Engrossments
Introduction		Posted on 07/13/2005
1st Engrossment		Posted on 07/14/2005

ARTICLE 1

GENERAL EDUCATION

Section 1.

Minnesota Statutes 2004, section 120A.05, is
amended by adding a subdivision to read:

new text begin Subd. 18.new text end

new text beginKindergarten.new text end

new text begin"Kindergarten" means a program
designed for pupils five years of age on September 1 of the
calendar year in which the school year commences that prepares
pupils to enter first grade the following school year. A
program designed for pupils younger than five years of age on
September 1 of the calendar year in which the school year
commences that prepares pupils to enter kindergarten the
following school year is a prekindergarten program.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2004, section 123A.05,
subdivision 2, is amended to read:

Subd. 2.

Reserve revenue.

Each district that is a member
of an area learning center must reserve revenue in an amount
equal to new text beginthe sum of (1) new text endat least 90 percent of the district
average general education revenue per pupil unit minus an amount
equal to the product of the formula allowance according to
section 126C.10, subdivision 2, times .0485, calculated without
basic skills revenuedeleted text begin,deleted text endnew text beginand new text endtransportation sparsity revenue, deleted text beginand
the transportation portion of the transition revenue adjustment,
deleted text end times the number of pupil units attending an area learning
center program under this sectionnew text begin, plus (2) the amount of basic
skills revenue generated by pupils attending the area learning
centernew text end. The amount of reserved revenue under this subdivision
may only be spent on program costs associated with the area
learning center. deleted text beginCompensatory revenue must be allocated
according to section 126C.15, subdivision 2.
deleted text end

Sec. 3.

Minnesota Statutes 2004, section 123B.75, is
amended by adding a subdivision to read:

new text begin Subd. 4a. new text end

new text begin Taconite revenue. new text end

new text begin Taconite revenue received in
a calendar year by a school district under section 298.28,
subdivisions 4, paragraphs (b) and (c), and 11, paragraph (d),
is fully recognized in the fiscal year in which the February
payment falls.
new text end

[EFFECTIVE DATE.]new text beginThis section is effective for revenue for
fiscal year 2006.
new text end

Sec. 4.

Minnesota Statutes 2004, section 123B.76,
subdivision 3, is amended to read:

Subd. 3.

Expenditures by building.

(a) For the purposes
of this section, "building" means education site as defined in
section 123B.04, subdivision 1.

(b) Each district shall maintain separate accounts to
identify general fund expendituresdeleted text begin, excluding capital
expenditures and pupil transportation,deleted text endfor each building. All
expenditures for regular instruction, secondary vocational
instruction, and school administration must be reported to the
department separately for each building. All expenditures for
special education instruction, instructional support services,
and pupil support services provided within a specific building
must be reported to the department separately for each
building. Salary expenditures reported by building must reflect
actual salaries for staff at the building and must not be based
on districtwide averages. All other general fund expenditures
may be reported new text beginby building or new text endon a districtwide basis.

(c) The department must annually report information showing
school district general fund expenditures per pupil by program
category for each building and estimated school district general
fund revenue generated by pupils attending each building on its
Web site. For purposes of this report:

(1) expenditures not deleted text beginrequired to be deleted text endreported by building
shall be allocated among buildings on a uniform per pupil basis;

(2) basic skills revenue shall be allocated according to
section 126C.10, subdivision 4;

(3) secondary sparsity revenue and elementary sparsity
revenue shall be allocated according to section 126C.10,
subdivisions 7 and 8;

(4) other general education revenue shall be allocated on a
uniform per pupil unit basis;

(5) first grade preparedness aid shall be allocated
according to section 124D.081;

(6) state and federal special education aid and Title I aid
shall be allocated in proportion to district expenditures for
these programs by building; and

(7) other general fund revenues shall be allocated on a
uniform per pupil basis, except that the department may allocate
other revenues attributable to specific buildings directly to
those buildings.

Sec. 5.

Minnesota Statutes 2004, section 123B.79,
subdivision 6, is amended to read:

Subd. 6.

Account transfer for statutory operating debt.

On June 30 of each year, a district may make a permanent
transfer from the general fund account entitled " deleted text beginundesignated
deleted text endnew text begin net unreserved general new text endfund balance since statutory operating
debt" to the account entitled "reserved fund balance reserve
account for purposes of statutory operating debt reduction."
The amount of the transfer is limited to the lesser of (a) the
net deleted text beginundesignated operating deleted text endnew text beginunreserved general new text endfund balance, or
(b) the sum of the remaining statutory operating debt levies
authorized for all future years according to section 126C.42,
subdivision 1. If the net deleted text beginundesignated operating deleted text endnew text beginunreserved
general new text endfund balance is less than zero, the district may not
make a transfer.

Sec. 6.

Minnesota Statutes 2004, section 123B.81,
subdivision 1, is amended to read:

Subdivision 1.

Operating debt.

The "operating debt" of a
school district means the net negative deleted text beginundesignated deleted text endnew text beginunreserved
general new text endfund balance deleted text beginin all school district funds, other than
capital expenditure, building construction, debt service, and
trust and agency,deleted text endcalculated as of June 30 of each year in
accordance with the uniform financial accounting and reporting
standards for Minnesota school districts.

Sec. 7.

Minnesota Statutes 2004, section 123B.82, is
amended to read:

123B.82 REORGANIZATION OPERATING DEBT.

The "reorganization operating debt" of a school district
means the net negative deleted text beginundesignated deleted text endnew text beginunreserved new text endfund deleted text beginbalance
deleted text endnew text begin balances new text endin all school district funds, other than building
construction, debt redemption, and trust and agency, calculated
in accordance with the uniform financial accounting and
reporting standards for Minnesota school districts as of:

(1) June 30 of the fiscal year before the first year that a
district receives revenue according to section 123A.39,
subdivision 3; or

(2) June 30 of the fiscal year before the effective date of
reorganization according to section 123A.46 or 123A.48.

Sec. 8.

Minnesota Statutes 2004, section 123B.83,
subdivision 2, is amended to read:

Subd. 2.

deleted text beginundesignated deleted text endnew text beginnet unreserved general new text endfund
balances.

deleted text beginBeginning in fiscal year 1978 and each year
thereafter, any deleted text endnew text beginA school new text enddistrict deleted text beginnot subject to the provisions
of subdivision 1 deleted text endmust limit its expenditures so that
its deleted text beginundesignated deleted text endnew text beginnet unreserved general new text endfund deleted text beginbalances do deleted text endnew text beginbalance
does new text endnot constitute statutory operating debt as defined in
section 126C.42.

Sec. 9.

Minnesota Statutes 2004, section 123B.92,
subdivision 1, is amended to read:

Subdivision 1.

Definitions.

For purposes of this section
and section 125A.76, the terms defined in this subdivision have
the meanings given to them.

(a) "Actual expenditure per pupil transported in the
regular and excess transportation categories" means the quotient
obtained by dividing:

(1) the sum of:

(i) all expenditures for transportation in the regular
category, as defined in paragraph (b), clause (1), and the
excess category, as defined in paragraph (b), clause (2), plus

(ii) an amount equal to one year's depreciation on the
district's school bus fleet and mobile units computed on a
straight line basis at the rate of 15 percent per year for
districts operating a program under section 124D.128 for grades
1 to 12 for all students in the district and 12-1/2 percent per
year for other districts of the cost of the fleet, plus

(iii) an amount equal to one year's depreciation on the
district's type three school buses, as defined in section
169.01, subdivision 6, clause (5), which must be used a majority
of the time for pupil transportation purposes, computed on a
straight line basis at the rate of 20 percent per year of the
cost of the type three school buses by:

(2) the number of pupils eligible for transportation in the
regular category, as defined in paragraph (b), clause (1), and
the excess category, as defined in paragraph (b), clause (2).

(b) "Transportation category" means a category of
transportation service provided to pupils as follows:

(1) Regular transportation is:

(i) transportation to and from school during the regular
school year for resident elementary pupils residing one mile or
more from the public or nonpublic school they attend, and
resident secondary pupils residing two miles or more from the
public or nonpublic school they attend, excluding desegregation
transportation and noon kindergarten transportation; but with
respect to transportation of pupils to and from nonpublic
schools, only to the extent permitted by sections 123B.84 to
123B.87;

(ii) transportation of resident pupils to and from language
immersion programs;

(iii) transportation of a pupil who is a custodial parent
and that pupil's child between the pupil's home and the child
care provider and between the provider and the school, if the
home and provider are within the attendance area of the school;

(iv) transportation to and from or board and lodging in
another district, of resident pupils of a district without a
secondary school; and

(v) transportation to and from school during the regular
school year required under subdivision 3 for nonresident
elementary pupils when the distance from the attendance area
border to the public school is one mile or more, and for
nonresident secondary pupils when the distance from the
attendance area border to the public school is two miles or
more, excluding desegregation transportation and noon
kindergarten transportation.

For the purposes of this paragraph, a district may
designate a licensed day care facility, respite care facility,
the residence of a relative, or the residence of a person chosen
by the pupil's parent or guardian as the home of a pupil for
part or all of the day, if requested by the pupil's parent or
guardian, and if that facility or residence is within the
attendance area of the school the pupil attends.

(2) Excess transportation is:

(i) transportation to and from school during the regular
school year for resident secondary pupils residing at least one
mile but less than two miles from the public or nonpublic school
they attend, and transportation to and from school for resident
pupils residing less than one mile from school who are
transported because of extraordinary traffic, drug, or crime
hazards; and

(ii) transportation to and from school during the regular
school year required under subdivision 3 for nonresident
secondary pupils when the distance from the attendance area
border to the school is at least one mile but less than two
miles from the public school they attend, and for nonresident
pupils when the distance from the attendance area border to the
school is less than one mile from the school and who are
transported because of extraordinary traffic, drug, or crime
hazards.

(3) Desegregation transportation is transportation within
and outside of the district during the regular school year of
pupils to and from schools located outside their normal
attendance areas under a plan for desegregation mandated by the
commissioner or under court order.

(4) "Transportation services for pupils with disabilities"
is:

(i) transportation of pupils with disabilities who cannot
be transported on a regular school bus between home or a respite
care facility and school;

(ii) necessary transportation of pupils with disabilities
from home or from school to other buildings, including centers
such as developmental achievement centers, hospitals, and
treatment centers where special instruction or services required
by sections 125A.03 to 125A.24, 125A.26 to 125A.48, and 125A.65
are provided, within or outside the district where services are
provided;

(iii) necessary transportation for resident pupils with
disabilities required by sections 125A.12, and 125A.26 to
125A.48;

(iv) board and lodging for pupils with disabilities in a
district maintaining special classes;

(v) transportation from one educational facility to another
within the district for resident pupils enrolled on a
shared-time basis in educational programs, and necessary
transportation required by sections 125A.18, and 125A.26 to
125A.48, for resident pupils with disabilities who are provided
special instruction and services on a shared-time basis new text beginor if
resident pupils are not transported, the costs of necessary
travel between public and private schools or neutral
instructional sites by essential personnel employed by the
district's program for children with a disabilitynew text end;

(vi) transportation for resident pupils with disabilities
to and from board and lodging facilities when the pupil is
boarded and lodged for educational purposes; and

(vii) services described in clauses (i) to (vi), when
provided for pupils with disabilities in conjunction with a
summer instructional program that relates to the pupil's
individual education plan or in conjunction with a learning year
program established under section 124D.128.

new text begin For purposes of computing special education base revenue
under section 125A.76, subdivision 2, the cost of providing
transportation for children with disabilities includes (A) the
additional cost of transporting a homeless student from a
temporary nonshelter home in another district to the school of
origin, or a formerly homeless student from a permanent home in
another district to the school of origin but only through the
end of the academic year; and (B) depreciation on district-owned
school buses purchased after July 1, 2005, and used primarily
for transportation of pupils with disabilities, calculated
according to paragraph (a), clauses (ii) and (iii).
Depreciation costs included in the disabled transportation
category must be excluded in calculating the actual expenditure
per pupil transported in the regular and excess transportation
categories according to paragraph (a).
new text end

(5) "Nonpublic nonregular transportation" is:

(i) transportation from one educational facility to another
within the district for resident pupils enrolled on a
shared-time basis in educational programs, excluding
transportation for nonpublic pupils with disabilities under
clause (4);

(ii) transportation within district boundaries between a
nonpublic school and a public school or a neutral site for
nonpublic school pupils who are provided pupil support services
pursuant to section 123B.44; and

(iii) late transportation home from school or between
schools within a district for nonpublic school pupils involved
in after-school activities.

(c) "Mobile unit" means a vehicle or trailer designed to
provide facilities for educational programs and services,
including diagnostic testing, guidance and counseling services,
and health services. A mobile unit located off nonpublic school
premises is a neutral site as defined in section 123B.41,
subdivision 13.

Sec. 10.

Minnesota Statutes 2004, section 123B.92,
subdivision 5, is amended to read:

Subd. 5.

District reports.

new text begin(a) new text endEach district must report
data to the department as required by the department to account
for transportation expenditures.

new text begin (b) Salaries and fringe benefits of district employees
whose primary duties are other than transportation, including
central office administrators and staff, building administrators
and staff, teachers, social workers, school nurses, and
instructional aides, must not be included in a district's
transportation expenditures, except that a district may include
salaries and benefits according to paragraph (c) for (1) an
employee designated as the district transportation director, (2)
an employee providing direct support to the transportation
director, or (3) an employee providing direct transportation
services such as a bus driver or bus aide.
new text end

new text begin (c) Salaries and fringe benefits of other district
employees who work part time in transportation and part time in
other areas must not be included in a district's transportation
expenditures unless the district maintains documentation of the
employee's time spent on pupil transportation matters in the
form and manner prescribed by the department.
new text end

new text begin (d) Pupil transportation expenditures, excluding
expenditures for capital outlay, leased buses, student board and
lodging, crossing guards, and aides on buses, must be allocated
among transportation categories based on cost-per-mile,
cost-per-student, cost-per-hour, or cost-per-route, regardless
of whether the transportation services are provided on
district-owned or contractor-owned school buses. Expenditures
for school bus driver salaries and fringe benefits may either be
directly charged to the appropriate transportation category or
may be allocated among transportation categories based on
cost-per-mile, cost-per-student, cost-per-hour, or
cost-per-route. Expenditures by private contractors or
individuals who provide transportation exclusively in one
transportation category must be charged directly to the
appropriate transportation category. Transportation services
provided by contractor-owned school bus companies incorporated
under different names but owned by the same individual or group
of individuals must be treated as the same company for cost
allocation purposes.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for expenditure
reporting for fiscal year 2006.
new text end

Sec. 11.

Minnesota Statutes 2004, section 124D.68,
subdivision 9, is amended to read:

Subd. 9.

Enrollment verification.

(a) For a pupil
attending an eligible program full time under subdivision 3,
paragraph (d), the department must pay 90 percent of the
district's average general education revenue less basic skills
revenue to the eligible program and ten percent of the
district's average general education revenue less basic skills
revenue to the contracting district within 30 days after the
eligible program verifies enrollment using the form provided by
the department. For a pupil attending an eligible program part
time, revenuenew text begin, excluding compensatory revenue,new text endshall be reduced
proportionately, according to the amount of time the pupil
attends the program, and the payments to the eligible program
and the contracting district shall be reduced accordingly. A
pupil for whom payment is made according to this section may not
be counted by any district for any purpose other than
computation of general education revenue. If payment is made
for a pupil under this subdivision, a district shall not
reimburse a program under section 124D.69 for the same
pupil. new text beginThe new text endbasic skills revenue deleted text beginshall be paid deleted text endnew text begingenerated by
pupils attending the eligible program new text endaccording to section
126C.10, subdivision 4new text begin, shall be paid to the eligible programnew text end.

(b) The department must pay up to 100 percent of the
revenue to the eligible program if there is an agreement to that
effect between the school district and the eligible program.

(c) Notwithstanding paragraphs (a) and (b), for an eligible
program that provides chemical treatment services to students,
the department must pay 100 percent of the revenue to the
eligible program.

Sec. 12.

Minnesota Statutes 2004, section 124D.69,
subdivision 1, is amended to read:

Subdivision 1.

Aid.

If a pupil enrolls in an alternative
program, eligible under section 124D.68, subdivision 3,
paragraph (d), or subdivision 4, operated by a private
organization that has contracted with a school district to
provide educational services for eligible pupils under section
124D.68, subdivision 2, the district contracting with the
private organization must reimburse the provider an amount equal
to new text beginthe sum of (1) new text endat least 95 percent of the district's average
general education less basic skills revenue per pupil unit times
the number of pupil units for pupils attending the programdeleted text begin.deleted text endnew text begin, and
(2) the amount of new text endbasic skills revenue deleted text beginshall be paid deleted text endnew text begingenerated
by pupils attending the program new text endaccording to section 126C.10,
subdivision 4. deleted text beginCompensatory revenue must be allocated according
to section 126C.15, subdivision 2.deleted text endFor a pupil attending the
program part time, the revenue paid to the programnew text begin, excluding
compensatory revenue,new text endmust be reduced proportionately, according
to the amount of time the pupil attends the program, and revenue
paid to the district shall be reduced accordingly. Pupils for
whom a district provides reimbursement may not be counted by the
district for any purpose other than computation of general
education revenue. If payment is made to a district or program
for a pupil under this section, the department must not make a
payment for the same pupil under section 124D.68, subdivision 9.
new text begin Notwithstanding sections 125A.15, 125A.51, and 125A.515, general
education revenue for a student who receives educational
services under this section shall be paid according to this
section.
new text end

Sec. 13.

Minnesota Statutes 2004, section 125A.51, is
amended to read:

125A.51 PLACEMENT OF CHILDREN WITHOUT DISABILITIES;
EDUCATION AND TRANSPORTATION.

The responsibility for providing instruction and
transportation for a pupil without a disability who has a
short-term or temporary physical or emotional illness or
disability, as determined by the standards of the commissioner,
and who is temporarily placed for care and treatment for that
illness or disability, must be determined as provided in this
section.

(a) The school district of residence of the pupil is the
district in which the pupil's parent or guardian resides.

(b) When parental rights have been terminated by court
order, the legal residence of a child placed in a residential or
foster facility for care and treatment is the district in which
the child resides.

(c) Before the placement of a pupil for care and treatment,
the district of residence must be notified and provided an
opportunity to participate in the placement decision. When an
immediate emergency placement is necessary and time does not
permit resident district participation in the placement
decision, the district in which the pupil is temporarily placed,
if different from the district of residence, must notify the
district of residence of the emergency placement within 15 days
of the placement.

(d) When a pupil without a disability is temporarily placed
for care and treatment in a day program and the pupil continues
to live within the district of residence during the care and
treatment, the district of residence must provide instruction
and necessary transportation to and from the treatment facility
for the pupil. Transportation shall only be provided by the
district during regular operating hours of the district. The
district may provide the instruction at a school within the
district of residence, at the pupil's residence, or in the case
of a placement outside of the resident district, in the district
in which the day treatment program is located by paying tuition
to that district. The district of placement may contract with a
facility to provide instruction by teachers licensed by the
state Board of Teaching.

(e) When a pupil without a disability is temporarily placed
in a residential program for care and treatment, the district in
which the pupil is placed must provide instruction for the pupil
and necessary transportation while the pupil is receiving
instruction, and in the case of a placement outside of the
district of residence, the nonresident district must bill the
district of residence for the actual cost of providing the
instruction for the regular school year and for summer school,
excluding transportation costs.

new text begin (f) Notwithstanding paragraph (e), if the pupil is homeless
and placed in a public or private homeless shelter, then the
district that enrolls the pupil under section 127A.47,
subdivision 2, shall provide the transportation, unless the
district that enrolls the pupil and the district in which the
pupil is temporarily placed agree that the district in which the
pupil is temporarily placed shall provide transportation.new text endWhen
a pupil without a disability is temporarily placed in a
residential program outside the district of residence, the
administrator of the court placing the pupil must send timely
written notice of the placement to the district of residence.
The district of placement may contract with a residential
facility to provide instruction by teachers licensed by the
state Board of Teaching. For purposes of this section, the state
correctional facilities operated on a fee-for-service basis are
considered to be residential programs for care and treatment.

deleted text begin (f) deleted text endnew text begin(g) new text endThe district of residence must include the pupil in
its residence count of pupil units and pay tuition as provided
in section 123A.488 to the district providing the instruction.
Transportation costs must be paid by the district providing the
transportation and the state must pay transportation aid to that
district. For purposes of computing state transportation aid,
pupils governed by this subdivision must be included in the
disabled transportation category new text beginif the pupils cannot be
transported on a regular school bus route without special
accommodationsnew text end.

Sec. 14.

Minnesota Statutes 2004, section 126C.01,
subdivision 11, is amended to read:

Subd. 11.

Net deleted text beginunappropriated operating deleted text endnew text beginunreserved general
new text end fund balance.

"Net deleted text beginunappropriated operating deleted text endnew text beginunreserved general
new text end fund balance" means the sum of the new text beginunreserved general new text endfund
deleted text begin balances in the general, food service, and community service
funds minus the balances reserved for statutory operating debt
reduction, bus purchase, severance pay, taconite, unemployment
benefits, maintenance levy reduction, operating capital,
disabled access, health and safety,deleted text endnew text beginbalance new text endand encumbrances,
computed as of June 30 each year.

Sec. 15.

Minnesota Statutes 2004, section 126C.05, is
amended by adding a subdivision to read:

new text begin Subd. 20. new text end

new text begin Project-based average daily membership. new text end

new text begin (a) To
receive general education revenue for a pupil enrolled in a
public school with a project-based program, a school must meet
the requirements in this paragraph. The school must:
new text end

new text begin (1) register with the commissioner as a project-based
program by May 30 of the preceding fiscal year;
new text end

new text begin (2) provide a minimum teacher contact of no less than one
hour per week per project-based credit for each pupil;
new text end

new text begin (3) maintain a record system that shows when each credit or
portion thereof was reported for membership for each pupil; and
new text end

new text begin (4) report pupil membership consistent with paragraph (b).
new text end

new text begin (b) The commissioner must develop a formula for reporting
pupil membership to compute average daily membership for each
registered project-based school. Average daily membership for a
pupil in a registered project-based program is the lesser of:
new text end

new text begin (1) 1.0; or
new text end

new text begin (2) the ratio of (i) the number of membership hours
generated by project-based credits completed during the school
year plus membership hours generated by credits completed in a
seat-based setting to (ii) the annual required instructional
hours at that grade level. Membership hours for a partially
completed project-based credit must be prorated.
new text end

Sec. 16.

Minnesota Statutes 2004, section 126C.10,
subdivision 1, is amended to read:

Subdivision 1.

General education revenue.

deleted text begin(a) For fiscal
year 2003, the general education revenue for each district
equals the sum of the district's basic revenue, basic skills
revenue, training and experience revenue, secondary sparsity
revenue, elementary sparsity revenue, transportation sparsity
revenue, total operating capital revenue, and equity revenue.
deleted text end

deleted text begin (b) deleted text endFor fiscal year deleted text begin2004 deleted text endnew text begin2006 new text endand later, the general
education revenue for each district equals the sum of the
district's basic revenue, extended time revenue, new text begingifted and
talented revenue,new text endbasic skills revenue, training and experience
revenue, secondary sparsity revenue, elementary sparsity
revenue, transportation sparsity revenue, total operating
capital revenue, equity revenue, new text beginalternative teacher
compensation revenue,new text endand transition revenue.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2006.
new text end

Sec. 17.

Minnesota Statutes 2004, section 126C.10,
subdivision 2, is amended to read:

Subd. 2.

Basic revenue.

The basic revenue for each
district equals the formula allowance times the adjusted
marginal cost pupil units for the school year. The formula
allowance for fiscal year deleted text begin2001 deleted text endnew text begin2005 new text endis deleted text begin$3,964 deleted text endnew text begin$4,601new text end. The
formula allowance for fiscal year deleted text begin2002 deleted text endnew text begin2006 new text endis deleted text begin$4,068 deleted text endnew text begin$4,783new text end.
The formula allowance for fiscal year deleted text begin2003 deleted text endnew text begin2007 new text endand subsequent
years is deleted text begin$4,601 deleted text endnew text begin$4,974new text end.

Sec. 18.

Minnesota Statutes 2004, section 126C.10, is
amended by adding a subdivision to read:

new text begin Subd. 2b.new text end

new text beginGifted and talented revenue.new text end

new text beginGifted and
talented revenue for each district equals $4 times the
district's adjusted marginal cost pupil units for fiscal year
2006 and $9 for fiscal year 2007 and later. A school district
must reserve gifted and talented revenue and, consistent with
section 120B.15, must spend the revenue only to:
new text end

new text begin (1) identify gifted and talented students;
new text end

new text begin (2) provide education programs for gifted and talented
students; or
new text end

new text begin (3) provide staff development to prepare teachers to best
meet the unique needs of gifted and talented students.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2006 and later.
new text end

Sec. 19.

Minnesota Statutes 2004, section 126C.10,
subdivision 13, is amended to read:

Subd. 13.

Total operating capital revenue.

(a) deleted text beginFor
fiscal year 2000 and thereafter,deleted text endTotal operating capital revenue
for a district equals the amount determined under paragraph (b)
or (c), plus $73 times the adjusted marginal cost pupil units
for the school year. The revenue must be placed in a reserved
account in the general fund and may only be used according
to deleted text beginparagraph (d) or deleted text endsubdivision 14.

(b) deleted text beginFor fiscal years 2000 and later,deleted text endCapital revenue for a
district equals $100 times the district's maintenance cost index
times its adjusted marginal cost pupil units for the school year.

(c) deleted text beginFor fiscal years 2000 and later,deleted text endThe revenue for a
district that operates a program under section 124D.128, is
increased by an amount equal to $30 times the number of marginal
cost pupil units served at the site where the program is
implemented.

deleted text begin (d) For fiscal years 2001, 2002, and 2003, the district
must reserve an amount equal to $5 per adjusted marginal cost
pupil unit for telecommunication access costs. Reserve revenue
under this paragraph must first be used to pay for ongoing or
recurring telecommunication access costs, including access to
data and video connections, including Internet access. Any
revenue remaining after covering all ongoing or recurring access
costs may be used for computer hardware or equipment.
deleted text end

Sec. 20.

Minnesota Statutes 2004, section 126C.10,
subdivision 13a, is amended to read:

Subd. 13a.

Operating capital levy.

To obtain operating
capital revenue for fiscal year deleted text begin2005 deleted text endnew text begin2007 new text endand later, a district
may levy an amount not more than the product of its operating
capital revenue for the fiscal year times the lesser of one or
the ratio of its adjusted net tax capacity per adjusted marginal
cost pupil unit to deleted text begin$22,222 deleted text endnew text beginthe operating capital equalizing
factornew text end. new text beginThe operating capital equalizing factor equals $22,222
for fiscal year 2006, and $10,700 for fiscal year 2007 and later.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2007.
new text end

Sec. 21.

