 	effective date but are not declared insolvent until after the effective date shall continue to 
120.41 	be governed by the law in effect prior to the effective date.

120.42 	Sec. 16. Minnesota Statutes 2008, section 61B.28, subdivision 4, is amended to read:
121.1 		Subd. 4.Prohibited sales practice. No person, including an insurer, agent, or 
121.2 	affiliate of an insurer, shall make, publish, disseminate, circulate, or place before the 
121.3 	public, or cause directly or indirectly, to be made, published, disseminated, circulated, 
121.4 	or placed before the public, in any newspaper, magazine, or other publication, or in the 
121.5 	form of a notice, circular, pamphlet, letter, or poster, or over any radio station or television 
121.6 	station, or in any other way, an advertisement, announcement, or statement, written or 
121.7 	oral, which uses the existence of the Minnesota Life and Health Insurance Guaranty 
121.8 	Association for the purpose of sales, solicitation, or inducement to purchase any form of 
121.9 	insurance covered by sections 61B.18 to 61B.32. The notice required by subdivision 8 
121.10 	is not a violation of this subdivision nor is it a violation of this subdivision to explain 
121.11 	verbally to an applicant or potential applicant the coverage provided by the Minnesota 
121.12 	Life and Health Insurance Guaranty Association at any time during the application process 
121.13 	or thereafter. This subdivision does not apply to the Minnesota Life and Health Insurance 
121.14 	Guaranty Association or an entity that does not sell or solicit insurance. A person violating 
121.15 	this section is guilty of a misdemeanor.

121.16 	Sec. 17. Minnesota Statutes 2008, section 61B.28, subdivision 8, is amended to read:
121.17 		Subd. 8.Form. The form of notice referred to in subdivision 7, paragraph (a), 
121.18 	is as follows:
121.19 	"....................
121.20 	....................
121.21 	....................
121.22 	(insert name, current address, and
121.23 	telephone number of insurer)
121.24 	NOTICE CONCERNING POLICYHOLDER RIGHTS IN AN
121.25 	INSOLVENCY UNDER THE MINNESOTA LIFE AND HEALTH
121.26 	INSURANCE GUARANTY ASSOCIATION LAW
121.27 	If the insurer that issued your life, annuity, or health insurance policy becomes 
121.28 	impaired or insolvent, you are entitled to compensation for your policy from the assets of 
121.29 	that insurer. The amount you recover will depend on the financial condition of the insurer.
121.30 	In addition, residents of Minnesota who purchase life insurance, annuities, or health 
121.31 	insurance from insurance companies authorized to do business in Minnesota are protected, 
121.32 	SUBJECT TO LIMITS AND EXCLUSIONS, in the event the insurer becomes financially 
121.33 	impaired or insolvent. This protection is provided by the Minnesota Life and Health 
121.34 	Insurance Guaranty Association.
121.35 	Minnesota Life and Health Insurance Guaranty Association
121.36 	(insert current
121.37 	address and telephone number)
122.1 	The maximum amount the guaranty association will pay for all policies issued on 
122.2 	one life by the same insurer is limited to $300,000 $500,000. Subject to this $300,000
122.3 	$500,000 limit, the guaranty association will pay up to $300,000 $500,000 in life 
122.4 	insurance death benefits, $100,000 $130,000 in net cash surrender and net cash withdrawal 
122.5 	values for life insurance, $300,000 $500,000 in health insurance benefits, including any 
122.6 	net cash surrender and net cash withdrawal values, $100,000 $250,000 in annuity net 
122.7 	cash surrender and net cash withdrawal values, $300,000 $410,000 in present value of 
122.8 	annuity benefits for annuities which are part of a structured settlement or for annuities 
122.9 	in regard to which periodic annuity benefits, for a period of not less than the annuitant's 
122.10 	lifetime or for a period certain of not less than ten years, have begun to be paid on or 
122.11 	before the date of impairment or insolvency, or if no coverage limit has been specified 
122.12 	for a covered policy or benefit, the coverage limit shall be $300,000 $500,000 in present 
122.13 	value. Unallocated annuity contracts issued to retirement plans, other than defined benefit 
122.14 	plans, established under section 401, 403(b), or 457 of the Internal Revenue Code of 
122.15 	1986, as amended through December 31, 1992, are covered up to $100,000 $250,000 in 
122.16 	net cash surrender and net cash withdrawal values, for Minnesota residents covered by 
122.17 	the plan provided, however, that the association shall not be responsible for more than 
122.18 	$7,500,000 $10,000,000 in claims from all Minnesota residents covered by the plan. If 
122.19 	total claims exceed $7,500,000 $10,000,000, the $7,500,000 $10,000,000 shall be prorated 
122.20 	among all claimants. These are the maximum claim amounts. Coverage by the guaranty 
122.21 	association is also subject to other substantial limitations and exclusions and requires 
122.22 	continued residency in Minnesota. If your claim exceeds the guaranty association's limits, 
122.23 	you may still recover a part or all of that amount from the proceeds of the liquidation of 
122.24 	the insolvent insurer, if any exist. Funds to pay claims may not be immediately available. 
122.25 	The guaranty association assesses insurers licensed to sell life and health insurance in 
122.26 	Minnesota after the insolvency occurs. Claims are paid from this assessment.
122.27 	THE COVERAGE PROVIDED BY THE GUARANTY ASSOCIATION IS NOT 
122.28 	A SUBSTITUTE FOR USING CARE IN SELECTING INSURANCE COMPANIES 
122.29 	THAT ARE WELL MANAGED AND FINANCIALLY STABLE. IN SELECTING AN 
122.30 	INSURANCE COMPANY OR POLICY, YOU SHOULD NOT RELY ON COVERAGE 
122.31 	BY THE GUARANTY ASSOCIATION.
122.32 	THIS NOTICE IS REQUIRED BY MINNESOTA STATE LAW TO ADVISE 
122.33 	POLICYHOLDERS OF LIFE, ANNUITY, OR HEALTH INSURANCE POLICIES 
122.34 	OF THEIR RIGHTS IN THE EVENT THEIR INSURANCE CARRIER BECOMES 
122.35 	FINANCIALLY INSOLVENT. THIS NOTICE IN NO WAY IMPLIES THAT THE 
122.36 	COMPANY CURRENTLY HAS ANY TYPE OF FINANCIAL PROBLEMS. ALL LIFE, 
123.1 	ANNUITY, AND HEALTH INSURANCE POLICIES ARE REQUIRED TO PROVIDE 
123.2 	THIS NOTICE."
123.3 	Additional language may be added to the notice if approved by the commissioner 
123.4 	prior to its use in the form. This section does not apply to fraternal benefit societies 
123.5 	regulated under chapter 64B.

123.6 	Sec. 18. Minnesota Statutes 2008, section 67A.01, is amended to read:
123.7 	67A.01 NUMBER OF MEMBERS REQUIRED, PROPERTY AND 
123.8 	TERRITORY.
123.9 		Subdivision 1.Number of members. (a) It shall be lawful for any number of 
123.10 	persons, not less than 25, residing in adjoining townships counties in this state, who shall 
123.11 	collectively own property worth at least $50,000, to form themselves into a corporation 
123.12 	for mutual insurance against loss or damage by the perils listed in section 67A.13.  
123.13 	(b) Except as otherwise provided in this section, the company shall operate in no 
123.14 	more than 150 adjoining townships in the aggregate at the same time. The company may, 
123.15 	if approval has been granted by the commissioner, operate in more than 150 adjoining 
123.16 	townships in the aggregate at the same time, subject to a maximum of 300 townships. 
123.17 	If the company confines its operations to one county it may transact business in that 
123.18 	county by so providing in its certificate of incorporation. In case of merger of two or 
123.19 	more companies having contiguous territories, the surviving company in the merger may 
123.20 	transact business in the entire territory of the merged companies, but the territory of the 
123.21 	surviving company in the merger must not be larger than 300 townships.
123.22 		Subd. 2.Authorized territory. (a) A township mutual fire insurance company may 
123.23 	be authorized to write business in up to nine adjoining counties in the aggregate at the 
123.24 	same time. If policyholder surplus is at least $500,000 as reported in the company's last 
123.25 	annual financial statement filed with the commissioner, the company may, if approval has 
123.26 	been granted by the commissioner, be authorized to write business in ten or more counties 
123.27 	in the aggregate at the same time, subject to a maximum of 20 adjoining counties, in 
123.28 	accordance with the following schedule:

123.29
123.30		Number of 
Counties
		Surplus 
Requirement
		
123.31		10
		$500,000
		
123.32		11
		600,000
		
123.33		12
		700,000
		
123.34		13
		800,000
		
123.35		14
		900,000
		
123.36		15
		1,000,000
		
124.1		16
		1,100,000
		
124.2		17
		1,200,000
		
124.3		18
		1,300,000
		
124.4		19
		1,400,000
		
124.5		20
		1,500,000
		
124.6 	(b) In the case of a merger of two or more companies having contiguous territories, 
124.7 	the surviving company in the merger may transact business in the entire territory of the 
124.8 	merged companies; however, the territory of the surviving company in the merger may not 
124.9 	be larger than 20 counties.
124.10 	(c) A township mutual fire insurance company may write new and renewal insurance 
124.11 	on property in cities within the company's authorized territory having a population less 
124.12 	than 25,000. A township mutual may continue to write new and renewal insurance once 
124.13 	the population increases to 25,000 or greater provided that amended and restated articles 
124.14 	are filed with the commissioner along with a certification that such city's population has 
124.15 	increased to 25,000 or greater.
124.16 	(d) A township mutual fire insurance company may write new and renewal insurance 
124.17 	on property in cities within the company's authorized territory with a population of 25,000 
124.18 	or greater, but less than 150,000, if approval has been granted by the commissioner. 
124.19 	No township mutual fire insurance company shall insure any property in cities with a 
124.20 	population of 150,000 or greater.
124.21 	(e) If a township mutual fire insurance company provides evidence to the 
124.22 	commissioner that the company had insurance in force on December 31, 2007, in a city 
124.23 	within the company's authorized territory with a population of 25,000 or greater, but less 
124.24 	than 150,000, the company may write new and renewal insurance on property in that city 
124.25 	provided that the company files amended and restated articles by July 31, 2010, naming 
124.26 	that city.

