1.1 	A bill for an act
1.2 	relating to state government operations; streamlining state government; 
1.3 	abolishing the Department of Employment and Economic Development and the 
1.4 	Department of Labor and Industry; establishing a process to reorganize delivery 
1.5 	of their services and performance of their functions; requiring establishment of 
1.6 	an employee participation committee before agency restructuring; requiring 
1.7 	reports; providing for taxpayer accountability;proposing coding for new law 
1.8 	in Minnesota Statutes, chapter 16C.
1.9 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.10 	ARTICLE 1
1.11 	GOVERNMENT EFFICIENCY REORGANIZATION

1.12 	Section 1. REORGANIZATION; GOALS.
 1.13 	The legislature finds that it is desirable to reorganize state services relating to 
1.14 	business and employment to achieve the following goals:
1.15 	(1) sustainable economic development throughout all regions of the state and all 
1.16 	sectors of the economy to ensure the economic well-being of the state's residents;
1.17 	(2) growth of the economy of this state that consistently exceeds the national average;
1.18 	(3) improved delivery of services, including greater efficiency and transparency;
1.19 	(4) citizen participation in all relevant decision-making processes and at meaningful 
1.20 	points in the processes;
1.21 	(5) best position the state, its workforce, its business community, and its educational 
1.22 	system to meet the needs of a competitive, global, and dynamic economy;
1.23 	(6) optimal coordination between the state's postsecondary higher education 
1.24 	institutions and industry; 
2.1 	(7) streamline state government, including elimination of at least one state 
2.2 	department; and
2.3 	(8) increased productivity of the work force given the expected shortage of labor to 
2.4 	remain competitive and successful in the world economy.

2.5 	Sec. 2. REORGANIZATION; OUTCOMES.
 2.6 	Reorganization must achieve the following outcomes:
2.7 	(1) increased citizen access to pertinent, understandable information relating to 
2.8 	business and employment;
2.9 	(2) better citizen representation, access, and information through an office of public 
2.10 	information and advocacy;
2.11 	(3) decentralization of the service delivery system combined with one-stop offering 
2.12 	of related services for the benefit of citizens of the state as consumers of services and 
2.13 	as persons who are subject to regulation;
2.14 	(4) flattening the internal organization of the delivery system with processes designed 
2.15 	to encourage cooperation, consensus, and participation of management and workers; 
2.16 	(5) the capacity to identify and capture cost savings where those savings can be made 
2.17 	without reducing the ability to implement the state's business and employment policy; 
2.18 	(6) the flexibility to enable state and local governments to coordinate and cooperate 
2.19 	as well as identify and address existing and emerging business and employment issues of 
2.20 	state, national, and international import; 
2.21 	(7) an increased use of performance-based employment measures to ensure the 
2.22 	effective use of state dollars;
2.23 	(8) increased accountability by reducing the number of executive administrators 
2.24 	reporting directly to the governor through a variety of strategies, including elimination 
2.25 	of at least one state department;
2.26 	(9) a commitment to adequate staff development resources sufficient to implement 
2.27 	the reorganization;
2.28 	(10) increased consumer satisfaction with state services, including licensing and 
2.29 	compliance investigations;
2.30 	(11) increased employment, especially in high-wage industries projected to expand 
2.31 	in Minnesota;
2.32 	(12) reduction in labor shortages in high-wage industries;
2.33 	(13) increased business development support, including numbers of start-up 
2.34 	companies with survival rates beyond five years;
2.35 	(14) reduced workplace injuries; 
3.1 	(15) increased development of businesses in emerging sectors, such as bioscience 
3.2 	and other green-economy-related businesses; and
3.3 	(16) appropriate use of priority-based budgeting.

