1.1A bill for an act1.2relating to higher education; authorizing data matching; modifying institution 1.3eligibility; establishing award procedures; establishing a grant program; 1.4modifying security requirements; requiring certain notice; establishing a central 1.5system office; modifying bonding limits; authorizing bonding authority transfer; 1.6providing for certain refunds; requiring a study; governing credit transfers; 1.7requiring system office streamlining; providing postretirement premium 1.8reimbursement; establishing a pilot project; making technical corrections; 1.9defining and clarifying terms; governing appropriation reductions;amending 1.10Minnesota Statutes 2008, sections 135A.15, subdivision 1; 135A.155; 135A.51, 1.11subdivision 2; 136A.101, subdivision 10; 136A.121, subdivision 6; 136A.126, 1.12by adding a subdivision; 136A.15, subdivision 6; 136A.16, subdivision 14; 1.13136A.62, subdivision 3; 136A.645; 136A.646; 141.25, subdivisions 7, 13, by 1.14adding a subdivision; 141.251, subdivision 2; 141.28, subdivision 2; 474A.04, 1.15subdivision 6; 474A.091, subdivision 3; Minnesota Statutes 2009 Supplement, 1.16sections 136A.01, subdivision 2; 136A.101, subdivision 4; 136F.98, subdivision 1.171; Laws 2010, chapter 215, article 2, sections 4, subdivision 3; 6; proposing 1.18coding for new law in Minnesota Statutes, chapters 136A; 136F; repealing 1.19Minnesota Statutes 2009 Supplement, section 136A.121, subdivision 9b.1.20BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:1.21    Section 1. Minnesota Statutes 2008, section 135A.15, subdivision 1, is amended to 1.22read:1.23    Subdivision 1. Policy required. The Board of Trustees of the Minnesota State 1.24Colleges and Universities shall, and the University of Minnesota is requested to, adopt 1.25a clear, understandable written policy on sexual harassment and sexual violence that 1.26informs victims of their rights under the crime victims bill of rights, including the right to 1.27assistance from the Crime Victims Reparations Board and the commissioner of public 1.28safety. The policy must apply to students and employees and must provide information 1.29about their rights and duties. The policy must apply to criminal incidents occurring on 1.30property owned by the postsecondary system or institution in which the victim is a 2.1student or employee of that system or institution. It must include procedures for reporting 2.2incidents of sexual harassment or sexual violence and for disciplinary actions against 2.3violators. During student registration, each technical college, community college, or state 2.4university shall, and the University of Minnesota is requested to, provide each student with 2.5information regarding its policy. A copy of the policy also shall be posted at appropriate 2.6locations on campus at all times. Each private postsecondary institution that is an eligible 2.7institution as defined in section 
         136A.101, subdivision 4 136A.155, must adopt a policy 2.8that meets the requirements of this section.  2.9    Sec. 2. Minnesota Statutes 2008, section 135A.155, is amended to read:2.10135A.155 HAZING POLICY.2.11The board of trustees of the Minnesota State Colleges and Universities shall, and 2.12the University of Minnesota is requested to, adopt a clear, understandable written policy 2.13on student conduct, including hazing. The policy must include procedures for reporting 2.14incidents of inappropriate hazing and for disciplinary actions against individual violators 2.15and organizations. The policy shall be made available to students by appropriate means as 2.16determined by each institution, which may include publication in a student handbook or 2.17other institutional publication, or posting by electronic display on the Internet, and shall 2.18be posted at appropriate locations on campus. A private postsecondary institution that 2.19is an eligible institution as defined in section 
         136A.101, subdivision 4 136A.155, must 2.20adopt a policy that meets the requirements of this section.  2.21    Sec. 3. Minnesota Statutes 2008, section 135A.51, subdivision 2, is amended to read:2.22    Subd. 2. Senior citizen. "Senior citizen" means a person who has reached 62 662.23years of age before the beginning of any term, semester or quarter, in which a course of 2.24study is pursued, or a person receiving a railroad retirement annuity who has reached 60 2.25years of age before the beginning of the term.2.26    Sec. 4. Minnesota Statutes 2009 Supplement, section 136A.01, subdivision 2, is 2.27amended to read:2.28    Subd. 2. Responsibilities.(a) The Minnesota Office of Higher Education is 2.29responsible for:2.30    (1) necessary state level administration of financial aid programs, including 2.31accounting, auditing, and disbursing state and federal financial aid funds, and reporting on 2.32financial aid programs to the governor and the legislature;3.1    (2) approval, registration, licensing, and financial aid eligibility of private collegiate 3.2and career schools, under sections 
         136A.61 to 
         136A.71 and chapter 141;3.3    (3) negotiating and administering reciprocity agreements;3.4    (4) publishing and distributing financial aid information and materials, and other 3.5information and materials under section 
