1.1 	A bill for an act
1.2 	relating to education finance; adjusting the current year aid payment percentage; 
1.3 	adjusting the current year special education aid estimated entitlement percentage;
1.4 	amending Minnesota Statutes 2014, sections 16A.152, subdivision 2; 124D.11, 
1.5 	subdivision 9; 127A.45, subdivisions 2, 13.
1.6 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.7 	Section 1. Minnesota Statutes 2014, section 16A.152, subdivision 2, is amended to read:
1.8 		Subd. 2.Additional revenues; priority. (a) If on the basis of a forecast of general 
1.9 	fund revenues and expenditures, the commissioner of management and budget determines 
1.10 	that there will be a positive unrestricted budgetary general fund balance at the close of 
1.11 	the biennium, the commissioner of management and budget must allocate money to the 
1.12 	following accounts and purposes in priority order:
1.13 	(1) the cash flow account established in subdivision 1 until that account reaches 
1.14 	$350,000,000;
1.15 	(2) the budget reserve account established in subdivision 1a until that account 
1.16 	reaches $810,992,000;
1.17 	(3) the amount necessary to increase the aid payment schedule for school district 
1.18 	aids and credits payments in section 127A.45 to not more than 90 95 percent rounded 
1.19 	to the nearest tenth of a percent without exceeding the amount available and with any 
1.20 	remaining funds deposited in the budget reserve; and
1.21 	(4) the amount necessary to restore all or a portion of the net aid reductions under 
1.22 	section 127A.441 and to reduce the property tax revenue recognition shift under section 
1.23 	123B.75, subdivision 5, by the same amount.
1.24 	(b) The amounts necessary to meet the requirements of this section are appropriated 
1.25 	from the general fund within two weeks after the forecast is released or, in the case of 
2.1 	transfers under paragraph (a), clauses (3) and (4), as necessary to meet the appropriations 
2.2 	schedules otherwise established in statute.
2.3 	(c) The commissioner of management and budget shall certify the total dollar 
2.4 	amount of the reductions under paragraph (a), clauses (3) and (4), to the commissioner of 
2.5 	education. The commissioner of education shall increase the aid payment percentage and 
2.6 	reduce the property tax shift percentage by these amounts and apply those reductions to 
2.7 	the current fiscal year and thereafter.

2.8 	Sec. 2. Minnesota Statutes 2014, section 124D.11, subdivision 9, is amended to read:
2.9 		Subd. 9.Payment of aids to charter schools. (a) Notwithstanding section 
2.10 	127A.45, subdivision 3, if the current year aid payment percentage under section 
2.11 	127A.45, subdivision 2, paragraph (d), is 90 95 or greater, aid payments for the current 
2.12 	fiscal year to a charter school shall be of an equal amount on each of the 24 payment 
2.13 	dates. Notwithstanding section 127A.45, subdivision 3, if the current year aid payment 
2.14 	percentage under section 127A.45, subdivision 2, paragraph (d), is less than 90 95, aid 
2.15 	payments for the current fiscal year to a charter school shall be of an equal amount on 
2.16 	each of the 16 payment dates in July through February.
2.17 	(b) Notwithstanding paragraph (a) and section 127A.45, for a charter school ceasing 
2.18 	operation on or prior to June 30 of a school year, for the payment periods occurring after 
2.19 	the school ceases serving students, the commissioner shall withhold the estimated state aid 
2.20 	owed the school. The charter school board of directors and authorizer must submit to the 
2.21 	commissioner a closure plan under chapter 308A or 317A, and financial information about 
2.22 	the school's liabilities and assets. After receiving the closure plan, financial information, 
2.23 	an audit of pupil counts, documentation of lease expenditures, and monitoring of special 
2.24 	education expenditures, the commissioner may release cash withheld and may continue 
2.25 	regular payments up to the current year payment percentages if further amounts are 
2.26 	owed. If, based on audits and monitoring, the school received state aid in excess of the 
2.27 	amount owed, the commissioner shall retain aid withheld sufficient to eliminate the aid 
2.28 	overpayment. For a charter school ceasing operations prior to, or at the end of, a school 
2.29 	year, notwithstanding section 127A.45, subdivision 3, preliminary final payments may 
2.30 	be made after receiving the closure plan, audit of pupil counts, monitoring of special 
2.31 	education expenditures, documentation of lease expenditures, and school submission of 
2.32 	Uniform Financial Accounting and Reporting Standards (UFARS) financial data for the 
2.33 	final year of operation. Final payment may be made upon receipt of audited financial 
2.34 	statements under section 123B.77, subdivision 3.
3.1 	(c) If a charter school fails to comply with the commissioner's directive to return, 
3.2 	for cause, federal or state funds administered by the department, the commissioner may 
3.3 	withhold an amount of state aid sufficient to satisfy the directive.
3.4 	(d) If, within the timeline under section 471.425, a charter school fails to pay the state 
3.5 	of Minnesota, a school district, intermediate school district, or service cooperative after 
3.6 	receiving an undisputed invoice for goods and services, the commissioner may withhold 
3.7 	an amount of state aid sufficient to satisfy the claim and shall distribute the withheld 
3.8 	aid to the interested state agency, school district, intermediate school district, or service 
3.9 	cooperative. An interested state agency, school district, intermediate school district, or 
3.10 	education cooperative shall notify the commissioner when a charter school fails to pay an 
3.11 	undisputed invoice within 75 business days of when it received the original invoice.
3.12 	(e) Notwithstanding section 127A.45, subdivision 3, and paragraph (a), 80 percent 
3.13 	of the start-up cost aid under subdivision 8 shall be paid within 45 days after the first day 
3.14 	of student attendance for that school year.
3.15 	(f) In order to receive state aid payments under this subdivision, a charter school in 
3.16 	its first three years of operation must submit a school calendar in the form and manner 
3.17 	requested by the department and a quarterly report to the Department of Education. The 
3.18 	report must list each student by grade, show the student's start and end dates, if any, 
3.19 	with the charter school, and for any student participating in a learning year program, 
3.20 	the report must list the hours and times of learning year activities. The report must be 
3.21 	submitted not more than two weeks after the end of the calendar quarter to the department. 
3.22 	The department must develop a Web-based reporting form for charter schools to use 
3.23 	when submitting enrollment reports. A charter school in its fourth and subsequent year of 
3.24 	operation must submit a school calendar and enrollment information to the department in 
3.25 	the form and manner requested by the department.
3.26 	(g) Notwithstanding sections 317A.701 to 317A.791, upon closure of a charter 
3.27 	school and satisfaction of creditors, cash and investment balances remaining shall be 
3.28 	returned to the state.
3.29 	(h) A charter school must have a valid, signed contract under section 124D.10, 
3.30 	subdivision 6, on file at the Department of Education at least 15 days prior to the date of 
3.31 	first payment of state aid for the fiscal year.
3.32 	(i) State aid entitlements shall be computed for a charter school only for the portion of 
3.33 	a school year for which it has a valid, signed contract under section 124D.10, subdivision 6.