124.27 	Sec. 19. Minnesota Statutes 2008, section 67A.06, is amended to read:
124.28 	67A.06 POWERS OF CORPORATION.
124.29 	Every corporation formed under the provisions of sections 67A.01 to 67A.26, 
124.30 	shall have power:
124.31 	(1) to have succession by its corporate name for the time stated in its certificate of 
124.32 	incorporation;
124.33 	(2) to sue and be sued in any court;
124.34 	(3) to have and use a common seal and alter the same at pleasure;
125.1 	(4) to acquire, by purchase or otherwise, and to hold, enjoy, improve, lease, 
125.2 	encumber, and convey all real and personal property necessary for the purpose of its 
125.3 	organization, subject to such limitations as may be imposed by law or by its articles of 
125.4 	incorporation;
125.5 	(5) to elect or appoint in such manner as it may determine all necessary or proper 
125.6 	officers, agents, boards, and committees, fix their compensation, and define their powers 
125.7 	and duties;
125.8 	(6) to make and amend consistently with law bylaws providing for the management 
125.9 	of its property and the regulation and government of its affairs;
125.10 	(7) to wind up and liquidate its business in the manner provided by chapter 60B; and
125.11 	(8) to indemnify certain persons against expenses and liabilities as provided in 
125.12 	section 302A.521. In applying section 302A.521 for this purpose, the term "members" 
125.13 	shall be substituted for the terms "shareholders" and "stockholders."; and
125.14 	(9) to eliminate or limit a director's personal liability to the company or its members 
125.15 	for monetary damages for breach of fiduciary duty as a director. A company shall not 
125.16 	eliminate or limit the liability of a director:
125.17 	(i) for breach of loyalty to the company or its members;
125.18 	(ii) for acts or omissions made in bad faith or with intentional misconduct or 
125.19 	knowing violation of law;
125.20 	(iii) for transactions from which the director derived an improper personal benefit; or
125.21 	(iv) for acts or omissions occurring before the date that the provisions in the articles 
125.22 	eliminating or limiting liability become effective.

125.23 	Sec. 20. Minnesota Statutes 2008, section 67A.07, is amended to read:
125.24 	67A.07 PRINCIPAL OFFICE.
125.25 	The principal office of a township mutual fire insurance company shall be located in 
125.26 	a township or in a city in a township county in which the company is authorized to do 
125.27 	business.

125.28 	Sec. 21. Minnesota Statutes 2008, section 67A.14, subdivision 1, is amended to read:
125.29 		Subdivision 1.Kinds of property; property outside authorized territory. (a) 
125.30 	Township mutual fire insurance companies may insure qualified property. Qualified 
125.31 	property means dwellings, household goods, appurtenant structures, farm buildings, farm 
125.32 	personal property, churches, church personal property, county fair buildings, community 
125.33 	and township meeting halls and their usual contents.
126.1 	(b) Township mutual fire insurance companies may extend coverage to include 
126.2 	an insured's secondary property if the township mutual fire insurance company covers 
126.3 	qualified property belonging to the insured. Secondary property means any real or 
126.4 	personal property that is not considered qualified property for a township mutual fire 
126.5 	insurance company to cover under this chapter. The maximum amount of coverage that a 
126.6 	township mutual fire insurance company may write for secondary property is 25 percent of 
126.7 	the total limit of liability of the policy issued to an insured covering the qualified property.
126.8 	(c) A township mutual fire insurance company may insure any real or personal 
126.9 	property, including qualified or secondary property, subject to the limitations in 
126.10 	subdivision 1, paragraph (b), located outside the limits of the territory in which the 
126.11 	company is authorized by its certificate or articles of incorporation to transact business, if 
126.12 	the company is already covering qualified property belonging to the insured, inside the 
126.13 	limits of the company's territory.
126.14 	(d) A township mutual fire insurance company may insure property temporarily 
126.15 	outside of the authorized territory of the township mutual fire insurance company.

126.16 	Sec. 22. Minnesota Statutes 2008, section 67A.14, subdivision 7, is amended to read:
126.17 		Subd. 7.Amount of insurable risk. No township mutual fire insurance company 
126.18 	shall insure or reinsure a single risk or hazard in a larger sum than the greater of $3,000, or 
126.19 	one tenth of its net assets plus two tenths of a mill of its insurance in force; provided that 
126.20 	no portion of any such risk or hazard which shall have been reinsured, as authorized by 
126.21 	the laws of this state, shall be included in determining the limitation of risk prescribed 
126.22 	by this subdivision.

126.23 	Sec. 23. [67A.175] SURPLUS REQUIREMENTS.
126.24 		Subdivision 1.Minimum. Township mutual fire insurance companies shall maintain 
126.25 	a minimum policyholders' surplus of $300,000 at all times.
126.26 		Subd. 2.Corrective action plan; filing. A township mutual fire insurance company 
126.27 	that falls below the $300,000 minimum surplus requirement must file a corrective action 
126.28 	plan with the commissioner. The plan shall state how the company will correct its surplus 
126.29 	deficiency. The plan must be submitted within 45 days of the company falling below the 
126.30 	minimum surplus level.
126.31 		Subd. 3.Corrective action plan; commissioner's notification. Within 30 days 
126.32 	after the submission by a township mutual fire insurance company of a corrective action 
126.33 	plan, the commissioner shall notify the insurer whether the plan may be implemented or 
126.34 	is, in the judgment of the commissioner, unsatisfactory. If the commissioner determines 
127.1 	the plan is unsatisfactory, the notification to the company must set forth the reasons for the 
127.2 	determination, and may set forth proposed revisions that will render the plan satisfactory 
127.3 	in the judgment of the commissioner. Upon notification from the commissioner, the 
127.4 	insurer shall prepare a revised corrective action plan that may incorporate by reference 
127.5 	any revisions proposed by the commissioner, and shall submit the revised plan to the 
127.6 	commissioner within 45 days.

127.7 	Sec. 24. Minnesota Statutes 2008, section 67A.18, subdivision 1, is amended to read:
127.8 		Subdivision 1.By member. Any member may terminate membership in the 
127.9 	company by giving written notice or returning the member's policy to the secretary and 
127.10 	paying the withdrawing member's share of all existing claims.

127.11 	Sec. 25. REPEALER.
 127.12 		Subdivision 1.Annual audits. Minnesota Statutes 2008, section 60A.129, is 
127.13 	repealed.
127.14 		Subd. 2.Township mutual insured properties, joint or partial risks, and 
127.15 	assessments. Minnesota Statutes 2008, sections 67A.14, subdivision 5; 67A.17; and 
127.16 	67A.19, are repealed.
127.17 		Subd. 3.Banking procedures; real estate tax records. Minnesota Rules, part 
127.18 	2675.2180, is repealed.
127.19 		Subd. 4.Debt prorating companies. Minnesota Rules, parts 2675.7100; 
127.20 	2675.7110; 2675.7120; 2675.7130; and 2675.7140, are repealed.
127.21 		Subd. 5.Guaranty association; inflation indexing. Minnesota Statutes 2008, 
127.22 	section 61B.19, subdivision 6, is repealed.

127.23 	ARTICLE 9
127.24 	DEBT MANAGEMENT AND DEBT SETTLEMENT SERVICE

127.25 	Section 1. Minnesota Statutes 2008, section 45.011, subdivision 1, is amended to read:
127.26 		Subdivision 1.Scope. As used in chapters 45 to 83, 155A,  332, 332A, 332B, 
127.27 	345, and 359, and sections 325D.30 to 325D.42, 326B.802 to 326B.885, and 386.61 to 
127.28 	386.78, unless the context indicates otherwise, the terms defined in this section have 
127.29 	the meanings given them. 