         136A.87, to students and parents;3.6    (5) collecting and maintaining student enrollment and financial aid data and 3.7reporting data on students and postsecondary institutions to develop and implement a 3.8process to measure and report on the effectiveness of postsecondary institutions;3.9    (6) administering the federal programs that affect students and institutions on a 3.10statewide basis; and3.11    (7) prescribing policies, procedures, and rules under chapter 14 necessary to 3.12administer the programs under its supervision.3.13    (b) The office is authorized to match individual student data from the student record 3.14enrollment database with individual student financial aid data collected and maintained 3.15by the office in order to audit or evaluate federal or state supported education programs 3.16as permitted by United States Code, title 20, section 1232g(b)(3), and Code of Federal 3.17Regulations, title 34, section 99.35. The office may match data from the following 3.18financial aid program databases with data from the student record enrollment database: 3.19tuition reciprocity; the state grant; the SELF loan; state work study; the postsecondary 3.20child care grant; the American Indian Scholarship; and the achieve scholarship. The office 3.21shall conduct the study in a manner that does not permit personal identification of parents 3.22or students by individuals other than representatives of the office.3.23    Sec. 5. Minnesota Statutes 2009 Supplement, section 136A.101, subdivision 4, is 3.24amended to read:3.25    Subd. 4. Eligible institution. "Eligible institution" means a postsecondary 3.26educational institution located in this state or in a state with which the office has entered 3.27into a higher education reciprocity agreement on state student aid programs that (1) is 3.28operated by this state or the Board of Regents of the University of Minnesota, or (2) 3.29is operated privately and, as determined by the office, meets all of the following: (i) 3.30maintains academic standards substantially equivalent to those of comparable institutions 3.31operated in this state; (ii) is licensed or registered as a postsecondary institution by the 3.32office or another state agency; and (iii) by July 1, 2013, is participating in the federal 3.33Pell Grant program under Title IV of the Higher Education Act of 1965, as amended an 3.34institution that meets the eligibility requirements under section 136A.103.4.1    Sec. 6. Minnesota Statutes 2008, section 136A.101, subdivision 10, is amended to read:4.2    Subd. 10. Satisfactory academic progress. "Satisfactory academic progress" 4.3means that: satisfactory academic progress as defined under Code of Federal Regulations, 4.4title 34, sections 668.16(e), 668.32(f), and 668.34.4.5    (1) by the end of a student's second academic year of attendance at an institution, the 4.6student has at least a cumulative grade point average of C or its equivalent, or academic 4.7standing consistent with the institution's graduation requirements; and4.8    (2) by the end of the first term of the third and fourth academic year of attendance, 4.9the student has a cumulative grade point average of at least a C or its equivalent.4.10    Sec. 7. [136A.103] INSTITUTION ELIGIBILITY REQUIREMENTS.4.11    (a) A postsecondary institution is eligible for state student aid under chapter 136A 4.12and sections 197.791 and 299A.45, if the institution is located in this state or in a state 4.13with which the office has entered into a higher education reciprocity agreement on state 4.14student aid programs that:4.15    (1) is operated by this state or the Board of Regents of the University of Minnesota; 4.16or4.17    (2) is operated privately and, as determined by the office, meets the requirements of 4.18paragraph (b).4.19    (b) A private institution must:4.20    (1) maintain academic standards substantially equivalent to those of comparable 4.21institutions operated in this state;4.22    (2) be licensed or registered as a postsecondary institution by the office; and4.23    (3)(i) by July 1, 2010, participate in the federal Pell Grant program under Title IV of 4.24the Higher Education Act of 1965, as amended; or4.25    (ii) if an institution was participating in state student aid programs as of June 30, 4.262010, and the institution did not participate in the federal Pell Grant program by June 30, 4.272010, the institution must require every student who enrolls to sign a disclosure form, 4.28provided by the office, stating that the institution is not participating in the federal Pell 4.29Grant program.4.30    (c) An institution that offers only graduate-level degrees or graduate-level nondegree 4.31programs, or that offers only degrees or programs that do not meet the required minimum 4.32program length to participate in the federal Pell Grant program, is an eligible institution if 4.33the institution is licensed or registered as a postsecondary institution by the office.4.34    (d) An eligible institution under paragraph (b), clause (3), item (ii), that changes 4.35ownership as defined in section 136A.63, subdivision 2, must participate in the federal 5.1Pell Grant program within four calendar years of the first ownership change to continue 5.2eligibility.5.3    (e) An institution that loses its eligibility for the federal Pell Grant program is not an 5.4eligible institution.5.5    Sec. 8. Minnesota Statutes 2008, section 136A.121, subdivision 6, is amended to read:5.6    Subd. 6. Cost of attendance. (a) The recognized cost of attendance consists of 5.7allowances specified in law for living and miscellaneous expenses, and an allowance 5.8for tuition and fees equal to the lesser of the average tuition and fees charged by the 5.9institution, or the tuition and fee maximums established in law, or for students at for-profit 5.10institutions, the