1.1 	A bill for an act
1.2 	relating to higher education; modifying workforce development scholarship program 
1.3 	parameters; appropriating money for various needs of the Minnesota State Colleges 
1.4 	and Universities;amending Minnesota Statutes 2024, section 136F.38, subdivisions 
1.5 	1, 2, 3, 4, 5.
1.6 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.7 	Section 1. Minnesota Statutes 2024, section 136F.38, subdivision 1, is amended to read:
1.8 		Subdivision 1.Program established. The board shall develop a scholarship program 
1.9 	to incentivize new students and students returning from the workforce to enter high-demand 
1.10 	occupations upon graduation, with an emphasis on skill-based outcomes, stackable 
1.11 	credentials, and credit for prior learning pathways.

1.12 	Sec. 2. Minnesota Statutes 2024, section 136F.38, subdivision 2, is amended to read:
1.13 		Subd. 2.Scholarship awards. (a) The program shall award scholarships at the beginning 
1.14 	of an academic term, in the amount of $2,500, to be distributed evenly between two terms
1.15 	to support student participation in eligible credit-based and noncredit programs.
1.16 	(b) For credit-based programs, a student in a two-year college in the Minnesota State 
1.17 	Colleges and Universities system is eligible for up to $2,500 per academic year, which may 
1.18 	be distributed flexibly across terms based on the student's enrollment and program 
1.19 	requirements.
1.20 	(c) For noncredit programs, a student in a two-year college in the Minnesota State 
1.21 	Colleges and Universities system is eligible for up to $1,500 per eligible program, not to 
2.1 	exceed the total cost of tuition, fees, required materials, and industry-recognized certification 
2.2 	exams.
2.3 	(d) For credit-based programs, a student in a four-year university in the Minnesota State 
2.4 	Colleges and Universities system is eligible for annual scholarships of up to $3,500 each.
2.5 	(e) Scholarship money may be used flexibly throughout the academic year to 
2.6 	accommodate variations in enrollment intensity or academic calendar structures, such as 
2.7 	accelerated or modular programs; seasonal or program-specific costs, including tools, 
2.8 	equipment, transportation, and uniforms; support for stackable credentials and transitions 
2.9 	from noncredit to credit-based pathways; and payment of fees for credit for prior learning 
2.10 	assessments that award academic credit based on a student's demonstrated knowledge, skills, 
2.11 	or competencies.
2.12 	(f) Money may roll over within an academic year and, where applicable, may be applied 
2.13 	to subsequent terms or programs.

2.14 	Sec. 3. Minnesota Statutes 2024, section 136F.38, subdivision 3, is amended to read:
2.15 		Subd. 3.Program eligibility. (a) Scholarships shall be awarded only to a student eligible 
2.16 	for resident tuition, as defined in section 135A.043, who is enrolled in any of the following 
2.17 	programs of study or certification: (1) advanced manufacturing; (2) agriculture; (3) health 
2.18 	care services; (4) information technology; (5) early childhood; (6) transportation; (7) 
2.19 	construction; (8) education; (9) public safety; (10) energy; or (11) a program of study under 
2.20 	paragraph (b).
2.21 	(b) Each institution may add one additional area of study or certification, based on a 
2.22 	workforce shortage for full-time employment requiring postsecondary education that is 
2.23 	unique to the institution's specific region, as reported in the most recent Department of 
2.24 	Employment and Economic Development job vacancy survey data for the economic 
2.25 	development region in which the institution is located. A workforce shortage area is one in 
2.26 	which the job vacancy rate for full-time employment in a specific occupation in a region is 
2.27 	higher than the state average vacancy rate for that same occupation. The institution may 
2.28 	change the area of study or certification based on new data once every two years.
2.29 	(c) The student must be enrolled for at least nine credits in a two-year college in the 
2.30 	Minnesota State Colleges and Universities system to be eligible for first- and second-year 
2.31 	scholarships for credit programs.
3.1 	(d) The student is eligible for a one-year transfer scholarship if the student transfers from 
3.2 	a two-year college after two or more terms, and the student is enrolled for at least nine 
3.3 	credits in a four-year university in the Minnesota State Colleges and Universities system.
3.4 	(d) Students pursuing noncredit programs that lead to industry-recognized credentials 
3.5 	or certifications aligned with high-demand occupations are eligible for scholarships. 
3.6 	Noncredit program participants may apply unused money toward credit-bearing programs, 
3.7 	stackable credentials, or credit for prior learning assessments.