127.30 	Sec. 2. Minnesota Statutes 2008, section 46.04, subdivision 1, is amended to read:
127.31 		Subdivision 1.General. The commissioner of commerce, referred to in chapters 46 
127.32 	to 59A, and chapter 332A, and 332B as the commissioner, is vested with all the powers, 
128.1 	authority, and privileges which, prior to the enactment of Laws 1909, chapter 201, were 
128.2 	conferred by law upon the public examiner, and shall take over all duties in relation to 
128.3 	state banks, savings banks, trust companies, savings associations, and other financial 
128.4 	institutions within the state which, prior to the enactment of chapter 201, were imposed 
128.5 	upon the public examiner. The commissioner of commerce shall exercise a constant 
128.6 	supervision, either personally or through the examiners herein provided for, over the 
128.7 	books and affairs of all state banks, savings banks, trust companies, savings associations, 
128.8 	credit unions, industrial loan and thrift companies, and other financial institutions doing 
128.9 	business within this state; and shall, through examiners, examine each financial institution 
128.10 	at least once every 24 calendar months. In satisfying this examination requirement, the 
128.11 	commissioner may accept reports of examination prepared by a federal agency having 
128.12 	comparable supervisory powers and examination procedures. With the exception of 
128.13 	industrial loan and thrift companies which do not have deposit liabilities and licensed 
128.14 	regulated lenders, it shall be the principal purpose of these examinations to inspect and 
128.15 	verify the assets and liabilities of each and so far investigate the character and value of 
128.16 	the assets of each institution as to determine with reasonable certainty that the values are 
128.17 	correctly carried on its books. Assets and liabilities shall be verified in accordance with 
128.18 	methods of procedure which the commissioner may determine to be adequate to carry out 
128.19 	the intentions of this section. It shall be the further purpose of these examinations to 
128.20 	assess the adequacy of capital protection and the capacity of the institution to meet usual 
128.21 	and reasonably anticipated deposit withdrawals and other cash commitments without 
128.22 	resorting to excessive borrowing or sale of assets at a significant loss, and to investigate 
128.23 	each institution's compliance with applicable laws and rules. Based on the examination 
128.24 	findings, the commissioner shall make a determination as to whether the institution 
128.25 	is being operated in a safe and sound manner. None of the above provisions limits the 
128.26 	commissioner in making additional examinations as deemed necessary or advisable. The 
128.27 	commissioner shall investigate the methods of operation and conduct of these institutions 
128.28 	and their systems of accounting, to ascertain whether these methods and systems are 
128.29 	in accordance with law and sound banking principles. The commissioner may make 
128.30 	requirements as to records as deemed necessary to facilitate the carrying out of the 
128.31 	commissioner's duties and to properly protect the public interest. The commissioner may 
128.32 	examine, or cause to be examined by these examiners, on oath, any officer, director, 
128.33 	trustee, owner, agent, clerk, customer, or depositor of any financial institution touching 
128.34 	the affairs and business thereof, and may issue, or cause to be issued by the examiners, 
128.35 	subpoenas, and administer, or cause to be administered by the examiners, oaths. In 
128.36 	case of any refusal to obey any subpoena issued under the commissioner's direction, 
129.1 	the refusal may at once be reported to the district court of the district in which the bank 
129.2 	or other financial institution is located, and this court shall enforce obedience to these 
129.3 	subpoenas in the manner provided by law for enforcing obedience to subpoenas of the 
129.4 	court. In all matters relating to official duties, the commissioner of commerce has the 
129.5 	power possessed by courts of law to issue subpoenas and cause them to be served and 
129.6 	enforced, and all officers, directors, trustees, and employees of state banks, savings banks, 
129.7 	trust companies, savings associations, and other financial institutions within the state, 
129.8 	and all persons having dealings with or knowledge of the affairs or methods of these 
129.9 	institutions, shall afford reasonable facilities for these examinations, make returns and 
129.10 	reports to the commissioner of commerce as the commissioner may require; attend and 
129.11 	answer, under oath, the commissioner's lawful inquiries; produce and exhibit any books, 
129.12 	accounts, documents, and property as the commissioner may desire to inspect, and in all 
129.13 	things aid the commissioner in the performance of duties. 

129.14 	Sec. 3. Minnesota Statutes 2008, section 46.05, is amended to read:
129.15 	46.05 SUPERVISION OVER FINANCIAL INSTITUTIONS.
129.16 	Every state bank, savings bank, trust company, savings association, debt management 
129.17 	services provider, debt settlement services provider, and other financial institutions shall 
129.18 	be at all times under the supervision and subject to the control of the commissioner 
129.19 	of commerce. If, and whenever in the performance of duties, the commissioner finds 
129.20 	it necessary to make a special investigation of any financial institution under the 
129.21 	commissioner's supervision, and other than a complete examination, the commissioner 
129.22 	shall make a charge therefor to include only the necessary costs thereof. Such a fee shall 
129.23 	be payable to the commissioner on the commissioner's making a request for payment.

129.24 	Sec. 4. Minnesota Statutes 2008, section 46.131, subdivision 2, is amended to read:
129.25 		Subd. 2.Assessment authority. Each bank, trust company, savings bank, savings 
129.26 	association, regulated lender, industrial loan and thrift company, credit union, motor 
129.27 	vehicle sales finance company, debt management services provider, debt settlement 
129.28 	services provider, and insurance premium finance company organized under the laws of 
129.29 	this state or required to be administered by the commissioner of commerce shall pay 
129.30 	into the state treasury its proportionate share of the cost of maintaining the Department 
129.31 	of Commerce.

129.32 	Sec. 5. Minnesota Statutes 2008, section 325E.311, subdivision 6, is amended to read:
130.1 		Subd. 6.Telephone solicitation. "Telephone solicitation" means any voice 
130.2 	communication over a telephone line for the purpose of encouraging the purchase or 
130.3 	rental of, or investment in, property, goods, or services, whether the communication is 
130.4 	made by a live operator, through the use of an automatic dialing-announcing device as 
130.5 	defined in section 325E.26, subdivision 2, or by other means. Telephone solicitation 
130.6 	does not include communications:
130.7 	(1) to any residential subscriber with that subscriber's prior express invitation or 
130.8 	permission; or
130.9 	(2) by or on behalf of any person or entity with whom a residential subscriber has a 
130.10 	prior or current business or personal relationship.
130.11 	Telephone solicitation also does not include communications if the caller is identified by a 
130.12 	caller identification service and the call is:
130.13 	(i) by or on behalf of an organization that is identified as a nonprofit organization 
130.14 	under state or federal law, unless the organization is a debt management services provider 
130.15 	defined in section 332A.02 or a debt settlement services provider defined in section 
130.16 	332B.02;
130.17 	(ii) by a person soliciting without the intent to complete, and who does not in 
130.18 	fact complete, the sales presentation during the call, but who will complete the sales 
130.19 	presentation at a later face-to-face meeting between the solicitor who makes the call 
130.20 	and the prospective purchaser; or
130.21 	(iii) by a political party as defined under section 200.02, subdivision 6.

130.22 	Sec. 6. Minnesota Statutes 2008, section 332A.02, is amended by adding a subdivision 
130.23 	to read:
130.24 		Subd. 2a.Advertise. "Advertise" means to solicit business through any means or 
130.25 	medium.

130.26 	Sec. 7. Minnesota Statutes 2008, section 332A.02, subdivision 5, is amended to read:
130.27 		Subd. 5.Controlling or affiliated party. "Controlling or affiliated party" means 
130.28 	any person or entity that controls or is controlled, directly or indirectly controlling, 
130.29 	controlled by, or is under common control with another person. Controlling or affiliated 
130.30 	party includes, but is not limited to, employees, officers, independent contractors, 
130.31 	corporations, partnerships, and limited liability corporations.

130.32 	Sec. 8. Minnesota Statutes 2008, section 332A.02, subdivision 8, is amended to read:
131.1 		Subd. 8.Debt management services provider. "Debt management services 
131.2 	provider" means any person offering or providing debt management services to a debtor 
131.3 	domiciled in this state, regardless of whether or not a fee is charged for the services and 
131.4 	regardless of whether the person maintains a physical presence in the state. This term 
131.5 	includes any person to whom duties under a debt management services agreement or 
131.6 	debt management services plan are delegated, and does not include services performed 
131.7 	by the following when engaged in the regular course of their respective businesses and 
131.8 	professions:
131.9 	(1) attorneys at law, escrow agents, accountants, broker-dealers in securities;
131.10 	(2) state or national banks, trust companies, savings associations, title insurance 
131.11 	companies, insurance companies, and all other lending institutions duly authorized to 
131.12 	transact business in Minnesota, provided no fee is charged for the service;
131.13 	(3) persons who, as employees on a regular salary or wage of an employer not 
131.14 	engaged in the business of debt management, perform credit services for their employer;
131.15 	(4) public officers acting in their official capacities and persons acting as a debt 
131.16 	management services provider pursuant to court order;
131.17 	(5) any person while performing services incidental to the dissolution, winding up, 
131.18 	or liquidation of a partnership, corporation, or other business enterprise;
131.19 	(6) the state, its political subdivisions, public agencies, and their employees;
131.20 	(7) credit unions and collection agencies, provided no fee is charged for the service
131.21 	that the services are provided to a creditor;
131.22 	(8) "qualified organizations" designated as representative payees for purposes of the 
131.23 	Social Security and Supplemental Security Income Representative Payee System and the 
131.24 	federal Omnibus Budget Reconciliation Act of 1990, Public Law 101-508;
131.25 	(9) accelerated mortgage payment providers. "Accelerated mortgage payment 
131.26 	providers" are persons who, after satisfying the requirements of sections 332.30 to 
131.27 	332.303, receive funds to make mortgage payments to a lender or lenders, on behalf 
131.28 	of mortgagors, in order to exceed regularly scheduled minimum payment obligations 
131.29 	under the terms of the indebtedness. The term does not include: (i) persons or entities 
131.30 	described in clauses (1) to (8); (ii) mortgage lenders or servicers, industrial loan and 
131.31 	thrift companies, or regulated lenders under chapter 56; or (iii) persons authorized to 
131.32 	make loans under section 47.20, subdivision 1. For purposes of this clause and sections 
131.33 	332.30 to 332.303, "lender" means the original lender or that lender's assignee, whichever 
131.34 	is the current mortgage holder;
131.35 	(10) trustees, guardians, and conservators; and
131.36 	(11) debt settlement services providers.; and
132.1 	(12) credit unions.

