1.1 	A bill for an act
1.2 	relating to economic development; making various policy changes; modifying 
1.3 	agency programs; modifying the commissioner's promotional authority; 
1.4 	modifying workforce development outcomes; creating the Workforce 
1.5 	Development Board; amending Minnesota Statutes 2014, sections 116J.035, 
1.6 	subdivision 1a; 116J.8738, subdivision 2; 116J.8747, by adding a subdivision; 
1.7 	116J.8748, subdivision 4; Minnesota Statutes 2015 Supplement, sections 
1.8 	116J.8738, subdivision 3; 116L.98, subdivision 3; proposing coding for new 
1.9 	law in Minnesota Statutes, chapter 116L; repealing Minnesota Statutes 2014, 
1.10 	section 116L.665.
1.11 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.12 	ARTICLE 1
1.13 	ECONOMIC DEVELOPMENT PROGRAMS

1.14 	Section 1. Minnesota Statutes 2014, section 116J.8738, subdivision 2, is amended to 
1.15 	read:
1.16 		Subd. 2.Qualified business. (a) A business is a qualified business if it satisfies the 
1.17 	requirement of this paragraph and is not disqualified under the provisions of paragraph 
1.18 	(b). To qualify, the business must:
1.19 	(1) have operated its trade or business in a city or cities in greater Minnesota for at 
1.20 	least one year before applying under subdivision 3;
1.21 	(2) (1) pay or agree to pay in the future each employee compensation, including 
1.22 	benefits not mandated by law, that on an annualized basis equal at least 120 percent of the 
1.23 	federal poverty level for a family of four;
1.24 	(3) (2) plan and agree to expand its employment in one or more cities in greater 
1.25 	Minnesota by the minimum number of employees required under subdivision 3, paragraph 
1.26 	(c); and
2.1 	(4) (3) have received certification from the commissioner under subdivision 3 that 
2.2 	it is a qualified business.
2.3 	(b) A business is not a qualified business if it is either:
2.4 	(1) primarily engaged in making retail sales to purchasers who are physically present 
2.5 	at the business's location or locations in greater Minnesota;
2.6 	(2) a public utility, as defined in section 336B.01; or
2.7 	(3) primarily engaged in lobbying; gambling; entertainment; professional sports; 
2.8 	political consulting; leisure; hospitality; or professional services provided by attorneys, 
2.9 	accountants, business consultants, physicians, or health care consultants.
2.10 	(c) The requirements in paragraph (a) that the business's operations and expansion 
2.11 	be located in a city do not apply to an agricultural processing facility.

2.12 	Sec. 2. Minnesota Statutes 2015 Supplement, section 116J.8738, subdivision 3, is 
2.13 	amended to read:
2.14 		Subd. 3.Certification of qualified business. (a) A business may apply to 
2.15 	the commissioner for certification as a qualified business under this section. The 
2.16 	commissioner shall specify the form of the application, the manner and times for applying, 
2.17 	and the information required to be included in the application. The commissioner may 
2.18 	impose an application fee in an amount sufficient to defray the commissioner's cost of 
2.19 	processing certifications. Application fees are deposited in the greater Minnesota business 
2.20 	expansion administration account in the special revenue fund. A business must file a copy 
2.21 	of its application with the chief clerical officer of the city at the same time it applies to 
2.22 	the commissioner. For an agricultural processing facility a business located outside the 
2.23 	boundaries of a city, the business must file a copy of the application with the county auditor.
2.24 	(b) The commissioner shall certify each business as a qualified business that:
2.25 	(1) satisfies the requirements of subdivision 2;
2.26 	(2) the commissioner determines would not expand its operations in greater 
2.27 	Minnesota without the tax incentives available under subdivision 4; and
2.28 	(3) enters a business subsidy agreement with the commissioner that pledges to 
2.29 	satisfy the minimum expansion requirements of paragraph (c) within three years or less 
2.30 	following execution of the agreement.
2.31 	The commissioner must act on an application within 90 days after its filing. Failure 
2.32 	by the commissioner to take action within the 90-day period is deemed approval of the 
2.33 	application.
3.1 	(c) The business must increase the number of full-time equivalent employees 
3.2 	in greater Minnesota from the time the business subsidy agreement is executed by two 
3.3 	employees or ten percent, whichever is greater.
3.4 	(d) The city, or a county for an agricultural processing facility a business located 
3.5 	outside the boundaries of a city, in which the business proposes to expand its operations 
3.6 	may file comments supporting or opposing the application with the commissioner. The 
3.7 	comments must be filed within 30 days after receipt by the city or county of the application 
3.8 	and may include a notice of any contribution the city or county intends to make to 
3.9 	encourage or support the business expansion, such as the use of tax increment financing, 
3.10 	property tax abatement, additional city or county services, or other financial assistance.
3.11 	(e) Certification of a qualified business is effective for the seven-year period 
3.12 	beginning on the first day of the calendar month immediately following the date that the 
3.13 	commissioner informs the business of the award of the benefit.