average tuition and fee amount for public two-year institutions for a 5.11student in a two-year program or the average tuition and fee amount for a state university 5.12for students in four-year programs.5.13    (b) For a student registering for less than full time, the office shall prorate the cost of 5.14attendance to the actual number of credits for which the student is enrolled.5.15    (c) The recognized cost of attendance for a student who is confined to a Minnesota 5.16correctional institution shall consist of the tuition and fee component in paragraph (a), 5.17with no allowance for living and miscellaneous expenses.5.18    (d) For the purpose of this subdivision, "fees" include only those fees that are 5.19mandatory and charged to full-time resident students attending the institution. Fees do 5.20not include charges for tools, equipment, computers, or other similar materials where the 5.21student retains ownership. Fees include charges for these materials if the institution retains 5.22ownership. Fees do not include optional or punitive fees.5.23EFFECTIVE DATE.This section is effective for grants made beginning on July 5.241, 2010.5.25    Sec. 9. Minnesota Statutes 2008, section 136A.126, is amended by adding a 5.26subdivision to read:5.27    Subd. 5.Awarding procedure.(a) Complete applications are ranked in order of 5.28completion date. If there are multiple applications with identical completion dates, those 5.29applications are further sorted by application receipt date.5.30    (b) Awards must be made on a first-come, first-served basis in the order complete 5.31applications are received.5.32    (c) Awards are made to eligible students until the appropriation is expended.5.33    (d) Applicants not receiving a grant and for whom the office has received a 5.34completed application are placed on a waiting list in order of application completion date.6.1    Sec. 10. [136A.129] ONETIME GRANT FOR HIGH SCHOOL-TO-COLLEGE 6.2DEVELOPMENTAL TRANSITION PROGRAM.6.3(a) Within the limits of appropriations, a student who enrolls in a program under 6.4section 135A.61 is eligible for a onetime grant to help pay expenses to attend the program. 6.5The amount of the grant must be determined according to section 136A.121, subdivision 6.65, except as modified by paragraph (b). The requirement in 136A.121, subdivision 9a, 6.7that subtracts a federal Pell Grant award for which a student would be eligible, even if 6.8the student has exhausted the federal Pell Grant award, does not apply to a student who 6.9receives a grant under this subdivision in the award year in which the grant is received. 6.10The maximum grant under this subdivision must be reduced by the average amount a 6.11student would earn working in an on-campus work-study position for ten hours per 6.12week during a summer term. The office must determine an amount for student earnings 6.13in a summer term, using available data about earnings, before determining the amount 6.14awarded under this subdivision.6.15(b) For a student with an expected family contribution of zero, the maximum amount 6.16of the grant is the cost of attendance under section 136A.121, subdivision 6. 6.17(c) A grant under this subdivision counts as one of the eight semesters of eligibility 6.18under section 136A.121, subdivision 9. A grant under this subdivision must not be 6.19awarded for the same term for which another grant is awarded under this section. 6.20(d) Beginning in fiscal year 2012, up to $1,000,000 each year may be used for 6.21grants under this section.6.22    Sec. 11. [136A.1291] LEGISLATIVE NOTICE.6.23    The office shall notify the chairs of the legislative committees with primary 6.24jurisdiction over higher education finance of any proposed material change to the 6.25administration of any of the grant or financial aid programs in sections 136A.095 to 6.26136A.128.6.27    Sec. 12. Minnesota Statutes 2008, section 136A.15, subdivision 6, is amended to read:6.28    Subd. 6. Eligible institution. "Eligible institution" means a postsecondary 6.29educational institution that (1) is operated or regulated by this state or the Board of Regents 6.30of the University of Minnesota; (2) is operated publicly or privately in another state, is 6.31approved by the United States Secretary of Education, and, as determined by the office, 6.32maintains academic standards substantially equal to those of comparable institutions 6.33operated in this state; (3) is licensed or registered as a postsecondary institution by the 6.34office or another state agency; and (4) by July 1, 2011, is participating in the federal Pell 7.1Grant program under Title IV of the Higher Education Act of 1965, as amended. It also 7.2includes any institution chartered in a province an institution that meets the eligibility 7.3requirements under section 136A.155.7.4    Sec. 13. [136A.155] ADDITIONAL INSTITUTION ELIGIBILITY 7.5REQUIREMENTS.7.6    A postsecondary institution is an eligible institution for purposes of sections 7.7136A.15 to 136A.1702, if the institution:7.8    (1) meets the eligibility requirements under section 136A.103; or7.9    (2) is operated publicly or privately in another state, is approved by the United States 7.10Secretary of Education, and, as determined by the office, maintains academic standards 7.11substantially equal to those of comparable institutions operated in this state.7.12    Sec. 14. Minnesota Statutes 2008, section 136A.16, subdivision 14, is amended to read:7.13    Subd. 14. Notes. The office may sell at public or private sale, at the price or prices 7.14determined