132.2 	Sec. 9. Minnesota Statutes 2008, section 332A.02, subdivision 9, is amended to read:
132.3 		Subd. 9.Debt management services. "Debt management services" means the 
132.4 	provision of any one or more of the following services in connection with debt incurred 
132.5 	primarily for personal, family, or household services:
132.6 	(1) managing the financial affairs of an individual by distributing income or money 
132.7 	to the individual's creditors; 
132.8 	(2) receiving funds for the purpose of distributing the funds among creditors in 
132.9 	payment or partial payment of obligations of a debtor; or
132.10 	(3) adjusting, prorating, pooling, or liquidating the indebtedness of a debtor whereby 
132.11 	a debt management services provider assists in managing the financial affairs of a debtor 
132.12 	by distributing periodic payments to the debtor's creditors from funds that the debt 
132.13 	management services provider receives from the debtor and where the primary purpose 
132.14 	of the services is to effect repayment of debt incurred primarily for personal, family, or 
132.15 	household services. 
132.16 	Any person so engaged or holding out as so engaged is deemed to be engaged in the 
132.17 	provision of debt management services regardless of whether or not a fee is charged for 
132.18 	such services.

132.19 	Sec. 10. Minnesota Statutes 2008, section 332A.02, subdivision 10, is amended to read:
132.20 		Subd. 10.Debtor. "Debtor" means the person for whom the debt prorating service 
132.21 	is management services are performed.

132.22 	Sec. 11. Minnesota Statutes 2008, section 332A.02, subdivision 13, is amended to read:
132.23 		Subd. 13.Debt settlement services provider. "Debt settlement services provider" 
132.24 	means any person engaging in or holding out as engaging in the business of negotiating, 
132.25 	adjusting, or settling debt incurred primarily for personal, family, or household purposes 
132.26 	without holding or receiving the debtor's funds or personal property and without paying 
132.27 	the debtor's funds to, or distributing the debtor's property among, creditors has the 
132.28 	meaning given in section 332B.02, subdivision 10. The term shall not include persons 
132.29 	listed in subdivision 8, clauses (1) to (10).

132.30 	Sec. 12. Minnesota Statutes 2008, section 332A.04, subdivision 6, is amended to read:
132.31 		Subd. 6.Right of action on bond. If the registrant has failed to account to a debtor 
132.32 	or distribute to the debtor's creditors the amounts required by this chapter and, or has 
133.1 	failed to perform any of the services promised in the debt management services agreement 
133.2 	between the debtor and registrant, the registrant is in default. The debtor or the debtor's 
133.3 	legal representative or receiver, the commissioner, or the attorney general, shall have, in 
133.4 	addition to all other legal remedies, a right of action in the name of the debtor on the bond 
133.5 	or the security given under this section, for loss suffered by the debtor, not exceeding the 
133.6 	face amount of the bond or security, and without the necessity of joining the registrant 
133.7 	in the suit or action based on the default.

133.8 	Sec. 13. Minnesota Statutes 2008, section 332A.08, is amended to read:
133.9 	332A.08 DENIAL OF REGISTRATION.
133.10 	The commissioner, with notice to the applicant by certified mail sent to the address 
133.11 	listed on the application, may deny an application for a registration upon finding that 
133.12 	the applicant:
133.13 	(1) has submitted an application required under section 332A.04 that contains 
133.14 	incorrect, misleading, incomplete, or materially untrue information. An application is 
133.15 	incomplete if it does not include all the information required in section 332A.04;
133.16 	(2) has failed to pay any fee or pay or maintain any bond required by this chapter, 
133.17 	or failed to comply with any order, decision, or finding of the commissioner made under 
133.18 	and within the authority of this chapter;
133.19 	(3) has violated any provision of this chapter or any rule or direction lawfully made 
133.20 	by the commissioner under and within the authority of this chapter;
133.21 	(4) or any controlling or affiliated party has ever been convicted of a crime or found 
133.22 	civilly liable for an offense involving moral turpitude, including forgery, embezzlement, 
133.23 	obtaining money under false pretenses, larceny, extortion, conspiracy to defraud, or any 
133.24 	other similar offense or violation, or any violation of a federal or state law or regulation 
133.25 	in connection with activities relating to the rendition of debt management services or 
133.26 	any consumer fraud, false advertising, deceptive trade practices, or similar consumer 
133.27 	protection law;
133.28 	(5) has had a registration or license previously revoked or suspended in this state or 
133.29 	any other state or the applicant or licensee has been permanently or temporarily enjoined 
133.30 	by any court of competent jurisdiction from engaging in or continuing any conduct or 
133.31 	practice involving any aspect of the debt management services provider business; or 
133.32 	any controlling or affiliated party has been an officer, director, manager, or shareholder 
133.33 	owning more than a ten percent interest in a debt management services provider whose 
133.34 	registration has previously been revoked or suspended in this state or any other state, or 
133.35 	who has been permanently or temporarily enjoined by any court of competent jurisdiction 
134.1 	from engaging in or continuing any conduct or practice involving any aspect of the debt 
134.2 	management services provider business;
134.3 	(6) has made any false statement or representation to the commissioner;
134.4 	(7) is insolvent;
134.5 	(8) refuses to fully comply with an investigation or examination of the debt 
134.6 	management services provider by the commissioner;
134.7 	(9) has improperly withheld, misappropriated, or converted any money or properties 
134.8 	received in the course of doing business;
134.9 	(10) has failed to have a trust account with an actual cash balance equal to or greater 
134.10 	than the sum of the escrow balances of each debtor's account;
134.11 	(11) has defaulted in making payments to creditors on behalf of debtors as required 
134.12 	by agreements between the provider and debtor; or
134.13 	(12) has used fraudulent, coercive, or dishonest practices, or demonstrated 
134.14 	incompetence, untrustworthiness, or financial irresponsibility in this state or elsewhere; or
134.15 	(13) has been shown to have engaged in a pattern of failing to perform the services 
134.16 	promised.