Minnesota Statutes 2004, section 126C.10,
subdivision 24, is amended to read:

Subd. 24.

Equity revenue.

(a) A school district
qualifies for equity revenue if:

(1) the school district's adjusted marginal cost pupil unit
amount of basic revenue, supplemental revenue, transition
revenue, and referendum revenue is less than the value of the
school district at or immediately above the 95th percentile of
school districts in its equity region for those revenue
categories; and

(2) the school district's administrative offices are not
located in a city of the first class on July 1, 1999.

(b) Equity revenue for a qualifying district that receives
referendum revenue under section 126C.17, subdivision 4, equals
the product of (1) the district's adjusted marginal cost pupil
units for that year; times (2) the sum of (i) $13, plus (ii)
$75, times the school district's equity index computed under
subdivision 27.

(c) Equity revenue for a qualifying district that does not
receive referendum revenue under section 126C.17, subdivision 4,
equals the product of the district's adjusted marginal cost
pupil units for that year times $13.

new text begin (d) A school district's equity revenue is increased by the
greater of zero or an amount equal to the district's resident
marginal pupil units times the difference between ten percent of
the statewide average amount of referendum revenue per resident
marginal cost pupil unit for that year and the district's
referendum revenue per resident marginal cost pupil unit. A
school district's revenue under this paragraph must not exceed
$100,000 for that year.
new text end

new text begin (e) A school district's equity revenue for a school
district located in the metro equity region equals the amount
computed in paragraphs (b), (c), and (d) multiplied by 1.25.
new text end

new text begin (f) For fiscal year 2007 and later, notwithstanding
paragraph (a), clause (2), a school district that has per pupil
referendum revenue below the 95th percentile qualifies for
additional equity revenue equal to $46 times its adjusted
marginal cost pupil unit.
new text end

new text begin (g) A district that does not qualify for revenue under
paragraph (f) qualifies for equity revenue equal to one-half of
the per pupil allowance in paragraph (f) times its adjusted
marginal cost pupil units.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2006.
new text end

Sec. 22.

Minnesota Statutes 2004, section 126C.10,
subdivision 31, is amended to read:

Subd. 31.

Transition revenue.

(a) A district's
transition allowance deleted text beginfor fiscal years 2004 through 2008 deleted text endequals
the greater of zero or the product of the ratio of the number of
adjusted marginal cost pupil units the district would have
counted for fiscal year 2004 under Minnesota Statutes 2002 to
the district's adjusted marginal cost pupil units for fiscal
year 2004, times the difference between: (1) the lesser of the
district's general education revenue per adjusted marginal cost
pupil unit for fiscal year 2003 or the amount of general
education revenue the district would have received per adjusted
marginal cost pupil unit for fiscal year 2004 according to
Minnesota Statutes 2002, and (2) the district's general
education revenue for fiscal year 2004 excluding transition
revenue divided by the number of adjusted marginal cost pupil
units the district would have counted for fiscal year 2004 under
Minnesota Statutes 2002.

deleted text begin A district's transition allowance for fiscal year 2009 and
later is zero.
deleted text end

(b) A district's transition revenue for fiscal year deleted text begin2004
and later deleted text endnew text begin2006 and later new text endequals new text beginthe sum of (1) new text endthe product of
the district's transition allowance times the district's
adjusted marginal cost pupil unitsdeleted text begin.deleted text endnew text beginplus (2) the amount of
referendum revenue under section 126C.17 and general education
revenue, excluding transition revenue, for fiscal year 2004
attributable to pupils four or five years of age on September 1,
2003, enrolled in a prekindergarten program implemented by the
district before July 1, 2003, and reported as kindergarten
pupils under section 126C.05, subdivision 1, for fiscal year
2004, plus (3) the amount of compensatory education revenue
under subdivision 3 for fiscal year 2005 attributable to pupils
four years of age on September 1, 2003, enrolled in a
prekindergarten program implemented by the district before July
1, 2003, and reported as kindergarten pupils under section
126C.05, subdivision 1, for fiscal year 2004 multiplied by .04.
new text end

Sec. 23.

Minnesota Statutes 2004, section 126C.10, is
amended by adding a subdivision to read:

new text begin Subd. 34. new text end

new text begin Basic alternative teacher compensation aid. new text end

new text begin (a)
For fiscal year 2006, the basic alternative teacher compensation
aid for a school district or an intermediate school district
with a plan approved under section 122A.414, subdivision 2b,
equals the alternative teacher compensation revenue under
section 122A.415, subdivision 1. The basic alternative teacher
compensation aid for a charter school with an approved plan
under section 122A.414, subdivision 2b, equals $260 times the
number of pupils enrolled in the school on October 1 of the
previous school year, or on October 1 of the current fiscal year
for a charter school in the first year of operation.
new text end

new text begin (b) For fiscal year 2007 and later, the basic alternative
teacher compensation aid for a school district with a plan
approved under section 122A.414, subdivision 2b, equals 73.1
percent of the alternative teacher compensation revenue under
section 122A.415, subdivision 1. The basic alternative teacher
compensation aid for an intermediate school district or charter
school with a plan approved under section 122A.414, subdivision
2b, and subdivision 2a, if the recipient is a charter school,
equals $260 times the number of pupils enrolled in the school on
October 1 of the previous fiscal year, or on October 1 of the
current fiscal year for a charter school in the first year of
operation, times the ratio of the sum of the alternative teacher
compensation aid and alternative teacher compensation levy for
all participating school districts to the maximum alternative
teacher compensation revenue for those districts under section
122A.415, subdivision 1.
new text end

new text begin (c) Notwithstanding paragraphs (a) and (b) and section
122A.415, subdivision 1, the state total basic alternative
teacher compensation aid entitlement must not exceed $19,329,000
for fiscal year 2006 and $75,636,000 for fiscal year 2007 and
later. The commissioner must limit the amount of alternative
teacher compensation aid approved under section 122A.415 so as
not to exceed these limits.
new text end

Sec. 24.

Minnesota Statutes 2004, section 126C.10, is
amended by adding a subdivision to read:

new text begin Subd. 35. new text end

new text begin Alternative teacher compensation levy. new text end

new text begin For
fiscal year 2007 and later, the alternative teacher compensation
levy for a district receiving basic alternative teacher
compensation aid equals the product of (1) the difference
between the district's alternative teacher compensation revenue
and the district's basic alternative teacher compensation aid
times (2) the lesser of one or the ratio of the district's
adjusted net tax capacity per adjusted pupil unit to $5,913.
new text end

Sec. 25.

Minnesota Statutes 2004, section 126C.10, is
amended by adding a subdivision to read:

new text begin Subd. 36. new text end

new text begin Alternative teacher compensation aid. new text end

new text begin (a) For
fiscal year 2007 and later, a district's alternative teacher
compensation equalization aid equals the district's alternative
teacher compensation revenue minus the district's basic
alternative teacher compensation aid minus the district's
alternative teacher compensation levy. If a district does not
levy the entire amount permitted, the alternative teacher
compensation equalization aid must be reduced in proportion to
the actual amount levied.
new text end

new text begin (b) A district's alternative teacher compensation aid
equals the sum of the district's basic alternative teacher
compensation aid and the district's alternative teacher
compensation equalization aid.
new text end

Sec. 26.

Minnesota Statutes 2004, section 126C.13,
subdivision 4, is amended to read:

Subd. 4.

General education aid.

(a) deleted text beginFor fiscal year
2004, a district's general education aid is the sum of the
following amounts:
deleted text end

deleted text begin (1) general education revenue;
deleted text end

deleted text begin (2) shared time aid according to section 126C.01,
subdivision 7;
deleted text end

deleted text begin (3) referendum aid according to section 126C.17; and
deleted text end

deleted text begin (4) online learning aid according to section 126C.24.
deleted text end

deleted text begin (b) deleted text endFor fiscal year deleted text begin2005 and later deleted text endnew text begin2006new text end, a district's
general education aid is the sum of the following amounts:

(1) general education revenue, excluding equity revenue,
total operating capital, and transition revenue;

(2) operating capital aid according to section 126C.10,
subdivision 13b;

(3) equity aid according to section 126C.10, subdivision
30;

(4) transition aid according to section 126C.10,
subdivision 33;

(5) shared time aid according to section 126C.01,
subdivision 7;

(6) referendum aid according to section 126C.17; and

(7) online learning aid according to section deleted text begin126C.24
deleted text endnew text begin 124D.096new text end.

new text begin (b) For fiscal year 2007 and later, a district's general
education aid is the sum of the following amounts:
new text end

new text begin (1) general education revenue, excluding equity revenue,
total operating capital revenue, alternative teacher
compensation revenue, and transition revenue;
new text end

new text begin (2) operating capital aid under section 126C.10,
subdivision 13b;
new text end

new text begin (3) equity aid under section 126C.10, subdivision 30;
new text end

new text begin (4) alternative teacher compensation aid under section
126C.10, subdivision 36;
new text end

new text begin (5) transition aid under section 126C.10, subdivision 33;
new text end

new text begin (6) shared time aid under section 126C.01, subdivision 7;
new text end

new text begin (7) referendum aid under section 126C.17; and
new text end

new text begin (8) online learning aid according to section 124D.096.
new text end

Sec. 27.

Minnesota Statutes 2004, section 126C.15,
subdivision 2, is amended to read:

Subd. 2.

Building allocation.

(a) A district must
allocate its compensatory revenue to each school building in the
district where the children who have generated the revenue are
served new text beginunless the school district has received permission under
section 50 to allocate compensatory revenue according to student
performance measures developed by the school boardnew text end.

(b) Notwithstanding paragraph (a), a district may allocate
up to five percent of the amount of compensatory revenue that
the district deleted text beginreceived during the previous fiscal year deleted text endnew text beginreceives
new text end to school sites according to a plan adopted by the school board.

(c) For the purposes of this section and section 126C.05,
subdivision 3, "building" means education site as defined in
section 123B.04, subdivision 1.

(d) If the pupil is served at a site other than one owned
and operated by the district, the revenue shall be paid to the
district and used for services for pupils who generate the
revenue.

new text begin EFFECTIVE DATE. new text end

new text begin This section is retroactively effective
from July 1, 2005, for revenue for fiscal year 2006.
new text end

Sec. 28.

Minnesota Statutes 2004, section 126C.15,
subdivision 3, is amended to read:

Subd. 3.

Recommendation.

A school site decision-making
team, as defined in section 123B.04, subdivision 2, paragraph
(a), or the instruction and curriculum advisory committee under
section 120B.11, if the school has no school site decision team,
shall recommend how the compensatory education revenue will be
used to carry out the purpose of this section. new text beginA school
district that has received permission under section 50 to
allocate compensatory revenue according to school performance
measures shall share its plan for the distribution of
compensatory revenue with the school site decision team.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively
from July 1, 2005, for revenue for fiscal year 2006.
new text end

Sec. 29.

Minnesota Statutes 2004, section 126C.17,
subdivision 2, is amended to read:

Subd. 2.

Referendum allowance limit.

(a) deleted text beginNotwithstanding
subdivision 1, for fiscal year 2003, a district's referendum
allowance must not exceed the greater of:
deleted text end

deleted text begin (1) the sum of a district's referendum allowance for fiscal
year 1994 times 1.162 plus its referendum conversion allowance
for fiscal year 2003, minus $415;
deleted text end

deleted text begin (2) 18.2 percent of the formula allowance;
deleted text end

deleted text begin (3) for a newly reorganized district created on July 1,
2002, the referendum revenue authority for each reorganizing
district in the year preceding reorganization divided by its
resident marginal cost pupil units for the year preceding
reorganization, minus $415; or
deleted text end

deleted text begin (4) for a newly reorganized district created after July 1,
2002, the referendum revenue authority for each reorganizing
district in the year preceding reorganization divided by its
resident marginal cost pupil units for the year preceding
reorganization.
deleted text end

deleted text begin (b) deleted text endNotwithstanding subdivision 1, for fiscal year deleted text begin2004
deleted text endnew text begin 2007 new text endand later, a district's referendum allowance must not
exceed the greater of:

(1) the sum of: (i) a district's referendum allowance for
fiscal year 1994 times 1.177 times the annual inflationary
increase as calculated under paragraph deleted text begin(c) deleted text endnew text begin(b) new text endplus (ii) its
referendum conversion allowance for fiscal year 2003, minus
(iii) deleted text begin$415 deleted text endnew text begin$215new text end;

(2) the greater of (i) deleted text begin18.6 deleted text endnew text begin26 new text endpercent of the formula
allowance or (ii) deleted text begin$855.79 deleted text endnew text begin$1,294 new text endtimes the annual inflationary
increase as calculated under paragraph deleted text begin(c) deleted text endnew text begin(b)new text end; or

(3) for a newly reorganized district created after July 1,
deleted text begin 2002 deleted text endnew text begin2006new text end, the referendum revenue authority for each
reorganizing district in the year preceding reorganization
divided by its resident marginal cost pupil units for the year
preceding reorganization.

deleted text begin (c) deleted text endnew text begin(b) new text endFor purposes of this subdivision, for fiscal year
2005 and later, "inflationary increase" means one plus the
percentage change in the Consumer Price Index for urban
consumers, as prepared by the United States Bureau of Labor
Standards, for the current fiscal year to fiscal year 2004. For
fiscal years 2009 and later, for purposes of paragraph deleted text begin(b) deleted text endnew text begin(a)new text end,
clause (1), the inflationary increase equals the inflationary
increase for fiscal year 2008 plus one-fourth of the percentage
increase in the formula allowance for that year compared with
the formula allowance for fiscal year 2008.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2007.
new text end

Sec. 30.

Minnesota Statutes 2004, section 126C.17,
subdivision 5, is amended to read:

Subd. 5.

Referendum equalization revenue.

(a) For fiscal
year 2003 and later, a district's referendum equalization
revenue equals the sum of the first tier referendum equalization
revenue and the second tier referendum equalization revenue.

(b) A district's first tier referendum equalization revenue
equals the district's first tier referendum equalization
allowance times the district's resident marginal cost pupil
units for that year.

(c) deleted text beginFor fiscal years 2003 and 2004, a district's first tier
referendum equalization allowance equals the lesser of the
district's referendum allowance under subdivision 1 or $126.
For fiscal year 2005, a district's first tier referendum
equalization allowance equals the lesser of the district's
referendum allowance under subdivision 1 or $405.deleted text endFor fiscal
year 2006 deleted text beginand laterdeleted text end, a district's first tier referendum
equalization allowance equals the lesser of the district's
referendum allowance under subdivision 1 or $500. new text beginFor fiscal
year 2007, a district's first tier referendum equalization
allowance equals the lesser of the district's referendum
allowance under subdivision 1 or $600.
new text end

new text begin For fiscal year 2008 and later, a district's first tier
referendum equalization allowance equals the lesser of the
district's referendum allowance under subdivision 1 or $700.
new text end

(d) A district's second tier referendum equalization
revenue equals the district's second tier referendum
equalization allowance times the district's resident marginal
cost pupil units for that year.

(e) new text beginFor fiscal year 2006,new text enda district's second tier
referendum equalization allowance equals the lesser of the
district's referendum allowance under subdivision 1 or 18.6
percent of the formula allowance, minus the district's first
tier referendum equalization allowance. new text beginFor fiscal year 2007
and later, a district's second tier referendum equalization
allowance equals the lesser of the district's referendum
allowance under subdivision 1 or 26 percent of the formula
allowance, minus the district's first tier referendum
equalization allowance.
new text end

(f) Notwithstanding paragraph (e), the second tier
referendum allowance for a district qualifying for secondary
sparsity revenue under section 126C.10, subdivision 7, or
elementary sparsity revenue under section 126C.10, subdivision
8, equals the district's referendum allowance under subdivision
1 minus the district's first tier referendum equalization
allowance.

Sec. 31.

Minnesota Statutes 2004, section 126C.17,
subdivision 7, is amended to read:

Subd. 7.

Referendum equalization aid.

(a) A district's
referendum equalization aid equals the difference between its
referendum equalization revenue and levy.

(b) If a district's actual levy for first or second tier
referendum equalization revenue is less than its maximum levy
limit for that tier, aid shall be proportionately reduced.

(c) Notwithstanding paragraph (a), the referendum
equalization aid for a district, where the referendum
equalization aid under paragraph (a) exceeds 90 percent of the
referendum revenue, must not exceed deleted text begin18.6 deleted text endnew text begin26 new text endpercent of the
formula allowance times the district's resident marginal cost
pupil units. A district's referendum levy is increased by the
amount of any reduction in referendum aid under this paragraph.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2007.
new text end

Sec. 32.

Minnesota Statutes 2004, section 126C.17,
subdivision 9, is amended to read:

Subd. 9.

Referendum revenue.

(a) The revenue authorized
by section 126C.10, subdivision 1, may be increased in the
amount approved by the voters of the district at a referendum
called for the purpose. The referendum may be called by the
board or shall be called by the board upon written petition of
qualified voters of the district. The referendum must be
conducted one or two calendar years before the increased levy
authority, if approved, first becomes payable. Only one
election to approve an increase may be held in a calendar year.
Unless the referendum is conducted by mail under paragraph (g),
the referendum must be held on the first Tuesday after the first
Monday in November. The ballot must state the maximum amount of
the increased revenue per resident marginal cost pupil unitdeleted text begin, the
estimated referendum tax rate as a percentage of referendum
market value in the first year it is to be levied, and that the
revenue must be used to finance school operationsdeleted text end. The ballot
may state a schedule, determined by the board, of increased
revenue per resident marginal cost pupil unit that differs from
year to year over the number of years for which the increased
revenue is authorized. deleted text beginIf the ballot contains a schedule
showing different amounts, it must also indicate the estimated
referendum tax rate as a percent of referendum market value for
the amount specified for the first year and for the maximum
amount specified in the schedule.deleted text endThe ballot may state that
existing referendum levy authority is expiring. In this case,
the ballot may also compare the proposed levy authority to the
existing expiring levy authority, and express the proposed
increase as the amount, if any, over the expiring referendum
levy authority. The ballot must designate the specific number
of years, not to exceed ten, for which the referendum
authorization applies. new text beginThe ballot, including a ballot on the
question to revoke or reduce the increased revenue amount under
paragraph (c), must abbreviate the term "per resident marginal
cost pupil unit" as "per pupil." new text endThe notice required under
section 275.60 may be modified to read, in cases of renewing
existing levies:

"BY VOTING "YES" ON THIS BALLOT QUESTION, YOU MAY BE VOTING
FOR A PROPERTY TAX INCREASE."

The ballot may contain a textual portion with the
information required in this subdivision and a question stating
substantially the following:

"Shall the increase in the revenue proposed by (petition
to) the board of ........., School District No. .., be approved?"

If approved, an amount equal to the approved revenue per
resident marginal cost pupil unit times the resident marginal
cost pupil units for the school year beginning in the year after
the levy is certified shall be authorized for certification for
the number of years approved, if applicable, or until revoked or
reduced by the voters of the district at a subsequent referendum.

(b) The board must prepare and deliver by first class mail
at least 15 days but no more than 30 days before the day of the
referendum to each taxpayer a notice of the referendum and the
proposed revenue increase. The board need not mail more than
one notice to any taxpayer. For the purpose of giving mailed
notice under this subdivision, owners must be those shown to be
owners on the records of the county auditor or, in any county
where tax statements are mailed by the county treasurer, on the
records of the county treasurer. Every property owner whose
name does not appear on the records of the county auditor or the
county treasurer is deemed to have waived this mailed notice
unless the owner has requested in writing that the county
auditor or county treasurer, as the case may be, include the
name on the records for this purpose. The notice must project
the anticipated amount of tax increase in annual dollars deleted text beginand
annual percentage deleted text endfor typical residential homesteads,
agricultural homesteads, apartments, and commercial-industrial
property within the school district.

The notice for a referendum may state that an existing
referendum levy is expiring and project the anticipated amount
of increase over the existing referendum levy in the first year,
if any, in annual dollars deleted text beginand annual percentage deleted text endfor typical
residential homesteads, agricultural homesteads, apartments, and
commercial-industrial property within the district.

The notice must include the following statement: "Passage
of this referendum will result in an increase in your property
taxes." However, in cases of renewing existing levies, the
notice may include the following statement: "Passage of this
referendum may result in an increase in your property taxes."

(c) A referendum on the question of revoking or reducing
the increased revenue amount authorized pursuant to paragraph
(a) may be called by the board and shall be called by the board
upon the written petition of qualified voters of the district.
A referendum to revoke or reduce the revenue amount must state
the amount per resident marginal cost pupil unit by which the
authority is to be reduced. Revenue authority approved by the
voters of the district pursuant to paragraph (a) must be
available to the school district at least once before it is
subject to a referendum on its revocation or reduction for
subsequent years. Only one revocation or reduction referendum
may be held to revoke or reduce referendum revenue for any
specific year and for years thereafter.

(d) A petition authorized by paragraph (a) or (c) is
effective if signed by a number of qualified voters in excess of
15 percent of the registered voters of the district on the day
the petition is filed with the board. A referendum invoked by
petition must be held on the date specified in paragraph (a).

(e) The approval of 50 percent plus one of those voting on
the question is required to pass a referendum authorized by this
subdivision.

(f) At least 15 days before the day of the referendum, the
district must submit a copy of the notice required under
paragraph (b) to the commissioner and to the county auditor of
each county in which the district is located. Within 15 days
after the results of the referendum have been certified by the
board, or in the case of a recount, the certification of the
results of the recount by the canvassing board, the district
must notify the commissioner of the results of the referendum.

Sec. 33.

Minnesota Statutes 2004, section 126C.17,
subdivision 13, is amended to read:

Subd. 13.

Referendum conversion allowance.

deleted text begin(a) deleted text endA school
district that received supplemental or transition revenue in
fiscal year 2002 may convert its supplemental revenue conversion
allowance and transition revenue conversion allowance to
additional referendum allowance under subdivision 1 for fiscal
year 2003 and thereafter. A majority of the school board must
approve the conversion at a public meeting before November 1,
2001. For a district with other referendum authority, the
referendum conversion allowance approved by the board continues
until the portion of the district's other referendum authority
with the earliest expiration date after June 30, 2006, expires.
For a district with no other referendum authority, the
referendum conversion allowance approved by the board continues
until June 30, 2012.

deleted text begin (b) A school district that received transition revenue in
fiscal year 2004 may convert all or part of its transition
revenue to referendum revenue with voter approval in a
referendum called for the purpose. The referendum must be held
in accordance with subdivision 9, except that the ballot may
state that existing transition revenue authority is being
canceled or is expiring. In this case, the ballot shall compare
the proposed referendum allowance to the canceled or expiring
transition revenue allowance. For purposes of this comparison,
the canceled or expiring transition revenue allowance per
adjusted marginal cost pupil unit shall be converted to an
allowance per resident marginal cost pupil unit based on the
district's ratio of adjusted marginal cost pupil units to
resident marginal cost pupil units for the preceding fiscal
year. The referendum must be held on the first Tuesday after
the first Monday in November. The notice required under section
275.60 may be modified to read: "BY VOTING 'YES' ON THIS BALLOT
QUESTION, YOU MAY BE VOTING FOR A PROPERTY TAX INCREASE."
Elections under this paragraph must be held in 2007 or earlier.
deleted text end

Sec. 34.

Minnesota Statutes 2004, section 126C.21,
subdivision 4, is amended to read:

Subd. 4.

Taconite deductions.

deleted text begin (1) Notwithstanding any
provisions of any other law to the contrary, the adjusted net
tax capacity used in calculating general education aid may
include only that property that is currently taxable in the
district.
deleted text end

deleted text begin (2) deleted text endFor districts that deleted text beginreceived payments deleted text endnew text beginhave revenue new text endunder
sections 298.018; 298.225; new text begin298.24 to new text end298.28new text begin, excluding 298.26
and 298.28, subdivision 4, paragraph (d)new text end; 298.34 to 298.39;
298.391 to 298.396; deleted text beginand deleted text end298.405new text begin; and 477A.15new text end, new text beginor new text endany law
imposing a tax upon severed mineral values; deleted text beginor recognized
revenue under section 477A.15;deleted text endnew text begin,new text endthe general education aid must
be reduced in the final adjustment payment by new text begin(1) new text endthe deleted text begindifference
between the dollar deleted text endamount of the deleted text beginpayments received deleted text endnew text beginrevenue
recognized new text endpursuant to those sectionsdeleted text begin, or revenue recognized
under section 477A.15 in deleted text endnew text beginfor new text endthe fiscal year to which the final
adjustment is attributable deleted text beginand deleted text endnew text begin, less (2) new text endthe amount that was
calculated, pursuant to section 126C.48, subdivision 8, as a
reduction of the levy attributable to the fiscal year to which
the final adjustment is attributable. If the final adjustment
of a district's general education aid for a fiscal year is a
negative amount because of this deleted text beginclause deleted text endnew text beginsubdivisionnew text end, the next
fiscal year's general education aid to that district must be
reduced by this negative amount in the following manner: there
must be withheld from each scheduled general education aid
payment due the district in such fiscal year, 15 percent of the
total negative amount, until the total negative amount has been
withheld. The amount reduced from general education aid
pursuant to this deleted text beginclause deleted text endnew text beginsubdivision new text endmust deleted text beginbe recognized as deleted text endnew text beginreduce
new text end revenue in the fiscal year to which the final adjustment payment
is attributable.

[EFFECTIVE DATE.]new text beginThis section is effective for revenue for
fiscal year 2006.
new text end

Sec. 35.

Minnesota Statutes 2004, section 126C.40,
subdivision 1, is amended to read:

Subdivision 1.

To lease building or land.

(a) When an
independent or a special school district or a group of
independent or special school districts finds it economically
advantageous to rent or lease a building or land for any
instructional purposes or for school storage or furniture
repair, and it determines that the operating capital revenue
authorized under section 126C.10, subdivision 13, is
insufficient for this purpose, it may apply to the commissioner
for permission to make an additional capital expenditure levy
for this purpose. An application for permission to levy under
this subdivision must contain financial justification for the
proposed levy, the terms and conditions of the proposed lease,
and a description of the space to be leased and its proposed use.

(b) The criteria for approval of applications to levy under
this subdivision must include: the reasonableness of the price,
the appropriateness of the space to the proposed activity, the
feasibility of transporting pupils to the leased building or
land, conformity of the lease to the laws and rules of the state
of Minnesota, and the appropriateness of the proposed lease to
the space needs and the financial condition of the district.
The commissioner must not authorize a levy under this
subdivision in an amount greater than deleted text begin90 percent of deleted text endthe cost to
the district of renting or leasing a building or land for
approved purposes. The proceeds of this levy must not be used
for custodial or other maintenance services. A district may not
levy under this subdivision for the purpose of leasing or
renting a district-owned building or site to itself.