by the office, any note or other instrument or obligation evidencing or securing 7.15a loan made by the office or its predecessor, including the Minnesota Higher Education 7.16Coordinating Board and the Minnesota Higher Education Services Office.7.17    Sec. 15. Minnesota Statutes 2008, section 136A.62, subdivision 3, is amended to read:7.18    Subd. 3. School. "School" means: 7.19    (1) any partnership, company, firm, society, trust, association, corporation, or any 7.20combination thereof, which (i) is, owns, or operates a private, nonprofit postsecondary 7.21education institution; (ii) is, owns, or operates a private, for-profit postsecondary education 7.22institution; or (iii) provides a postsecondary instructional program or course leading to a 7.23degree whether or not for profit; 7.24    (2) any public or private postsecondary educational institution located in another 7.25state or country which offers or makes available to a Minnesota resident any course, 7.26program or educational activity which does not require the leaving of the state for its 7.27completion; or7.28    (3) any individual, entity, or postsecondary institution located in another state 7.29that contracts with any school located within the state of Minnesota for the purpose of 7.30providing educational programs, training programs, or awarding postsecondary credits 7.31or continuing education credits to Minnesota residents that may be applied to a degree 7.32program.8.1    Sec. 16. Minnesota Statutes 2008, section 136A.645, is amended to read:8.2136A.645 SCHOOL CLOSURE.8.3    (a) When a school decides to cease postsecondary education operations, it must 8.4cooperate with the office in assisting students to find alternative means to complete their 8.5studies with a minimum of disruption, and inform the office of the following:8.6    (1) the planned date for termination of postsecondary education operations;8.7    (2) the planned date for the transfer of the student records;8.8    (3) confirmation of the name and address of the organization to receive and hold 8.9the student records; and8.10    (4) the official at the organization receiving the student records who is designated to 8.11provide official copies of records or transcripts upon request.8.12    (b) Upon notice from a school of its intention to cease operations, the office shall 8.13notify the school of the date on which it must cease the enrollment of students and all 8.14postsecondary educational operations.8.15    Without limitation as to other circumstance, a school shall be deemed to have ceased 8.16operations when the school:8.17    (1) has an unscheduled nonemergency closure or cancellation of classes for more 8.18than 24 hours without prior notice to the office;8.19    (2) announces it is closed or closing; or 8.20    (3) files for bankruptcy.8.21    Sec. 17. Minnesota Statutes 2008, section 136A.646, is amended to read:8.22136A.646 ADDITIONAL SECURITY.8.23    (a) In the event any registered institution is notified by the United States Department 8.24of Education that it has fallen below minimum financial standards and that its continued 8.25participation in Title IV will be conditioned upon its satisfying either the Zone Alternative, 8.26Code of Federal Regulations, title 34, section 
         668.175, paragraph (f), or a Letter of Credit 8.27Alternative, Code of Federal Regulations, title 34, section 
         668.175, paragraph (c), the 8.28institution shall provide a surety bond conditioned upon the faithful performance of all 8.29contracts and agreements with students in a sum equal to the "letter of credit" required by 8.30the United States Department of Education in the Letter of Credit Alternative, but in no 8.31event shall such bond be less than $10,000 nor more than $250,000.8.32    (b) In lieu of a bond, the institution may deposit with the commissioner of finance:8.33    (1) a sum equal to the amount of the required surety bond in cash; or8.34    (2) securities, as may be legally purchased by savings banks or for trust funds, in an 8.35aggregate market value equal to the amount of the required surety bond.9.1    Sec. 18. [136F.08] CENTRAL SYSTEM OFFICE.9.2    Subdivision 1.Establishment.A central system office is established for the 9.3Minnesota State Colleges and Universities to provide central support to the institutions 9.4enrolling students and to assist the board in fulfilling its missions under section 136F.05. 9.5The central office must not assume responsibility for services that are most effectively 9.6and efficiently provided at the institution level. The central system office is under the 9.7direction of the chancellor.9.8    Subd. 2.General duties.The central system office must coordinate system level 9.9responsibilities for financial management, personnel management, facilities management, 9.10information technology, credit transfer, legal affairs, government relations, and auditing. 9.11The central system office shall coordinate its services with the services provided at the 9.12institution level so as not to duplicate any functions that are provided by institutions.9.13    Sec. 19. Minnesota Statutes 2009 Supplement, section 136F.98, subdivision 1, is 9.14amended to read:9.15    Subdivision 1. Issuance of bonds. The Board of Trustees of the Minnesota State 9.16Colleges and Universities or a successor may issue revenue bonds under sections 
         136F.90 9.17to 
         136F.97 whose aggregate principal amount at any time may not exceed $200,000,0009.18$275,000,000, and payable from the revenue appropriated to the fund established by 9.19section 