134.17 	Sec. 14. Minnesota Statutes 2008, section 332A.10, is amended to read:
134.18 	332A.10 WRITTEN DEBT MANAGEMENT SERVICES AGREEMENT.
134.19 		Subdivision 1.Written agreement required. (a) A debt management services 
134.20 	provider may not perform any debt management services or receive any money related 
134.21 	to a debt management services plan until the provider has obtained a debt management 
134.22 	services agreement that contains all  terms of the agreement between the debt management 
134.23 	services provider and the debtor.
134.24 	(b) A debt management services agreement must:
134.25 	(1) be in writing, dated, and signed by the debt management services provider and 
134.26 	the debtor;
134.27 	(2) conspicuously indicate whether or not the debt management services provider 
134.28 	is registered with the Minnesota Department of Commerce and include any registration 
134.29 	number; and
134.30 	(3) be written in the debtor's primary language if the debt management services 
134.31 	provider advertised in that language. 
134.32 	(c) The registrant must furnish the debtor with a copy of the signed contract upon 
134.33 	execution.
135.1 		Subd. 2.Actions prior to written agreement. No person may provide debt 
135.2 	management services for a debtor or execute a debt management services agreement 
135.3 	unless the person first has:
135.4 	(1) provided the debtor individualized counseling and educational information 
135.5 	that, at a minimum, addresses managing household finances, managing credit and debt, 
135.6 	budgeting, and personal savings strategies;
135.7 	(2) prepared in writing and provided to the debtor, in a form that the debtor may 
135.8 	keep, an individualized financial analysis and a proposed debt management services 
135.9 	plan listing the debtor's known debts with specific recommendations regarding actions 
135.10 	the debtor should take to reduce or eliminate the amount of the debts, including written 
135.11 	disclosure that debt management services are not suitable for all debtors and that there are 
135.12 	other ways, including bankruptcy, to deal with indebtedness;
135.13 	(3) made a determination supported by an individualized financial analysis that the 
135.14 	debtor can reasonably meet the requirements of the proposed debt management services 
135.15 	plan and that there is a net tangible benefit to the debtor of entering into the proposed debt 
135.16 	management services plan; and
135.17 	(4) prepared, in a form the debtor may keep, a written list identifying all known 
135.18 	creditors of the debtor that the provider reasonably expects to participate in the plan 
135.19 	and the creditors, including secured creditors, that the provider reasonably expects not 
135.20 	to participate; and
135.21 	(5) disclosed, in addition to the written disclosure on the agreement required under 
135.22 	subdivision 1, whether or not the debt management services provider is registered with the 
135.23 	Minnesota Department of Commerce and any registration number.
135.24 		Subd. 3.Required terms provisions. (a) Each debt management services 
135.25 	agreement must contain the following terms provisions, which must be disclosed 
135.26 	prominently and clearly in bold print on the front page of the agreement, segregated by 
135.27 	bold lines from all other information on the page:
135.28 	(1) the origination fee amount to be paid by the debtor and whether all or a portion 
135.29 	of the initial origination fee amount is refundable or nonrefundable;
135.30 	(2) the monthly fee amount or percentage to be paid by the debtor; and
135.31 	(3) the total amount of fees reasonably anticipated to be paid by the debtor over 
135.32 	the term of the agreement.
135.33 	(b) Each debt management services agreement must also contain the following:
135.34 	(1) a disclosure that if the amount of debt owed is increased by interest, late fees, 
135.35 	over the limit fees, and other amounts imposed by the creditors, the length of the debt 
135.36 	management services agreement will be extended and remain in force and that the total 
136.1 	dollar charges agreed upon may increase at the rate agreed upon in the original contract 
136.2 	agreement;
136.3 	(2) a prominent statement describing the terms upon which the debtor may cancel 
136.4 	the contract as set forth in section 332A.11;
136.5 	(3) a detailed description of all services to be performed by the debt management 
136.6 	services provider for the debtor;
136.7 	(4) the debt management services provider's refund policy; and
136.8 	(5) the debt management services provider's principal business address and the name 
136.9 	and address of its agent in this state authorized to receive service of process.
136.10 		Subd. 4.Prohibited terms. The following terms shall not be included in the debt 
136.11 	management services agreement:
136.12 	(1) a hold harmless clause;
136.13 	(2) a confession of judgment, or a power of attorney to confess judgment against the 
136.14 	debtor or appear as the debtor in any judicial proceeding;
136.15 	(3) a waiver of the right to a jury trial, if applicable, in any action brought by 
136.16 	or against a debtor;
136.17 	(4) an assignment of or an order for payment of wages or other compensation for 
136.18 	services;
136.19 	(5) a provision in which the debtor agrees not to assert any claim or defense arising 
136.20 	out of the debt management services agreement;
136.21 	(6) a waiver of any provision of this chapter or a release of any obligation required 
136.22 	to be performed on the part of the debt management services provider; or
136.23 	(7) a mandatory arbitration or choice of law clause.
136.24 		Subd. 5. New debt management services agreements; modification of existing 
136.25 	agreements. (a) Separate and additional debt management services agreements that 
136.26 	comply with this chapter may be entered into by the debt management services provider 
136.27 	and the debtor provided that no additional initial origination fee may be charged by the 
136.28 	debt management services provider. 
136.29 	(b) Any modification of an existing debt management services agreement, including 
136.30 	any increase in the number or amount of debts included in the debt management service
136.31 	services agreement, must be in writing and signed by both parties, except that the signature 
136.32 	of the debtor is not required if: 
136.33 	(1) a creditor is added to or deleted from a debt management services agreement 
136.34 	at the request of the debtor or a debtor voluntarily increases the amount of a payment, 
136.35 	provided the debt management services provider must provide an updated payment 
136.36 	schedule to the debtor within seven days; or 
137.1 	(2) the payment amount to a creditor in the agreement increases by $10 or less 
137.2 	and the total payment amount to all creditors increases a total of $20 or less as a result 
137.3 	of incorrect or incomplete information provided by the debtor regarding the amount of 
137.4 	debt owed a creditor, provided the debt management services provider must notify the 
137.5 	debtor of the increase within seven days. 
137.6 	No fees, charges, or other consideration may be demanded from the debtor for 
137.7 	the modification, other than an increase in the amount of the monthly maintenance fee 
137.8 	established in the original debt management services agreement. 

137.9 	Sec. 15. Minnesota Statutes 2008, section 332A.11, subdivision 2, is amended to read:
137.10 		Subd. 2.Notice of debtor's right to cancel. A debt management services 
137.11 	agreement must contain, on its face, in an easily readable typeface type immediately 
137.12 	adjacent to the space for signature by the debtor, the following notice: "Right To Cancel: 
137.13 	You have the right to cancel this contract at any time on ten days' written notice." 

137.14 	Sec. 16. Minnesota Statutes 2008, section 332A.14, is amended to read:
137.15 	332A.14 PROHIBITIONS.
137.16 	A registrant (a) No debt management services provider shall not:
137.17 	(1) purchase from a creditor any obligation of a debtor;
137.18 	(2) use, threaten to use, seek to have used, or seek to have threatened the use of any 
137.19 	legal process, including but not limited to garnishment and repossession of personal 
137.20 	property, against any debtor while the debt management services agreement between the 
137.21 	registrant and the debtor remains executory;
137.22 	(3) advise, counsel, or encourage a debtor to stop paying a creditor until a debt 
137.23 	management services plan is in place, or imply, infer, encourage, or in any other way 
137.24 	indicate, that it is advisable to stop paying a creditor;
137.25 	(4) sanction or condone the act by a debtor of ceasing payments or imply, infer, 
137.26 	or in any manner indicate that the act of ceasing payments is advisable or beneficial to 
137.27 	the debtor;
137.28 	(4) (5) require as a condition of performing debt management services the purchase 
137.29 	of any services, stock, insurance, commodity, or other property or any interest therein 
137.30 	either by the debtor or the registrant;
137.31 	(5) (6) compromise any debts unless the prior written approval of the debtor has 
137.32 	been obtained to such compromise and unless such compromise inures solely to the 
137.33 	benefit of the debtor;
138.1 	(6) (7) receive from any debtor as security or in payment of any fee a promissory 
138.2 	note or other promise to pay or any mortgage or other security, whether as to real or 
138.3 	personal property;
138.4 	(7) (8) lend money or provide credit to any debtor if any interest or fee is charged, 
138.5 	or directly or indirectly collect any fee for referring, advising, procuring, arranging, or 
138.6 	assisting a consumer in obtaining any extension of credit or other debtor service from a 
138.7 	lender or debt management services provider;
138.8 	(8) (9) structure a debt management services agreement that would result in negative 
138.9 	amortization of any debt in the plan;
138.10 	(9) (10) engage in any unfair, deceptive, or unconscionable act or practice in 
138.11 	connection with any service provided to any debtor;
138.12 	(10) (11) offer, pay, or give any material cash fee, gift, bonus, premium, reward, or 
138.13 	other compensation to any person for referring any prospective customer to the registrant 
138.14 	or for enrolling a debtor in a debt management services plan, or provide any other 
138.15 	incentives for employees or agents of the debt management services provider to induce 
138.16 	debtors to enter into a debt management services plan;
138.17 	(11) (12) receive any cash, fee, gift, bonus, premium, reward, or other compensation 
138.18 	from any person other than the debtor or a person on the debtor's behalf in connection 
138.19 	with activities as a registrant, provided that this paragraph does not apply to a registrant 
138.20 	which is a bona fide nonprofit corporation duly organized under chapter 317A or under 
138.21 	the similar laws of another state;
138.22 	(12) (13) enter into a contract with a debtor unless a thorough written budget analysis 
138.23 	indicates that the debtor can reasonably meet the requirements of the financial adjustment 
138.24 	plan and will be benefited by the plan;
138.25 	(13) (14) in any way charge or purport to charge or provide any debtor credit 
138.26 	insurance in conjunction with any contract or agreement involved in the debt management 
138.27 	services plan;
138.28 	(14) (15) operate or employ a person who is an employee or owner of a collection 
138.29 	agency or process-serving business; or
138.30 	(15) (16) solicit, demand, collect, require, or attempt to require payment of a sum 
138.31 	that the registrant states, discloses, or advertises to be a voluntary contribution to a debt 
138.32 	management services provider or designee from the debtor.