(c) For agreements finalized after July 1, 1997, a district
may not levy under this subdivision for the purpose of leasing:
(1) a newly constructed building used primarily for regular
kindergarten, elementary, or secondary instruction; or (2) a
newly constructed building addition or additions used primarily
for regular kindergarten, elementary, or secondary instruction
that contains more than 20 percent of the square footage of the
previously existing building.

(d) Notwithstanding paragraph (b), a district may levy
under this subdivision for the purpose of leasing or renting a
district-owned building or site to itself only if the amount is
needed by the district to make payments required by a lease
purchase agreement, installment purchase agreement, or other
deferred payments agreement authorized by law, and the levy
meets the requirements of paragraph (c). A levy authorized for
a district by the commissioner under this paragraph may be in
the amount needed by the district to make payments required by a
lease purchase agreement, installment purchase agreement, or
other deferred payments agreement authorized by law, provided
that any agreement include a provision giving the school
districts the right to terminate the agreement annually without
penalty.

(e) The total levy under this subdivision for a district
for any year must not exceed deleted text begin$90 deleted text endnew text begin$100 new text endtimes the resident pupil
units for the fiscal year to which the levy is attributable.

(f) For agreements for which a review and comment have been
submitted to the Department of Education after April 1, 1998,
the term "instructional purpose" as used in this subdivision
excludes expenditures on stadiums.

(g) The commissioner of education may authorize a school
district to exceed the limit in paragraph (e) if the school
district petitions the commissioner for approval. The
commissioner shall grant approval to a school district to exceed
the limit in paragraph (e) for not more than five years if the
district meets the following criteria:

(1) the school district has been experiencing pupil
enrollment growth in the preceding five years;

(2) the purpose of the increased levy is in the long-term
public interest;

(3) the purpose of the increased levy promotes colocation
of government services; and

(4) the purpose of the increased levy is in the long-term
interest of the district by avoiding over construction of school
facilities.

(h) A school district that is a member of an intermediate
school district may include in its authority under this section
deleted text begin 90 percent of deleted text endthe costs associated with leases of administrative
and classroom space for intermediate school district programs.
This authority must not exceed deleted text begin$22.50 deleted text endnew text begin$25 new text endtimes the adjusted
marginal cost pupil units of the member districts. This
authority is in addition to any other authority authorized under
this section.

(i) In addition to the allowable capital levies in
paragraph (a), a district that is a member of the "Technology
and Information Education Systems" data processing joint board,
that finds it economically advantageous to enter into a lease
purchase agreement for a building for a group of school
districts or special school districts for staff development
purposes, may levy for its portion of lease costs attributed to
the district within the total levy limit in paragraph (e).

Sec. 36.

Minnesota Statutes 2004, section 126C.43,
subdivision 2, is amended to read:

Subd. 2.

Payment to unemployment insurance program trust
fund by state and political subdivisions.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2006.
new text end

Sec. 37.

Minnesota Statutes 2004, section 126C.43,
subdivision 3, is amended to read:

Subd. 3.

Tax levy for judgment.

A district may levy deleted text begin90
percent of deleted text endthe amount deleted text beginexceeding $10 times the district's
adjusted marginal cost pupil units for the fiscal year ending in
the year before the year the levy is certified deleted text endnecessary to pay
judgments against the district under section 123B.25 that became
final after the date the district certified its proposed levy in
the previous year. With the approval of the commissioner, a
district may spread this levy over a period not to exceed three
years. Upon approval through the adoption of a resolution by
each of an intermediate district's member school district
boards, a member school district may include its proportionate
share of the costs of a judgment against an intermediate school
district that became final under section 123B.25 after the date
that the earliest member school district certified its proposed
levy in the previous year. With the approval of the
commissioner, an intermediate school district member school
district may spread this levy over a period not to exceed three
years.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2006.
new text end

Sec. 38.

Minnesota Statutes 2004, section 126C.48,
subdivision 2, is amended to read:

Subd. 2.

Notice to commissioner; forms.

By October 7 of
each year each district must notify the commissioner of the
proposed levies in compliance with the levy limitations of this
chapter and chapters 120B, 122A, 123A, 123B, 124D, 125A, 127A,
and 136D. By January deleted text begin15 deleted text endnew text begin7 new text endof each year each district must
notify the commissioner of the final levies certified. The
commissioner shall prescribe the form of these notifications and
may request any additional information necessary to compute
certified levy amounts.

Sec. 39.

Minnesota Statutes 2004, section 126C.48,
subdivision 8, is amended to read:

Subd. 8.

Taconite payment and other reductions.

(1)
Reductions in levies pursuant to subdivision 1 must be made
prior to the reductions in clause (2).

(2) Notwithstanding any other law to the contrary,
districts deleted text beginwhich received payments deleted text endnew text beginthat have revenue new text endpursuant to
sections 298.018; 298.225; new text begin298.24 to new text end298.28, except an amount
distributed under deleted text beginsection deleted text endnew text beginsections 298.26;new text end298.28, subdivision
4, deleted text beginparagraph deleted text endnew text beginparagraphs new text end(c), clause (ii)new text begin, and (d)new text end; 298.34 to
298.39; 298.391 to 298.396; 298.405; new text begin477A.15;new text endand any law
imposing a tax upon severed mineral valuesdeleted text begin; or recognized
revenue under section 477A.15 must not include a portion of
these aids in their permissible levies pursuant to those
sections, but instead deleted text endmust reduce the deleted text beginpermissible deleted text endlevies
authorized by this chapter and chapters 120B, 122A, 123A, 123B,
124A, 124D, 125A, and 127A by deleted text beginthe greater of the following:deleted text endnew text begin95
percent of the previous year's revenue specified under this
clause.
new text end

deleted text begin (a) an amount equal to 50 percent of the total dollar
amount of the payments received pursuant to those sections or
revenue recognized under section 477A.15 in the previous fiscal
year; or
deleted text end

deleted text begin (b) an amount equal to the total dollar amount of the
payments received pursuant to those sections or revenue
recognized under section 477A.15 in the previous fiscal year
less the product of the same dollar amount of payments or
revenue times five percent.
deleted text end

deleted text begin For levy year 2002 only, 77 percent of the amounts
distributed under section 298.225 and 298.28, and 100 percent of
the amounts distributed under sections 298.018; 298.34 to
298.39; 298.391 to 298.396; 298.405; and any law imposing a tax
upon severed mineral values, or recognized revenue under section
477A.15, shall be used for purposes of the calculations under
this paragraph. For levy year 2003 only, the levy reductions
under this subdivision must be calculated as if section 298.28,
subdivision 4, paragraph (f), did not apply for the 2003
distribution.
deleted text end

(3) The amount of any voter approved referendum, facilities
down payment, and debt levies shall not be reduced by more than
50 percent under this subdivision. In administering this
paragraph, the commissioner shall first reduce the nonvoter
approved levies of a district; then, if any payments, severed
mineral value tax revenue or recognized revenue under paragraph
(2) remains, the commissioner shall reduce any voter approved
referendum levies authorized under section 126C.17; then, if any
payments, severed mineral value tax revenue or recognized
revenue under paragraph (2) remains, the commissioner shall
reduce any voter approved facilities down payment levies
authorized under section 123B.63 and then, if any payments,
severed mineral value tax revenue or recognized revenue under
paragraph (2) remains, the commissioner shall reduce any voter
approved debt levies.

(4) Before computing the reduction pursuant to this
subdivision of the health and safety levy authorized by sections
123B.57 and 126C.40, subdivision 5, the commissioner shall
ascertain from each affected school district the amount it
proposes to levy under each section or subdivision. The
reduction shall be computed on the basis of the amount so
ascertained.

(5) To the extent the levy reduction calculated under
paragraph (2) exceeds the limitation in paragraph (3), an amount
equal to the excess must be distributed from the school
district's distribution under sections 298.225, 298.28, and
477A.15 in the following year to the cities and townships within
the school district in the proportion that their taxable net tax
capacity within the school district bears to the taxable net tax
capacity of the school district for property taxes payable in
the year prior to distribution. No city or township shall
receive a distribution greater than its levy for taxes payable
in the year prior to distribution. The commissioner of revenue
shall certify the distributions of cities and towns under this
paragraph to the county auditor by September 30 of the year
preceding distribution. The county auditor shall reduce the
proposed and final levies of cities and towns receiving
distributions by the amount of their distribution.
Distributions to the cities and towns shall be made at the times
provided under section 298.27.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2006.
new text end

Sec. 40.

Minnesota Statutes 2004, section 127A.45,
subdivision 11, is amended to read:

Subd. 11.

Payment percentage for reimbursement aids.

One
hundred percent of the aid for the previous fiscal year must be
paid in the current year for the following aids:
new text begin telecommunications/Internet access equity and according to
section 125B.26,new text endspecial education special pupil aid according
to section 125A.75, subdivision 3, aid for litigation costs
according to section 125A.75, subdivision 8, aid for
court-placed special education expenses according to section
125A.79, subdivision 4, and aid for special education
out-of-state tuition according to section 125A.79, subdivision
8new text begin, and shared time aid according to section 126C.01, subdivision
7new text end.

Sec. 41.

Minnesota Statutes 2004, section 127A.49,
subdivision 2, is amended to read:

Subd. 2.

Abatements.

Whenever by virtue of chapter 278,
sections 270.07, 375.192, or otherwise, the net tax capacity of
any district for any taxable year is changed after the taxes for
that year have been spread by the county auditor and the local
tax rate as determined by the county auditor based upon the
original net tax capacity is applied upon the changed net tax
capacities, the county auditor shall, prior to February 1 of
each year, certify to the commissioner of education the amount
of any resulting net revenue loss that accrued to the district
during the preceding year. Each year, the commissioner shall
pay an abatement adjustment to the district in an amount
calculated according to the provisions of this subdivision.
This amount shall be deducted from the amount of the levy
authorized by section 126C.46. The amount of the abatement
adjustment must be the product of:

(1) the net revenue loss as certified by the county
auditor, times

(2) the ratio of:

(i) the sum of the amounts of the district's certified levy
in the new text beginthird new text endpreceding year according to the following:

(A) section 123B.57, if the district received health and
safety aid according to that section for the second preceding
year;

(B) section 124D.20, if the district received aid for
community education programs according to that section for the
second preceding year;

(C) section 124D.135, subdivision 3, if the district
received early childhood family education aid according to
section 124D.135 for the second preceding year; and

(D) section 126C.17, subdivision 6, if the district
received referendum equalization aid according to that section
for the second preceding year; to

(ii) the total amount of the district's certified levy in
the new text beginthird new text endpreceding December, plus or minus auditor's
adjustments.

Sec. 42.

Minnesota Statutes 2004, section 127A.49,
subdivision 3, is amended to read:

Subd. 3.

Excess tax increment.

(a) If a return of excess
tax increment is made to a district pursuant to deleted text beginsection deleted text endnew text beginsections
new text end 469.176, subdivision 2, new text beginand 469.177, subdivision 9,new text endor upon
decertification of a tax increment district, the school
district's aid and levy limitations must be adjusted for the
fiscal year in which the excess tax increment is paid under the
provisions of this subdivision.

(b) An amount must be subtracted from the district's aid
for the current fiscal year equal to the product of:

(1) the amount of the payment of excess tax increment to
the district, times

(2) the ratio of:

(i) the sum of the amounts of the district's certified levy
for the fiscal year in which the excess tax increment is paid
according to the following:

(A) section 123B.57, if the district received health and
safety aid according to that section for the second preceding
year;

(B) section 124D.20, if the district received aid for
community education programs according to that section for the
second preceding year;

(C) section 124D.135, subdivision 3, if the district
received early childhood family education aid according to
section 124D.135 for the second preceding year; and

(D) section 126C.17, subdivision 6, if the district
received referendum equalization aid according to that section
for the second preceding year; to

(ii) the total amount of the district's certified levy for
the fiscal year, plus or minus auditor's adjustments.

(c) An amount must be subtracted from the school district's
levy limitation for the next levy certified equal to the
difference between:

(1) the amount of the distribution of excess increment; and

(2) the amount subtracted from aid pursuant to clause (a).

If the aid and levy reductions required by this subdivision
cannot be made to the aid for the fiscal year specified or to
the levy specified, the reductions must be made from aid for
subsequent fiscal years, and from subsequent levies. The school
district must use the payment of excess tax increment to replace
the aid and levy revenue reduced under this subdivision.

(d) This subdivision applies only to the total amount of
excess increments received by a district for a calendar year
that exceeds $25,000.

Sec. 43.

Minnesota Statutes 2004, section 275.14, is
amended to read:

275.14 CENSUS.

deleted text begin For the purposes of sections 275.124 to 275.16, the
population of a city shall be that established by the last
federal census, by a special census taken by the United States
Bureau of the Census, by an estimate made by the Metropolitan
Council, or by the state demographer made according to section
4A.02, whichever has the latest stated date of count or
estimate, before July 2 of the current levy year.deleted text endThe
population of a school district must be as certified by the
Department of Education from the most recent federal census. In
any year in which no federal census is taken pursuant to law in
any school district affected by sections deleted text begin275.124 to
275.16 deleted text endnew text begin124D.20 and 124D.531 new text enda population estimate may be made
and submitted to the state demographer for approval as
hereinafter provided. The school board of a school district, in
case it desires a population estimate, shall pass a resolution
by July 1 containing a current estimate of the population of the
school district and shall submit the resolution to the state
demographer. The resolution shall describe the criteria on
which the estimate is based and shall be in a form and
accompanied by the data prescribed by the state demographer.
The state demographer shall determine whether or not the
criteria and process described in the resolution provide a
reasonable basis for the population estimate and shall inform
the school district of that determination within 30 days of
receipt of the resolution. If the state demographer determines
that the criteria and process described in the resolution do not
provide a reasonable basis for the population estimate, the
resolution shall be of no effect. If the state demographer
determines that the criteria and process do provide a reasonable
basis for the population estimate, the estimate shall be treated
as the population of the school district for the purposes of
sections deleted text begin275.124 to 275.16 deleted text endnew text begin124D.20 and 124D.531 new text enduntil the
population of the school district has been established by the
next federal census or until a more current population estimate
is prepared and approved as provided herein, whichever occurs
first. The state demographer shall establish guidelines for
acceptable population estimation criteria and processes. The
state demographer shall issue advisory opinions upon request in
writing to cities or school districts as to proposed criteria
and processes prior to their implementation in an estimation.
The advisory opinion shall be final and binding upon the
demographer unless the demographer can show cause why it should
not be final and binding.

In the event that a census tract employed in taking a
federal or local census overlaps two or more school districts,
the county auditor shall, on the basis of the best information
available, allocate the population of said census tract to the
school districts involved.

deleted text begin The term "council," as used in sections 275.124 to 275.16,
means any board or body, whether composed of one or more
branches, authorized to make ordinances for the government of a
city within this state.
deleted text end

Sec. 44.

Minnesota Statutes 2004, section 275.16, is
amended to read:

275.16 COUNTY AUDITOR TO FIX AMOUNT OF LEVY.

If any such municipality shall return to the county auditor
a levy greater than permitted by chapters 123A, 123B, new text begin124D,
new text end 126C, new text beginand new text end136C, deleted text beginand 136D,deleted text endsections 275.124 to 275.16, and 275.70
to 275.74, such county auditor shall extend only such amount of
taxes as the limitations herein prescribed will permit;
provided, if such levy shall include any levy for the payment of
bonded indebtedness or judgments, such levies for bonded
indebtedness or judgments shall be extended in full, and the
remainder of the levies shall be reduced so that the total
thereof, including levies for bonds and judgments, shall not
exceed such amount as the limitations herein prescribed will
permit.

Sec. 45.

Minnesota Statutes 2004, section 469.177,
subdivision 9, is amended to read:

Subd. 9.

Distributions of excess taxes on captured net
tax capacity.

(a) If the amount of tax paid on captured net tax
capacity exceeds the amount of tax increment, the county auditor
shall distribute the excess to the municipality, county, and
school district as follows: each governmental unit's share of
the excess equals

(1) the total amount of the excess for the tax increment
financing district, multiplied by

(2) a fraction, the numerator of which is the current local
tax rate of the governmental unit less the governmental unit's
local tax rate for the year the original local tax rate for the
district was certified (in no case may this amount be less than
zero) and the denominator of which is the sum of the numerators
for the municipality, county, and school district.

If the entire increase in the local tax rate is attributable to
a taxing district, other than the municipality, county, or
school district, then the excess must be distributed to the
municipality, county, and school district in proportion to their
respective local tax rates.

(b) The amounts distributed shall be deducted in computing
the levy limits of the taxing district for the succeeding
taxable year. deleted text beginIn the case of a school district, only the
proportion of the excess taxes attributable to unequalized
levies that are subject to a fixed dollar amount levy limit
shall be deducted from the levy limit.
deleted text end

(c) In the case of distributions to a school district deleted text beginthat
are attributable to state equalized leviesdeleted text end, the county auditor
shall report amounts distributed to the commissioner of
education in the same manner as provided for excess increments
under section 469.176, subdivision 2, and the distribution shall
be deducted from the school district's state aid payments new text beginand
levy limitation according to section 127A.49, subdivision 3new text end.

Sec. 46. new text beginKINDERGARTEN REPORTING.
new text end

new text begin Notwithstanding Minnesota Statutes, sections 120A.05,
subdivision 18; 120A.20, subdivision 1; and 124D.02, subdivision
1, pupils four or five years of age on September 1 of the
calendar year in which the school year commences and enrolled in
a prekindergarten program implemented by the district before
July 1, 2003, may be reported as kindergarten pupils under
Minnesota Statutes, section 126C.05, subdivision 1, for fiscal
years 2004 and earlier.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment and applies to fiscal years 2004 and
earlier.
new text end

Sec. 47. new text beginALTERNATIVE TEACHER COMPENSATION REVENUE
GUARANTEE.
new text end

new text begin Notwithstanding Minnesota Statutes, sections 122A.415,
subdivision 1, and 126C.10, subdivision 34, paragraphs (a) and
(b), a school district that received alternative teacher
compensation aid for fiscal year 2005, but does not qualify for
alternative teacher compensation revenue for all sites in the
district for fiscal year 2006 or 2007, shall receive additional
basic alternative teacher compensation aid for that fiscal year
equal to the lesser of the amount of alternative teacher
compensation aid it received for fiscal year 2005 or the amount
it would have received for that fiscal year under Minnesota
Statutes 2004, section 122A.415, subdivision 1, for teachers at
sites not qualifying for alternative teacher compensation
revenue for that fiscal year, if the district submits a timely
application and the commissioner determines that the district
continues to implement an alternative teacher compensation
system, consistent with its application under Minnesota Statutes
2004, section 122A.415, for fiscal year 2005. The additional
basic alternative teacher compensation aid under this section
must not be used in calculating the alternative teacher
compensation levy under Minnesota Statutes, section 126C.10,
subdivision 35. This section applies only to fiscal years 2006
and 2007 and does not apply to later fiscal years.
new text end

Sec. 48. new text beginINITIAL APPROVAL PROCESS.
new text end

new text begin Notwithstanding Minnesota Statutes, sections 122A.414,
subdivision 2b, and 122A.415, subdivision 3, paragraph (b), or
other law to the contrary, until July 1, 2006, only, the
commissioner of education may accept, and subsequently approve
an application to participate in the alternative teacher
compensation system under Minnesota Statutes, section 122A.414,
based on the proportionate distribution of the student
population in the seven-county metropolitan area and in rural
Minnesota. The commissioner must provide timely public notice
of the applicants the commissioner approves under this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2007.
new text end

Sec. 49. new text beginSCHOOL BUS LEVY; CARPENTER SCHOOL BUSES.
new text end

new text begin For taxes payable in 2006 through 2010, a school district
may levy an amount, not to exceed in the aggregate, $30,000
times the number of Carpenter school buses in its fleet as of
January 1, 2003, that have been determined to have potentially
defective welds and are subject to limitations imposed by the
Department of Public Safety.
new text end

Sec. 50. new text beginCOMPENSATORY REVENUE ALLOCATION; TEST SCORE
PILOT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Pilot program created. new text end

new text begin A pilot program is
created to allow a school district to allocate compensatory
revenue received under Minnesota Statutes, section 126C.10,
subdivision 3, among its school buildings according to each
building's school performance measures.
new text end

new text begin Subd. 2. new text end

new text begin Application process. new text end

new text begin Independent School
Districts Nos. 11, Anoka-Hennepin; 279, Osseo; 281, Robbinsdale;
535, Rochester; and 833, South Washington may submit an
application to the commissioner of education by August 15, 2005,
for a plan to allocate compensatory revenue to school sites
based on student performance. The application must include a
written resolution approved by the school board that: (1)
identifies the test results that will be used to assess student
performance; (2) describes the method for distribution of
compensatory revenue to the school sites; and (3) summarizes the
evaluation procedure the district will use to determine if the
redistribution of compensatory revenue improves overall student
performance. The application must be submitted in the form and
manner specified by the commissioner. The commissioner must
notify the selected school districts by September 1, 2005.
new text end

new text begin Subd. 3.new text end

new text beginReport.new text end

new text beginThe commissioner of education must
submit a report by February 15, 2008, to the education
committees of the legislature evaluating the effectiveness of
the pilot program.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 51. new text beginINCREASE IN EQUITY REVENUE; FISCAL YEAR 2006
ONLY.
new text end

new text begin For fiscal year 2006 only, the increase in equity revenue
under section 21 is payable entirely in state aid.
new text end

Sec. 52. new text beginRED LAKE FISCAL YEAR 2005 PUPIL UNITS.
new text end

new text begin Notwithstanding Minnesota Statutes, section 126C.05, the
fiscal year 2005 average daily membership for Independent School
District No. 38, Red Lake, shall be the greater of the amount
that would have been computed if the district's school buildings
had not reopened after March 21, 2005, or the amount computed
using actual data for the entire school year. Notwithstanding
Minnesota Statutes, section 126C.05, subdivision 15, for fiscal
year 2005, learning year pupil units for Independent School
District No. 38, Red Lake, must be calculated using the hours in
excess of the actual number of instructional hours in the
calendar year for the school attended by the student, instead of
the number of hours in excess of 1,020 for a secondary school
pupil.
new text end

Sec. 53. new text beginFISCAL YEARS 2006 AND 2007 DECLINING PUPIL UNIT
AID, RED LAKE.
new text end

new text begin For fiscal years 2006 and 2007 only, Independent School
District No. 38, Red Lake, is eligible for declining pupil unit
aid equal to the greater of zero or the product of the general
education formula allowance times the difference between the
district's adjusted marginal cost pupil units for fiscal year
2005 and the district's adjusted marginal cost pupil units for
that fiscal year. Notwithstanding Minnesota Statutes, section
126C.13, the declining pupil unit aid must be included in
calculating the district's general education aid.
new text end

Sec. 54. new text beginAPPROPRIATIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Department of education. new text end

new text begin The sums
indicated in this section are appropriated from the general fund
to the Department of Education for the fiscal years designated
and include and supersede any amounts appropriated in Laws 2005,
First Special Session chapter 2, or authorized by order of the
Ramsey County District Court in Case No. C9-05-5928.
new text end

new text begin Subd. 2. new text end

new text begin General education aid. new text end

new text begin For general education
aid under Minnesota Statutes, section 126C.13, subdivision 4:
new text end

new text begin $5,136,578,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $5,390,196,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $784,978,000 for 2005 and
$4,351,600,000 for 2006.
new text end

new text begin The 2007 appropriation includes $817,588,000 for 2006 and
$4,572,608,000 for 2007.
new text end

new text begin Subd. 3. new text end

new text begin Referendum tax base replacement aid. new text end

new text begin For
referendum tax base replacement aid under Minnesota Statutes,
section 126C.17, subdivision 7a:
new text end

new text begin $8,704,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $8,704,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $1,366,000 for 2005 and
$7,338,000 for 2006.
new text end

new text begin The 2007 appropriation includes $1,366,000 for 2006 and
$7,338,000 for 2007.
new text end

new text begin Subd. 4. new text end

new text begin Enrollment options transportation. new text end

new text begin For
transportation of pupils attending postsecondary institutions
under Minnesota Statutes, section 124D.09, or for transportation
of pupils attending nonresident districts under Minnesota
Statutes, section 124D.03:
new text end

new text begin $55,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $55,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 5. new text end

new text begin Abatement revenue. new text end

new text begin For abatement aid under
Minnesota Statutes, section 127A.49:
new text end

new text begin $903,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $955,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $187,000 for 2005 and
$716,000 for 2006.
new text end

new text begin The 2007 appropriation includes $133,000 for 2006 and
$822,000 for 2007.
new text end

new text begin Subd. 6. new text end

new text begin Consolidation transition. new text end

new text begin For districts
consolidating under Minnesota Statutes, section 123A.485:
new text end

new text begin $253,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2007 appropriation includes $0 for 2006 and $253,000
for 2007.
new text end

new text begin Subd. 7. new text end

new text begin Nonpublic pupil education aid. new text end

new text begin For nonpublic
pupil education aid under Minnesota Statutes, sections 123B.87
and 123B.40 to 123B.43:
new text end

new text begin $15,370,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $16,434,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $2,305,000 for 2005 and
$13,065,000 for 2006.
new text end

new text begin The 2007 appropriation includes $2,433,000 for 2006 and
$14,001,000 for 2007.
new text end

new text begin Subd. 8. new text end

new text begin Nonpublic pupil transportation. new text end

new text begin For nonpublic
pupil transportation aid under Minnesota Statutes, section
123B.92, subdivision 9:
new text end

new text begin $21,451,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $23,043,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $3,274,000 for 2005 and
$18,177,000 for 2006.
new text end

new text begin The 2007 appropriation includes $3,385,000 for 2006 and
$19,658,000 for 2007.
new text end

new text begin Subd. 9. new text end

new text begin One room schoolhouse. new text end

new text begin For a grant to
Independent School District No. 690, Warroad, to operate the
Angle Inlet School:
new text end

new text begin $50,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $50,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 10. new text end

new text begin Declining pupil aid; albert lea. new text end

new text begin For declining
pupil aid to Independent School District No. 241, Albert Lea:
new text end

new text begin $75,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin Subd. 11. new text end

new text begin Declining pupil aid; mesabi east. new text end

new text begin For
declining pupil aid to Independent School District No. 2711,
Mesabi East:
new text end

new text begin $50,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin Subd. 12. new text end

new text begin Declining pupil aid; roseau. new text end

new text begin For declining
pupil aid to Independent School District No. 682, Roseau:
new text end

new text begin $10,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin Subd. 13. new text end

new text begin Compensatory revenue pilot project. new text end

new text begin For grants
for participation in the compensatory revenue pilot program
under section 50:
new text end

new text begin $2,100,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $2,100,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Of this amount, $1,500,000 in each year is for a grant to
Independent School District No. 11, Anoka-Hennepin, $210,000 in
each year is for a grant to Independent School District No. 279,
Osseo, $160,000 in each year is for a grant to Independent
School District No. 281, Robbinsdale, $165,000 each year is for
a grant to Independent School District No. 535, Rochester, and
$65,000 in each year is for Independent School District No. 833,
South Washington.
new text end

new text begin If a grant to a specific school district is not awarded,
the commissioner may increase the aid amounts to any of the
remaining participating school districts.
new text end

new text begin This appropriation is part of the base budget for
subsequent fiscal years.
new text end

Sec. 55. new text beginREPEALER.
new text end

new text begin Minnesota Statutes 2004, sections 122A.415, subdivision 2;
123B.83, subdivision 1; and 126C.42, subdivisions 1 and 4, are
repealed.
new text end

Sec. 56. new text beginEFFECTIVE DATE.
new text end

new text begin Any section in this article without a specified effective
date is retroactively effective from July 1, 2005.
new text end

ARTICLE 2

EDUCATION EXCELLENCE

Section 1.