         136F.94, and use the proceeds together with other public or private money that 9.20may otherwise become available to acquire land, and to acquire, construct, complete, 9.21remodel, and equip structures or portions thereof to be used for dormitory, residence hall, 9.22student union, food service, parking purposes, or for any other similar revenue-producing 9.23building or buildings of such type and character as the board finds desirable for the good 9.24and benefit of the state colleges and universities. Before issuing the bonds or any part 9.25of them, the board shall consult with and obtain the advisory recommendations of the 9.26chairs of the house of representatives Ways and Means Committee and the senate Finance 9.27Committee about the facilities to be financed by the bonds.9.28    Sec. 20. Minnesota Statutes 2008, section 141.25, is amended by adding a subdivision 9.29to read:9.30    Subd. 2a.Refunds.If a contract is deemed unenforceable under subdivision 2, a 9.31school must refund tuition, fees, and other charges received from a student or on behalf 9.32of a student within 30 days of receiving written notification and demand for refund from 9.33the Minnesota Office of Higher Education.10.1    Sec. 21. Minnesota Statutes 2008, section 141.25, subdivision 7, is amended to read:10.2    Subd. 7. Minimum standards. A license shall be issued if the office first 10.3determines:10.4    (1) that the applicant has a sound financial condition with sufficient resources 10.5available to:10.6    (i) meet the school's financial obligations;10.7    (ii) refund all tuition and other charges, within a reasonable period of time, in the 10.8event of dissolution of the school or in the event of any justifiable claims for refund against 10.9the school by the student body;10.10    (iii) provide adequate service to its students and prospective students; and10.11    (iv) maintain and support the school;10.12    (2) that the applicant has satisfactory facilities with sufficient tools and equipment 10.13and the necessary number of work stations to prepare adequately the students currently 10.14enrolled, and those proposed to be enrolled;10.15    (3) that the applicant employs a sufficient number of qualified teaching personnel to 10.16provide the educational programs contemplated;10.17    (4) that the school has an organizational framework with administrative and 10.18instructional personnel to provide the programs and services it intends to offer;10.19    (5) that the premises and conditions under which the students work and study are 10.20sanitary, healthful, and safe, according to modern standards;10.21    (6) that the quality and content of each occupational course or program of study 10.22provides education and adequate preparation to enrolled students for entry level positions 10.23in the occupation for which prepared;10.24    (7) that the living quarters which are owned, maintained, recommended, or approved 10.25by the applicant for students are sanitary and safe;10.26    (8) that the contract or enrollment agreement used by the school complies with 10.27the provisions in section 
         141.265; 10.28    (9) that contracts and agreements do not contain a wage assignment provision or a 10.29confession of judgment clause; and10.30    (10) that there has been no adjudication of fraud or misrepresentation in any 10.31criminal, civil, or administrative proceeding in any jurisdiction against the school or its 10.32owner, officers, agents, or sponsoring organization.10.33    Sec. 22. Minnesota Statutes 2008, section 141.25, subdivision 13, is amended to read:10.34    Subd. 13.  Schools licensed by another state agency or board. A school required 10.35to obtain a private career school license due to the use of "academy," "institute," "college," 11.1or "university" in its name or licensed for the purpose of participating in state financial aid 11.2under chapter 136A, and which is also licensed by another state agency or board shall be 11.3required to satisfy only the requirements of subdivisions 3, clauses (1), (2), (3), (5), (7), 11.4and (10); 4; 5, paragraph (b), clause (2); 7, clauses (1) and (10); 8; 9, clause (13); and 12. 11.5    Sec. 23. Minnesota Statutes 2008, section 141.251, subdivision 2, is amended to read:11.6    Subd. 2. Conditions. The office shall adopt rules establishing the conditions for 11.7renewal of a license. The conditions shall permit two levels of renewal based on the record 11.8of the school. A school that has demonstrated the quality of its program and operation 11.9through longevity and performance in the state may renew its license based on a relaxed 11.10standard of scrutiny. A school that has been in operation in Minnesota for a limited period 11.11of time or that has not performed adequately on performance indicators shall renew its 11.12license based on a strict standard of scrutiny. The office shall specify minimum longevity 11.13standards and performance indicators that must be met before a school may be permitted 11.14to operate under the relaxed standard of scrutiny. The performance indicators used in this 11.15determination shall include, but not be limited to: degree granting status, regional or 11.16national accreditation, loan default rates, placement rate of graduates, student withdrawal 11.17rates, audit results, student complaints, and school status with the United States 11.18Department of Education. Schools that meet the requirements established in rule shall be 11.19required to submit a full relicensure report once every four years, and in the interim years 11.20will be exempt from the requirements of section 