3.14 	Sec. 3. Minnesota Statutes 2014, section 116J.8748, subdivision 4, is amended to read:
3.15 		Subd. 4.Certification; benefits. (a) The commissioner may certify a Minnesota job 
3.16 	creation fund business as eligible to receive a specific value of benefit under paragraphs 
3.17 	(b) and (c) when the business has achieved its job creation and capital investment goals 
3.18 	noted in its agreement under subdivision 3.
3.19 	(b) A qualified Minnesota job creation fund business may be certified eligible for 
3.20 	the benefits in this paragraph for up to five years for projects located in the metropolitan 
3.21 	area as defined in section 200.02, subdivision 24, and seven years for projects located 
3.22 	outside the metropolitan area, as determined by the commissioner when considering the 
3.23 	best interests of the state and local area. Notwithstanding section 16B.98, subdivision 5, 
3.24 	paragraph (b), grant agreements for projects located outside the metropolitan area may 
3.25 	be for up to seven years in length. The eligibility for the following benefits begins the 
3.26 	date the commissioner certifies the business as a qualified Minnesota job creation fund 
3.27 	business under this subdivision:
3.28 	(1) up to five percent rebate for projects located in the metropolitan area as 
3.29 	defined in section 200.02, subdivision 24, and 7.5 percent for projects located outside 
3.30 	the metropolitan area, on capital investment on qualifying purchases as provided in 
3.31 	subdivision 5 with the total rebate for a project not to exceed $500,000;
3.32 	(2) an award of up to $500,000 based on full-time job creation and wages paid as 
3.33 	provided in subdivision 6 with the total award not to exceed $500,000;
4.1 	(3) up to $1,000,000 in capital investment rebates and $1,000,000 in job creation 
4.2 	awards are allowable for projects that have at least $25,000,000 in capital investment 
4.3 	and 200 new employees;
4.4 	(4) up to $1,000,000 in capital investment rebates are allowable for projects that 
4.5 	have at least $25,000,000 in capital investment and 200 retained employees for projects 
4.6 	located in the metropolitan area as defined in section 200.02, subdivision 24, and 75 
4.7 	employees for projects located outside the metropolitan area; and
4.8 	(5) for clauses (3) and (4) only, the capital investment expenditure requirements may 
4.9 	include the installation and purchases of machinery and equipment. These expenditures 
4.10 	are not eligible for the capital investment rebate provided under subdivision 5.
4.11 	(c) The job creation award may be provided in multiple years as long as the qualified 
4.12 	Minnesota job creation fund business continues to meet the job creation goals provided 
4.13 	for in its agreement under subdivision 3 and the total award does not exceed $500,000 
4.14 	except as provided under paragraph (b), clauses (3) and (4).
4.15 	(d) No rebates or award may be provided until the Minnesota job creation fund 
4.16 	business has at least $500,000 in capital investment in the project and at least ten full-time 
4.17 	jobs have been created and maintained for at least one year or the retained employees, as 
4.18 	provided in paragraph (b), clause (4), remain for at least one year. The agreement may 
4.19 	require additional performance outcomes that need to be achieved before rebates and 
4.20 	awards are provided. If fewer retained jobs are maintained, but still above the minimum 
4.21 	under this subdivision, the capital investment award shall be reduced on a proportionate 
4.22 	basis.
4.23 	(e) The forms needed to be submitted to document performance by the Minnesota 
4.24 	job creation fund business must be in the form and be made under the procedures specified 
4.25 	by the commissioner. The forms shall include documentation and certification by the 
4.26 	business that it is in compliance with the business subsidy agreement, sections 116J.871 
4.27 	and 116L.66, and other provisions as specified by the commissioner.
4.28 	(f) Minnesota job creation fund businesses must pay each new full-time employee 
4.29 	added pursuant to the agreement total compensation, including benefits not mandated by 
4.30 	law, that on an annualized basis is equal to at least 110 percent of the federal poverty 
4.31 	level for a family of four.
4.32 	(g) A Minnesota job creation fund business must demonstrate reasonable progress on 
4.33 	its capital investment expenditures within six months following designation as a Minnesota 
4.34 	job creation fund business to ensure that the capital investment goal in the agreement 
4.35 	under subdivision 1 will be met. Businesses not making reasonable progress will not be 
4.36 	eligible for benefits under the submitted application and will need to work with the local 
5.1 	government unit to resubmit a new application and request to be a Minnesota job creation 
5.2 	fund business. Notwithstanding the goals noted in its agreement under subdivision 1, this 
5.3 	action shall not be considered a default of the business subsidy agreement.