Minnesota Statutes 2004, section 13.32,
subdivision 8, is amended to read:

Subd. 8.

Access by juvenile justice system.

(a) Upon
request, the following education data shall be disclosed under
subdivision 3, clause (i), to the juvenile justice system: a
student's full name, home address, telephone number, date of
birth; a student's school schedule, new text begindaily new text endattendance record, and
photographs, if any; and parents' names, home addresses, and
telephone numbers.

(b) In addition, the existence of the following data about
a student may be disclosed under subdivision 3, clause (i):

(1) use of a controlled substance, alcohol, or tobacco;

(2) assaultive or threatening conduct that could result in
dismissal from school under section 121A.45, subdivision 2,
clause (b) or (c);

(3) possession or use of weapons or look-alike weapons;

(4) theft; or

(5) vandalism or other damage to property.

Any request for access to data under this paragraph must
contain an explanation of why access to the data is necessary to
serve the student.

(c) A principal or chief administrative officer of a school
who receives a request to disclose information about a student
to the juvenile justice system under paragraph (b) shall, to the
extent permitted by federal law, notify the student's parent or
guardian by certified mail of the request to disclose
information before disclosing the information. If the student's
parent or guardian notifies the principal or chief
administrative officer within ten days of receiving the
certified notice that the parent or guardian objects to the
disclosure, the principal or chief administrative officer must
not disclose the information. The principal or chief
administrative officer must inform the requesting member of the
juvenile justice system of the objection.

(d) A principal or chief administrative officer is not
required to create data under this subdivision. Information
provided in response to a data request under paragraph (b) shall
indicate only whether the data described in paragraph (b)
exist. The principal or chief administrative officer is not
authorized under paragraph (b) to disclose the actual data or
other information contained in the student's education record.
A principal or chief administrative officer is not required to
provide data that are protected by court order. A principal or
chief administrative officer must respond to a data request
within 14 days if no objection is received from the parent or
guardian.

(e) Nothing in this subdivision shall limit the disclosure
of educational data pursuant to court order.

(f) A school district, its agents, and employees who
provide data in good faith under this subdivision are not liable
for compensatory or exemplary damages or an award of attorney
fees in an action under section 13.08, or other law, or for a
penalty under section 13.09.

(g) Section 13.03, subdivision 4, applies to data that are
shared under this subdivision with a government entity. If data
are shared with a member of the juvenile justice system who is
not a government entity, the person receiving the shared data
must treat the data consistent with the requirements of this
chapter applicable to a government entity.

(h) A member of the juvenile justice system who falsely
certifies a request for data under this section is subject to
the penalties under section 13.09.

Sec. 2.

Minnesota Statutes 2004, section 13.321, is
amended by adding a subdivision to read:

new text begin Subd. 10.new text end

new text beginTeacher data from value-added assessment
model.new text end

new text beginData on individual teachers generated from a value-added
assessment model are governed under section 120B.362.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2004, section 120A.22,
subdivision 12, is amended to read:

Subd. 12.

Legitimate exemptions.

A parent, guardian, or
other person having control of a child may apply to a school
district to have the child excused from attendance for the whole
or any part of the time school is in session during any school
year. Application may be made to any member of the board, a
truant officer, a principal, or the superintendent. new text beginThe school
district may state in its school attendance policy that it may
ask the student's parent or legal guardian to verify in writing
the reason for the child's absence from school.new text endThe board of
the district in which the child resides may approve the
application upon the following being demonstrated to the
satisfaction of that board:

(1) that the child's bodily or mental condition is such as
to prevent attendance at school or application to study for the
period requireddeleted text begin; or deleted text endnew text begin, which includes:
new text end

new text begin (i) child illness, medical, dental, orthodontic, or
counseling appointments;
new text end

new text begin (ii) family emergencies;
new text end

new text begin (iii) the death or serious illness or funeral of an
immediate family member;
new text end

new text begin (iv) active duty in any military branch of the United
States; or
new text end

new text begin (v) other exemptions included in the district's school
attendance policy;
new text end

(2) that deleted text beginfor the school years 1988-1989 through 1999-2000
the child has already completed the studies ordinarily required
in the 10th grade and that for the school years beginning with
the 2000-2001 school year the child has already completed the
studies ordinarily required to graduate deleted text endnew text beginthe child has already
completed state and district standards required for graduation
new text end from high school; or

(3) that it is the wish of the parent, guardian, or other
person having control of the child, that the child attend for a
period or periods not exceeding in the aggregate three hours in
any week, a school for religious instruction conducted and
maintained by some church, or association of churches, or any
Sunday school association incorporated under the laws of this
state, or any auxiliary thereof. This school for religious
instruction must be conducted and maintained in a place other
than a public school building, and it must not, in whole or in
part, be conducted and maintained at public expense. However, a
child may be absent from school on such days as the child
attends upon instruction according to the ordinances of some
church.

Sec. 4.

Minnesota Statutes 2004, section 120B.02, is
amended to read:

120B.02 EDUCATIONAL EXPECTATIONS FOR MINNESOTA'S
STUDENTS.

(a) The legislature is committed to establishing rigorous
academic standards for Minnesota's public school students. To
that end, the commissioner shall adopt in rule statewide
academic standards. The commissioner shall not prescribe in
rule or otherwise the delivery system, classroom assessments, or
form of instruction that school sites must use. For purposes of
this chapter, a school site is a separate facility, or a
separate program within a facility that a local school board
recognizes as a school site for funding purposes.

(b) All commissioner actions regarding the rule must be
premised on the following:

(1) the rule is intended to raise academic expectations for
students, teachers, and schools;

(2) any state action regarding the rule must evidence
consideration of school district autonomy; and

(3) the Department of Education, with the assistance of
school districts, must make available information about all
state initiatives related to the rule to students and parents,
teachers, and the general public in a timely format that is
appropriate, comprehensive, and readily understandable.

(c) When fully implemented, the requirements for high
school graduation in Minnesota must require students to deleted text beginpass the
basic skills test requirements and deleted text endsatisfactorily complete, as
determined by the school district, the course credit
requirements under section 120B.024new text beginand:
new text end

new text begin (1) for students enrolled in grade 8 before the 2005-2006
school year, to pass the basic skills test requirements; and
new text end

new text begin (2) for students enrolled in grade 8 in the 2005-2006
school year and later, to pass the Minnesota Comprehensive
Assessments Second Edition (MCA-IIs)new text end.

(d) The commissioner shall periodically review and report
on the state's assessment process.

(e) School districts are not required to adopt specific
provisions of deleted text beginthe Goals 2000 and deleted text endthe federal School-to-Work
programs.

Sec. 5.

Minnesota Statutes 2004, section 120B.021, is
amended by adding a subdivision to read:

new text begin Subd. 1a. new text end

new text begin Rigorous course of study; waiver. new text end

new text begin (a) Upon
receiving a student's application signed by the student's parent
or guardian, a school district, area learning center, or charter
school must declare that a student meets or exceeds a specific
academic standard required for graduation under this section if
the local school board, the school board of the school district
in which the area learning center is located, or the charter
school board of directors determines that the student:
new text end

new text begin (1) is participating in a course of study, including an
advanced placement or international baccalaureate course or
program; a learning opportunity outside the curriculum of the
district, area learning center, or charter school; or an
approved preparatory program for employment or postsecondary
education that is equally or more rigorous than the
corresponding state or local academic standard required by the
district, area learning center, or charter school;
new text end

new text begin (2) would be precluded from participating in the rigorous
course of study, learning opportunity, or preparatory employment
or postsecondary education program if the student were required
to achieve the academic standard to be waived; and
new text end

new text begin (3) satisfactorily completes the requirements for the
rigorous course of study, learning opportunity, or preparatory
employment or postsecondary education program.
new text end

new text begin Consistent with the requirements of this section, the local
school board, the school board of the school district in which
the area learning center is located, or the charter school board
of directors also may formally determine other circumstances in
which to declare that a student meets or exceeds a specific
academic standard that the site requires for graduation under
this section.
new text end

new text begin (b) A student who satisfactorily completes a postsecondary
enrollment options course or program under section 124D.09 is
not required to complete other requirements of the academic
standards corresponding to that specific rigorous course of
study.
new text end

Sec. 6.

Minnesota Statutes 2004, section 120B.11,
subdivision 1, is amended to read:

Subdivision 1.

Definitions.

For the purposes of this
section and section 120B.10, the following terms have the
meanings given them.

(a) "Instruction" means methods of providing learning
experiences that deleted text beginenables deleted text endnew text beginenable new text enda student to meet new text beginstate and
district academic standards and new text endgraduation
deleted text begin standards deleted text endnew text beginrequirementsnew text end.

(b) "Curriculum" means new text begindistrict or school adopted programs
and new text endwritten plans for providing students with learning
experiences that lead to new text beginexpected new text endknowledgedeleted text begin,deleted text endnew text beginand new text endskillsdeleted text begin, and
positive attitudesdeleted text end.

Sec. 7.

Minnesota Statutes 2004, section 120B.11,
subdivision 2, is amended to read:

Subd. 2.

Adopting policies.

(a) A school board shall
deleted text begin adopt annually a deleted text endnew text beginhave in place an adopted new text endwritten policy that
includes the following:

(1) district goals for instruction deleted text beginand deleted text endnew text beginincluding the use of
best practices, district and school new text endcurriculumnew text begin, and achievement
for all student subgroupsnew text end;

(2) a process for evaluating each student's progress toward
meeting deleted text begingraduation deleted text endnew text beginacademic new text endstandards and identifying the
strengths and weaknesses of instruction and curriculum affecting
students' progress;

(3) a system for periodically reviewing new text beginand evaluating new text endall
instruction and curriculum;

(4) a plan for improving instruction deleted text beginand deleted text endnew text begin,new text endcurriculumnew text begin, and
student achievementnew text end; and

(5) an deleted text begininstruction plan that includes deleted text endeducation
effectiveness deleted text beginprocesses developed under deleted text endnew text beginplan aligned with
new text end section 122A.625deleted text beginand deleted text endnew text beginthat new text endintegrates instruction, curriculum,
and technology.

Sec. 8.

Minnesota Statutes 2004, section 120B.11,
subdivision 3, is amended to read:

Subd. 3.

deleted text begininstruction and curriculum deleted text endnew text begindistrict new text endadvisory
committee.

Each school board shall establish an deleted text beginInstruction and
Curriculum deleted text endadvisory committee to ensure active community
participation in all phases of planning and improving the
instruction and curriculum affecting state deleted text begingraduation deleted text endnew text beginand
district academic new text endstandards. A district advisory committee, to
the extent possible, shall reflect the diversity of the district
and its learning sites, and shall include teachers, parents,
support staff, deleted text beginpupils deleted text endnew text beginstudentsnew text end, and other community residents.
The district may establish building teams as subcommittees of
the district advisory committee under subdivision 4. The
district advisory committee shall recommend to the school
board deleted text begindistrictwide education standards deleted text endnew text beginrigorous academic
standards, student achievement goals and measuresnew text end, assessments,
and program evaluations. Learning sites may expand upon
district evaluations of instruction, curriculum, assessments, or
programs. Whenever possible, parents and other community
residents shall comprise at least two-thirds of advisory
committee members.

Sec. 9.

Minnesota Statutes 2004, section 120B.11,
subdivision 4, is amended to read:

Subd. 4.

Building team.

A school may establish a
building team to develop and implement an education
effectiveness plan to improve instruction deleted text beginand deleted text endnew text begin,new text endcurriculumnew text begin, and
student achievementnew text end. The team shall advise the board and the
advisory committee about developing an instruction and
curriculum improvement plan that aligns curriculum, assessment
of student progress in meeting state deleted text begingraduation deleted text endnew text beginand district
academic new text endstandards, and instruction.

Sec. 10.

Minnesota Statutes 2004, section 120B.11,
subdivision 5, is amended to read:

Subd. 5.

Report.

(a) By October 1 of each year, the
school board shall use standard statewide reporting procedures
the commissioner develops and adopt a report that includes the
following:

(1) student deleted text beginperformance deleted text endnew text beginachievement new text endgoals for meeting state
deleted text begin graduation deleted text endnew text beginacademic new text endstandards deleted text beginadopted for that yeardeleted text end;

(2) results of local assessment data, and any additional
test data;

(3) the annual school district improvement plans new text beginincluding
staff development goals under section 122A.60new text end;

(4) information about district and learning site progress
in realizing previously adopted improvement plans; and

(5) the amount and type of revenue attributed to each
education site as defined in section 123B.04.

(b) The school board shall publish the report in the local
newspaper with the largest circulation in the district deleted text beginor deleted text endnew text begin,new text endby
mailnew text begin, or by electronic means such as the district Web site. If
electronic means are used, school districts must publish notice
of the report in a periodical of general circulation in the
district. School districts must make copies of the report
available to the public on requestnew text end. The board shall make a copy
of the report available to the public for inspection. The board
shall send a copy of the report to the commissioner of education
by October 15 of each year.

(c) The title of the report shall contain the name and
number of the school district and read "Annual Report on
Curriculum, Instruction, and Student deleted text beginPerformance deleted text endnew text beginAchievementnew text end."
The report must include at least the following information about
advisory committee membership:

(1) the name of each committee member and the date when
that member's term expires;

(2) the method and criteria the school board uses to select
committee members; and

(3) the date by which a community resident must apply to
next serve on the committee.

Sec. 11.

Minnesota Statutes 2004, section 120B.11,
subdivision 8, is amended to read:

Subd. 8.

Biennial evaluation; assessment program.

At
least once every two years, the district report shall include an
evaluation of the district testing programs, according to the
following:

(1) written objectives of the assessment program;

(2) names of tests and grade levels tested;

(3) use of test results; and

(4) deleted text beginimplementation of an assurance of mastery program
deleted text endnew text begin student achievement results compared to previous yearsnew text end.

Sec. 12.

new text begin [120B.128] EDUCATIONAL PLANNING AND ASSESSMENT
SYSTEM (EPAS) PROGRAM.
new text end

new text begin (a) School districts and charter schools may elect to
participate in the Educational Planning and Assessment System
(EPAS) program offered by ACT, Inc. to provide a longitudinal,
systematic approach to student educational and career planning,
assessment, instructional support, and evaluation. The EPAS
achievement tests include English, reading, mathematics,
science, and components on planning for high school and
postsecondary education, interest inventory, needs assessments,
and student education plans. These tests are linked to the ACT
assessment for college admission and allow students, parents,
teachers, and schools to determine the student's college
readiness before grades 11 and 12.
new text end

new text begin (b) The commissioner of education shall provide ACT Explore
tests for students in grade 8 and the ACT Plan test for students
in grade 10 to assess individual student academic strengths and
weaknesses, academic achievement and progress, higher order
thinking skills, and college readiness. The state shall pay the
test costs for school districts and charter schools that choose
to participate in the EPAS program. The commissioner shall
establish an application procedure and a process for state
payment of costs.
new text end

Sec. 13.

Minnesota Statutes 2004, section 120B.13,
subdivision 1, is amended to read:

Subdivision 1.

Program structure; training programs for
teachers.

(a) The advanced placement and international
baccalaureate programs are well-established academic programs
for mature, academically directed high school students. These
programs, in addition to providing academic rigor, offer sound
curricular design, accountability, comprehensive external
assessment, feedback to students and teachers, and the
opportunity for high school students to compete academically on
a global level. Advanced placement and international
baccalaureate programs allow students to leave high school with
the academic skills and self-confidence to succeed in college
and beyond. The advanced placement and international
baccalaureate programs help provide Minnesota students with
world-class educational opportunity.

(b) Critical to schools' educational success is ongoing
advanced placement/international baccalaureate-approved teacher
training. A secondary teacher assigned by a district to teach
an advanced placement or international baccalaureate course or
other interested educator may participate in a training program
offered by The College Board or International Baccalaureate
North America, Inc. The state may pay a portion of the tuition,
room, deleted text beginand deleted text endboardnew text begin, and out-of-state travel new text endcosts a teacher or
other interested educator incurs in participating in a training
program. The commissioner shall determine application
procedures and deadlines, deleted text beginand deleted text endselect teachers and other
interested educators to participate in the training programnew text begin, and
determine the payment process and amount of the subsidynew text end. The
procedures determined by the commissioner shall, to the extent
possible, ensure that advanced placement and international
baccalaureate courses become available in all parts of the state
and that a variety of course offerings are available in school
districts. This subdivision does not prevent teacher or other
interested educator participation in training programs offered
by The College Board or International Baccalaureate North
America, Inc., when tuition is paid by a source other than the
state.

Sec. 14.

Minnesota Statutes 2004, section 120B.13,
subdivision 3, is amended to read:

Subd. 3.

Subsidy for examination fees.

The state may pay
all or part of the fee for advanced placement or international
baccalaureate examinations deleted text beginfor pupils of low-income families in
public and nonpublic schoolsdeleted text end. The commissioner shall deleted text beginadopt a
schedule for fee subsidies that may allow payment of the entire
fee for deleted text endnew text beginpay all examination fees for all public and nonpublic
students of new text endlow-income families, as defined by the commissionernew text begin,
and to the limit of the available appropriation, shall also pay
a portion or all of the examination fees for other public and
nonpublic students sitting for an advanced placement
examination, international baccalaureate examination, or bothnew text end.
The commissioner shall determine procedures for state payments
of fees.

Sec. 15.

Minnesota Statutes 2004, section 120B.13, is
amended by adding a subdivision to read:

new text begin Subd. 3a. new text end

new text begin College credit. new text end

new text begin The colleges and universities
of the Minnesota State Colleges and Universities system must
award, and the University of Minnesota and private postsecondary
institutions are encouraged to award, college credit to high
school students who receive a score of three or higher on an
advanced placement or four or higher on the international
baccalaureate program examination.
new text end

Sec. 16.

new text begin [120B.131] COLLEGE-LEVEL EXAMINATION PROGRAM
(CLEP).
new text end

new text begin Subdivision 1. new text end

new text begin Program structure. new text end

new text begin The College-Level
Examination Program (CLEP) offered by the College Board provides
students with the opportunity to demonstrate college-level
achievement and receive college credit or advanced standing
through a program of examinations in undergraduate college
courses. Schools must provide information about CLEP and the
opportunity to receive college credit from a Minnesota
postsecondary institution to students successfully completing a
college-level course.
new text end

new text begin Subd. 2. new text end

new text begin Reimbursement for examination fees. new text end

new text begin The state
may reimburse college level examination program (CLEP) fees for
a Minnesota public high school student who has successfully
completed one or more college-level courses in high school and
earned a satisfactory score on one or more CLEP examinations in
the following subjects: composition and literature, mathematics
and science, social sciences and history, foreign languages, and
business and humanities. The state may reimburse each
successful student for up to six examination fees. The
commissioner shall establish application procedures and a
process and schedule for fee reimbursements. The commissioner
must give priority to reimburse the CLEP examination fees of
students of low-income families.
new text end

new text begin Subd. 3. new text end

new text begin College credit. new text end

new text begin The colleges and universities
of the Minnesota State Colleges and Universities system must
award, and the University of Minnesota and private postsecondary
institutions are encouraged to award, college credit to high
school students who receive a satisfactory score on a CLEP
examination under this section. The commissioner, in
consultation with the Minnesota State Colleges and Universities,
shall set a passing score for college credits.
new text end

Sec. 17.

new text begin [120B.15] GIFTED AND TALENTED STUDENTS
PROGRAMS.
new text end

new text begin School districts may identify students, locally develop
programs, provide staff development, and evaluate programs to
provide gifted and talented students with challenging
educational programs.
new text end

new text begin School districts may adopt guidelines for assessing and
identifying students for participation in gifted and talented
programs. The guidelines should include the use of:
new text end

new text begin (1) multiple and objective criteria; and
new text end

new text begin (2) assessments and procedures that are valid and reliable,
fair, and based on current theory and research.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for the
2005-2006 school year.
new text end

Sec. 18.

Minnesota Statutes 2004, section 120B.22,
subdivision 1, is amended to read:

Subdivision 1.

Violence prevention curriculum.

(a) The
commissioner of education, in consultation with the
commissioners of health and human services, state minority
councils, battered women's and domestic abuse programs, battered
women's shelters, sexual assault centers, representatives of
religious communities, and the assistant commissioner of the
Office of Drug Policy and Violence Prevention, shall assist
districts on request in developing or implementing a violence
prevention program for students in kindergarten to grade 12 that
can be integrated into existing curriculum. The purpose of the
program is to help students learn how to resolve conflicts
within their families and communities in nonviolent, effective
ways.

(b) Each district is encouraged to integrate into its
existing curriculum a program for violence prevention that
includes at least:

(1) a comprehensive, accurate, and age appropriate
curriculum on violence prevention, nonviolent conflict
resolution, sexual, racial, and cultural
harassment, new text beginself-protection,new text endand student hazing that promotes
equality, respect, understanding, effective communication,
individual responsibility, thoughtful decision making, positive
conflict resolution, useful coping skills, critical thinking,
listening and watching skills, and personal safety;

(2) planning materials, guidelines, and other accurate
information on preventing physical and emotional violence,
identifying and reducing the incidence of sexual, racial, and
cultural harassment, and reducing child abuse and neglect;

(3) a special parent education component of early childhood
family education programs to prevent child abuse and neglect and
to promote positive parenting skills, giving priority to
services and outreach programs for at-risk families;

(4) involvement of parents and other community members,
including the clergy, business representatives, civic leaders,
local elected officials, law enforcement officials, and the
county attorney;

(5) collaboration with local community services, agencies,
and organizations that assist in violence intervention or
prevention, including family-based services, crisis services,
life management skills services, case coordination services,
mental health services, and early intervention services;

(6) collaboration among districts and service cooperatives;

(7) targeting early adolescents for prevention efforts,
especially early adolescents whose personal circumstances may
lead to violent or harassing behavior;

(8) opportunities for teachers to receive in-service
training or attend other programs on strategies or curriculum
designed to assist students in intervening in or preventing
violence in school and at home; and

(9) administrative policies that reflect, and a staff that
models, nonviolent behaviors that do not display or condone
sexual, racial, or cultural harassment or student hazing.

Sec. 19.

new text begin [120B.225] CHARACTER DEVELOPMENT EDUCATION.
new text end

new text begin Subdivision 1. new text end

new text begin Character development education. new text end

new text begin The
legislature encourages districts to integrate or offer
instruction on character education including, but not limited
to, character qualities such as attentiveness, truthfulness,
respect for authority, diligence, gratefulness, self-discipline,
patience, forgiveness, respect for others, peacemaking, and
resourcefulness. Instruction should be integrated into a
district's existing programs, curriculum, or the general school
environment. The commissioner shall provide assistance at the
request of a district to develop character education curriculum
and programs.
new text end

new text begin Subd. 2.new text end

new text beginFunding sources.new text end

new text beginThe commissioner must first
use federal funds for character development education programs
to the extent available under United States Code, title 20,
section 7247. Districts may accept funds from private and other
public sources for character development education programs
developed and implemented under this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 20.

new text begin [120B.25] AMERICAN HERITAGE EDUCATION.
new text end

new text begin (a) School districts shall permit grade-level instruction
for students to read and study America's founding documents,
including documents that contributed to the foundation or
maintenance of America's representative form of limited
government, the Bill of Rights, our free-market economic system,
and patriotism.
new text end

new text begin (b) Districts may not censor or restrain instruction in
American or Minnesota state history or heritage based on
religious references in original source documents, writings,
speeches, proclamations, or records.
new text end

Sec. 21.

Minnesota Statutes 2004, section 120B.30,
subdivision 1, is amended to read:

Subdivision 1.

Statewide testing.

(a) The commissioner,
with advice from experts with appropriate technical
qualifications and experience and stakeholders, consistent with
subdivision 1a, shall include in the comprehensive assessment
system, for each grade level to be tested, state-constructed
tests developed from and aligned with the state's required
academic standards under section 120B.021 and administered
annually to all students in grades 3 through 8 and at the high
school level. A state-developed test in a subject other than
writing, developed after the 2002-2003 school year, must include
both deleted text beginmultiple choice deleted text endnew text beginmachine-scoreable new text endand constructed response
questions. The commissioner shall establish one or more months
during which schools shall administer the tests to students each
school year. new text beginFor students enrolled in grade 8 before the
2005-2006 school year,new text endonly Minnesota basic skills tests in
reading, mathematics, and writing shall fulfill students' basic
skills testing requirements for a passing state notation. The
passing scores of the state tests in reading and mathematics are
the equivalent of:

(1) 70 percent correct for students entering grade 9 in
1996; and

(2) 75 percent correct for students entering grade 9 in
1997 and thereafter, as based on the first uniform test
administration of February 1998.

new text begin For students enrolled in grade 8 in the 2005-2006 school
year and later, only the Minnesota Comprehensive Assessments
Second Edition (MCA-IIs) in reading, mathematics, and writing
shall fulfill students' academic standard requirements.
new text end

(b) The third through 8th grade and high school level test
results shall be available to districts for diagnostic purposes
affecting student learning and district instruction and
curriculum, and for establishing educational accountability.
The commissioner must disseminate to the public the test results
upon receiving those results.

(c) State tests must be constructed and aligned with state
academic standards. The testing process and the order of
administration shall be determined by the commissioner. The
statewide results shall be aggregated at the site and district
level, consistent with subdivision 1a.