         141.25, subdivision 3, clauses (4), (5), 11.21and (8), and Minnesota Rules, parts 4880.1700, subpart 6; and 4880.2100, subpart 4.11.22    Sec. 24. Minnesota Statutes 2008, section 141.28, subdivision 2, is amended to read:11.23    Subd. 2. Unlawful designation. No school organized after November 15, 1969, 11.24shall apply to itself either as a part of its name or in any other manner the designation of 11.25"college" or "university" unless such school applies for and receives certification from the 11.26office that it meets appropriate standards and is entitled to such designation. Operating 11.27schools now using such designation may continue use thereof.11.28    Sec. 25. Minnesota Statutes 2008, section 474A.04, subdivision 6, is amended to read:11.29    Subd. 6. Entitlement transfers. An entitlement issuer may enter into an agreement 11.30with another entitlement issuer whereby the recipient entitlement issuer issues obligations 11.31pursuant to bonding authority allocated to the original entitlement issuer under this 11.32section. An entitlement issuer may enter into an agreement with an issuer which is not 11.33an entitlement issuer whereby the recipient issuer issues qualified mortgage bonds, up to 12.1$100,000 of which are issued pursuant to bonding authority allocated to the original 12.2entitlement issuer under this section. The agreement may be approved and executed by the 12.3mayor of the entitlement issuer with or without approval or review by the city council.12.4Notwithstanding section 474A.091, subdivision 4, prior to December 1, the Minnesota 12.5Housing Finance Agency, Minnesota Office of Higher Education, and Minnesota Rural 12.6Finance Authority may transfer allocated bonding authority made available under this 12.7chapter to one another under an agreement by each agency and the commissioner.12.8    Sec. 26. Minnesota Statutes 2008, section 474A.091, subdivision 3, is amended to read:12.9    Subd. 3. Allocation procedure. (a) The commissioner shall allocate available 12.10bonding authority under this section on the Monday of every other week beginning with 12.11the first Monday in August through and on the last Monday in November. Applications 12.12for allocations must be received by the department by 4:30 p.m. on the Monday preceding 12.13the Monday on which allocations are to be made. If a Monday falls on a holiday, the 12.14allocation will be made or the applications must be received by the next business day 12.15after the holiday.12.16    (b) Prior to October 1, only the following applications shall be awarded allocations 12.17from the unified pool. Allocations shall be awarded in the following order of priority:12.18    (1) applications for residential rental project bonds;12.19    (2) applications for small issue bonds for manufacturing projects; and12.20    (3) applications for small issue bonds for agricultural development bond loan 12.21projects.12.22    (c) On the first Monday in October through the last Monday in November, 12.23allocations shall be awarded from the unified pool in the following order of priority:12.24    (1) applications for student loan bonds issued by or on behalf of the Minnesota 12.25Office of Higher Education;12.26    (2) applications for mortgage bonds;12.27    (3) applications for public facility projects funded by public facility bonds;12.28    (4) applications for small issue bonds for manufacturing projects;12.29    (5) applications for small issue bonds for agricultural development bond loan 12.30projects;12.31    (6) applications for residential rental project bonds;12.32    (7) applications for enterprise zone facility bonds;12.33    (8) applications for governmental bonds; and12.34    (9) applications for redevelopment bonds.13.1    (d) If there are two or more applications for manufacturing projects from the 13.2unified pool and there is insufficient bonding authority to provide allocations for all 13.3manufacturing projects in any one allocation period, the available bonding authority shall 13.4be awarded based on the number of points awarded a project under section 
         474A.04513.5with those projects receiving the greatest number of points receiving allocation first. If 13.6two or more applications for manufacturing projects receive an equal amount of points, 13.7available bonding authority shall be awarded by lot unless otherwise agreed to by the 13.8respective issuers. 13.9    (e) If there are two or more applications for enterprise zone facility projects from 13.10the unified pool and there is insufficient bonding authority to provide allocations for 13.11all enterprise zone facility projects in any one allocation period, the available bonding 13.12authority shall be awarded based on the number of points awarded a project under section 13.13474A.045
          with those projects receiving the greatest number of points receiving allocation 13.14first. If two or more applications for enterprise zone facility projects receive an equal 13.15amount of points, available bonding authority shall be awarded by lot unless otherwise 13.16agreed to by the respective issuers. 13.17    (f) If there are two or more applications for residential rental projects from the 13.18unified pool and there is insufficient bonding authority to provide allocations for all 13.19residential rental projects in any one allocation period, the available bonding authority 13.20shall be awarded in the following order of priority: (1) projects that preserve existing 13.21federally subsidized housing; (2) projects that are not restricted to persons who are 55 13.22years of age or older; and (3) other residential rental projects.13.23    (g) From the first Monday in August through the last Monday in November, 13.24$20,000,000 of bonding authority or an amount equal to the total annual amount of 13.25bonding authority allocated to the small issue pool under section 