5.4 	ARTICLE 2
5.5 	PROMOTIONAL AUTHORITY

5.6 	Section 1. Minnesota Statutes 2014, section 116J.035, subdivision 1a, is amended to 
5.7 	read:
5.8 		Subd. 1a.Promotional contracts. In order to best carry out duties and 
5.9 	responsibilities and to serve the people of the state in the promotion of tourism, trade, 
5.10 	and economic development, the commissioner may engage in programs and projects, 
5.11 	including solicitations and proposals for programs and projects, jointly with a private 
5.12 	person, firm, corporation or association and. The commissioner  may enter into contracts 
5.13 	under terms to be mutually agreed upon to carry out such these programs and projects not 
5.14 	including acquisition of land or buildings. Contracts may be negotiated and are not subject 
5.15 	to the provisions of chapter 16C relating to competitive bidding.

5.16 	ARTICLE 3
5.17 	WORKFORCE DEVELOPMENT PROGRAM OUTCOMES

5.18 	Section 1. Minnesota Statutes 2015 Supplement, section 116L.98, subdivision 3, is 
5.19 	amended to read:
5.20 		Subd. 3.Uniform outcome report card; reporting by commissioner. (a) By 
5.21 	December 31 of each even-numbered year, the commissioner must report to the chairs 
5.22 	and ranking minority members of the committees of the house of representatives and the 
5.23 	senate having jurisdiction over economic development and workforce policy and finance 
5.24 	the following information separately for each of the previous two fiscal or calendar years, 
5.25 	for each program subject to the requirements of subdivision 1:
5.26 	(1) the total number of participants enrolled;
5.27 	(2) the median pre-enrollment wages based on participant wages for the second 
5.28 	through the fifth calendar quarters immediately preceding the quarter of enrollment 
5.29 	excluding those with zero income;
5.30 	(3) the total number of participants with zero income in the second through fifth 
5.31 	calendar quarters immediately preceding the quarter of enrollment;
5.32 	(4) the total number of participants enrolled in training;
5.33 	(5) the total number of participants enrolled in training by occupational group;
6.1 	(6) the total number of participants that exited the program and the average 
6.2 	enrollment duration of participants that have exited the program during the year;
6.3 	(7) the total number of exited participants who completed training;
6.4 	(8) the total number of exited participants who attained a credential;
6.5 	(9) the total number of participants employed during three consecutive quarters 
6.6 	immediately following the quarter of exit, by industry;
6.7 	(10) the median wages of participants employed during three four consecutive 
6.8 	quarters immediately following the quarter of exit;
6.9 	(11) the total number of participants employed during eight consecutive quarters 
6.10 	immediately following the quarter of exit, by industry;
6.11 	(12) the median wages of participants employed during eight consecutive quarters 
6.12 	immediately following the quarter of exit;
6.13 	(13) the total cost of the program;
6.14 	(14) the total cost of the program per participant;
6.15 	(15) the cost per credential received by a participant; and
6.16 	(16) the administrative cost of the program.
6.17 	(b) The report to the legislature must contain participant information by education 
6.18 	level, race and ethnicity, gender, and geography, and a comparison of exited participants 
6.19 	who completed training and those who did not.
6.20 	(c) The requirements of this section apply to programs administered directly by the 
6.21 	commissioner or administered by other organizations under a grant made by the department.