138.33 	Sec. 17. [332B.02] DEFINITIONS.
139.1 		Subdivision 1.Scope. Unless a different meaning is clearly indicated by the context, 
139.2 	for the purposes of this chapter, the terms defined in this section have the meanings given 
139.3 	them.
139.4 		Subd. 2.Advertise. "Advertise" means to solicit business through any means or 
139.5 	medium.
139.6 		Subd. 3.Aggregate debt. "Aggregate debt" means the total of principal and interest 
139.7 	that is owed by the debtor to the creditors at the time of execution of the debt settlement 
139.8 	agreement.
139.9 		Subd. 4.Attorney general. "Attorney general" means the attorney general of the 
139.10 	state of Minnesota.
139.11 		Subd. 5.Commissioner. "Commissioner" means the commissioner of commerce.
139.12 		Subd. 6.Controlling or affiliated party. "Controlling or affiliated party" means 
139.13 	any person or entity that controls or is controlled, directly or indirectly, or is under 
139.14 	common control with another person. Controlling or affiliated party includes, but is not 
139.15 	limited to, employees, officers, independent contractors, corporations, partnerships, and 
139.16 	limited liability corporations.
139.17 		Subd. 7.Debt settlement services. "Debt settlement services" means any one or 
139.18 	more of the following activities:
139.19 	(1) offering to provide advice, or offering to act or acting as an intermediary between 
139.20 	a debtor and one or more of the debtor's creditors, where the primary purpose of the 
139.21 	advice or action is to obtain a settlement for less than the full amount of debt, whether 
139.22 	in principal, interest, fees, or other charges, incurred primarily for personal, family, or 
139.23 	household purposes including, but not limited to, offering debt negotiation, debt reduction, 
139.24 	or debt relief services; or
139.25 	(2) advising, encouraging, assisting, or counseling a debtor to accumulate funds in 
139.26 	an account for future payment of a reduced amount of debt to one or more of the debtor's 
139.27 	creditors.
139.28 	Any person so engaged or holding out as so engaged is deemed to be engaged in 
139.29 	the provision of debt settlement services, regardless of whether or not a fee is charged for 
139.30 	such services.
139.31 		Subd. 8.Debt settlement services agreement. "Debt settlement services 
139.32 	agreement" means the written contract between the debt settlement services provider 
139.33 	and the debtor.
139.34 		Subd. 9.Debt settlement services plan. "Debt settlement services plan" means the 
139.35 	debtor's individualized package of debt settlement services set forth in the debt settlement 
139.36 	services agreement.
140.1 		Subd. 10.Debt settlement services provider. "Debt settlement services provider" 
140.2 	means any person offering or providing debt settlement services to a debtor domiciled 
140.3 	in this state, regardless of whether or not a fee is charged for the services and regardless 
140.4 	of whether the person maintains a physical presence in the state. The term includes any 
140.5 	person to whom duties under a debt management agreement or debt management plan 
140.6 	are delegated.
140.7 		Subd. 11.Person. "Person" means an individual, firm, partnership, association, 
140.8 	or corporation.

140.9 	Sec. 18. [332B.03] REQUIREMENT OF REGISTRATION.
140.10 	On or after August 1, 2009, it is unlawful for any person, whether or not located 
140.11 	in this state, to operate as a debt settlement services provider or provide debt settlement 
140.12 	services including, but not limited to, offering, advertising, or executing or causing to be 
140.13 	executed any debt settlement services or debt settlement services agreement, except as 
140.14 	authorized by law, without first becoming registered as provided in this chapter. Debt 
140.15 	settlement services providers may continue to provide debt settlement services without 
140.16 	complying with this chapter to those debtors who entered into a contract to participate 
140.17 	in a debt settlement services plan prior to August 1, 2009, but may not enter into a debt 
140.18 	settlement services agreement with a debt on or after August 1, 2009, without complying 
140.19 	with this chapter.

140.20 	Sec. 19. [332B.04] REGISTRATION.
140.21 		Subdivision 1.Form. Application for registration to operate as a debt settlement 
140.22 	services provider in this state must be made in writing to the commissioner, under oath, in 
140.23 	the form prescribed by the commissioner, and must contain:
140.24 	(1) the full name of each principal of the entity applying;
140.25 	(2) the address, which must not be a post office box, and the telephone number and, 
140.26 	if applicable, the e-mail address, of the applicant;
140.27 	(3) consent to the jurisdiction of the courts of this state;
140.28 	(4) the name and address of the registered agent authorized to accept service of 
140.29 	process on behalf of the applicant or appointment of the commissioner as the applicant's 
140.30 	agent for purposes of accepting service of process;
140.31 	(5) disclosure of:
140.32 	(i) whether any controlling or affiliated party has ever been convicted of a crime 
140.33 	or found civilly liable for an offense involving moral turpitude, including forgery, 
140.34 	embezzlement, obtaining money under false pretenses, larceny, extortion, conspiracy to 
141.1 	defraud, or any other similar offense or violation, or any violation of a federal or state 
141.2 	law or regulation in connection with activities relating to the rendition of debt settlement 
141.3 	services or involving any consumer fraud, false advertising, deceptive trade practices, or 
141.4 	similar consumer protection law;
141.5 	(ii) any judgments, private or public litigation, tax liens, written complaints, 
141.6 	administrative actions, or investigations by any government agency against the applicant 
141.7 	or any officer, director, manager, or shareholder owning more than five percent interest 
141.8 	in the applicant, unresolved or otherwise, filed or otherwise commenced within the 
141.9 	preceding ten years;
141.10 	(iii) whether the applicant or any person employed by the applicant has had a record 
141.11 	of having defaulted in the payment of money collected for others, including the discharge 
141.12 	of debts through bankruptcy proceedings; and
141.13 	(iv) whether the applicant's license or registration to provide debt settlement services 
141.14 	in any other state has ever been revoked or suspended;
141.15 	(6) a copy of the applicant's standard debt settlement services agreement that the 
141.16 	applicant intends to execute with debtors;
141.17 	(7) proof of accreditation; and
141.18 	(8) any other information and material as the commissioner may require.
141.19 	The commissioner may, for good cause shown, temporarily waive any requirement 
141.20 	of this subdivision.
141.21 		Subd. 2.Term and scope of registration. A registration is effective until 11:59 
141.22 	p.m. on December 31 of the year for which the application for registration is filed or until 
141.23 	it is surrendered by the registrant or revoked or suspended by the commissioner. The 
141.24 	registration is limited solely to the business of providing debt settlement services.
141.25 		Subd. 3.Fees; bond. An applicant for registration as a debt settlement services 
141.26 	provider must comply with the requirements of section 332A.04, subdivisions 3, 4, and 5.
141.27 		Subd. 4.Right of action on bond. If the registrant has failed to account to a debtor, 
141.28 	or has failed to perform any of the services promised, the registrant is in default. The 
141.29 	debtor or the debtor's legal representative or receiver, the commissioner, or the attorney 
141.30 	general, shall have, in addition to all other legal remedies, a right of action in the name of 
141.31 	the debtor on the bond or the security given under this section, for loss suffered by the 
141.32 	debtor, not exceeding the face amount of the bond or security, and without the necessity of 
141.33 	joining the registrant in the suit or action based on the default.
141.34 		Subd. 5.Registrant list. The commissioner must maintain a list of registered debt 
141.35 	settlement services providers. The list must be made available to the public in written 
141.36 	form upon request and on the Department of Commerce Web site.
142.1 		Subd. 6.Renewal of registration. Each year, each registrant under the provisions 
142.2 	of this chapter must not, more than 60 nor less than 30 days before its registration is to 
142.3 	expire, apply to the commissioner for renewal of its registration on a form prescribed by 
142.4 	the commissioner. The application must be signed by the registrant under penalty of 
142.5 	perjury, contain current information on all matters required in the original application, and 
142.6 	be accompanied by a payment of $250. The registrant must maintain a continuous surety 
142.7 	bond that satisfies the requirements of section 332A.04, subdivision 4. The renewal is 
142.8 	effective for one year. The commissioner may, for good cause shown, temporarily waive 
142.9 	any requirement of this section.

142.10 	Sec. 20. [332B.05] DENIAL, SUSPENSION, REVOCATION, OR 
142.11 	NONRENEWAL OF REGISTRATION.
142.12 		Subdivision 1.Denial. The commissioner, with notice to the applicant by certified 
142.13 	mail sent to the address listed on the application, may deny an application for a registration 
142.14 	for any of the reasons specified under section 332A.08.
142.15 		Subd. 2.Suspension, revocation, or nonrenewal. The commissioner may suspend, 
142.16 	revoke, or refuse to renew any registration issued under this chapter, or may levy a civil 
142.17 	penalty under section 45.027, or any combination of actions, if the debt settlement services 
142.18 	provider or any controlling or affiliated person has committed any act or omission for 
142.19 	which the commissioner could have refused to issue an initial registration.
142.20 		Subd. 3.Procedure. Suspension, revocation, or nonrenewal must be upon notice 
142.21 	and under the conditions prescribed in section 332A.09, subdivision 1. Upon issuance of 
142.22 	an order suspending, revoking, or refusing to renew a registration, the commissioner:
142.23 	(1) shall follow the procedure established in section 332A.09, subdivision 2; and
142.24 	(2) may follow the procedure specified in section 332A.09, subdivision 3, concerning 
142.25 	the appointment of a receiver for funds of sanctioned registrants.