         474A.03, subdivision 1, 13.26less the amount allocated to issuers from the small issue pool for that year, whichever is 13.27less, is reserved within the unified pool for small issue bonds to the extent such amounts 13.28are available within the unified pool. 13.29    (h) The total amount of allocations for mortgage bonds from the housing pool and 13.30the unified pool may not exceed:13.31    (1) $10,000,000 for any one city; or13.32    (2) $20,000,000 for any number of cities in any one county.13.33    (i) The total amount of allocations for student loan bonds from the unified pool may 13.34not exceed $10,000,000 $25,000,000 per year.13.35    (j) If there is insufficient bonding authority to fund all projects within any qualified 13.36bond category other than enterprise zone facility projects, manufacturing projects, and 14.1residential rental projects, allocations shall be awarded by lot unless otherwise agreed to 14.2by the respective issuers.14.3    (k) If an application is rejected, the commissioner must notify the applicant and 14.4return the application deposit to the applicant within 30 days unless the applicant requests 14.5in writing that the application be resubmitted.14.6    (l) The granting of an allocation of bonding authority under this section must be 14.7evidenced by issuance of a certificate of allocation.14.8    Sec. 27. Laws 2010, chapter 215, article 2, section 4, subdivision 3, is amended to read:

14.9Subd. 3.Operations and Maintenance-0-(9,967,000)

14.10For fiscal years 2012 and 2013, the base for 14.11operations and maintenance is $592,792,00014.12$580,802,000  each year.14.13    Sec. 28. Laws 2010, chapter 215, article 2, section 6, the effective date, is amended to 14.14read:14.15EFFECTIVE DATE.This section is effective the day following final enactment, 14.16for grant awards beginning July 1, 2010.14.17    Sec. 29. STUDY OF CERTIFICATES AND DIPLOMAS; EDUCATIONAL 14.18CAREER PATH.14.19    The Board of Trustees of the Minnesota State Colleges and Universities, in 14.20conjunction with the Minnesota Chamber of Commerce, representatives of industry 14.21groups, and labor unions, shall study the program requirements for certificates and 14.22diplomas awarded by the Minnesota State Colleges and Universities to determine the 14.23feasibility of designing technical education programs to allow students to have more 14.24opportunities to earn credentials with lower credit requirements that could be combined 14.25into higher level certificates or diplomas. The study must consult with business and 14.26industry representatives as well as labor unions and faculty on the types of credentials that 14.27would be recognized for employment purposes. In addition, the study must address the 14.28feasibility of increasing the capacity to accumulate credentials in related programs into 14.29an educational career path leading to a diploma or degree. The study must also address 14.30the need for workers in other fields and take into account other job training programs 14.31provided by labor unions and business.15.1    The board must report the study findings to the committees of the legislature with 15.2responsibility for postsecondary education finance by February 15, 2011.15.3    Sec. 30. STREAMLINED MINNESOTA STATE COLLEGES AND 15.4UNIVERSITIES SYSTEM OFFICE.15.5    Notwithstanding any law or policy to the contrary, the Board of Trustees of the 15.6Minnesota State Colleges and Universities shall streamline services provided through 15.7the system's central service office to reduce expenditures, better target the use of state 15.8resources, and provide services at the most appropriate and efficient level so as not 15.9to duplicate any services provided at the institutional level. These actions must be 15.10implemented so as to achieve budgetary savings and efficiencies in delivery of services 15.11and the accomplishment of the academic mission. The board must revise any board 15.12policies in a way that is consistent with the requirements of this section.15.13    Sec. 31. CREDIT TRANSFER; MINNESOTA STATE COLLEGES AND 15.14UNIVERSITIES.15.15    (a) The Board of Trustees of the Minnesota State Colleges and Universities must 15.16develop and implement a plan to improve credit transfers within the system. At a 15.17minimum, the board must:15.18    (1) enhance the availability of easily used information on transferring and tracking 15.19credits;15.20    (2) improve training for all staff involved with credit transfer;15.21    (3) identify barriers to transferring credits including intellectual property issues for 15.22faculty and devise methods to eliminate these barriers; and15.23    (4) identify discrepancies in the treatment of transferring and accepting credits 15.24by various institutions within the system and devise methods to improve the uniform 15.25treatment of credit transfers.15.26    (b) The board must convene working groups of affected faculty, staff, and 15.27administrators representing institutions and academic and technical disciplines in the 15.28system to work on issues and barriers to credit transfer. The purpose of the working 15.29groups is to develop specific actions that will