3.8 	Sec. 4. Minnesota Statutes 2024, section 136F.38, subdivision 4, is amended to read:
3.9 		Subd. 4.Renewal; cap. A student who has received a scholarship may apply again but 
3.10 	total lifetime awards are not to exceed $7,500 $8,500 per student, which may include a 
3.11 	combination of awards for credit and noncredit programs. Students may only be awarded 
3.12 	a second scholarship upon completion of two academic terms or a corresponding noncredit 
3.13 	program. Students may only be awarded a third scholarship if the student transfers to a 
3.14 	corresponding four-year program at a Minnesota state university or is already in a four-year 
3.15 	program at a Minnesota state university.

3.16 	Sec. 5. Minnesota Statutes 2024, section 136F.38, subdivision 5, is amended to read:
3.17 		Subd. 5.Administration. (a) The board shall establish an application process and other 
3.18 	guidelines for implementing this program, including procedures for flexible distribution of 
3.19 	money.
3.20 	(b) The board shall give preference to students in financial need.
3.21 	(c) Up to one and one-half percent of the money appropriated for this program may be 
3.22 	used for the administration of this program, including outreach to students and promotion 
3.23 	of programs where graduates and certificate holders are currently most needed.
3.24 	(d) Institutions may allocate scholarships across terms or programs to support variations 
3.25 	in student enrollment, unexpected life circumstances, or unique program needs. Institutions 
3.26 	are also authorized to use scholarship money for nontuition costs such as certification exams, 
3.27 	tools, transportation, and credit for prior learning assessments.

3.28 	Sec. 6. APPROPRIATIONS.
 3.29 	(a) $237,958,000 in fiscal year 2026 and $236,958,000 in fiscal year 2027 are 
3.30 	appropriated from the general fund to the Board of Trustees of the Minnesota State Colleges 
3.31 	and Universities for operations and maintenance of the Minnesota State Colleges and 
4.1 	Universities. The base for this appropriation is $236,958,000 in fiscal year 2028 and later. 
4.2 	Of the amounts appropriated in this paragraph:
4.3 	(1) $50,000,000 in fiscal year 2026 is for repair or replacement of existing on-campus 
4.4 	buildings and infrastructure;
4.5 	(2) $25,000,000 in fiscal year 2026 is for demolition of obsolete buildings and 
4.6 	infrastructure and restoration of the vacant sites;
4.7 	(3) $25,000,000 in fiscal year 2026 is for development and implementation of the 
4.8 	Workday Student information system;
4.9 	(4) $19,408,000 in fiscal year 2026 and $19,408,000 in fiscal year 2027 are to expand 
4.10 	student support services;
4.11 	(5) $1,050,000 in fiscal year 2026 and $1,050,000 in fiscal year 2027 are to develop and 
4.12 	expand the availability of free course materials;
4.13 	(6) $93,000,000 in fiscal year 2026 and $192,000,000 in fiscal year 2027 are to address 
4.14 	personnel and nonpersonnel cost increases, maintain academic programs, and limit tuition 
4.15 	changes to instances where there is compelling need to better align rates with costs;
4.16 	(7) $4,250,000 in fiscal year 2026 and $4,250,000 in fiscal year 2027 are to support the 
4.17 	maintenance of high-cost and high-demand career and technical, baccalaureate, and graduate 
4.18 	programs;
4.19 	(8) $6,750,000 in fiscal year 2026 and $6,750,000 in fiscal year 2027 are to upgrade 
4.20 	college and university equipment and learning environments and to enhance applied research 
4.21 	laboratories;
4.22 	(9) $6,750,000 in fiscal year 2026 and $6,750,000 in fiscal year 2027 are to develop and 
4.23 	expand industry sector programming to build capacity and support new and redesigned 
4.24 	curricular options with an emphasis on offering students work-based learning experiences; 
4.25 	and
4.26 	(10) $6,750,000 in fiscal year 2026 and $6,750,000 in fiscal year 2027 are to expand 
4.27 	the workforce development scholarship program under Minnesota Statutes, section 136F.38.
4.28 	(b) $5,000,000 in fiscal year 2026 and $5,000,000 in fiscal year 2027 are appropriated 
4.29 	from the general fund to the commissioner of the Office of Higher Education for emergency 
4.30 	grants to students of the Minnesota State Colleges and Universities to meet immediate needs 
4.31 	that could interfere with the student completing the term or their program.