142.26 	Sec. 21. [332B.06] WRITTEN DEBT SETTLEMENT SERVICES AGREEMENT; 
142.27 	DISCLOSURES; TRUST ACCOUNT.
142.28 		Subdivision 1.Written agreement required. (a) A debt settlement services 
142.29 	provider may not perform, or impose any charges or receive any payment for, any debt 
142.30 	settlement services until the provider and the debtor have executed a debt settlement 
142.31 	services agreement that contains all terms of the agreement between the debt settlement 
142.32 	services provider and the debtor and complies with all the applicable requirements of 
142.33 	this chapter.
142.34 	(b) A debt settlement services agreement must:
143.1 	(1) be in writing, dated, and signed by the debt settlement services provider and 
143.2 	the debtor;
143.3 	(2) conspicuously indicate whether or not the debt settlement services provider is 
143.4 	registered with the Minnesota Department of Commerce and include any registration 
143.5 	number; and
143.6 	(3) be written in the debtor's primary language if the debt settlement services 
143.7 	provider advertises in that language.
143.8 	(c) The registrant must furnish the debtor with a copy of the signed contract upon 
143.9 	execution.
143.10 		Subd. 2.Actions prior to executing a written agreement. No person may provide 
143.11 	debt settlement services for a debtor or execute a debt settlement services agreement 
143.12 	unless the person first has: 
143.13 	(1) provided the debtor individualized counseling that, at a minimum, addresses 
143.14 	managing household finances, managing credit and debt, budgeting, personal savings 
143.15 	strategies, and a detailed description of all the various ways to reduce or eliminate the 
143.16 	debt, which must, at a minimum, include bankruptcy; and
143.17 	(2) prepared in writing and provided to the debtor, in a form the debtor may keep, 
143.18 	an individualized financial analysis of the debtor's financial circumstances, including 
143.19 	income and liabilities, and made a determination supported by the individualized financial 
143.20 	analysis that:
143.21 	(i) the debt settlement plan proposed for addressing the debt is suitable for the 
143.22 	individual debtor;
143.23 	(ii) the debtor can reasonably meet the requirements of the proposed debt settlement 
143.24 	services plan; and
143.25 	(iii) there is a net tangible benefit to the debtor of entering into the proposed debt 
143.26 	settlement services plan.
143.27 		Subd. 3.Disclosures. (a) A person offering to provide or providing debt settlement 
143.28 	services must disclose both orally and in writing whether or not the person is registered 
143.29 	with the Minnesota Department of Commerce and any registration number.
143.30 	(b) No person may provide debt settlement services unless the person first has 
143.31 	provided, both orally and in writing, on a single sheet of paper, separate from any other 
143.32 	document or writing, the following verbatim notice:
143.33 	WARNING
143.34 	We CANNOT GUARANTEE that you will successfully reduce or eliminate your 
143.35 	debt.
143.36 	You SHOULD NOT stop paying your creditors.
144.1 	Fees, interest, and other charges will continue to mount up during the (insert 
144.2 	number) months this plan is in effect.
144.3 	Even if you sign up for this service:
144.4 	• YOUR WAGES OR BANK ACCOUNT MAY STILL BE GARNISHED.
144.5 	• YOU MAY STILL BE CONTACTED BY CREDITORS.
144.6 	• YOU MAY STILL BE SUED BY CREDITORS for the money you owe.
144.7 	Even if we do settle your debt, YOU MAY STILL HAVE TO PAY TAXES on 
144.8 	the amount forgiven.
144.9 	Your credit rating may be adversely affected.
144.10 	(c) The heading, "WARNING," must be in bold, underlined, 28-point type, and the 
144.11 	remaining text must be in 14-point type, with a double space between each statement.
144.12 	(d) The disclosure and notice required under this subdivision must be provided in 
144.13 	the debtor's primary language if the debt settlement provider advertises in that language.
144.14 		Subd. 4.Required information. (a) Each debt settlement services agreement must 
144.15 	contain the following information, which must be disclosed prominently and clearly in 
144.16 	bold print on the front page of the agreement, segregated by bold lines from all other 
144.17 	information on the page:
144.18 	(1) the origination fee amount to be paid by the debtor and whether all or part of the 
144.19 	origination fee is refundable or nonrefundable; and
144.20 	(2) the service fee formula and the total amount of service fees reasonably 
144.21 	anticipated to be paid by the debtor over the term of the agreement.
144.22 	(b) Each debt settlement services agreement must also contain the following:
144.23 	(1) a prominent statement describing the terms upon which the debtor may cancel 
144.24 	the contract as set forth in section 332B.07;
144.25 	(2) a detailed description of all services to be performed by the debt settlement 
144.26 	services provider for the debtor;
144.27 	(3) the debt settlement services provider's refund policy;
144.28 	(4) the debt settlement services provider's principal business address, which must 
144.29 	not be a post office box, and the name and address of its agent in this state authorized to 
144.30 	receive service of process; and
144.31 	(5) the name of each creditor the debtor has listed and the aggregate debt owed to 
144.32 	each creditor that will be the subject of settlement.
144.33 		Subd. 5.Prohibited terms. A debt settlement services agreement may not contain 
144.34 	any of the terms prohibited under section 332A.10, subdivision 4.
144.35 		Subd. 6.New debt settlement services agreements; modifications of existing 
144.36 	agreements. (a) Separate and additional debt settlement services agreements that comply 
145.1 	with this chapter may be entered into by the debt settlement services provider and the 
145.2 	debtor, provided that no additional origination fee may be charged by the debt settlement 
145.3 	services provider.
145.4 	(b) Any modification of an existing debt settlement services agreement, including 
145.5 	any increase in the number or amount of debts included in the debt settlement services 
145.6 	agreement, must be in writing and signed by both parties. No fee may be charged to 
145.7 	modify an existing agreement.
145.8 		Subd. 7.Payments held in trust. If the registrant holds funds for the debtor, the 
145.9 	registrant must maintain a separate trust account and deposit in the account all payments 
145.10 	received from the moment that the funds are available, except that the registrant may 
145.11 	commingle the payment with the registrant's own property or funds, but only to the extent 
145.12 	necessary to ensure the maintenance of a minimum balance if the financial institution at 
145.13 	which the trust account is held requires a minimum balance to avoid the assessment of 
145.14 	fees or penalties for failure to maintain a minimum balance. All disbursements, whether 
145.15 	to the debtor or to the creditors of the debtor, or to the registrant, must be made from 
145.16 	such account.

145.17 	Sec. 22. [332B.07] RIGHT TO CANCEL.
145.18 		Subdivision 1.Debtor's right to cancel. (a) A debtor has the right to cancel a debt 
145.19 	settlement services agreement without cause at any time upon ten days' written notice 
145.20 	to the debt settlement services provider.
145.21 	(b) In the event of cancellation, the debt settlement services provider must, within 
145.22 	ten days of the cancellation, notify the debtor's creditors of the cancellation and provide 
145.23 	a refund of all funds paid by or for the debtor to the debt settlement services provider, 
145.24 	except for the origination fee specified in section 332B.09, subdivision 1.
145.25 		Subd. 2.Notice of debtor's right to cancel. A debt settlement services agreement 
145.26 	must contain, on its face, in an easily readable type immediately adjacent to the space for 
145.27 	signature by the debtor, the following notice: "Right to Cancel: You have the right to 
145.28 	cancel this contract at any time on ten days' written notice."
145.29 		Subd. 3.Automatic termination. Upon the payment of all listed or settled debts 
145.30 	and fees, the debt settlement services agreement must automatically terminate, and all 
145.31 	unexpended funds paid by or for the debtor to the debt settlement services provider must 
145.32 	be immediately returned to the debtor.
145.33 		Subd. 4.Debt settlement services provider's right to cancel. (a) A debt settlement 
145.34 	services provider may cancel a debt settlement services agreement with good cause upon 
145.35 	30 days' written notice to the debtor.
146.1 	(b) Within ten days after the cancellation, the debt settlement services provider must:
146.2 	(1) notify the debtor's creditors of the cancellation; and
146.3 	(2) return to the debtor all funds paid by or for the debtor to the debt settlement 
146.4 	provider, except for the origination fee specified in section 332B.09, subdivision 1.

146.5 	Sec. 23. [332B.08] BOOKS, RECORDS, AND INFORMATION.
146.6 		Subdivision 1.Records retention; annual report. Every registrant must keep, and 
146.7 	use in the registrant's business, such books, accounts, and records, including electronic 
146.8 	records, as will enable the commissioner to determine whether the registrant is complying 
146.9 	with this chapter and the rules, orders, and directives adopted by the commissioner under 
146.10 	this chapter. Every registrant must preserve such books, accounts, and records for at least 
146.11 	six years after making the final entry on any transaction recorded therein. Examinations 
146.12 	of the books, records, and method of operations conducted under the supervision of the 
146.13 	commissioner shall be done at the cost of the registrant. The cost must be assessed as 
146.14 	determined under section 46.131.
146.15 		Subd. 2.Annual report. On or before March 15 of each calendar year, each 
146.16 	registrant must file a report with the commissioner containing such information as the 
146.17 	commissioner may require about the preceding calendar year. The report must be in a 
146.18 	form the commissioner prescribes.
146.19 		Subd. 3.Statements to debtors. (a) Each registrant must:
146.20 	(1) maintain and make available records and accounts that will enable each debtor to 
146.21 	ascertain the amounts paid to the creditors of the debtor. A statement showing amounts 
146.22 	received from the debtor, disbursements to each creditor, amounts that any creditor has 
146.23 	agreed to as payment in full for any debt owed the creditor by the debtor, charges deducted 
146.24 	by the registrant, and other information as the commissioner may prescribe, must be 
146.25 	furnished by the registrant to the debtor at least monthly and, in addition, upon any 
146.26 	cancellation or termination of the contract;
146.27 	(2) include in the statement furnished to debtors a list of all activities conducted 
146.28 	pursuant to the contract, including the number and description of communications with 
146.29 	each creditor during the reporting period; and
146.30 	(3) prepare and retain in the file of each debtor a written analysis of the debtor's 
146.31 	income and expenses to substantiate that the plan of payment is feasible and practicable.
146.32 	(b) Each debtor must have reasonable access, without cost, by electronic or other 
146.33 	means, to information in the registrant's files applicable to the debtor. These statements, 
146.34 	records, and accounts must otherwise remain confidential, except for duly authorized 
147.1 	state and government officials, the commissioner, the attorney general, the debtor, and 
147.2 	the debtor's representative and designees.