remove any barriers to credit transfer and to 15.30improve the ease and transparency of credit transfer for students.15.31    (c) The board must report to the legislature by January 15, 2012, on the plans for and 15.32progress towards improvements in the transfer of credits. Any proposal to develop and 15.33implement a mandatory or voluntary common course numbering system for the Minnesota 16.1State Colleges and Universities must not be required until after the receipt of the report 16.2under this section.16.3    Sec. 32. POSTRETIREMENT HEALTH INSURANCE PREMIUM 16.4REIMBURSEMENT.16.5    The Minnesota State Colleges and Universities system shall waive premium 16.6reimbursement payments including any late payment charges, fees, penalties, or interest 16.7payments imposed on overdue health insurance premium reimbursements owed by a 16.8college retiree to the college under a contractual or collective bargaining agreement 16.9providing for postretirement health insurance benefits arising from employment under 16.10a contract or collective bargaining agreement with a school district or technical college 16.11prior to July 1, 1995, and who became an employee of Minnesota State Colleges and 16.12Universities on July 1, 1995. This section applies only if the college has failed to bill 16.13the retiree for the premium reimbursement payments as required under the applicable 16.14collective bargaining or contractual agreement, or if not otherwise established, within 90 16.15days following the date on which the premium was due.16.16EFFECTIVE DATE.This section is effective July 1, 2010.16.17    Sec. 33. PILOT PROJECT; LOCAL DEPOSIT OF RESERVES OF 16.18MINNESOTA STATE COLLEGES AND UNIVERSITIES.16.19    Subdivision 1.Establishment.To increase the distribution of potential economic 16.20benefit of deposits of reserve funds of the institutions of the Minnesota State Colleges and 16.21Universities, a pilot project is established to transfer certain reserve deposits of selected 16.22institutions from the state treasury to a community financial institution. Notwithstanding 16.23Minnesota Statutes, section 16A.27, by December 31, 2010, the commissioner of 16.24management and budget shall transfer the designated amount of board-required reserve 16.25funds of colleges and universities selected by the Board of Trustees under subdivision 16.262, to a community financial institution designated for each of the participating colleges 16.27and universities.16.28    Subd. 2.Participating colleges and universities.By August 15, 2010, colleges 16.29and universities must apply to the Board of Trustees of the Minnesota State Colleges and 16.30Universities for participation in the pilot project. Each applicant must designate one or 16.31more community financial institutions for the deposit of board-required reserves with the 16.32terms of the deposit for each designated community financial institution. The designated 16.33community financial institution must be located in the geographic area of a participating 16.34campus. From the applicants, the board shall select up to eight postsecondary institutions 17.1to participate in the local deposit pilot project. In making its selection, the board must 17.2consider the size of the institution's reserves and the terms offered by the designated 17.3community financial institutions. Two-year and four-year institutions must be selected 17.4to participate in the pilot project and the majority of the selected institutions must be 17.5located in greater Minnesota.17.6    By December 1, 2010, the board must notify the commissioner of management 17.7and budget of the participating colleges and universities and the associated community 17.8financial institutions.17.9    Subd. 3.Community financial institution.As used in this section, "community 17.10financial institution" means a federally insured bank or credit union, chartered as a bank 17.11or credit union by the state of Minnesota or the United States, that is headquartered in 17.12Minnesota and that has no more than $2,500,000,000 in assets.17.13    Subd. 4.Evaluation and report.The commissioner of management and budget and 17.14the Board of Trustees shall independently evaluate the effectiveness or harm of the local 17.15deposit pilot project in increasing the use of community financial institutions and providing 17.16wider distribution of the economic benefit of the deposit of postsecondary reserves. Each 17.17evaluation must include the participating colleges, universities, and community financial 17.18institutions. The commissioner and the board shall report the results of the pilot project 17.19evaluation to the appropriate committees of the legislature by December 1, 2011, with 17.20recommendations on the future implementation of the pilot project.17.21    Sec. 34. APPROPRIATION REDUCTIONS.17.22    Any reduction in appropriations for the biennium ending June 30, 2011, for the 17.23central system office of the Minnesota State Colleges and Universities must not be passed 17.24through to any institution or campus. The Board of Trustees of the Minnesota State 17.25Colleges and Universities must not charge any institution for appropriation reductions 17.26made to the central office.17.27    Sec. 35. UNIVERSITY MAYO PARTNERSHIP.17.28    Any reductions to the University of Minnesota for operations and maintenance 17.29in fiscal year 2011 must not be allocated to the University of Minnesota and Mayo 17.30Foundation Partnership.17.31    Sec. 36.  REPEALER.17.32Minnesota Statutes 2009 Supplement, section 136A.121, subdivision 9b, is repealed.