(d) In addition to the testing and reporting requirements
under this section, the commissioner shall include the following
components in the statewide public reporting system:

(1) uniform statewide testing of all students in grades 3
through 8 and at the high school level that provides exemptions,
only with parent or guardian approval, for those very few
students for whom the student's individual education plan team
under sections 125A.05 and 125A.06, determines that the student
is incapable of taking a statewide test, or for a limited
English proficiency student under section 124D.59, subdivision
2, if the student has been in the United States for fewer than
three years;

(2) educational indicators that can be aggregated and
compared across school districts and across time on a statewide
basis, including average daily attendance, high school
graduation rates, and high school drop-out rates by age and
grade level;

(3) students' scores on the American College Test; and

(4) state results from participation in the National
Assessment of Educational Progress so that the state can
benchmark its performance against the nation and other states,
and, where possible, against other countries, and contribute to
the national effort to monitor achievement.

(e) Districts must report exemptions under paragraph (d),
clause (1), to the commissioner consistent with a format
provided by the commissioner.

Sec. 22.

Minnesota Statutes 2004, section 120B.30,
subdivision 1a, is amended to read:

Subd. 1a.

Statewide and local assessments; results.

(a)
The commissioner must develop deleted text beginlanguage arts deleted text endnew text beginreadingnew text end,
mathematics, and science assessments aligned with state academic
standards that districts and sites must use to monitor student
growth toward achieving those standards. The commissioner must
not develop statewide assessments for academic standards in
social studiesnew text begin, health and physical education,new text endand the arts.
The commissioner must require:

(1) annual deleted text beginlanguage arts deleted text endnew text beginreading new text endand mathematics
assessments in grades 3 through 8 and at the high school level
for the 2005-2006 school year and later; and

(2) annual science assessments in one grade in the grades 3
through 5 span, the grades 6 through 9 span, and a life sciences
assessment in the grades 10 through 12 span for the 2007-2008
school year and later.

(b) The commissioner must ensure that all statewide tests
administered to elementary and secondary students measure
students' academic knowledge and skills and not students'
values, attitudes, and beliefs.

(1) provide timely, useful, and understandable information
on the performance of individual students, schools, school
districts, and the state;

(2) include, by the 2006-2007 school year, a value-added
component to measure student achievement growth over time; and

(3) new text begin(i) for students enrolled in grade 8 before the
2005-2006 school year,new text enddetermine whether students have met the
state's basic skills requirementsnew text begin; and
new text end

new text begin (ii) for students enrolled in grade 8 in the 2005-2006
school year and later, determine whether students have met the
state's academic standardsnew text end.

(d) Consistent with applicable federal law and subdivision
1, paragraph (d), clause (1), the commissioner must include
alternative assessments for the very few students with
disabilities for whom statewide assessments are inappropriate
and for students with limited English proficiency.

(e) A school, school district, and charter school must
administer statewide assessments under this section, as the
assessments become available, to evaluate student progress in
achieving the academic standards. If a state assessment is not
available, a school, school district, and charter school must
determine locally if a student has met the required academic
standards. A school, school district, or charter school may use
a student's performance on a statewide assessment as one of
multiple criteria to determine grade promotion or retention. A
school, school district, or charter school may use a high school
student's performance on a statewide assessment as a percentage
of the student's final grade in a course, or place a student's
assessment score on the student's transcript.

Sec. 23.

Minnesota Statutes 2004, section 120B.30, is
amended by adding a subdivision to read:

new text begin Subd. 4. new text end

new text begin Access to tests. new text end

new text begin The commissioner must adopt
and publish a policy to provide public and parental access for
review of basic skills tests, Minnesota Comprehensive
Assessments, or any other such statewide test and assessment.
Upon receiving a written request, the commissioner must make
available to parents or guardians a copy of their student's
actual answer sheet to the test questions to be reviewed by the
parent.
new text end

Sec. 24.

new text begin [120B.362] VALUE-ADDED ASSESSMENT PROGRAM.
new text end

new text begin (a) The commissioner of education must implement a
value-added assessment program to assist school districts,
public schools, and charter schools in assessing and reporting
individual students' growth in academic achievement under
section 120B.30, subdivision 1a. The program must use
assessments of individual students' academic achievement to make
longitudinal comparisons of each student's academic growth over
time. School districts, public schools, and charter schools may
apply to the commissioner to participate in the initial trial
program using a form and in the manner the commissioner
prescribes. The commissioner must select program participants
from urban, suburban, and rural areas throughout the state.
new text end

new text begin (b) The commissioner may issue a request for proposals to
contract with an organization that provides a value-added
assessment model that reliably estimates school and school
district effects on students' academic achievement over time.
The model the commissioner selects must accommodate diverse data
and must use each student's test data across grades. Data on
individual teachers generated under the model are personnel data
under section 13.43.
new text end

new text begin (c) The contract under paragraph (b) must be consistent
with the definition of "best value" under section 16C.02,
subdivision 4.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 25.

Minnesota Statutes 2004, section 121A.03,
subdivision 1, is amended to read:

Subdivision 1.

Model policy.

The commissioner shall
maintain and make available to school boards a model sexual,
religious, and racial harassment and violence policy. The model
policy shall address the requirements of subdivision 2new text begin, and may
encourage violence prevention and character development
education programs, consistent with section 120B.225,
subdivision 1, to prevent and reduce policy violationsnew text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 26.

Minnesota Statutes 2004, section 121A.06,
subdivision 2, is amended to read:

Subd. 2.

Reports; content.

deleted text beginBy January 1, 1994, the
commissioner, in consultation with the criminal and juvenile
information policy group, shall develop a standardized form to
be used by schools to report incidents involving the use or
possession of a dangerous weapon in school zones.deleted text endnew text beginSchool
districts must electronically report to the commissioner of
education incidents involving the use or possession of a
dangerous weapon in school zones.new text endThe form deleted text beginshall deleted text endnew text beginmust new text endinclude
the following information:

(1) a description of each incident, including a description
of the dangerous weapon involved in the incident;

(2) where, at what time, and under what circumstances the
incident occurred;

(3) information about the offender, other than the
offender's name, including the offender's age; whether the
offender was a student and, if so, where the offender attended
school; and whether the offender was under school expulsion or
suspension at the time of the incident;

(4) information about the victim other than the victim's
name, if any, including the victim's age; whether the victim was
a student and, if so, where the victim attended school; and if
the victim was not a student, whether the victim was employed at
the school;

(5) the cost of the incident to the school and to the
victim; and

(6) the action taken by the school administration to
respond to the incident.

The commissioner deleted text beginalso deleted text endshall deleted text begindevelop deleted text endnew text beginprovide new text endan deleted text beginalternative
deleted text endnew text begin electronic new text endreporting format that allows school districts to
provide aggregate datadeleted text begin, with an option to use computer
technology to report the datadeleted text end.

Sec. 27.

Minnesota Statutes 2004, section 121A.06,
subdivision 3, is amended to read:

Subd. 3.

Reports; filing requirements.

By deleted text beginFebruary 1 and
deleted text end July deleted text begin1 deleted text endnew text begin31 new text endof each year, each new text beginpublic new text endschool shall report
incidents involving the use or possession of a dangerous weapon
in school zones to the commissioner. The reports must be deleted text beginmade
on the standardized forms or using the alternative
format deleted text endnew text beginsubmitted using the electronic reporting system new text enddeveloped
by the commissioner under subdivision 2. The commissioner shall
compile the information it receives from the schools and report
it annually to the commissioner of public safetydeleted text begin, the criminal
and juvenile information policy group,deleted text endand the legislature.

Sec. 28.

new text begin [121A.0695] SCHOOL BOARD POLICY; PROHIBITING
INTIMIDATION AND BULLYING.
new text end

new text begin Each school board shall adopt a written policy prohibiting
intimidation and bullying of any student.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for the
2005-2006 school year and later.
new text end

Sec. 29.

Minnesota Statutes 2004, section 121A.15,
subdivision 3, is amended to read:

Subd. 3.

Exemptions from immunizations.

(a) If a person
is at least seven years old and has not been immunized against
pertussis, the person must not be required to be immunized
against pertussis.

(b) If a person is at least 18 years old and has not
completed a series of immunizations against poliomyelitis, the
person must not be required to be immunized against
poliomyelitis.

(c) If a statement, signed by a physician, is submitted to
the administrator or other person having general control and
supervision of the school or child care facility stating that an
immunization is contraindicated for medical reasons or that
laboratory confirmation of the presence of adequate immunity
exists, the immunization specified in the statement need not be
required.

(d) If a notarized statement signed by the minor child's
parent or guardian or by the emancipated person is submitted to
the administrator or other person having general control and
supervision of the school or child care facility stating that
the person has not been immunized as prescribed in subdivision 1
because of the conscientiously held beliefs of the parent or
guardian of the minor child or of the emancipated person, the
immunizations specified in the statement shall not be required.
This statement must also be forwarded to the commissioner of the
Department of Health.

(e) If the person is under 15 months, the person is not
required to be immunized against measles, rubella, or mumps.

(f) If a person is at least five years old and has not been
immunized against haemophilus influenza type b, the person is
not required to be immunized against haemophilus influenza type
b.

new text begin (g) If a person who is not a Minnesota resident enrolls in
a Minnesota school online learning course or program that
delivers instruction to the person only by computer and does not
provide any teacher or instructor contact time or require
classroom attendance, the person is not subject to the
immunization, statement, and other requirements of this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 30.

Minnesota Statutes 2004, section 121A.47,
subdivision 14, is amended to read:

Subd. 14.

Admission or readmission plan.

new text begin(a) new text endA school
administrator shall prepare and enforce an admission or
readmission plan for any pupil who is excluded or expelled from
school. The plan may include measures to improve the pupil's
behaviornew text begin, including completing a character education program,
consistent with section 120B.225, subdivision 1,new text endand require
parental involvement in the admission or readmission process,
and may indicate the consequences to the pupil of not improving
the pupil's behavior.

new text begin (b) The definition of suspension under section 121A.41,
subdivision 10, does not apply to a student's dismissal from
school for one school day or less, except as provided under
federal law for a student with a disability. Each suspension
action may include a readmission plan. A readmission plan must
provide, where appropriate, alternative education services,
which must not be used to extend the student's current
suspension period. Consistent with section 125A.091,
subdivision 5, a readmission plan must not obligate a parent or
guardian to provide psychotropic drugs to their student as a
condition of readmission. School officials must not use the
refusal of a parent or guardian to consent to the administration
of psychotropic drugs to their student or to consent to a
psychiatric evaluation, screening or examination of the student
as a ground, by itself, to prohibit the student from attending
class or participating in a school-related activity, or as a
basis of a charge of child abuse, child neglect or medical or
educational neglect.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 31.

Minnesota Statutes 2004, section 121A.53, is
amended to read:

121A.53 REPORT TO COMMISSIONER OF EDUCATION.

Subdivision 1.

Exclusions and expulsions.

The school
board deleted text beginshall deleted text endnew text beginmust new text endreport new text beginthrough the department electronic
reporting system new text endeach exclusion or expulsion within 30 days of
the effective date of the action to the commissioner of
education. This report deleted text beginshall deleted text endnew text beginmust new text endinclude a statement of
alternative educational services given the pupil and the reason
for, the effective date, and the duration of the exclusion or
expulsion. new text beginThe report must also include the student's age,
grade, gender, race, and special education status.
new text end

Subd. 2.

Report.

The school board must include state
student identification numbers of affected pupils on all
dismissal reports required by the department. The department
must report annually to the commissioner summary data on the
number of dismissals by age, grade, gender, race, and special
education status of the affected pupils. new text beginAll dismissal reports
must be submitted through the department electronic reporting
system.
new text end

Sec. 32.

new text begin [121A.575] ALTERNATIVES TO PUPIL SUSPENSION.
new text end

new text begin Notwithstanding any law to the contrary and in accordance
with sections 121A.40 to 121A.56, after a school administration
notifies a pupil of the grounds for suspension, the school
administration may, instead of imposing the suspension, do one
or more of the following:
new text end

new text begin (1) strongly encourage a parent or guardian of the pupil to
attend school with the pupil for one day;
new text end

new text begin (2) assign the pupil to attend school on Saturday as
supervised by the principal or the principal's designee; and
new text end

new text begin (3) petition the juvenile court that the student is in need
of services under chapter 260C.
new text end

Sec. 33.

Minnesota Statutes 2004, section 122A.06,
subdivision 4, is amended to read:

Subd. 4.

Comprehensive, scientifically based reading
instruction.

deleted text begin "Comprehensive, scientifically based reading
instruction" includes instruction and practice in phonemic
awareness, phonics and other word-recognition skills, and guided
oral reading for beginning readers, as well as extensive silent
reading, vocabulary instruction, instruction in comprehension,
and instruction that fosters understanding and higher-order
thinking for readers of all ages and proficiency
levels. deleted text end new text begin "Comprehensive, scientifically based reading
instruction" includes a program or collection of instructional
practices that is based on reliable, valid evidence showing that
when these programs or practices are used, students can be
expected to achieve, at a minimum, satisfactory reading
progress. The program or collection of practices must include,
at a minimum, instruction in five areas of reading: phonemic
awareness, phonics, fluency, vocabulary, and text comprehension.
new text end

new text begin Comprehensive, scientifically based reading instruction
also includes and integrates instructional strategies for
continuously assessing, evaluating, and communicating the
student's reading progress and needs in order to design and
implement ongoing interventions so that students of all ages and
proficiency levels can read and comprehend text and apply higher
level thinking skills.
new text end

Sec. 34.

Minnesota Statutes 2004, section 122A.12,
subdivision 2, is amended to read:

Subd. 2.

Terms; compensation; removal; administrationnew text begin;
reimbursementnew text end.

new text begin(a) new text endMembership terms, removal of members, and
the filling of membership vacancies are as provided in section
214.09. The terms of the initial board members must be
determined by lot as follows:

(1) three members must be appointed for terms that expire
August 1, 2002;

(2) three members must be appointed for terms that expire
August 1, 2003; and

(3) four members must be appointed for terms that expire
August 1, 2004.

Members shall not receive the daily payment under section
214.09, subdivision 3. The public employer of a member shall
not reduce the member's compensation or benefits for the
member's absence from employment when engaging in the business
of the board. The provision of staff, administrative services,
and office space; the review and processing of complaints; the
setting of fees; the selection and duties of an executive
secretary to serve the board; and other provisions relating to
board operations are as provided in chapter 214. Fiscal year
and reporting requirements are as provided in sections 214.07
and 214.08.

new text begin (b) The board may reimburse local school districts for the
cost of a substitute teacher employed when a regular teacher is
providing professional assistance to the state by serving on the
board or on a committee or task force appointed by the board.
new text end

Sec. 35.

Minnesota Statutes 2004, section 122A.18,
subdivision 2a, is amended to read:

Subd. 2a.

Reading strategies.

(a) All colleges and
universities approved by the Board of Teaching to prepare
persons for classroom teacher licensure must include in their
teacher preparation programs deleted text beginreading best practices that enable
classroom teacher licensure candidates to know how to teach
reading, such as phonics or other deleted text endresearch-based best practices
new text begin in reading, consistent with section 122A.06, subdivision 4, that
enable the licensure candidate to know how to teach reading in
the candidate's content areasnew text end.

(b) Board-approved teacher preparation programs for
teachers of elementary education must require instruction in the
application of comprehensive, scientifically based, and balanced
reading instruction programsdeleted text begin.deleted text endnew text beginthat:
new text end

new text begin (1) teach students to read using foundational knowledge,
practices, and strategies consistent with section 122A.06,
subdivision 4, so that all students will achieve continuous
progress in reading; and
new text end

new text begin (2) teach specialized instruction in reading strategies,
interventions, and remediations that enable students of all ages
and proficiency levels to become proficient readers.
new text end

Sec. 36.

Minnesota Statutes 2004, section 122A.33, is
amended to read:

122A.33 LICENSE AND DEGREE EXEMPTION FOR HEAD COACH.

new text begin Subdivision 1. new text end

new text begin Employment. new text end

Notwithstanding section
122A.15, subdivision 1, a school district may employ as a head
varsity coach of an interscholastic sport at its secondary
school a person who does not have a license as head varsity
coach of interscholastic sports and who does not have a
bachelor's degree if:

(1) in the judgment of the school board, the person has the
knowledge and experience necessary to coach the sport;

(2) can verify completion of six quarter credits, or the
equivalent, or 60 clock hours of instruction in first aid and
the care and prevention of athletic injuries; and

(3) can verify completion of a coaching methods or theory
course.

new text begin Subd. 2. new text end

new text begin Annual contract. new text end

Notwithstanding section
122A.58, a person employed as a head varsity coach deleted text beginunder this
section deleted text endhas an annual contract as a coach that the school board
may or may not renew as the board sees fit.

new text begin Subd. 3.new text end

new text beginNotice of nonrenewal; opportunity to respond.new text end

new text beginA
school board that declines to renew the coaching contract of a
licensed or nonlicensed head varsity coach must notify the coach
within 14 days of that decision. If the coach requests reasons
for not renewing the coaching contract, the board must give the
coach its reasons in writing within ten days of receiving the
request. Upon request, the board must provide the coach with a
reasonable opportunity to respond to the reasons at a board
meeting. The hearing may be opened or closed at the election of
the coach unless the board closes the meeting under section
13D.05, subdivision 2, to discuss nonpublic data.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2005.
new text end

Sec. 37.

Minnesota Statutes 2004, section 122A.41,
subdivision 5a, is amended to read:

Subd. 5a.

Probationary period for principals hired
internally.

A board and the exclusive representative of the
school principals in the district may negotiate a plan for a
probationary period of up to two school years for licensed
teachers employed by the board who are subsequently employed by
the board as a licensed school principal new text beginor assistant principal
and an additional probationary period of up to two years for
licensed assistant principals employed by the board who are
subsequently employed by the board as a licensed school
principalnew text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2005.
new text end

Sec. 38.

Minnesota Statutes 2004, section 122A.41,
subdivision 14, is amended to read:

Subd. 14.

Services terminated by discontinuance or lack
of pupils; preference given.

(a) A teacher whose services are
terminated on account of discontinuance of position or lack of
pupils must receive first consideration for other positions in
the district for which that teacher is qualified. In the event
it becomes necessary to discontinue one or more positions, in
making such discontinuance, teachers must be discontinued in any
department in the inverse order in which they were employednew text begin,
unless a board and the exclusive representative of teachers in
the district negotiate a plan providing otherwisenew text end.

(b) Notwithstanding the provisions of clause (a), a teacher
is not entitled to exercise any seniority when that exercise
results in that teacher being retained by the district in a
field for which the teacher holds only a provisional license, as
defined by the Board of Teaching, unless that exercise of
seniority results in the termination of services, on account of
discontinuance of position or lack of pupils, of another teacher
who also holds a provisional license in the same field. The
provisions of this clause do not apply to vocational education
licenses.

(c) Notwithstanding the provisions of clause (a), a teacher
must not be reinstated to a position in a field in which the
teacher holds only a provisional license, other than a
vocational education license, while another teacher who holds a
nonprovisional license in the same field is available for
reinstatement.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2005.
new text end

Sec. 39.

Minnesota Statutes 2004, section 122A.413, is
amended to read:

122A.413 EDUCATIONAL IMPROVEMENT PLAN.

Subdivision 1.

Qualifying plan.

A district new text beginor
intermediate school district new text endmay develop an educational
improvement plan for the purpose of qualifying for deleted text beginalternative
teacher compensation aid deleted text endnew text beginthe alternative teacher professional
pay system new text endunder deleted text beginsections 122A.414 and 122A.415 deleted text endnew text beginsection
122A.414new text end. The plan must include measures for improving school
districtnew text begin, intermediate school districtnew text end, school site, teacher,
and individual student performance.

Subd. 2.

Plan components.

The educational improvement
plan must be approved by the school board and have at least
these elements:

(1) assessment and evaluation tools to measure student
performance and progress;

(2) performance goals and benchmarks for improvement;

(3) measures of student attendance and completion rates;

(4) a rigorous professional development systemnew text begin, consistent
with section 122A.60,new text endthat is aligned with educational
improvement, designed to achieve teaching quality improvement,
and consistent with clearly defined research-based standards;

(5) measures of student, family, and community involvement
and satisfaction;

(6) a data system about students and their academic
progress that provides parents and the public with
understandable information; deleted text beginand
deleted text end

(7) a teacher induction and mentoring program for
probationary teachers that provides continuous learning and
sustained teacher supportdeleted text begin. The process for developing the plan
must involve district teachers deleted text endnew text begin; and
new text end

new text begin (8) substantial participation by the exclusive
representative of the teachers in developing the plannew text end.

Subd. 3.

School site accountability.

A district new text beginor
intermediate school district new text endthat develops a plan under
subdivisions 1 and 2 must ensure that each school site develops
a board-approved educational improvement plan that is aligned
with the district educational improvement plan under subdivision
2 new text beginand developed with the exclusive representative of the
teachersnew text end. While a site plan must be consistent with the
district educational improvement plan, it may establish
performance goals and benchmarks that meet or exceed those of
the district. deleted text beginThe process for developing the plan must involve
site teachers.
deleted text end

Sec. 40.

Minnesota Statutes 2004, section 122A.414, is
amended to read:

122A.414 ALTERNATIVE TEACHER deleted text beginCOMPENSATION deleted text endnew text beginPAYnew text end.

Subdivision 1.

Restructured pay system.

A restructured
new text begin alternative new text endteacher deleted text begincompensation deleted text endnew text beginprofessional pay new text endsystem is
established under subdivision 2 to provide incentives deleted text beginfor deleted text endnew text beginto
encourage new text endteachers to improve their knowledge and new text begininstructional
new text end skills new text beginin order to improve student learning new text endand for school
districtsnew text begin, intermediate school districts, and charter schools new text endto
recruit and retain highly qualified teachers, new text beginencourage highly
qualified teachers to undertake challenging assignments,new text endand deleted text beginto
deleted text end support teachers' roles in improving students' educational
achievement.

new text begin Subd. 1a. new text end

new text begin Transitional planning year. new text end

new text begin (a) To be eligible
to participate in an alternative teacher professional pay
system, a school district, intermediate school district, or
site, at least one school year before it expects to fully
implement an alternative pay system, must:
new text end

new text begin (1) submit to the department a letter of intent executed by
the school district or intermediate school district and the
exclusive representative of the teachers to complete a plan
preparing for full implementation, consistent with subdivision
2, that may include, among other activities, training to
evaluate teacher performance, a restructured school day to
develop integrated ongoing site-based professional development
activities, release time to develop an alternative pay system
agreement, and teacher and staff training on using multiple data
sources; and
new text end

new text begin (2) agree to use up to two percent of basic revenue for
staff development purposes, consistent with sections 122A.60 and
122A.61, to develop the alternative teacher professional pay
system agreement under this section.
new text end

new text begin (b) To be eligible to participate in an alternative teacher
professional pay system, a charter school, at least one school
year before it expects to fully implement an alternative pay
system, must:
new text end

new text begin (1) submit to the department a letter of intent executed by
the charter school and the charter school board of directors;
new text end

new text begin (2) submit the record of a formal vote by the teachers
employed at the charter school indicating at least 70 percent of
all teachers agree to implement the alternative pay system; and
new text end

new text begin (3) agree to use up to two percent of basic revenue for
staff development purposes, consistent with sections 122A.60 and
122A.61, to develop the alternative teacher professional pay
system.
new text end

new text begin (c) The commissioner may waive the planning year if the
commissioner determines, based on the criteria under subdivision
2, that the school district, intermediate school district, site
or charter school is ready to fully implement an alternative pay
system.
new text end

Subd. 2.

Alternative teacher professional pay system.

(a) To participate in this program, a school districtnew text begin,
intermediate school district, school site, or charter school
new text end must have an educational improvement plan deleted text beginas described in deleted text endnew text beginunder
new text end section 122A.413 and an alternative teacher professional pay
system deleted text beginas described in deleted text endnew text beginagreement under new text endparagraph (b). new text beginA charter
school participant also must comply with subdivision 2a.
new text end

(b) The alternative teacher professional pay
system new text beginagreement new text endmust:

(1) describe deleted text beginthe conditions necessary for deleted text endnew text beginhow teachers can
achieve new text endcareer advancement and additional compensation;

(2) new text begindescribe how the school district, intermediate school
district, school site, or charter school will new text endprovide new text beginteachers
with new text endcareer advancement options deleted text beginfor teachers retaining deleted text endnew text beginthat
allow teachers to retain new text endprimary roles in student
instruction new text beginand facilitate site-focused professional development
that helps other teachers improve their skillsnew text end;

(3) deleted text beginuse a professional pay system that replaces the step
and lane salary schedule and is not based on years of service;
deleted text end

deleted text begin (4) encourage teachers' continuous improvement in content
knowledge, pedagogy, and use of best practices; and
deleted text end

deleted text begin (5) implement an objective evaluation system, including
classroom observation, that is aligned with the district's or
the site's educational improvement plan as described in section
122A.413. deleted text end new text begin reform the "steps and lanes" salary schedule, prevent
any teacher's compensation paid before implementing the pay
system from being reduced as a result of participating in this
system, and base at least 60 percent of any compensation
increase on teacher performance using:
new text end

new text begin (i) schoolwide student achievement gains under section
120B.35 or locally selected standardized assessment outcomes, or
both;
new text end

new text begin (ii) measures of student achievement; and
new text end

new text begin (iii) an objective evaluation program that includes:
new text end

new text begin (A) individual teacher evaluations aligned with the
educational improvement plan under section 122A.413 and the
staff development plan under section 122A.60; and
new text end

new text begin (B) objective evaluations using multiple criteria conducted
by a locally selected and periodically trained evaluation team
that understands teaching and learning;
new text end

new text begin (4) provide integrated ongoing site-based professional
development activities to improve instructional skills and
learning that are aligned with student needs under section
122A.413, consistent with the staff development plan under
section 122A.60 and led during the school day by trained teacher
leaders such as master or mentor teachers;
new text end

new text begin (5) allow any teacher in a participating school district,
intermediate school district, school site, or charter school
that implements an alternative pay system to participate in that
system without any quota or other limit; and
new text end

new text begin (6) encourage collaboration rather than competition among
teachers.
new text end

new text begin Subd. 2a. new text end

new text begin Charter school applications. new text end

new text begin For charter
school applications, the board of directors of a charter school
that satisfies the conditions under subdivisions 2 and 2b must
submit to the commissioner an application that contains:
new text end

new text begin (1) an agreement to implement an alternative teacher
professional pay system under this section;
new text end

new text begin (2) a resolution by the charter school board of directors
adopting the agreement; and
new text end

new text begin (3) the record of a formal vote by the teachers employed at
the charter school indicating that at least 70 percent of all
teachers agree to implement the alternative teacher professional
pay system, unless the charter school submits an alternative
teacher professional pay system agreement under this section
before the first year of operation.
new text end

new text begin Alternative compensation revenue for a qualifying charter
school must be calculated under section 126C.10, subdivision 34,
paragraphs (a) and (b).
new text end

new text begin Subd. 2b. new text end

new text begin Approval process. new text end

new text begin (a) Consistent with the
requirements of this section and sections 122A.413 and 122A.415,
the department must prepare and transmit to interested school
districts, intermediate school districts, school sites, and
charter schools a standard form for applying to participate in
the alternative teacher professional pay system. An interested
school district, intermediate school district, school site, or
charter school must submit to the commissioner a completed
application executed by the district superintendent and the
exclusive bargaining representative of the teachers if the
applicant is a school district, intermediate school district, or
school site, or executed by the charter school board of
directors if the applicant is a charter school. The application
must include the proposed alternative teacher professional pay
system agreement under subdivision 2. The department must
convene a review committee that at least includes teachers and
administrators within 30 days of receiving a completed
application to recommend to the commissioner whether to approve
or disapprove the application. The commissioner must approve
applications on a first-come, first-served basis. The
applicant's alternative teacher professional pay system
agreement must be legally binding on the applicant and the
collective bargaining representative before the applicant
receives alternative compensation revenue. The commissioner
must approve or disapprove an application based on the
requirements under subdivisions 2 and 2a.
new text end

new text begin (b) If the commissioner disapproves an application, the
commissioner must give the applicant timely notice of the
specific reasons in detail for disapproving the application.
The applicant may revise and resubmit its application and
related documents to the commissioner within 30 days of
receiving notice of the commissioner's disapproval and the
commissioner must approve or disapprove the revised application,
consistent with this subdivision. Applications that are revised
and then approved are considered submitted on the date the
applicant initially submitted the application.
new text end

Subd. 3.