3.4 	Sec. 3. REORGANIZATION; PROCESS.
 3.5 		Subdivision 1.Working groups. (a) Within 60 days after the effective date of 
3.6 	this section, the Management Analysis Division of the Department of Management and 
3.7 	Budget shall provide a facilitator or facilitators who shall convene each of the following 
3.8 	working groups: 
3.9 	(1) a working group consisting of ten to 15 persons from agencies listed in section 5 
3.10 	who are members of the managerial plan established under Minnesota Statutes, section 
3.11 	43A.18, subdivision 3, appointed by the governor within 30 days after the effective date 
3.12 	of this section; 
3.13 	(2) a working group consisting of employees from agencies listed in section 5 who 
3.14 	are represented by exclusive representatives, selected by the exclusive representatives of 
3.15 	employees of those agencies within 30 days after the effective date of this section; 
3.16 	(3) a working group consisting of up to ten persons appointed by the speaker of 
3.17 	the house and up to ten persons appointed by the Subcommittee on Committees of the 
3.18 	Committee on Rules and Administration of the senate, including at least one person 
3.19 	appointed by each appointing authority in each of the following categories:
3.20 	(i) a representative of labor unions;
3.21 	(ii) a representative of business;
3.22 	(iii) a representative of an institution of higher education with expertise in vocational 
3.23 	training;
3.24 	(iv) a representative of an institution of higher education with expertise in career 
3.25 	training;
3.26 	(v) an attorney experienced in workers' compensation law;
3.27 	(vi) a member of the financial consulting community; 
3.28 	(vii) a member of the employee placement community; and
3.29 	(viii) a representative of a provider of employment services to disabled workers.
3.30 	Organizations, occupations, and industries described in clause (3) may submit 
3.31 	the names of persons they wish considered for appointment to a working group to the 
3.32 	appointing authorities. The appointing authorities under this clause must complete their 
3.33 	appointments within 30 days after the effective date of this section.
3.34 	(b) Members of the working groups established in paragraph (a) shall serve as 
3.35 	partners in changing the delivery of state services and the performance of state functions. 
4.1 	Each working group shall initially meet separately to develop its own recommendations 
4.2 	for a governmental structure to perform the functions and provide the services affected by 
4.3 	section 5 in furtherance of the outcomes listed in section 2.  A facilitator shall assist each 
4.4 	group.  Each group must complete its recommendations by October 1, 2010.
4.5 		Subd. 2.Joint committee. (a) By September 1, 2010, each working group shall 
4.6 	select from its membership representatives to a joint committee, as follows: 
4.7 	(1) two representatives from the working group established by subdivision 1, 
4.8 	paragraph (a), clause (1); 
4.9 	(2) three representatives from the working group established by subdivision 1, 
4.10 	paragraph (a), clause (2); and 
4.11 	(3) five representatives from the working group established by subdivision 1, 
4.12 	paragraph (a), clause (3), who must be private citizens. 
4.13 	(b) The facilitator or facilitators shall convene the first meeting of the joint 
4.14 	committee by October 1, 2010. The joint committee shall develop a recommendation for 
4.15 	a governmental structure to perform the functions and provide the services affected by 
4.16 	section 5 in furtherance of the goals and outcomes listed in sections 1 and 2, including 
4.17 	ways to measure and track performances on the outcomes established in section 2.  The 
4.18 	recommendation must address ways to obtain input from local and regional governmental 
4.19 	units in order to achieve the coordinated and cooperative outcomes required by section 
4.20 	2. The speaker of the house and the Subcommittee on Committees of the Committee on 
4.21 	Rules and Administration of the senate may provide legislative staff support to the joint 
4.22 	committee upon its request. A facilitator provided by the management analysis division 
4.23 	shall chair meetings of the joint committee and serve as a nonvoting member. The joint 
4.24 	committee shall submit its recommendation for reorganization, including draft legislation, 
4.25 	to the governor and the chairs and ranking minority members of the legislative committees 
4.26 	and divisions with jurisdiction over state government and economic development policy 
4.27 	and finance by January 15, 2011. 
4.28 	(c) The joint committee expires after submission of the report.