3.34 	Sec. 3. Minnesota Statutes 2014, section 127A.45, subdivision 2, is amended to read:
4.1 		Subd. 2.Definitions. (a) "Other district receipts" means payments by county 
4.2 	treasurers pursuant to section 276.10, apportionments from the school endowment fund 
4.3 	pursuant to section 127A.33, apportionments by the county auditor pursuant to section 
4.4 	127A.34, subdivision 2, and payments to school districts by the commissioner of revenue 
4.5 	pursuant to chapter 298.
4.6 	(b) "Cumulative amount guaranteed" means the product of
4.7 	(1) the cumulative disbursement percentage shown in subdivision 3; times
4.8 	(2) the sum of
4.9 	(i) the current year aid payment percentage of the estimated aid and credit 
4.10 	entitlements paid according to subdivision 13; plus
4.11 	(ii) 100 percent of the entitlements paid according to subdivisions 11 and 12; plus
4.12 	(iii) the other district receipts.
4.13 	(c) "Payment date" means the date on which state payments to districts are made 
4.14 	by the electronic funds transfer method. If a payment date falls on a Saturday, a Sunday, 
4.15 	or a weekday which is a legal holiday, the payment shall be made on the immediately 
4.16 	preceding business day. The commissioner may make payments on dates other than 
4.17 	those listed in subdivision 3, but only for portions of payments from any preceding 
4.18 	payment dates which could not be processed by the electronic funds transfer method due 
4.19 	to documented extenuating circumstances.
4.20 	(d) The current year aid payment percentage equals 90 in fiscal year 2015 and 95 in 
4.21 	fiscal year 2016 and later.

4.22 	Sec. 4. Minnesota Statutes 2014, section 127A.45, subdivision 13, is amended to read:
4.23 		Subd. 13.Aid payment percentage. Except as provided in subdivisions 11, 12, 
4.24 	12a, and 14, each fiscal year, all education aids and credits in this chapter and chapters 
4.25 	120A, 120B, 121A, 122A, 123A, 123B, 124D, 125A, 125B, 126C, 134, and section 
4.26 	273.1392, shall be paid at the current year aid payment percentage of the estimated 
4.27 	entitlement during the fiscal year of the entitlement. For the purposes of this subdivision, a 
4.28 	district's estimated entitlement for special education aid under section 125A.76 for fiscal 
4.29 	year 2014 and later equals 97.4 percent of the district's entitlement for the current fiscal 
4.30 	year. The final adjustment payment, according to subdivision 9, must be the amount of 
4.31 	the actual entitlement, after adjustment for actual data, minus the payments made during 
4.32 	the fiscal year of the entitlement.