Report; continued funding.

new text begin(a) new text endParticipating
districts deleted text beginand deleted text endnew text begin, intermediate school districts,new text endschool sitesnew text begin, and
charter schools new text endmust report on the implementation and
effectiveness of the alternative teacher deleted text begincompensation plan
deleted text endnew text begin professional pay systemnew text end, particularly addressing each
requirement under subdivision 2 and make deleted text beginbiennial deleted text endnew text beginannual
new text end recommendations by deleted text beginJanuary 1 deleted text endnew text beginJune 15 new text endto their school boards.
The school deleted text beginboards deleted text endnew text beginboard or board of directors new text endshall transmit new text begina
copy of the report with new text enda summary of the findings and
recommendations of deleted text begintheir deleted text endnew text beginthe new text enddistrictnew text begin, intermediate school
district, school site, or charter school new text endto the commissioner.

new text begin (b) If the commissioner determines that a school district,
intermediate school district, school site, or charter school
that receives alternative teacher compensation revenue is not
complying with the requirements of this section, the
commissioner may withhold funding from that participant. Before
making the determination, the commissioner must notify the
participant of any deficiencies and provide the participant an
opportunity to comply.
new text end

new text begin Subd. 3a. new text end

new text begin Planning and staff development. new text end

new text begin A school
district that qualifies to participate in the alternative
teacher professional pay system transitional planning year under
subdivision 1a may use up to two percent of basic revenue that
would otherwise be reserved under section 122A.61 for complying
with the planning and staff development activities under this
section.
new text end

Sec. 41.

new text begin [122A.4144] SUPPLEMENTAL AGREEMENTS; ALTERNATIVE
TEACHER PAY.
new text end

new text begin Notwithstanding section 179A.20 or other law to the
contrary, a school board and the exclusive representative of the
teachers may agree to reopen a collective bargaining agreement
for the purpose of entering into an alternative teacher
professional pay system agreement under sections 122A.413,
122A.414, and 122A.415. Negotiations for a contract reopened
under this section must be limited to issues related to the
alternative teacher professional pay system.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 42.

Minnesota Statutes 2004, section 122A.415,
subdivision 1, is amended to read:

Subdivision 1.

deleted text beginaid deleted text endnew text beginrevenue new text endamount.

(a) A school district
new text begin , intermediate school district, school site, or charter school
new text end that meets the conditions of section 122A.414 and submits an
application approved by the commissioner is eligible for
alternative new text beginteacher new text endcompensation deleted text beginaid deleted text endnew text beginrevenuenew text end.

new text begin (b) For school district and intermediate school district
applications,new text endthe commissioner must consider only new text beginthose
new text end applications new text beginto participate that are new text endsubmitted jointly by
a deleted text beginschool deleted text enddistrict and the exclusive representative of the
teachers deleted text beginfor participation in the programdeleted text end. The application must
contain deleted text begina formally adopted collective bargaining agreement,
memorandum of understanding, or other binding agreement deleted text endnew text beginan
alternative teacher professional pay system agreement new text endthatnew text begin:
new text end

new text begin (1) new text endimplements an alternative teacher professional pay
system consistent with section 122A.414new text begin;new text endand deleted text beginincludes all
teachers in a district, all teachers at a school site, or at
least 25 percent of the teachers in a district. The
commissioner, in approving applications, may give preference to
applications involving entire districts or sites or to
applications that align measures of teacher performance with
student academic achievement and progress under section 120B.35,
subdivision 1
deleted text end

new text begin (2) is negotiated and adopted according to the Public
Employment Labor Relations Act under chapter 179A, except that
notwithstanding section 179A.20, subdivision 3, a district may
enter into a contract for a term of two or four yearsnew text end.

deleted text begin (b) deleted text endAlternative new text beginteacher new text endcompensation deleted text beginaid deleted text endnew text beginrevenue new text endfor a
qualifying school districtdeleted text begin,deleted text endnew text beginor new text endsitedeleted text begin, or portion of a district or
school site is as follows:
deleted text end

deleted text begin (1) for a school district deleted text endin which the school board and the
exclusive representative of the teachers agree to place deleted text beginall
deleted text end teachers in the district or at the site on the
alternative deleted text begincompensation schedule, alternative compensation aid
deleted text endnew text begin teacher professional pay system new text endequals deleted text begin$150 deleted text endnew text begin$260 new text endtimes the
deleted text begin district's or the site's deleted text endnumber of pupils enrolled new text beginat the
district or site new text endon October 1 of the previous fiscal yeardeleted text begin; or
deleted text end

deleted text begin (2) for a district in which the school board and the
exclusive representative of the teachers agree that at least 25
percent of the district's licensed teachers will be paid on the
alternative compensation schedule, alternative compensation aid
equals $150 times the percentage of participating teachers times
the district's number of pupils enrolled as of October 1 of the
previous fiscal yeardeleted text end. new text beginAlternative teacher compensation revenue
for a qualifying intermediate school district must be calculated
under section 126C.10, subdivision 34, paragraphs (a) and (b).
new text end

new text begin (c) For a newly combined or consolidated district, the
revenue shall be computed using the sum of pupils enrolled on
October 1 of the previous year in the districts entering into
the combination or consolidation. The commissioner may adjust
the revenue computed for a site using prior year data to reflect
changes attributable to school closings, school openings, or
grade level reconfigurations between the prior year and the
current year.
new text end

new text begin (d) The revenue is available only to school districts,
intermediate school districts, school sites, and charter schools
that fully implement an alternative teacher professional pay
system by October 1 of the current school year.
new text end

Sec. 43.

Minnesota Statutes 2004, section 122A.415,
subdivision 3, is amended to read:

Subd. 3.

deleted text beginaid deleted text endnew text beginrevenue new text endtiming.

(a) Districts deleted text beginor deleted text endnew text begin,
intermediate school districts, school new text endsitesnew text begin, or charter schools
new text end with approved applications must receive alternative compensation
deleted text begin aid deleted text endnew text beginrevenue new text endfor each school year that the district deleted text beginor deleted text endnew text begin,
intermediate school district, school new text endsite deleted text beginparticipates in the
program as described in deleted text endnew text begin, or charter school implements an
alternative teacher professional pay system under new text endthis
subdivision new text beginand section 122A.414new text end. deleted text beginDistricts or sites with
applications received by the commissioner before June 1 of the
first year of a two-year contract shall receive alternative
compensation aid for both years of the contract. Districts or
sites with applications received by the commissioner after June
1 of the first year of a two-year contract shall receive
alternative compensation aid only for the second year of the
contract.deleted text endnew text beginFor fiscal year 2007 and later,new text enda qualifying district
deleted text begin or deleted text endnew text begin, intermediate school district, school new text endsitenew text begin, or charter school
new text end that received alternative new text beginteacher new text endcompensation aid for the
previous fiscal year must receive at least an amount new text beginof
alternative teacher compensation revenue new text endequal to the lesser of
the amount it received for the previous fiscal year or deleted text beginits
proportionate share of the previous year's appropriation deleted text endnew text beginthe
amount it qualifies for under subdivision 1 for the current
fiscal year new text endif the district deleted text beginor deleted text endnew text begin, intermediate school district,
school new text endsitenew text begin, or charter school new text endsubmits a timely application and
the commissioner determines that the district deleted text beginor deleted text endnew text begin, intermediate
school district, school new text endsitenew text begin, or charter school new text endcontinues to
implement an alternative teacher professional pay system,
consistent with its application under this section. deleted text beginThe
commissioner must approve initial applications for school
districts qualifying under subdivision 1, paragraph (b), clause
(1), by January 15 of each year. If any money remains, the
commissioner must approve aid amounts for school districts
qualifying under subdivision 1, paragraph (b), clause (2), by
February 15 of each year.
deleted text end

(b) The commissioner shall new text beginapprove applications that comply
with sections 122A.414, subdivisions 2, paragraph (b), and 2a,
if the applicant is a charter school, and 122A.415, subdivision
1, in the order in which they are received,new text endselect applicants
that qualify for this program, notify school districts deleted text beginand deleted text endnew text begin,
intermediate school districts,new text endschool sitesnew text begin, and charter schools
new text end about the program, develop and disseminate application
materials, and carry out other activities needed to implement
this section.

new text begin (c) For applications approved under section 122A.415 before
August 1 of the fiscal year for which the aid is paid, the
portion of the state total basic alternative teacher
compensation aid entitlement allocated to charter schools must
not exceed $522,000 for fiscal year 2006 and $3,374,000 for
fiscal year 2007. For fiscal year 2008 and later, the portion
of the state total basic alternative teacher compensation aid
entitlement allocated to charter schools must not exceed the
product of $3,374,000 times the ratio of the state total charter
school enrollment for the previous fiscal year to the state
total charter school enrollment for the second previous year.
Additional basic alternative teacher compensation aid may be
approved for charter schools after August 1, not to exceed the
charter school limit for the following fiscal year, if the basic
alternative teacher compensation aid entitlement for school
districts based on applications approved by August 1 does not
expend the remaining amount under the limit.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2005.
new text end

Sec. 44.

Minnesota Statutes 2004, section 122A.60,
subdivision 1, is amended to read:

Subdivision 1.

Staff development committee.

A school
board must use the revenue authorized in section 122A.61 for
in-service education for programs under section 120B.22,
subdivision 2, or for staff development plans under this
section. The board must establish an advisory staff development
committee to develop the plan, assist site professional
development teams in developing a site plan consistent with the
goals of the plan, and evaluate staff development efforts at the
site level. A majority of the advisory committee and the site
professional development team must be teachers representing
various grade levels, subject areas, and special education. The
advisory committee must also include nonteaching staff, parents,
and administrators. deleted text beginDistricts must report staff development
results and expenditures to the commissioner in the form and
manner determined by the commissioner. The expenditure report
must include expenditures by the board for district level
activities and expenditures made by the staff. The report must
provide a breakdown of expenditures for (1) curriculum
development and programs, (2) in-service education, workshops,
and conferences, and (3) the cost of teachers or substitute
teachers for staff development purposes. Within each of these
categories, the report must also indicate whether the
expenditures were incurred at the district level or the school
site level, and whether the school site expenditures were made
possible by the grants to school sites that demonstrate
exemplary use of allocated staff development revenue. These
expenditures are to be reported using the UFARS system. The
commissioner shall report the staff development expenditure data
to the education committees of the legislature by February 15
each year.
deleted text end

Sec. 45.

Minnesota Statutes 2004, section 122A.60, is
amended by adding a subdivision to read:

new text begin Subd. 1a. new text end

new text begin Effective staff development activities. new text end

new text begin (a)
Staff development activities must:
new text end

new text begin (1) focus on the school classroom and research-based
strategies that improve student learning;
new text end

new text begin (2) provide opportunities for teachers to practice and
improve their instructional skills over time;
new text end

new text begin (3) provide opportunities for teachers to use student data
as part of their daily work to increase student achievement;
new text end

new text begin (4) enhance teacher content knowledge and instructional
skills;
new text end

new text begin (5) align with state and local academic standards;
new text end

new text begin (6) provide opportunities to build professional
relationships, foster collaboration among principals and staff
who provide instruction, and provide opportunities for
teacher-to-teacher mentoring; and
new text end

new text begin (7) align with the plan of the district or site for an
alternative teacher professional pay system.
new text end

new text begin Staff development activities may include curriculum development
and curriculum training programs, and activities that provide
teachers and other members of site-based teams training to
enhance team performance. The school district also may
implement other staff development activities required by law and
activities associated with professional teacher compensation
models.
new text end

new text begin (b) Release time provided for teachers to supervise
students on field trips and school activities, or independent
tasks not associated with enhancing the teacher's knowledge and
instructional skills, such as preparing report cards,
calculating grades, or organizing classroom materials, may not
be counted as staff development time that is financed with staff
development reserved revenue under section 122A.61.
new text end

Sec. 46.

Minnesota Statutes 2004, section 122A.60, is
amended by adding a subdivision to read:

new text begin Subd. 4. new text end

new text begin Staff development report. new text end

new text begin (a) By October 15 of
each year, the district and site staff development committees
shall write and submit a report of staff development activities
and expenditures for the previous year, in the form and manner
determined by the commissioner. The report, signed by the
district superintendent and staff development chair, must
include assessment and evaluation data indicating progress
toward district and site staff development goals based on
teaching and learning outcomes, including the percentage of
teachers and other staff involved in instruction who participate
in effective staff development activities under subdivision 3.
new text end

new text begin (b) The report must break down expenditures for:
new text end

new text begin (1) curriculum development and curriculum training
programs; and
new text end

new text begin (2) staff development training models, workshops, and
conferences, and the cost of releasing teachers or providing
substitute teachers for staff development purposes.
new text end

new text begin The report also must indicate whether the expenditures were
incurred at the district level or the school site level, and
whether the school site expenditures were made possible by
grants to school sites that demonstrate exemplary use of
allocated staff development revenue. These expenditures must be
reported using the uniform financial and accounting and
reporting standards.
new text end

new text begin (c) The commissioner shall report the staff development
progress and expenditure data to the house of representatives
and senate committees having jurisdiction over education by
February 15 each year.
new text end

Sec. 47.

new text begin [122A.628] SCHOOLS MENTORING SCHOOLS REGIONAL
SITES.
new text end

new text begin Subdivision 1. new text end

new text begin Program. new text end

new text begin The commissioner of education
shall select up to four school districts, or partnerships of
school districts, for the purpose of assisting other school
districts in the region with the development of thorough and
effective teacher mentoring programs. The commissioner shall
use geographic balance and proven teacher induction programs as
criteria when selecting the sites. One site must include the
Brainerd teacher support system, which has been cited by the
Minnesota Board of Teaching as a model program and was one of
only six programs in the nation to be recognized for the 2004
NEA-Saturn/UAW partnership award. The sites shall be known as
schools mentoring schools regional sites.
new text end

new text begin The sites shall provide high quality mentoring assistance
programs and services to other nearby school districts for the
development of effective systems of support for new teachers.
The sites shall offer coaching/mentor training, in-class
observation training, and train-the-teacher opportunities for
teams of participating teachers. The sites shall use their
recognized experience and methods to equip schools to work with
their own new and beginning teachers. The commissioner shall
review and report annually to the legislature on the operation
of each training center.
new text end

new text begin Subd. 2. new text end

new text begin Revenue. new text end

new text begin A school district that is selected to
participate in the schools mentoring schools program under this
section may utilize its professional compensation revenue under
section 122A.4142, subdivision 4, to pay regional training sites
for staff development and training services.
new text end

Sec. 48.

new text begin [122A.74] PRINCIPALS' LEADERSHIP INSTITUTE.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin (a) The commissioner of
education may contract with the regents of the University of
Minnesota to establish a Principals' Leadership Institute to
provide professional development to school principals by:
new text end

new text begin (1) creating a network of leaders in the educational and
business communities to communicate current and future trends in
leadership techniques;
new text end

new text begin (2) helping to create a vision for the school that is
aligned with the community and district priorities; and
new text end

new text begin (3) developing strategies to retain highly qualified
teachers.
new text end

new text begin (b) The University of Minnesota must cooperate with
participating members of the business community to provide
funding and content for the institute.
new text end

new text begin (c) Participants must agree to attend the Principals'
Leadership Institute for four weeks during the academic summer.
new text end

new text begin (d) The Principals' Leadership Institute must incorporate
program elements offered by leadership programs at the
University of Minnesota and program elements used by the
participating members of the business community to enhance
leadership within their businesses.
new text end

new text begin Subd. 2. new text end

new text begin Method of selection and requirements. new text end

new text begin (a) The
board of each school district in the state may select a
principal, upon the recommendation of the district's
superintendent and based on the principal's leadership
potential, to attend the institute.
new text end

new text begin (b) The school board shall forward its list of recommended
participants to the commissioner of education by February 1 each
year. In addition, a principal may submit an application
directly to the commissioner by February 1. The commissioner of
education shall notify the school board, the principal
candidates, and the University of Minnesota of the principals
selected to participate in the Principals' Leadership Institute
each year.
new text end

Sec. 49.

new text begin [123A.12] AGREEMENT REGARDING ADMINISTRATIVE
SERVICES.
new text end

new text begin Subdivision 1. new text end

new text begin Agreement. new text end

new text begin (a) Two or more school
districts may enter into an agreement pursuant to section 471.59
to increase efficiency in the delivery of administrative
services and to reduce costs by the provision of an
administrative service by a district or an entity created by or
specified in the agreement and the purchase of that service by
one or more other districts that are a party to that agreement.
new text end

new text begin (b) Administrative services include, but are not limited to:
new text end

new text begin (1) a superintendent, deputy superintendent, or assistant
superintendent;
new text end

new text begin (2) a principal, assistant principal, or vice principal; or
new text end

new text begin (3) a director, manager, coordinator, supervisor, dean, or
other administrative position regardless of title.
new text end

new text begin (c) A person providing administrative services to another
district pursuant to the agreement shall remain an employee of
the employing district or the entity created by or specified in
the agreement for all purposes.
new text end

new text begin Subd. 2. new text end

new text begin Levy. new text end

new text begin If an administrative position is
discontinued in a district as a result of the purchase of
administrative services under the agreement in subdivision 1,
the district may levy over a period of up to three years for
costs approved by the commissioner for retirement incentives or
severance pay or other costs related to the discontinuance of
that position.
new text end

Sec. 50.

Minnesota Statutes 2004, section 123B.02, is
amended by adding a subdivision to read:

new text begin Subd. 14a. new text end

new text begin Employee recognition. new text end

new text begin A school board may
establish and operate an employee recognition program for
district employees, including teachers, and may expend funds as
necessary to achieve the objectives of the program. The
employee recognition program shall not include monetary awards.
new text end

Sec. 51.

Minnesota Statutes 2004, section 123B.02, is
amended by adding a subdivision to read:

new text begin Subd. 22.new text end

new text beginReward.new text end

new text beginA school board, after formally
adopting a policy consistent with this subdivision, may offer a
reward to a person who provides accurate and reliable
information leading to the conviction of a person who has
committed or conspired to commit a crime against students or
school employees, volunteers or board members as a result of
their affiliation with the school district, or against school
district property.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 52.

Minnesota Statutes 2004, section 123B.02, is
amended by adding a subdivision to read:

new text begin Subd. 23.new text end

new text beginCredit cards.new text end

new text beginA board may authorize the use of
a credit card by any officer or employee otherwise authorized to
make a purchase on behalf of the district. If a district
officer or employee makes or directs a purchase by credit card
that is not approved by the school board, the officer or
employee is personally liable for the amount of the purchase. A
purchase by credit card must otherwise comply with all statutes,
rules, or district policy applicable to school district
purchases.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment and applies for fiscal year 2005 and
later.
new text end

Sec. 53.

Minnesota Statutes 2004, section 123B.04,
subdivision 1, is amended to read:

Subdivision 1.

Definition.

"Education site" means a
separate facility. A program within a facility new text beginor within a
district new text endis an education site if the school board recognizes it
as a site.

Sec. 54.

Minnesota Statutes 2004, section 123B.04,
subdivision 2, is amended to read:

Subd. 2.

Agreement.

(a) deleted text beginEither the school board or the
school site decision-making team may request that the school
board enter into an agreement with a school site decision-making
team concerning deleted text endnew text beginUpon the request of 60 percent of the licensed
employees of a site or a school site decision-making team, the
school board shall enter into discussions to reach an agreement
concerning new text endthe governance, management, or control of the
school. A school site decision-making team may include the
school principal, teachers in the school or their designee,
other employees in the school, deleted text beginparents of pupils in the school,
deleted text end representatives of pupils in the school, or other members in the
community. new text beginA school site decision-making team must include at
least one parent of a pupil in the school. For purposes of
formation of a new site, a school site decision-making team may
be a team of teachers that is recognized by the board as a
site.new text endThe school site decision-making team shall include the
school principal or other person having general control and
supervision of the school. The site decision-making team must
reflect the diversity of the education site. deleted text beginNo more than deleted text endnew text beginAt
least new text endone-half of the members shall be employees of the
district, unless an employee is the parent of a student enrolled
in the school site, in which case the employee may elect to
serve as a parent member of the site team.

(b) School site decision-making agreements must delegate
powers, duties, and broad management responsibilities to site
teams and involve staff members, students as appropriate, and
parents in decision making.

(c) An agreement shall include a statement of powers,
duties, responsibilities, and authority to be delegated to and
within the site.

(d) An agreement may include:

(1) an achievement contract according to subdivision 4;

(2) a mechanism to allow principals, new text begina site leadership
team,new text endor other persons having general control and supervision of
the school, to make decisions regarding how financial and
personnel resources are best allocated at the site and from whom
goods or services are purchased;

(3) a mechanism to implement parental involvement programs
under section 124D.895 and to provide for effective parental
communication and feedback on this involvement at the site
level;

(4) a provision that would allow the team to determine who
is hired into licensed and nonlicensed positions;

(5) a provision that would allow teachers to choose the
principal or other person having general control;

(6) an amount of revenue allocated to the site under
subdivision 3; and

(7) any other powers and duties determined appropriate by
the board.

The school board of the district remains the legal employer
under clauses (4) and (5).

(e) Any powers or duties not delegated to the school site
management team in the school site management agreement shall
remain with the school board.

(f) Approved agreements shall be filed with the
commissioner. If a school board denies a request new text beginor the school
site and school board fail to reach an agreement new text endto enter into a
school site management agreement, deleted text beginit deleted text endnew text beginthe school board new text endshall
provide a copy of the request and the reasons for its denial to
the commissioner.

new text begin (g) A site decision-making grant program is established,
consistent with this subdivision, to allow sites to implement an
agreement that at least:
new text end

new text begin (1) notwithstanding subdivision 3, allocates to the site
all revenue that is attributable to the students at that site;
new text end

new text begin (2) a provision, consistent with current law and the
collective bargaining agreement in effect, allows the site team
to decide who is selected from within the district for licensed
and nonlicensed positions at the site and to make staff
assignments in the site; and
new text end

new text begin (3) includes a completed performance agreement under
subdivision 4.
new text end

new text begin The commissioner shall establish the form and manner of the
application for a grant and annually, at the end of each fiscal
year, report to the house of representative and senate
committees having jurisdiction over education on the progress of
the program.
new text end

Sec. 55.

Minnesota Statutes 2004, section 123B.49,
subdivision 4, is amended to read:

Subd. 4.

Board control of extracurricular activities.

(a) The board may take charge of and control all extracurricular
activities of the teachers and children of the public schools in
the district. Extracurricular activities means all direct and
personal services for pupils for their enjoyment that are
managed and operated under the guidance of an adult or staff
member. The board shall allow all resident pupils receiving
instruction in a home school as defined in section 123B.36,
subdivision 1, paragraph (a), to be eligible to fully
participate in extracurricular activities on the same basis as
public school students.

(b) Extracurricular activities have all of the following
characteristics:

(1) they are not offered for school credit nor required for
graduation;

(2) they are generally conducted outside school hours, or
if partly during school hours, at times agreed by the
participants, and approved by school authorities;

(3) the content of the activities is determined primarily
by the pupil participants under the guidance of a staff member
or other adult.

(c) If the board does not take charge of and control
extracurricular activities, these activities shall be
self-sustaining with all expenses, except direct salary costs
and indirect costs of the use of school facilities, met by dues,
admissions, or other student fund-raising events. The general
fund must reflect only those salaries directly related to and
readily identified with the activity and paid by public funds.
Other revenues and expenditures for extra curricular activities
must be recorded according to the deleted text begin"Manual of Instruction for
Uniform Student Activities Accounting for Minnesota School
Districts and Area Vocational-Technical Colleges." deleted text endnew text beginManual for
Activity Fund Accounting.new text endExtracurricular activities not under
board control must have an annual financial audit and must also
be audited annually for compliance with this section.

(d) If the board takes charge of and controls
extracurricular activities, any or all costs of these activities
may be provided from school revenues and all revenues and
expenditures for these activities shall be recorded in the same
manner as other revenues and expenditures of the district.

(e) If the board takes charge of and controls
extracurricular activities, the teachers or pupils in the
district must not participate in such activity, nor shall the
school name or any allied name be used in connection therewith,
except by consent and direction of the board.

Sec. 56.

Minnesota Statutes 2004, section 123B.88, is
amended by adding a subdivision to read:

new text begin Subd. 3a.new text end

new text beginPupil transportation safety committee.new text end

new text begin(a) A
school board may establish a pupil transportation safety
committee. The chair of the pupil transportation safety
committee is the district's school transportation safety
director. The school board shall appoint the other members of
the pupil transportation safety committee. Membership may
include parents, school bus drivers, representatives of school
bus companies, local law enforcement officials, other school
district staff, and representatives from other units of local
government.
new text end

new text begin (b) The duties of the pupil transportation safety committee
include: (1) reviewing and recommending changes to the
district's pupil transportation safety policy required under
subdivision 1; and (2) developing a comprehensive plan for the
safe transportation of students who face hazardous
transportation conditions. The comprehensive hazardous
transportation plan shall consider safety factors including the
types of roads that students must cross, the speed of traffic on
those roads, the age of the students, and any other factors as
determined by the committee.
new text end

new text begin (c) The pupil transportation safety committee must hold at
least one public meeting before adopting its comprehensive plan
for transporting students who face hazardous transportation
conditions.
new text end

new text begin (d) Any recommended changes to the district's pupil
transportation safety policy and the comprehensive plan for
hazardous transportation must be submitted to the school board.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 57.