4.29 	Sec. 4. EMPLOYEE PARTICIPATION COMMITTEE.
 4.30 	(a) By July 1, 2010, exclusive representatives of state employees and agency heads 
4.31 	of the agencies listed in section 5 shall establish a committee that includes representatives 
4.32 	of state employees and employers within each affected agency. Members of the committee 
4.33 	may also serve as members of the working groups created by section 3. Each exclusive 
4.34 	representative of employees shall select a committee member from each of its bargaining 
4.35 	units in each affected agency. The head of each agency shall select an employee member 
5.1 	from each unit of employees not represented by an exclusive representative. The agency 
5.2 	head shall also appoint one or more committee members to represent the agency. The 
5.3 	number of members appointed by the agency head, however, may not exceed the total 
5.4 	number of members representing bargaining units. 
5.5 	(b) The committee established under paragraph (a) shall: 
5.6 	(1) identify tasks related to agency reorganization and adopt plans for addressing 
5.7 	those tasks; 
5.8 	(2) identify other employer and employee issues related to reorganization and adopt 
5.9 	plans for addressing those issues; 
5.10 	(3) adopt detailed plans for providing retraining for affected employees; and 
5.11 	(4) guide the implementation of the reorganization.
5.12 	(c) The committee must submit a copy of its plans by January 15, 2011, to the 
5.13 	affected commissioners and to the chairs and ranking minority members of the legislative 
5.14 	committees with primary policy jurisdiction over state government.
5.15 	(d) The committee expires after submission of the plans required under paragraph (c).

5.16 	Sec. 5. ABOLITION OF AGENCIES, POWERS, AND DUTIES.
 5.17 		Subdivision 1.Agencies. The Departments of Employment and Economic 
5.18 	Development and Labor and Industry are abolished.
5.19 		Subd. 2.Collective bargaining agreements. Nothing in this section abrogates 
5.20 	or modifies any rights of affected employees under terms of an agreement between an 
5.21 	exclusive bargaining representative and the state or one of its appointing authorities.

5.22 	Sec. 6. BUDGET FOR NEXT BIENNIUM.
 5.23 	In preparing a proposed budget for the biennium beginning July 1, 2011, the 
5.24 	governor shall include an amount to cover the functions performed and services provided 
5.25 	by the agencies abolished in section 5, subdivision 1. The amount allocated for those 
5.26 	functions and services must be at least equal to the amount appropriated for those 
5.27 	functions and services in fiscal years 2010 and 2011, adjusted for inflation as measured by 
5.28 	the Consumer Price Index for Urban Wage Earners and Clerical Workers all items index 
5.29 	published by the Bureau of Labor Statistics of the United States Department of Labor. The 
5.30 	budget must include an amount for staff development according to Minnesota Statutes, 
5.31 	section 43A.045, and a substantial increase in overall expenditures for staff development. 
5.32 	The budget must not require the layoff of classified employees or unclassified employees 
5.33 	covered by a collective bargaining agreement except as provided in a plan negotiated 
5.34 	under Minnesota Statutes, chapter 179A, that provides options to layoff for employees 
6.1 	who would be affected. The governor's budget proposal must give due consideration to 
6.2 	the reorganization recommendations submitted by the joint committee under section 3.

6.3 	Sec. 7. MANAGERIAL POSITION REDUCTIONS.
 6.4 	In anticipation of the reorganization required by this article, the commissioners of 
6.5 	employment and economic development and labor and industry must reduce the number of 
6.6 	deputy commissioners, assistant commissioners, and positions designated as unclassified 
6.7 	under authority of Minnesota Statutes, section 43A.08, subdivision 1a. The amount of 
6.8 	money saved in fiscal year 2011 due to the position reductions must be at least sufficient to 
6.9 	offset any costs of the reorganization in fiscal year 2011. Any additional savings due to 
6.10 	the position reductions must be redirected to other purposes within the reorganized agency 
6.11 	so that the net cost to the state of the reorganization is zero.