147.3 	Sec. 24. [332B.09] FEES, PAYMENTS, AND CONSENT OF CREDITORS.
147.4 		Subdivision 1.Origination fee. A debt settlement services provider may charge a 
147.5 	nonrefundable origination fee of not more than $50.
147.6 		Subd. 2.Service fee. In addition to the origination fee under subdivision 1, a debt 
147.7 	settlement services provider may charge a service fee equal to five percent of the savings 
147.8 	actually negotiated by the debt settlement services provider. No other fees may be charged. 
147.9 	The savings shall be calculated as the difference between the aggregate debt that is stated 
147.10 	in the debt settlement services agreement at the time of its execution and total amount 
147.11 	that the debtor actually pays to settle all the debts stated in the debt settlement services 
147.12 	agreement, provided that only savings resulting from concessions actually negotiated by 
147.13 	the debt settlement services provider may be counted.
147.14 		Subd. 3.Collection of fees. No debt settlement services provider may claim, 
147.15 	demand, charge, collect, or receive any compensation until after the debt settlement 
147.16 	service provider has fully performed each and every service the provider has contracted to 
147.17 	perform or represented would be performed or as otherwise provided in this section.
147.18 		Subd. 4.Consent of creditors. Before providing any services, a debt settlement 
147.19 	services provider must obtain the written consent of all creditors that agree to participate in 
147.20 	the debt settlement services plan set forth in the debt management services agreement. The 
147.21 	debt settlement services provider must notify the debtor within ten days after any failure to 
147.22 	obtain the required consent of any creditor and of the debtor's right to cancel the agreement 
147.23 	without penalty. If not all creditors listed in the debt settlement services agreement have 
147.24 	consented to participate in the debt settlement services plan, the debt settlement services 
147.25 	provider must obtain the written authorization from the debtor to proceed with the debt 
147.26 	settlement services agreement without the participation of all listed creditors.
147.27 		Subd. 5.Withdrawal of creditor. Whenever a creditor withdraws from a debt 
147.28 	settlement services plan, the debt settlement services provider must promptly notify the 
147.29 	debtor of the withdrawal, identify the creditor, and inform the debtor of the right to cancel 
147.30 	the debt settlement services agreement. In no case may this notice be provided more 
147.31 	than 15 days after the debt settlement services provider learns of the creditor's decision 
147.32 	to withdraw from a plan.
147.33 		Subd. 6.Timely notification of settlement. A debt settlement services provider 
147.34 	must notify the debtor within 24 hours of settlement of a debt with a creditor.

148.1 	Sec. 25. [332B.10] PROHIBITIONS.
148.2 	No debt settlement services provider shall:
148.3 	(1) engage in any activity, act, or omission prohibited under section 332A.14;
148.4 	(2) promise, guarantee, or directly or indirectly imply, infer, or in any manner 
148.5 	represent that any debt will be settled prior to the presentation to the debtor of an offer by 
148.6 	the creditors participating in the debt settlement plan to settle;
148.7 	(3) misrepresent the timing of negotiations with creditors;
148.8 	(4) imply, infer, or in any manner represent that:
148.9 	(i) fees, interest, and other charges will not continue to accrue prior to the time 
148.10 	debts are settled;
148.11 	(ii) wages or bank accounts are not subject to garnishment;
148.12 	(iii) creditors will not continue to contact the debtor;
148.13 	(iv) the debtor is not subject to legal action; and
148.14 	(v) the debtor will not be subject to tax consequences for the portion of any debts 
148.15 	forgiven;
148.16 	(5) execute a power of attorney or any other agreement, oral or written, express 
148.17 	or implied, that extinguishes or limits the debtor's right at any time to contract or 
148.18 	communicate with any creditor or the creditor's right at any time to communicate with 
148.19 	the debtor;
148.20 	(6) exercise or attempt to exercise a power of attorney after an individual has 
148.21 	terminated an agreement;
148.22 	(7) state, imply, infer, or, in any other manner, indicate that entering into a debt 
148.23 	settlement services agreement or settling debts will either have no effect on, or improve, 
148.24 	the debtor's credit, credit rating, and credit score;
148.25 	(8) challenge a debt without the written consent of the debtor;
148.26 	(9) make any false or misleading claim regarding a creditor's right to collect a debt;
148.27 	(10) represent that the debt settlement services provider can negotiate better 
148.28 	settlement terms with a creditor than the debtor alone can negotiate;
148.29 	(11) provide or offer to provide legal advice or legal services unless the person 
148.30 	providing or offering to provide legal advice is licensed to practice law in the state;
148.31 	(12) misrepresent that it is authorized or competent to furnish legal advice or 
148.32 	perform legal services; and
148.33 	(13) settle a debt or lead an individual to believe that a payment to a creditor is in 
148.34 	settlement of a debt to the creditor unless, at the time of settlement, the individual receives 
148.35 	a certification from the creditor that the payment is in full settlement of the debt.

149.1 	Sec. 26. [332B.11] ADVERTISEMENT OF DEBT SETTLEMENT SERVICES 
149.2 	PLAN.
149.3 	No debt settlement services provider may engage in any activity proscribed by 
149.4 	section 332A.16, or represent, claim, imply, or infer that secured debts may be settled.

149.5 	Sec. 27. [332B.12] DEBT SETTLEMENT SERVICES AGREEMENT 
149.6 	RESCISSION.
149.7 	Any debtor has the right to rescind any debt settlement services agreement with a 
149.8 	debt settlement services provider that commits a material violation of this chapter. On 
149.9 	rescission, all fees paid to the debt settlement services provider or any other person other 
149.10 	than creditors of the debtor must be returned to the debtor entering into the debt settlement 
149.11 	services agreement within ten days of rescission of the debt settlement services agreement.

149.12 	Sec. 28. [332B.13] ENFORCEMENT; REMEDIES.
149.13 		Subdivision 1.Violation as deceptive practice. A violation of any of the provisions 
149.14 	of this chapter is considered an unfair or deceptive trade practice under section 8.31, 
149.15 	subdivision 1. A private right of action under section 8.31 by an aggrieved debtor is in 
149.16 	the public interest.
149.17 		Subd. 2.Private right of action. (a) A debt settlement provider who fails to comply 
149.18 	with any of the provisions of this chapter is liable under this section in an individual 
149.19 	action for the sum of:
149.20 	(1) actual, incidental, and consequential damages sustained by the debtor as a result 
149.21 	of the failure; and
149.22 	(2) statutory damages of up to $5,000.
149.23 	(b) A debt settlement provider who fails to comply with any of the provisions of this 
149.24 	chapter is liable to the named plaintiffs under this section in a class action for the amount 
149.25 	that each named plaintiff could recover under paragraph (a), clause (1), and to the other 
149.26 	class members for such amount as the court may allow.
149.27 	(c) In determining the amount of statutory damages, the court shall consider, among 
149.28 	other relevant factors:
149.29 	(1) the frequency, nature, and persistence of noncompliance;
149.30 	(2) the extent to which the noncompliance was intentional; and
149.31 	(3) in the case of a class action, the number of debtors adversely affected.
149.32 	(d) A plaintiff or class successful in a legal or equitable action under this section is 
149.33 	entitled to the costs of the action, plus reasonable attorney fees.
150.1 		Subd. 3.Injunctive relief. A debtor may sue a debt settlement services provider 
150.2 	for temporary or permanent injunctive or other appropriate equitable relief to prevent 
150.3 	violations of any provision of this chapter. A court must grant injunctive relief on a 
150.4 	showing that the debt settlement services provider has violated any provision of this 
150.5 	chapter, or in the case of a temporary injunction, on a showing that the debtor is likely to 
150.6 	prevail on allegations that the debt settlement services provider violated any provision 
150.7 	of this chapter.
150.8 		Subd. 4.Remedies cumulative. The remedies provided in this section are 
150.9 	cumulative and do not restrict any remedy that is otherwise available. The provisions 
150.10 	of this chapter are not exclusive and are in addition to any other requirements, rights, 
150.11 	remedies, and penalties provided by law.
150.12 		Subd. 5.Public enforcement. The attorney general shall enforce this chapter 
150.13 	under section 8.31.

150.14 	Sec. 29. [332B.14] INVESTIGATIONS.
150.15 	At any reasonable time, the commissioner may examine the books and records of 
150.16 	every registrant and of any person engaged in the business of providing debt settlement 
150.17 	services. The commissioner, once during any calendar year, may require the submission 
150.18 	of an audit prepared by a certified public accountant of the books and records of each 
150.19 	registrant. If the registrant has, within one year previous to the commissioner's demand, 
150.20 	had an audit prepared for some other purpose, this audit may be submitted to satisfy the 
150.21 	requirement of this section. The commissioner may investigate any complaint concerning 
150.22 	violations of this chapter and may require the attendance and sworn testimony of witnesses 
150.23 	and the production of documents.