Minnesota Statutes 2004, section 124D.09,
subdivision 12, is amended to read:

Subd. 12.

Credits.

A pupil may enroll in a course under
this section for either secondary credit or postsecondary
credit. At the time a pupil enrolls in a course, the pupil
shall designate whether the course is for secondary or
postsecondary credit. A pupil taking several courses may
designate some for secondary credit and some for postsecondary
credit. A pupil must not audit a course under this section.

A district shall grant academic credit to a pupil enrolled
in a course for secondary credit if the pupil successfully
completes the course. Seven quarter or four semester college
credits equal at least one full year of high school credit.
Fewer college credits may be prorated. A district must also
grant academic credit to a pupil enrolled in a course for
postsecondary credit if secondary credit is requested by a
pupil. If no comparable course is offered by the district, the
district must, as soon as possible, notify the commissioner, who
shall determine the number of credits that shall be granted to a
pupil who successfully completes a course. If a comparable
course is offered by the district, the school board shall grant
a comparable number of credits to the pupil. If there is a
dispute between the district and the pupil regarding the number
of credits granted for a particular course, the pupil may appeal
the board's decision to the commissioner. The commissioner's
decision regarding the number of credits shall be final.

The secondary credits granted to a pupil must be counted
toward the graduation requirements and subject area requirements
of the district. Evidence of successful completion of each
course and secondary credits granted must be included in the
pupil's secondary school record. A pupil shall provide the
school with a copy of the pupil's grade in each course taken for
secondary credit under this section. Upon the request of a
pupil, the pupil's secondary school record must also include
evidence of successful completion and credits granted for a
course taken for postsecondary credit. In either case, the
record must indicate that the credits were earned at a
postsecondary institution.

If a pupil enrolls in a postsecondary institution after
leaving secondary school, the postsecondary institution must
award postsecondary credit for any course successfully completed
for secondary credit at that institution. Other postsecondary
institutions may award, after a pupil leaves secondary school,
postsecondary credit for any courses successfully completed
under this section. An institution may not charge a pupil for
the award of credit.

new text begin The Board of Trustees of the Minnesota State Colleges and
Universities and the Board of Regents of the University of
Minnesota must, and private nonprofit and proprietary
postsecondary institutions, should award postsecondary credit
for any successfully completed courses in a program certified by
the National Alliance of Concurrent Enrollment Partnerships
offered according to an agreement under subdivision 10.
new text end

Sec. 58.

Minnesota Statutes 2004, section 124D.095,
subdivision 8, is amended to read:

Subd. 8.

Financial arrangements.

(a) For a student
enrolled in an on-line learning course, the department must
calculate average daily membership and make payments according
to this subdivision.

(b) The initial on-line learning average daily membership
equals 1/12 for each semester course or a proportionate amount
for courses of different lengths. The adjusted on-line learning
average daily membership equals the initial on-line learning
average daily membership times .88.

(c) No on-line learning average daily membership shall be
generated if: (1) the student does not complete the on-line
learning course, or (2) the student is enrolled in on-line
learning provided by the enrolling district deleted text beginand the student was
enrolled in a Minnesota public school for the school year before
the school year in which the student first enrolled in on-line
learningdeleted text end.

(d) On-line learning average daily membership under this
subdivision for a student currently enrolled in a Minnesota
public school deleted text beginand who was enrolled in a Minnesota public school
for the school year before the school year in which the student
first enrolled in on-line learning deleted text endshall be used only for
computing average daily membership according to section 126C.05,
subdivision 19, paragraph (a), clause (ii), and for computing
on-line learning aid according to section deleted text begin126C.24 deleted text endnew text begin124D.096new text end.

deleted text begin (e) On-line learning average daily membership under this
subdivision for students not included in paragraph (c) or (d)
shall be used only for computing average daily membership
according to section 126C.05, subdivision 19, paragraph (a),
clause (ii), and for computing payments under paragraphs (f) and
(g).
deleted text end

deleted text begin (f) Subject to the limitations in this subdivision, the
department must pay an on-line learning provider an amount equal
to the product of the adjusted on-line learning average daily
membership for students under paragraph (e) times the student
grade level weighting under section 126C.05, subdivision 1,
times the formula allowance.
deleted text end

deleted text begin (g) The department must pay each on-line learning provider
100 percent of the amount in paragraph (f) within 45 days of
receiving final enrollment and course completion information
each quarter or semester.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for revenue for
fiscal year 2006.
new text end

Sec. 59.

Minnesota Statutes 2004, section 124D.10,
subdivision 4, is amended to read:

Subd. 4.

Formation of school.

(a) A sponsor may
authorize one or more licensed teachers under section 122A.18,
subdivision 1, to operate a charter school subject to approval
by the commissioner. A board must vote on charter school
application for sponsorship no later than 90 days after
receiving the application. After 90 days, the applicant may
apply to the commissioner. If a board elects not to sponsor a
charter school, the applicant may appeal the board's decision to
the commissionerdeleted text begin. The commissioner deleted text endnew text beginwho new text endmay elect to deleted text beginsponsor the
charter school or deleted text endassist the applicant in finding an eligible
sponsor. The school must be organized and operated as a
cooperative under chapter 308A or nonprofit corporation under
chapter 317A and the provisions under the applicable chapter
shall apply to the school except as provided in this section.
Notwithstanding sections 465.717 and 465.719, a school district
may create a corporation for the purpose of creating a charter
school.

(b) Before the operators may form and operate a school, the
sponsor must file an affidavit with the commissioner stating its
intent to authorize a charter school. The affidavit must state
the terms and conditions under which the sponsor would authorize
a charter school new text beginand how the sponsor intends to oversee the
fiscal and student performance of the charter school and to
comply with the terms of the written contract between the
sponsor and the charter school board of directors under
subdivision 6new text end. The commissioner must approve or disapprove the
sponsor's proposed authorization within deleted text begin60 deleted text endnew text begin90 new text enddays of receipt of
the affidavit. Failure to obtain commissioner approval
precludes a sponsor from authorizing the charter school that was
the subject of the affidavit.

(c) The operators authorized to organize and operate a
school, before entering into a contract or other agreement for
professional or other services, goods, or facilities, must
incorporate as a cooperative under chapter 308A or as a
nonprofit corporation under chapter 317A and must establish a
board of directors composed of at least five members until a
timely election for members of the charter school board of
directors is held according to the school's articles and
bylaws. A charter school board of directors must be composed of
at least five members. Any staff members who are employed at
the school, including teachers providing instruction under a
contract with a cooperative, and all parents of children
enrolled in the school may participate in the election for
members of the school's board of directors. Licensed teachers
employed at the school, including teachers providing instruction
under a contract with a cooperative, must be a majority of the
members of the board of directors before the school completes
its third year of operation, unless the commissioner waives the
requirement for a majority of licensed teachers on the board.
Board of director meetings must comply with chapter 13D.

(d) The granting or renewal of a charter by a sponsoring
entity must not be conditioned upon the bargaining unit status
of the employees of the school.

(e) A sponsor may authorize the operators of a charter
school to expand the operation of the charter school to
additional sites or to add additional grades at the school
beyond those described in the sponsor's application as approved
by the commissioner only after submitting a supplemental
application to the commissioner in a form and manner prescribed
by the commissioner. The supplemental application must provide
evidence that:

(1) the expansion of the charter school is supported by
need and projected enrollment;

(2) the charter school is fiscally sound;

(3) the sponsor supports the expansion; and

(4) the building of the additional site meets all health
and safety requirements to be eligible for lease aid.

(f) The commissioner annually must provide timely financial
management training to newly elected members of a charter school
board of directors and ongoing training to other members of a
charter school board of directors. Training must address ways
to:

(1) proactively assess opportunities for a charter school
to maximize all available revenue sources;

(2) establish and maintain complete, auditable records for
the charter school;

(3) establish proper filing techniques;

(4) document formal actions of the charter school,
including meetings of the charter school board of directors;

(5) properly manage and retain charter school and student
records;

(6) comply with state and federal payroll record-keeping
requirements; and

(7) address other similar factors that facilitate
establishing and maintaining complete records on the charter
school's operations.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for the
2005-2006 school year and later.
new text end

Sec. 60.

Minnesota Statutes 2004, section 124D.10,
subdivision 6, is amended to read:

Subd. 6.

Contract.

The sponsor's authorization for a
charter school must be in the form of a written contract signed
by the sponsor and the board of directors of the charter
school. The contract must be completed within 90 days of the
commissioner's approval of the sponsor's proposed authorization.
The contract for a charter school must be in writing and contain
at least the following:

(1) a description of a program that carries out one or more
of the purposes in subdivision 1;

(2) specific outcomes pupils are to achieve under
subdivision 10;

(3) admission policies and procedures;

(4) management and administration of the school;

(5) requirements and procedures for program and financial
audits;

(6) how the school will comply with subdivisions 8, 13, 16,
and 23;

(7) assumption of liability by the charter school;

(8) types and amounts of insurance coverage to be obtained
by the charter school;

(9) the term of the contract, which may be up to three
years; deleted text beginand
deleted text end

(10) if the board of directors or the operators of the
charter school provide special instruction and services for
children with a disability under sections 125A.03 to 125A.24,
and 125A.65, a description of the financial parameters within
which the charter school will operate to provide the special
instruction and services to children with a disabilitynew text begin; and
new text end

new text begin (11) the process and criteria the sponsor intends to use to
monitor and evaluate the fiscal and student performance of the
charter school, consistent with subdivision 15new text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for the
2005-2006 school year and later.
new text end

Sec. 61.

Minnesota Statutes 2004, section 124D.10,
subdivision 15, is amended to read:

Subd. 15.

Review and comment.

new text begin(a) new text endThe department must
review and comment on the evaluation, by the sponsor, of the
performance of a charter school before the charter school's
contract is renewed new text beginfor another contract term. The sponsor must
submit to the commissioner timely information for the review and
commentnew text end.

new text begin (b) new text endA sponsor shall monitor and evaluate the fiscal and
student performance of the school, and may for this purpose
annually assess a charter school: (1) in its first, second, or
third year of operation up to $30 per student up to a maximum of
$10,000; and (2) in its fourth or a subsequent year of operation
up to $10 per student up to a maximum of $3,500. deleted text beginThe
information for the review and comment shall be reported by the
sponsor to the commissioner of education in a timely manner.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for the
2005-2006 school year and later.
new text end

Sec. 62.

Minnesota Statutes 2004, section 124D.10,
subdivision 23, is amended to read:

Subd. 23.

Causes for nonrenewal or termination of charter
school contract.

(a) The duration of the contract with a
sponsor must be for the term contained in the contract according
to subdivision 6. The sponsor may or may not renew a contract
at the end of the term for any ground listed in paragraph (b).
A sponsor may unilaterally terminate a contract during the term
of the contract for any ground listed in paragraph (b). At
least 60 days before not renewing or terminating a contract, the
sponsor shall notify the board of directors of the charter
school of the proposed action in writing. The notice shall
state the grounds for the proposed action in reasonable detail
and that the charter school's board of directors may request in
writing an informal hearing before the sponsor within 14 days of
receiving notice of nonrenewal or termination of the contract.
Failure by the board of directors to make a written request for
a hearing within the 14-day period shall be treated as
acquiescence to the proposed action. Upon receiving a timely
written request for a hearing, the sponsor shall give reasonable
notice to the charter school's board of directors of the hearing
date. The sponsor shall conduct an informal hearing before
taking final action. The sponsor shall take final action to
renew or not renew a contract by the last day of classes in the
school year. If the sponsor is a local board, the school's
board of directors may appeal the sponsor's decision to the
commissioner.

(b) A contract may be terminated or not renewed upon any of
the following grounds:

(1) failure to meet the requirements for pupil performance
contained in the contract;

(2) failure to meet generally accepted standards of fiscal
management;

(3) violations of law; or

(4) other good cause shown.

If a contract is terminated or not renewed new text beginunder this
paragraphnew text end, the school must be dissolved according to the
applicable provisions of chapter 308A or 317A, except when the
commissioner approves the decision of a different eligible
sponsor to authorize the charter school.

(c) new text beginIf at the end of a contract term, either the sponsor or
the charter school board of directors wants to voluntarily
terminate the contract, a change in sponsors is allowed if the
commissioner approves the decision of a different eligible
sponsor to authorize the charter school. The party intending to
terminate the contract must notify the other party and the
commissioner of its intent at least 90 days before the date on
which the contract ends. The sponsor that is a party to the
existing contract at least must inform the approved different
eligible sponsor about the fiscal and student performance of the
school. If no different eligible sponsor is approved, the
school must be dissolved according to applicable law and the
terms of the contract.
new text end

new text begin (d) new text endThe commissioner, after providing reasonable notice to
the board of directors of a charter school and the existing
sponsor, and after providing an opportunity for a public
hearing, may terminate the existing sponsorial relationship if
the charter school has a history of:

(1) financial mismanagement; or

(2) repeated violations of the law.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for the
2005-2006 school year and later.
new text end

Sec. 63.

Minnesota Statutes 2004, section 124D.11,
subdivision 1, is amended to read:

Subdivision 1.

General education revenue.

(a) General
education revenue must be paid to a charter school as though it
were a district. The general education revenue for each
adjusted marginal cost pupil unit is the state average general
education revenue per pupil unit, plus the referendum
equalization aid allowance in the pupil's district of residence,
minus an amount equal to the product of the formula allowance
according to section 126C.10, subdivision 2, times .0485,
calculated without basic skills revenue, new text beginextended time revenue,
alternative teacher compensation revenue, transition revenue,
new text end and transportation sparsity revenue, plus basic skills revenuenew text begin,
extended time revenue, basic alternative teacher compensation
aid according to section 126C.10, subdivision 34,new text endand transition
revenue as though the school were a school district. new text beginThe
general education revenue for each extended time marginal cost
pupil unit equals $4,378.
new text end

(b) Notwithstanding paragraph (a), for charter schools in
the first year of operation, general education revenue shall be
computed using the number of adjusted pupil units in the current
fiscal year.

Sec. 64.

Minnesota Statutes 2004, section 124D.11,
subdivision 2, is amended to read:

Subd. 2.

Transportation revenue.

Transportation revenue
must be paid to a charter school that provides transportation
services according to section 124D.10, subdivision 16, according
to this subdivision. Transportation aid shall equal
transportation revenue.

In addition to the revenue under subdivision 1, a charter
school providing transportation services must receive general
education aid deleted text beginfor each pupil unit deleted text endequal to the sum of new text beginthe
product of (i) new text endan amount equal to the product of the formula
allowance according to section 126C.10, subdivision 2, times
.0485, plus the transportation sparsity allowance for the school
district in which the charter school is located new text begintimes (ii) the
adjusted marginal cost pupil units, plus the product of $223
times the extended time marginal cost pupil unitsnew text end.

Sec. 65.

Minnesota Statutes 2004, section 124D.11,
subdivision 6, is amended to read:

Subd. 6.

Other aid, grants, revenue.

(a) A charter
school is eligible to receive other aids, grants, and revenue
according to chapters 120A to 129C, as though it were a district.

(b) Notwithstanding paragraph (a), a charter school may not
receive aid, a grant, or revenue if a levy is required to obtain
the money, new text beginor if the aid, grant, or revenue replaces levy
revenue that is not general education revenue,new text endexcept as
otherwise provided in this section.

(c) Federal aid received by the state must be paid to the
school, if it qualifies for the aid as though it were a school
district.

(d) A charter school may receive money from any source for
capital facilities needs. In the year-end report to the
commissioner of education, the charter school shall report the
total amount of funds received from grants and other outside
sources.

Sec. 66.

new text begin [124D.4531] CAREER AND TECHNICAL LEVY.
new text end

new text begin Subdivision 1. new text end

new text begin Career and technical levy. new text end

new text begin (a) A district
with a career and technical program approved under this section
for the fiscal year in which the levy is certified may levy an
amount equal to the lesser of:
new text end

new text begin (1) $80 times the district's average daily membership in
grades 10 through 12 for the fiscal year in which the levy is
certified; or
new text end

new text begin (2) 25 percent of approved expenditures in the fiscal year
in which the levy is certified for the following:
new text end

new text begin (i) salaries paid to essential, licensed personnel
providing direct instructional services to students in that
fiscal year for services rendered in the district's approved
career and technical education programs;
new text end

new text begin (ii) contracted services provided by a public or private
agency other than a Minnesota school district or cooperative
center under subdivision 7;
new text end

new text begin (iii) necessary travel between instructional sites by
licensed career and technical education personnel;
new text end

new text begin (iv) necessary travel by licensed career and technical
education personnel for vocational student organization
activities held within the state for instructional purposes;
new text end

new text begin (v) curriculum development activities that are part of a
five-year plan for improvement based on program assessment;
new text end

new text begin (vi) necessary travel by licensed career and technical
education personnel for noncollegiate credit-bearing
professional development; and
new text end

new text begin (vii) specialized vocational instructional supplies.
new text end

new text begin (b) Up to ten percent of a district's career and technical
levy may be spent on equipment purchases. Districts using the
career and technical levy for equipment purchases must report to
the department on the improved learning opportunities for
students that result from the investment in equipment.
new text end

new text begin (c) The district must recognize the full amount of this
levy as revenue for the fiscal year in which it is certified.
new text end

new text begin Subd. 2. new text end

new text begin Allocation from cooperative centers and
intermediate districts. new text end

new text begin For purposes of this section, a
cooperative center or an intermediate district must allocate its
approved expenditures for career and technical education
programs among participating districts.
new text end

new text begin Subd. 3. new text end

new text begin Levy guarantee. new text end

new text begin Notwithstanding subdivision 1,
the career and technical education levy for a district is not
less than the lesser of:
new text end

new text begin (1) the district's career and technical education levy
authority for the previous fiscal year; or
new text end

new text begin (2) 100 percent of the approved expenditures for career and
technical programs included in subdivision 1, paragraph (b), for
the fiscal year in which the levy is certified.
new text end

new text begin Subd. 4.new text end

new text beginDistrict reports.new text end

new text beginEach district or cooperative
center must report data to the department for all career and
technical education programs as required by the department to
implement the career and technical levy formula.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes
payable in 2008.
new text end

Sec. 67.

Minnesota Statutes 2004, section 124D.66,
subdivision 3, is amended to read:

Subd. 3.

Eligible services.

(a) Assurance of mastery
programs may provide direct instructional services to an
eligible pupil, or a group of eligible pupils, under the
following conditions in paragraphs (b) to (d).

(b) Instruction may be provided at one or more grade levels
from kindergarten to grade 8 and for students in grades 9
through 12 who new text beginwere enrolled in grade 8 before the 2005-2006
school year and new text endhave failed the basic skills testsnew text begin, or were
enrolled in grade 8 in the 2005-2006 school year and later and
who have failed the Minnesota Comprehensive Assessments
(MCA-IIs) in reading, mathematics, or writing as required for
high school graduation under section 120B.02new text end. If an assessment
of pupils' needs within a district demonstrates that the
eligible pupils in grades kindergarten to grade 8 are being
appropriately served, a district may serve eligible pupils in
grades 9 to 12.

(c) Instruction must be provided under the supervision of
the eligible pupil's regular classroom teacher. Instruction may
be provided by the eligible pupil's classroom teacher, by
another teacher, by a team of teachers, or by an education
assistant or aide. A special education teacher may provide
instruction, but instruction that is provided under this section
is not eligible for aid under section 125A.76.

(d) The instruction that is provided must differ from the
initial instruction the pupil received in the regular classroom
setting. The instruction may differ by presenting different
curriculum than was initially presented in the regular classroom
or by presenting the same curriculum:

(1) at a different rate or in a different sequence than it
was initially presented;

(2) using different teaching methods or techniques than
were used initially; or

(3) using different instructional materials than were used
initially.

Sec. 68.

Minnesota Statutes 2004, section 124D.74,
subdivision 1, is amended to read:

Subdivision 1.

Program described.

American Indian
education programs are programs in public elementary and
secondary schools, nonsectarian nonpublic, community,
tribal, new text begincharter,new text endor alternative schools enrolling American
Indian children designed to:

(1) support postsecondary preparation for pupils;

(2) support the academic achievement of American Indian
students with identified focus to improve reading and mathematic
skills;

(3) make the curriculum more relevant to the needs,
interests, and cultural heritage of American Indian pupils;

(4) provide positive reinforcement of the self-image of
American Indian pupils;

(5) develop intercultural awareness among pupils, parents,
and staff; and

(6) supplement, not supplant, state and federal educational
and cocurricular programs.

Program components may include: development of support
components for students in the areas of academic achievement,
retention, and attendance; development of support components for
staff, including in-service training and technical assistance in
methods of teaching American Indian pupils; research projects,
including experimentation with and evaluation of methods of
relating to American Indian pupils; provision of personal and
vocational counseling to American Indian pupils; modification of
curriculum, instructional methods, and administrative procedures
to meet the needs of American Indian pupils; and supplemental
instruction in American Indian language, literature, history,
and culture. Districts offering programs may make contracts for
the provision of program components by establishing cooperative
liaisons with tribal programs and American Indian social service
agencies. These programs may also be provided as components of
early childhood and family education programs.

Sec. 69.

Minnesota Statutes 2004, section 124D.81,
subdivision 1, is amended to read:

Subdivision 1.

Grants; procedures.

Each fiscal year the
commissioner of education must make grants to no fewer than six
American Indian education programs. At least three programs
must be in urban areas and at least three must be on or near
reservations. The board of a local district, a participating
school or a group of boards may develop a proposal for grants in
support of American Indian education programs. Proposals may
provide for contracts for the provision of program components by
nonsectarian nonpublic, community, tribal, new text begincharter,new text endor
alternative schools. The commissioner shall prescribe the form
and manner of application for grants, and no grant shall be made
for a proposal not complying with the requirements of sections
124D.71 to 124D.82. deleted text beginThe commissioner must submit all proposals
to the state Advisory Committee on American Indian Education
Programs for its recommendations concerning approval,
modification, or disapproval and the amounts of grants to
approved programs.
deleted text end

Sec. 70.

Minnesota Statutes 2004, section 124D.84,
subdivision 1, is amended to read:

Subdivision 1.

Awards.

The commissionerdeleted text begin, with the advice
and counsel of the Minnesota Indian Education Committee,deleted text endmay
award scholarships to any Minnesota resident student who is of
one-fourth or more Indian ancestry, who has applied for other
existing state and federal scholarship and grant programs, and
who, in the opinion of the commissioner, has the capabilities to
benefit from further education. Scholarships must be for
accredited degree programs in accredited Minnesota colleges or
universities or for courses in accredited Minnesota business,
technical, or vocational schools. Scholarships may also be
given to students attending Minnesota colleges that are in
candidacy status for obtaining full accreditation, and are
eligible for and receiving federal financial aid programs.
Students are also eligible for scholarships when enrolled as
students in Minnesota higher education institutions that have
joint programs with other accredited higher education
institutions. Scholarships shall be used to defray the total
cost of education including tuition, incidental fees, books,
supplies, transportation, other related school costs and the
cost of board and room and shall be paid directly to the college
or school concerned where the student receives federal financial
aid. The total cost of education includes all tuition and fees
for each student enrolling in a public institution and the
portion of tuition and fees for each student enrolling in a
private institution that does not exceed the tuition and fees at
a comparable public institution. Each student shall be awarded
a scholarship based on the total cost of the student's education
and a federal standardized need analysis. Applicants are
encouraged to apply for all other sources of financial aid. deleted text beginThe
amount and type of each scholarship shall be determined through
the advice and counsel of the Minnesota Indian education
committee.
deleted text end

When an Indian student satisfactorily completes the work
required by a certain college or school in a school year the
student is eligible for additional scholarships, if additional
training is necessary to reach the student's educational and
vocational objective. Scholarships may not be given to any
Indian student for more than five years of study deleted text beginwithout special
recommendation of the Minnesota Indian Education Committeedeleted text end.

Sec. 71.

Minnesota Statutes 2004, section 126C.457, is
amended to read:

126C.457 CAREER AND TECHNICAL LEVY.

new text begin For taxes payable in 2006 and 2007,new text enda school district may
levy an amount equal to the greater of (1) $10,000, or (2) the
district's fiscal year 2001 entitlement for career and technical
aid under Minnesota Statutes 2000, section 124D.453. The
district must recognize the full amount of this levy as revenue
for the fiscal year in which it is certified. Revenue received
under this section must be reserved and used only for career and
technical programs.

Sec. 72.

new text begin [127A.095] IMPLEMENTATION OF NO CHILD LEFT
BEHIND ACT.
new text end

new text begin Subdivision 1. new text end

new text begin Continued implementation. new text end

new text begin The Department
of Education shall continue to implement the federal No Child
Left Behind Act, Public Law 107-110, without interruption.
new text end

new text begin Subd. 2. new text end

new text begin No child left behind review. new text end

new text begin (a) The
legislature intends to require the Department of Education to
conduct a comprehensive review of the consolidated state plan
the state submitted to the federal Department of Education to
implement the No Child Left Behind Act. The Minnesota
Department of Education shall seek waivers under paragraph (b).
If the Department of Education is unable to obtain waivers under
paragraph (b), it should recommend in its report under paragraph
(b) whether the state should opt out of the No Child Left Behind
Act.
new text end

new text begin (b) The commissioner, by January 15, 2007, shall report to
the house of representatives and senate committees having
jurisdiction over kindergarten through grade 12 education policy
and finance whether the department has received approval from
the federal Department of Education to:
new text end

new text begin (1) allow the state to develop a plan for determining
adequate yearly progress that uses multiple measures of student
achievement that include value-added measurement of student
achievement in addition to standardized test results to evaluate
school and student performance;
new text end

new text begin (2) exclude from sanctions a school that is classified as
not having made adequate yearly progress due solely to different
subgroups testing below proficient levels for at least two
consecutive years;
new text end

new text begin (3) allow the state to average three years of data for the
purposes of identifying a school for improvement;
new text end

new text begin (4) allow the state to use No Child Left Behind Act money
to provide supplemental education services only in the academic
subject area that causes a school to miss adequate yearly
progress;
new text end

new text begin (5) exclude from sanctions schools that have not made
adequate yearly progress due solely to a subgroup of students
with disabilities not testing at a proficient level;
new text end

new text begin (6) identify a school as not making adequate yearly
progress only after the school has missed the adequate yearly
progress targets in the same subject and subgroup for two
consecutive years;
new text end

new text begin (7) limit the score of a student within multiple subgroups
to the smallest subgroup in which that student is included when
calculating adequate yearly progress;
new text end

new text begin (8) determine when to hold schools accountable for
including a student with limited English proficiency in adequate
yearly progress calculations; and
new text end

new text begin (9) use a fully computer-adaptive test for purposes of
compliance with the No Child Left Behind Act.
new text end

new text begin Subd. 3.new text end

new text beginDepartment of finance certification.new text end

new text beginIf the
federal Department of Education does not transmit to the
commissioner of education its approval of the conditions in
subdivision 2, paragraph (b), the commissioner of finance shall
certify and report to the legislature annually beginning January
1, 2008, the amount of federal revenue, if any, that the federal
government may withhold as a result of a potential state
decision to discontinue implementation of the No Child Left
Behind Act. The report shall also specify the intended purpose
of the federal revenue and the amount of revenue that the
federal government may withhold from the state, each school
district, and each charter school in each fiscal year.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 73.