6.12 	Sec. 8. EFFECTIVE DATE.
 6.13 	(a) Sections 1 to 4, 6, and 7 are effective the day following final enactment.
6.14 	(b) Section 5 is effective July 1, 2011. The effective date of section 5, subdivision 1, 
6.15 	is based on the assumption that the 2011 legislature will act on the recommendations made 
6.16 	by the joint committee under section 4 and that legislation will be enacted transferring the 
6.17 	responsibilities of the agencies abolished in section 5, subdivision 1.

6.18 	ARTICLE 2
6.19 	TAXPAYERS ACCOUNTABILITY ACT

6.20 	Section 1. [16C.051] REQUIREMENTS FOR CONTRACTS OVER $100,000.
6.21 		Subdivision 1.Application. This section applies to a contract with an estimated 
6.22 	value of $100,000 or more. The requirements imposed by this section are in addition 
6.23 	to, and do not supersede, the requirements of any other applicable section of law. This 
6.24 	section does not apply to a Department of Transportation contract that is subject to 
6.25 	section 161.3203.
6.26 		Subd. 2.Required review.  (a) Before entering into a contract subject to this section, 
6.27 	the agency head must prepare a comprehensive written estimate of the cost of having the 
6.28 	same work provided in the most cost-effective manner by agency employees. The cost 
6.29 	estimate must include all costs of having agency employees provide the work, including 
6.30 	the cost of pension, insurance, and all other employee benefits. The cost estimate is 
6.31 	nonpublic data, as defined in section 13.02, subdivision 9, until the day after the deadline 
6.32 	for receipt of responses under paragraph (b).
7.1 	(b) After soliciting and receiving responses, the contracting agency shall prepare 
7.2 	a comprehensive written estimate of the cost of the highest scoring proposal or lowest 
7.3 	cost bid based on the designated responder's response, including costs associated with 
7.4 	monitoring the proposed contract. If the designated responder proposes to perform any 
7.5 	or all of the desired services outside the state, the contracting agency shall include in 
7.6 	the cost estimate, as nearly as possible, any loss of sales and income tax revenue to the 
7.7 	state. The cost estimate must not include trade secret data that is classified as nonpublic 
7.8 	data under section 13.37, subdivision 2.
7.9 	(c) An agency may not enter into a contract subject to this section unless the agency 
7.10 	head determines that: 
7.11 	(1) the cost estimated under paragraph (b) will be lower than the cost estimated 
7.12 	under paragraph (a); 
7.13 	(2) the quality of the work to be provided by the designated responder is likely to 
7.14 	equal or exceed the quality of services that could be provided by state employees;
7.15 	(3) the contract, together with other contracts to which the agency is or has been a 
7.16 	party, will not violate section 16C.08 or 16C.09, or otherwise reduce full-time equivalent 
7.17 	positions within the agency; and 
7.18 	(4) the proposed contract is in the public interest.
7.19 		Subd. 3.Reports. The commissioner must electronically report to the chairs and 
7.20 	ranking minority members of the legislative committees with jurisdiction over finance by 
7.21 	January 15 each year, in compliance with sections 3.195 and 3.197, on implementation of 
7.22 	this section. The report must list all contracts subject to this section that were executed or 
7.23 	performed, whether wholly or in part, in the previous fiscal year. The report must identify, 
7.24 	with respect to each contract: the contractor; contract amount; duration; work, provided or 
7.25 	to be provided; the comprehensive estimate derived under subdivision 2, paragraph (a); 
7.26 	the comprehensive estimate derived under subdivision 2, paragraph (b); the actual cost to 
7.27 	the agency of the contractor's performance of the contract; and a statement containing the 
7.28 	agency head's determinations under subdivision 2, paragraph (c). 
7.29 		Subd. 4.Short title. This section may be cited as the "Taxpayers Accountability 
7.30 	Act."