6.22 	ARTICLE 4
6.23 	PAY FOR PERFORMANCE GRANTS

6.24 	Section 1. Minnesota Statutes 2014, section 116J.8747, is amended by adding a 
6.25 	subdivision to read:
6.26 		Subd. 5.Grant administration authority. The state agency administering grants 
6.27 	under this section may offer exemption from sections 16A.28, subdivision 6, and 16B.98, 
6.28 	subdivision 7.

6.29 	ARTICLE 5
6.30 	WORKFORCE INNOVATION AND OPPORTUNITY ACT UPDATES

6.31 	Section 1. [116L.6651] WORKFORCE DEVELOPMENT BOARD.
6.32 		Subdivision 1.Creation; duties. The governor's Workforce Development Board 
6.33 	is created under the authority of the Workforce Innovation and Opportunity Act, United 
7.1 	States Code, title 29, section 3111. The Workforce Development Board serves as 
7.2 	Minnesota's state workforce development board for the purposes of the federal Workforce 
7.3 	Innovation and Opportunity Act and must perform the duties under that act.
7.4 		Subd. 2.Membership. (a) The board is composed of 41 voting members and 
7.5 	14 nonvoting members representing businesses, labor organizations, community-based 
7.6 	organizations, state agencies, and education. Membership terms, compensation of 
7.7 	members, and removal of members are governed by section 15.059.
7.8 	(b) No person shall serve as a member of more than one category described in 
7.9 	paragraph (a).
7.10 	(c) Voting members shall consist of the following:
7.11 	(1) the governor or the governor's designee;
7.12 	(2) one member of the house of representatives appointed by the speaker of the 
7.13 	house and one member of the senate appointed by the majority leader of the senate;
7.14 	(3) 21 representatives of businesses in the state appointed by the governor who:
7.15 	(i) are owners of businesses, chief executives or operating officers of businesses, or 
7.16 	other business executives or employers with optimum policy-making or hiring authority, 
7.17 	and who, in addition, may be members of a local board under United States Code, title 29, 
7.18 	section 3122(b)(2)(A)(i);
7.19 	(ii) represent businesses, including small businesses, or organizations representing 
7.20 	businesses that provide employment opportunities that, at a minimum, include 
7.21 	high-quality, work-relevant training and development in in-demand industry sectors or 
7.22 	occupations in the state; and
7.23 	(iii) are appointed from individuals nominated by state business organizations and 
7.24 	business trade associations;
7.25 	(4) commissioners of the state agencies with primary responsibility for core 
7.26 	programs identified within the state plan including:
7.27 	(i) the Department of Employment and Economic Development;
7.28 	(ii) Adult Basic Education through the Department of Education; and
7.29 	(iii) the Department of Human Services; and
7.30 	(5) other voting members appointed by the governor, including:
7.31 	(i) two chief elected officials, collectively representing cities and counties;
7.32 	(ii) six representatives of labor organizations, including:
7.33 	(A) representatives of labor organizations who have been nominated by state labor 
7.34 	federations; and
8.1 	(B) a member of a labor organization or a training director from a joint labor 
8.2 	and management apprenticeship program, or if no joint program exists in the state, a 
8.3 	representative of an apprenticeship program in the state;
8.4 	(iii) two representatives of community-based organizations that have demonstrated 
8.5 	experience and expertise in addressing the employment, training, or education needs of 
8.6 	individuals with barriers to employment, including organizations that serve veterans or that 
8.7 	provide or support competitive, integrated employment for individuals with disabilities; and
8.8 	(iv) four officials responsible for education programs in the state, including chief 
8.9 	executive officers of community colleges and other institutions of higher education, 
8.10 	including:
8.11 	(A) chancellor, Minnesota State Colleges and Universities;
8.12 	(B) president, University of Minnesota;
8.13 	(C) president, private postsecondary; and
8.14 	(D) representative of career and technical education.
8.15 	(d) The 14 nonvoting members of the board shall be appointed by the governor and 
8.16 	consist of one of each of the following:
8.17 	(1) a representative of Adult Basic Education;
8.18 	(2) a representative of public libraries;
8.19 	(3) a representative of Women's Economic Security Act;
8.20 	(4) the chair of the Minnesota Workforce Council Association;
8.21 	(5) the commissioner of the Department of Labor and Industry;
8.22 	(6) the commissioner of the Office of Higher Education;
8.23 	(7) the commissioner of the Department of Corrections;
8.24 	(8) the commissioner of Management and Budget;
8.25 	(9) two representatives of community-based organizations;
8.26 	(10) a district superintendent of a public school district;
8.27 	(11) a representative of school-based service learning;
8.28 	(12) the minority leader of the house of representatives; and
8.29 	(13) the minority leader of the senate.
8.30 		Subd. 4.Board meetings. (a) The board shall hold regular in-person meetings at 
8.31 	least quarterly and as often as necessary to perform the duties outlined in the statement of 
8.32 	authority and bylaws. Meetings shall be called by the chair. Special meetings may be called 
8.33 	as needed. Notices of all meetings shall be made at least 48 hours prior to the meeting date.
8.34 	(b) The chairperson shall approve an agenda for each meeting. Members shall 
8.35 	submit a written request for consideration of an agenda item no less than 24 hours in 
8.36 	advance of the meeting. Members of the public may submit a written request within 48 
9.1 	hours of a meeting in order to be considered for inclusion on the agenda. Those members 
9.2 	of the public in attendance at any meeting of the board may address the board only with 
9.3 	the approval or at the request of the chair.
9.4 	(c) All meeting notices must be posted on the board's Web site. All meetings of the 
9.5 	board and committees must be open to the public. The board must make available to 
9.6 	the public, on a regular basis through electronic means and open meetings, information 
9.7 	regarding the activities of the board, information regarding membership and, on request, 
9.8 	minutes of formal meetings of the board.
9.9 	(d) For the purpose of conducting business before the board at a duly called meeting, 
9.10 	a simple majority of the membership, excluding any vacancies, shall constitute a quorum.
9.11 		Subd. 5.Executive committee duties. The executive committee must, in 
9.12 	cooperation with the operations committee and with advice and input of local workforce 
9.13 	boards and other stakeholders as appropriate, develop performance standards for the 
9.14 	state workforce centers. By January 15, 2017, and each odd-numbered year thereafter, 
9.15 	the executive committee shall submit a report to the senate and house of representatives 
9.16 	committees with jurisdiction over workforce development programs regarding the 
9.17 	performance and outcomes of the workforce centers. The report must provide 
9.18 	recommendations regarding workforce center funding levels and sources, program 
9.19 	changes, and administrative changes.
9.20 		Subd. 6.Staffing. The Department of Employment and Economic Development 
9.21 	must provide staff to the board necessary to carry out the duties of the board. The board 
9.22 	may ask for assistance from other units of state government as it requires in order to 
9.23 	fulfill its duties and responsibilities.
9.24 		Subd. 7.Funding. The commissioner shall develop recommendations on a funding 
9.25 	formula for allocating Workforce Innovation and Opportunity Act funds to the board with 
9.26 	a minimum allocation of $350,000 per year.

9.27 	Sec. 2.  REPEALER.
 9.28 	Minnesota Statutes 2014, section 116L.665, is repealed.