Minnesota Statutes 2004, section 127A.47,
subdivision 8, is amended to read:

Subd. 8.

Charter schools.

(a) The general education aid
for districts must be adjusted for each pupil attending a
charter school under section 124D.10. The adjustments must be
made according to this subdivision.

(b) General education aid paid to a district in which a
charter school not providing transportation according to section
124D.10, subdivision 16, is located must be increased by an
amount equal to the new text beginsum of:
new text end

new text begin (1) the new text endproduct of: deleted text begin(1) deleted text endnew text begin(i) new text endthe sum of an amount equal to
the product of the formula allowance according to section
126C.10, subdivision 2, times .0485, plus the transportation
sparsity allowance for the district; times deleted text begin(2) deleted text endnew text begin(ii) new text endthe new text beginadjusted
marginal cost new text endpupil units attributable to the pupilnew text begin; plus
new text end

new text begin (2) the product of $223 and the extended time marginal cost
pupil units attributable to the pupilnew text end.

Sec. 74.

Minnesota Statutes 2004, section 128C.05, is
amended by adding a subdivision to read:

new text begin Subd. 3. new text end

new text begin Exemption. new text end

new text begin The appropriate regional committee
must hear a request for a waiver to allow a nonresident student
to participate in another district when that participation
affects a school's classification for interscholastic athletic
activities. The regional committee must review requests for
waivers and make timely recommendations to the Minnesota State
High School League Board of Directors.
new text end

Sec. 75.

Minnesota Statutes 2004, section 128C.12,
subdivision 1, is amended to read:

Subdivision 1.

Dues and events revenue.

new text begin(a) new text endThe state
auditor annually must examine the accounts of, and audit all
money paid to, the State High School League by its members. The
audit must include financial and compliance issues. The deleted text beginstate
auditor deleted text endnew text beginaudit new text endmust also deleted text beginaudit deleted text endnew text begininclude new text endall money derived from any
event sponsored by the league. deleted text beginLeague audits must include
audits of administrative regions of the league. The league and
its administrative regions may not contract with private
auditors. The scope of the state auditor's examinations of the
league must be agreed upon by the board and the state auditor,
provided that all requirements of this section must be met.
deleted text end

new text begin (b) The administrative regions of the league may contract
with the state auditor or with a private certified public
accountant for the audit required by this section. If a private
certified public accountant performs the audit, the state
auditor may require additional information from the private
certified public accountant as the state auditor deems in the
public interest. The state auditor may accept the audit or make
additional examinations as the state auditor deems to be in the
public interest.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 76.

Minnesota Statutes 2004, section 128C.12,
subdivision 3, is amended to read:

Subd. 3.

Copies.

The deleted text beginstate auditor deleted text endnew text beginboard new text endmust file
copies of the deleted text beginfinancial and compliance deleted text endaudit report with the
commissioner of education and the director of the Legislative
Reference Library.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 77.

new text begin [129C.105] BOARD MEETINGS BY TELEPHONE OR OTHER
ELECTRONIC MEANS.
new text end

new text begin (a) Notwithstanding section 13D.01 and if complying with
section 13D.02 is impractical, the Board of the Perpich Center
for Arts Education may conduct a meeting of its members by
telephone or other electronic means when:
new text end

new text begin (1) all members of the board participating in the meeting,
wherever the members' physical locations, can hear one another
and all discussion and testimony;
new text end

new text begin (2) members of the public present at the regular meeting
location of the board can hear all discussion and testimony and
all votes of members of the board;
new text end

new text begin (3) at least one member of the board is physically present
at the regular meeting location; and
new text end

new text begin (4) all votes are conducted by roll call, so each member's
vote on each issue can be identified and recorded.
new text end

new text begin (b) Each member of the board participating in a meeting by
telephone or other electronic means is considered present at the
meeting for purposes of determining a quorum and participating
in all proceedings.
new text end

new text begin (c) If telephone or other electronic means is used to
conduct a meeting, the board, to the extent practical, shall
allow a person to monitor the meeting electronically from a
remote location. The board may require the person making such a
connection to pay for documented marginal costs that the board
incurs as a result of the additional connection.
new text end

new text begin (d) If telephone or other electronic means is used to
conduct a regular, special, or emergency meeting, the board
shall provide notice of the regular meeting location, of the
fact that some members may participate by telephone or other
electronic means, and of the provisions of paragraph (c). The
timing and method of providing notice is governed by section
13D.04.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 78.

new text begin [138.911] MINNESOTA HUMANITIES COMMISSION.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The Minnesota Humanities
Commission, a nonprofit organization, is established to advance
the study of the humanities and enhance the work of schools,
colleges, and cultural organizations throughout the state.
new text end

new text begin Subd. 2. new text end

new text begin Reports. new text end

new text begin The Minnesota Humanities Commission
shall report to the legislature by September 1 of each year on
the use of state funds appropriated to the commission. The
report shall include an itemized account of the programs and
projects supported and the source of money for each. The report
shall show actual expenditures for the fiscal year ending the
preceding June 30 and proposed expenditures for the fiscal year
beginning the preceding July 1.
new text end

new text begin Subd. 3.new text end

new text beginHumanities center.new text end

new text begin(a) The Minnesota Humanities
Commission may establish a humanities center to ensure balance
in public education and in the cultural life of the state, and
to improve humanities education through the establishment of two
institutes: the Minnesota Institute for Lifelong Learning and
the Minnesota Institute for the Advancement of Teaching.
new text end

new text begin (b) The humanities center may transport people and
resources to small towns, rural communities, and urban settings
to provide grants, technical assistance, and high-quality
educational and cultural programs to schools and community
organizations throughout Minnesota.
new text end

new text begin (c) The Minnesota Institute for the Advancement of Teaching
may conduct seminars and other activities for the recognition of
the teaching profession and the advancement of teaching in
Minnesota.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day
following final enactment.
new text end

Sec. 79.

new text begin [171.176] REVOCATION OR SUSPENSION; SCHOOL
ATTENDANCE.
new text end

new text begin The commissioner of public safety may not link or condition
issuing, suspending, or revoking a person's license to operate a
motor vehicle to attendance at a secondary school.
new text end

Sec. 80.

Minnesota Statutes 2004, section 260C.201,
subdivision 1, as amended by Laws 2005, chapter 159, article 2,
section 16, is amended to read:

Subdivision 1.

Dispositions.

(a) If the court finds that
the child is in need of protection or services or neglected and
in foster care, it shall enter an order making any of the
following dispositions of the case:

(1) place the child under the protective supervision of the
responsible social services agency or child-placing agency in
the home of a parent of the child under conditions prescribed by
the court directed to the correction of the child's need for
protection or services:

(i) the court may order the child into the home of a parent
who does not otherwise have legal custody of the child, however,
an order under this section does not confer legal custody on
that parent;

(ii) if the court orders the child into the home of a
father who is not adjudicated, he must cooperate with paternity
establishment proceedings regarding the child in the appropriate
jurisdiction as one of the conditions prescribed by the court
for the child to continue in his home; and

(iii) the court may order the child into the home of a
noncustodial parent with conditions and may also order both the
noncustodial and the custodial parent to comply with the
requirements of a case plan under subdivision 2; or

(2) transfer legal custody to one of the following:

(i) a child-placing agency; or

(ii) the responsible social services agency. In making a
foster care placement for a child whose custody has been
transferred under this subdivision, the agency shall make an
individualized determination of how the placement is in the
child's best interests using the consideration for relatives and
the best interest factors in section 260C.212, subdivision 2,
paragraph (b); or

(3) order a trial home visit without modifying the transfer
of legal custody to the responsible social services agency under
clause (2). Trial home visit means the child is returned to the
care of the parent or guardian from whom the child was removed
for a period not to exceed six months. During the period of the
trial home visit, the responsible social services agency:

(i) shall continue to have legal custody of the child,
which means the agency may see the child in the parent's home,
at school, in a child care facility, or other setting as the
agency deems necessary and appropriate;

(ii) shall continue to have the ability to access
information under section 260C.208;

(iii) shall continue to provide appropriate services to
both the parent and the child during the period of the trial
home visit;

(iv) without previous court order or authorization, may
terminate the trial home visit in order to protect the child's
health, safety, or welfare and may remove the child to foster
care;

(v) shall advise the court and parties within three days of
the termination of the trial home visit when a visit is
terminated by the responsible social services agency without a
court order; and

(vi) shall prepare a report for the court when the trial
home visit is terminated whether by the agency or court order
which describes the child's circumstances during the trial home
visit and recommends appropriate orders, if any, for the court
to enter to provide for the child's safety and stability. In
the event a trial home visit is terminated by the agency by
removing the child to foster care without prior court order or
authorization, the court shall conduct a hearing within ten days
of receiving notice of the termination of the trial home visit
by the agency and shall order disposition under this subdivision
or conduct a permanency hearing under subdivision 11 or 11a.
The time period for the hearing may be extended by the court for
good cause shown and if it is in the best interests of the child
as long as the total time the child spends in foster care
without a permanency hearing does not exceed 12 monthsdeleted text begin.deleted text endnew text begin;
new text end

(4) if the child has been adjudicated as a child in need of
protection or services because the child is in need of special
services or care to treat or ameliorate a physical or mental
disability, the court may order the child's parent, guardian, or
custodian to provide it. The court may order the child's health
plan company to provide mental health services to the child.
Section 62Q.535 applies to an order for mental health services
directed to the child's health plan company. If the health
plan, parent, guardian, or custodian fails or is unable to
provide this treatment or care, the court may order it
provided. Absent specific written findings by the court that
the child's disability is the result of abuse or neglect by the
child's parent or guardian, the court shall not transfer legal
custody of the child for the purpose of obtaining special
treatment or care solely because the parent is unable to provide
the treatment or care. If the court's order for mental health
treatment is based on a diagnosis made by a treatment
professional, the court may order that the diagnosing
professional not provide the treatment to the child if it finds
that such an order is in the child's best interests; or

(5) if the court believes that the child has sufficient
maturity and judgment and that it is in the best interests of
the child, the court may order a child 16 years old or older to
be allowed to live independently, either alone or with others as
approved by the court under supervision the court considers
appropriate, if the county board, after consultation with the
court, has specifically authorized this dispositional
alternative for a child.

(b) If the child was adjudicated in need of protection or
services because the child is a runaway or habitual truant, the
court may order any of the following dispositions in addition to
or as alternatives to the dispositions authorized under
paragraph (a):

(1) counsel the child or the child's parents, guardian, or
custodian;

(2) place the child under the supervision of a probation
officer or other suitable person in the child's own home under
conditions prescribed by the court, including reasonable rules
for the child's conduct and the conduct of the parents,
guardian, or custodian, designed for the physical, mental, and
moral well-being and behavior of the child; or with the consent
of the commissioner of corrections, place the child in a group
foster care facility which is under the commissioner's
management and supervision;

(3) subject to the court's supervision, transfer legal
custody of the child to one of the following:

(i) a reputable person of good moral character. No person
may receive custody of two or more unrelated children unless
licensed to operate a residential program under sections 245A.01
to 245A.16; or

(ii) a county probation officer for placement in a group
foster home established under the direction of the juvenile
court and licensed pursuant to section 241.021;

(4) require the child to pay a fine of up to $100. The
court shall order payment of the fine in a manner that will not
impose undue financial hardship upon the child;

(5) require the child to participate in a community service
project;

(6) order the child to undergo a chemical dependency
evaluation and, if warranted by the evaluation, order
participation by the child in a drug awareness program or an
inpatient or outpatient chemical dependency treatment program;

(7) if the court believes that it is in the best interests
of the child deleted text beginand deleted text endnew text beginor new text endof public safety that the child's driver's
license or instruction permit be canceled, the court may order
the commissioner of public safety to cancel the child's license
or permit for any period up to the child's 18th birthday. If
the child does not have a driver's license or permit, the court
may order a denial of driving privileges for any period up to
the child's 18th birthday. The court shall forward an order
issued under this clause to the commissioner, who shall cancel
the license or permit or deny driving privileges without a
hearing for the period specified by the court. At any time
before the expiration of the period of cancellation or denial,
the court may, for good cause, order the commissioner of public
safety to allow the child to apply for a license or permit, and
the commissioner shall so authorize;

(8) order that the child's parent or legal guardian deliver
the child to school at the beginning of each school day for a
period of time specified by the court; or

(9) require the child to perform any other activities or
participate in any other treatment programs deemed appropriate
by the court.

To the extent practicable, the court shall enter a
disposition order the same day it makes a finding that a child
is in need of protection or services or neglected and in foster
care, but in no event more than 15 days after the finding unless
the court finds that the best interests of the child will be
served by granting a delay. If the child was under eight years
of age at the time the petition was filed, the disposition order
must be entered within ten days of the finding and the court may
not grant a delay unless good cause is shown and the court finds
the best interests of the child will be served by the delay.

(c) If a child who is 14 years of age or older is
adjudicated in need of protection or services because the child
is a habitual truant and truancy procedures involving the child
were previously dealt with by a school attendance review board
or county attorney mediation program under section 260A.06 or
260A.07, the court shall order a cancellation or denial of
driving privileges under paragraph (b), clause (7), for any
period up to the child's 18th birthday.

(d) In the case of a child adjudicated in need of
protection or services because the child has committed domestic
abuse and been ordered excluded from the child's parent's home,
the court shall dismiss jurisdiction if the court, at any time,
finds the parent is able or willing to provide an alternative
safe living arrangement for the child, as defined in Laws 1997,
chapter 239, article 10, section 2.

(e) When a parent has complied with a case plan ordered
under subdivision 6 and the child is in the care of the parent,
the court may order the responsible social services agency to
monitor the parent's continued ability to maintain the child
safely in the home under such terms and conditions as the court
determines appropriate under the circumstances.

Sec. 81. new text beginBOARD OF SCHOOL ADMINISTRATORS; RULEMAKING
AUTHORITY.
new text end

new text begin On or before June 30, 2007, the Board of School
Administrators may adopt expedited rules under Minnesota
Statutes, section 14.389, to make technical revisions and
clarifications to Minnesota Rules, chapter 3512.
new text end

Sec. 82. new text beginCOLLEGE PREPARATION STANDARDS.
new text end

new text begin (a) The Higher Education Advisory Council must convene a
working group to develop standards describing the skills and
knowledge a high school graduate must have at entry into
postsecondary education in order to successfully graduate from
college. The standards must, to the extent possible, be
applicable for all postsecondary education but may describe
differences in the skills and knowledge necessary for success in
different higher education institutions and programs. The
standards need not be comprehensive but must, at a minimum, be
the essential skills and knowledge that will enable a student to
succeed in college. The Higher Education Services Office must
provide staff for the working group.
new text end

new text begin (b) The Higher Education Advisory Council must submit the
standards to the commissioner of education no later than January
15, 2006. No later than March 15, 2006, the commissioner of
education must report, to the chairs of the legislative
committees with jurisdiction over kindergarten through grade 12
education policy and finance and higher education policy and
finance, its recommendations regarding the changes, if any, that
must be made in Minnesota's academic standards in order to
ensure that Minnesota high school graduates meet the college
readiness standards established by the Higher Education Advisory
Council.
new text end

new text begin (c) The Higher Education Advisory Council must invite the
University of Minnesota, Minnesota State Colleges and
Universities, representatives of private colleges, and other
private postsecondary institutions, to participate in the
working group and may invite other individuals or entities to
participate. The Higher Education Advisory Council and its
working group may collaborate with the Minnesota P-16 Education
Partnership in developing the college readiness standards.
new text end

Sec. 83. new text beginMINNESOTA COMPREHENSIVE ASSESSMENTS; RULES.
new text end

new text begin The commissioner of education shall adopt rules on or
before January 1, 2006, to implement the Minnesota Comprehensive
Assessments Second Edition (MCA-IIs) in reading, mathematics,
and writing. For purposes of state and local high school
graduation requirements, the rules must include criteria
enabling school districts to:
new text end

new text begin (1) appropriately accommodate a student who fails but seeks
to pass the Minnesota Comprehensive Assessments Second Edition;
and
new text end

new text begin (2) exempt a disabled student, consistent with the
student's individualized education plan, or an English language
learner from the Minnesota Comprehensive Assessments Second
Edition or administer an alternative assessment either to a
disabled student, consistent with the student's individualized
education plan, or to an English language learner.
new text end

Sec. 84. new text beginAPPROPRIATIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Department. new text end

new text begin The sums indicated in this
section are appropriated from the general fund to the Department
of Education for the fiscal years designated and include and
supersede any amounts appropriated in Laws 2005, First Special
Session chapter 2, or authorized by order of the Ramsey County
District Court in Case No. C9-05-5928.
new text end

new text begin Subd. 2. new text end

new text begin Charter school building lease aid. new text end

new text begin For building
lease aid under Minnesota Statutes, section 124D.11, subdivision
4:
new text end

new text begin $25,465,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $30,929,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $3,324,000 for 2005 and
$22,141,000 for 2006.
new text end

new text begin The 2007 appropriation includes $4,123,000 for 2006 and
$26,806,000 for 2007.
new text end

new text begin Subd. 3. new text end

new text begin Charter school startup aid. new text end

new text begin For charter school
startup cost aid under Minnesota Statutes, section 124D.11:
new text end

new text begin $1,393,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $3,185,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $0 for 2005 and $1,393,000
for 2006.
new text end

new text begin The 2007 appropriation includes $259,000 for 2006 and
$2,926,000 for 2007.
new text end

new text begin Subd. 4. new text end

new text begin Integration aid. new text end

new text begin For integration aid under
Minnesota Statutes, section 124D.86, subdivision 5:
new text end

new text begin $57,801,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $57,536,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $8,545,000 for 2005 and
$49,256,000 for 2006.
new text end

new text begin The 2007 appropriation includes $9,173,000 for 2006 and
$48,363,000 for 2007.
new text end

new text begin Subd. 5. new text end

new text begin Magnet school grants. new text end

new text begin For magnet school and
program grants:
new text end

new text begin $ 750,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $ 750,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin These amounts may be used for magnet school programs under
Minnesota Statutes, section 124D.88.
new text end

new text begin Subd. 6. new text end

new text begin Interdistrict desegregation or integration
transportation grants. new text end

new text begin For interdistrict desegregation or
integration transportation grants under Minnesota Statutes,
section 124D.87:
new text end

new text begin $7,768,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $9,908,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 7. new text end

new text begin Success for the future. new text end

new text begin For American Indian
success for the future grants under Minnesota Statutes, section
124D.81:
new text end

new text begin $2,137,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $2,137,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $335,000 for 2005 and
$1,802,000 for 2006.
new text end

new text begin The 2007 appropriation includes $335,000 for 2006 and
$1,802,000 for 2007.
new text end

new text begin Subd. 8. new text end

new text begin American indian scholarships. new text end

new text begin For American
Indian scholarships under Minnesota Statutes, section 124D.84:
new text end

new text begin $1,875,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $1,875,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 9. new text end

new text begin American indian teacher preparation grants. new text end

new text begin For
joint grants to assist American Indian people to become teachers
under Minnesota Statutes, section 122A.63:
new text end

new text begin $ 190,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $ 190,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 10. new text end

new text begin Tribal contract schools. new text end

new text begin For tribal contract
school aid under Minnesota Statutes, section 124D.83:
new text end

new text begin $2,389,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $2,603,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin The 2006 appropriation includes $348,000 for 2005 and
$2,041,000 for 2006.
new text end

new text begin The 2007 appropriation includes $380,000 for 2006 and
$2,223,000 for 2007.
new text end

new text begin Subd. 11. new text end

new text begin Early childhood programs at tribal
schools. new text end

new text begin For early childhood family education programs at
tribal contract schools under Minnesota Statutes, section
124D.83, subdivision 4:
new text end

new text begin $ 68,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $ 68,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 12. new text end

new text begin Statewide testing. new text end

new text begin For statewide testing
support under Minnesota Statutes, section 120B.30:
new text end

new text begin $10,200,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $10,200,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Of this appropriation, $1,200,000 each year is for
development of interactive science assessments.
new text end

new text begin Subd. 13. new text end

new text begin Examination fees; teacher training and support
programs. new text end

new text begin (a) For students' advanced placement and
international baccalaureate examination fees under Minnesota
Statutes, section 120B.13, subdivision 3, and the training and
related costs for teachers and other interested educators under
Minnesota Statutes, section 120B.13, subdivision 1:
new text end

new text begin $4,500,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $4,500,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin (b) The advanced placement program shall receive 75 percent
of the appropriation each year and the international
baccalaureate program shall receive 25 percent of the
appropriation each year. The department, in consultation with
representatives of the advanced placement and international
baccalaureate programs selected by the Advanced Placement
Advisory Council and IBMN, respectively, shall determine the
amounts of the expenditures each year for examination fees and
training and support programs for each program.
new text end

new text begin (c) Notwithstanding Minnesota Statutes, section 120B.13,
subdivision 1, at least $500,000 each year is for teachers to
attend subject matter summer training programs and follow-up
support workshops approved by the advanced placement or
international baccalaureate programs. The amount of the subsidy
for each teacher attending an advanced placement or
international baccalaureate summer training program or workshop
shall be the same. The commissioner shall determine the payment
process and the amount of the subsidy.
new text end

new text begin (d) The commissioner shall pay all examination fees for all
students of low-income families under Minnesota Statutes,
section 120B.13, subdivision 3, and to the extent of available
appropriations shall also pay examination fees for students
sitting for an advanced placement examination, international
baccalaureate examination, or both.
new text end

new text begin Any balance in the first year does not cancel but is
available in the second year.
new text end

new text begin Subd. 14. new text end

new text begin First grade preparedness. new text end

new text begin For first grade
preparedness grants under Minnesota Statutes, section 124D.081:
new text end

new text begin $7,250,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $7,250,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin Subd. 15. new text end

new text begin Collaborative urban educator. new text end

new text begin For the
collaborative urban educator program:
new text end

new text begin $ 528,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $ 528,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin $210,000 each year is for the Southeast Asian teacher
program at Concordia University, St. Paul; $159,000 each year is
for the collaborative urban educator program at the University
of St. Thomas; and $159,000 each year is for the Center for
Excellence in Urban Teaching at Hamline University. Grant
recipients must collaborate with urban and nonurban school
districts.
new text end

new text begin Any balance in the first year does not cancel but is
available in the second year.
new text end

new text begin Subd. 16. new text end

new text begin Youth works program. new text end

new text begin For funding youth works
programs under Minnesota Statutes, sections 124D.37 to 124D.45:
new text end

new text begin $ 900,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $ 900,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin A grantee organization may provide health and child care
coverage to the dependents of each participant enrolled in a
full-time youth works program to the extent such coverage is not
otherwise available.
new text end

new text begin Subd. 17. new text end

new text begin Student organizations. new text end

new text begin For student
organizations:
new text end

new text begin $725,000 new text end new text begin ..... new text end new text begin 2006
new text end

new text begin $725,000 new text end new text begin ..... new text end new text begin 2007
new text end

new text begin $40,000 each year is for student organizations serving
health occupations.
new text end

new text begin $38,000 each year is for student organizations serving
service occupations.
new text end

new text begin $88,000 each year is for student organizations serving
trade and industry occupations.
new text end

new text begin $84,000 each year is for student organizations serving
business occupations.
new text end

new text begin $131,000 each year is

HF 141

Bill Text Versions

Current Version - 1st Engrossment

ARTICLE 1

GENERAL EDUCATION

Section 1.

new text begin Subd. 18.new text end

new text beginKindergarten.new text end

new text begin EFFECTIVE DATE. new text end

Sec. 2.

Subd. 2.

Reserve revenue.

Sec. 3.

new text begin Subd. 4a. new text end

new text begin Taconite revenue. new text end

Sec. 4.

Subd. 3.

Expenditures by building.

Sec. 5.

Subd. 6.

Account transfer for statutory operating debt.

Sec. 6.

Subdivision 1.

Operating debt.

Sec. 7.

123B.82 REORGANIZATION OPERATING DEBT.

Sec. 8.

Subd. 2.

deleted text beginundesignated deleted text endnew text beginnet unreserved general new text endfund balances.

Sec. 9.

Subdivision 1.

Definitions.

Sec. 10.

Subd. 5.

District reports.

new text begin EFFECTIVE DATE. new text end

Sec. 11.

Subd. 9.

Enrollment verification.

Sec. 12.

Subdivision 1.

Aid.

Sec. 13.

125A.51 PLACEMENT OF CHILDREN WITHOUT DISABILITIES; EDUCATION AND TRANSPORTATION.

Sec. 14.

Subd. 11.

Net deleted text beginunappropriated operating deleted text endnew text beginunreserved general new text end fund balance.

Sec. 15.

new text begin Subd. 20. new text end

new text begin Project-based average daily membership. new text end

Sec. 16.

Subdivision 1.

General education revenue.

new text begin EFFECTIVE DATE. new text end

Sec. 17.

Subd. 2.

Basic revenue.

Sec. 18.

new text begin Subd. 2b.new text end

new text beginGifted and talented revenue.new text end

new text begin EFFECTIVE DATE. new text end

Sec. 19.

Subd. 13.

Total operating capital revenue.

Sec. 20.

Subd. 13a.

Operating capital levy.

new text begin EFFECTIVE DATE. new text end

Sec. 21.

Subd. 24.

Equity revenue.

new text begin EFFECTIVE DATE. new text end

Sec. 22.

Subd. 31.

Transition revenue.

Sec. 23.

new text begin Subd. 34. new text end

new text begin Basic alternative teacher compensation aid. new text end

Sec. 24.

new text begin Subd. 35. new text end

deleted text beginundesignated deleted text endnew text beginnet unreserved general new text endfund
balances.

125A.51 PLACEMENT OF CHILDREN WITHOUT DISABILITIES;
EDUCATION AND TRANSPORTATION.

Net deleted text beginunappropriated operating deleted text endnew text beginunreserved general
new text end fund balance.

Payment to unemployment insurance program trust
fund by state and political subdivisions.

Distributions of excess taxes on captured net
tax capacity.

Sec. 46. new text beginKINDERGARTEN REPORTING.
new text end