HF 1900

3rd Engrossment - 93rd Legislature (2023 - 2024) Posted on 05/22/2023 12:12pm

A bill for an act
relating to natural resources; proposing an amendment to the Minnesota
Constitution, article XI, section 14; providing for the renewal of the environment
and natural resources trust fund; requiring a report; appropriating money; proposing
coding for new law in Minnesota Statutes, chapter 116P; proposing coding for
new law as Minnesota Statutes, chapter 116X.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

CONSTITUTIONAL AMENDMENT

Section 1. new text begin CONSTITUTIONAL AMENDMENT PROPOSED.
new text end

new text begin An amendment to the Minnesota Constitution is proposed to the people. If the amendment
is adopted, article XI, section 14, will read:
new text end

Sec. 14.

A permanent environment and natural resources trust fund is established in the
state treasury. deleted text begin Loans may be made of up to five percent of the principal of the fund for water
system improvements as provided by law. deleted text end The assets of the fund shall be appropriated by
law for the public purpose of protection, conservation, preservation, and enhancement of
the state's air, water, land, fish, wildlife, and other natural resources. new text begin The assets of the fund
shall not be used to pay the principal or interest of any bonds. The assets of the fund shall
not be used to pay for any costs related to the construction, repair, improvement, or operation
of any facility or system that processes wastewater, but may be used to pay for research
related to wastewater. new text end The amount appropriated each year of a biennium, commencing on
July 1 in each odd-numbered year and ending on and including June 30 in the next
odd-numbered year, may be up to deleted text begin 5-1/2 deleted text end new text begin seven new text end percent of the market value of the fund on
June 30 one year before the start of the biennium. Not less than 40 percent of the net proceeds
from any state-operated lottery must be credited to the fund deleted text begin until the year 2025 deleted text end new text begin through
December 31, 2050 new text end .

Sec. 2. new text begin SUBMISSION TO VOTERS.
new text end

new text begin (a) The proposed amendment must be submitted to the people at the 2024 general election.
The question submitted must be:
new text end

new text begin "Shall the Minnesota Constitution be amended to protect drinking water sources and the
water quality of lakes, rivers, and streams; conserve wildlife habitat and natural areas;
improve air quality; and expand access to parks and trails by extending the transfer of
proceeds from the state-operated lottery to the environment and natural resources trust fund,
and to dedicate the proceeds for these purposes?
new text end

	new text begin Yes . new text end
	new text begin No . new text end	new text begin " new text end

new text begin (b) The title required under Minnesota Statutes, section 204D.15, subdivision 1, for the
question submitted to the people under paragraph (a) shall be: "Environment and Natural
Resources Trust Fund Renewal."
new text end

ARTICLE 2

STATUTORY CHANGES

Section 1.

new text begin [116P.011] CHAPTER DOES NOT APPLY TO CERTAIN
APPROPRIATIONS.
new text end

new text begin This chapter does not apply to appropriations from the environment and natural resources
trust fund under section 116X.03 or to projects funded with those appropriations.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin If the constitutional amendment in article 1, section 1, is approved
by the voters at the 2024 general election, this section is effective January 1, 2025.
new text end

Sec. 2.

new text begin [116X.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Applicability. new text end

new text begin The definitions in this section apply to this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Advisory council. new text end

new text begin "Advisory council" means the council created under section
116X.05.
new text end

new text begin Subd. 3. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of natural resources.
new text end

new text begin Subd. 4. new text end

new text begin Grant program. new text end

new text begin "Grant program" means the program established under section
116X.03.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the day on which the
constitutional amendment in article 1, section 1, is approved by the voters at the 2024 general
election.
new text end

Sec. 3.

new text begin [116X.03] ENVIRONMENT AND NATURAL RESOURCES TRUST FUND
COMMUNITY GRANT PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment; grants. new text end

new text begin (a) The commissioner must establish the
environment and natural resources trust fund community grant program for the benefit of
current residents and future generations.
new text end

new text begin (b) The commissioner must award grants under the program for purposes that are
authorized under Minnesota Constitution, article XI, section 14, but that have not traditionally
been funded from that source. The commissioner must provide at least two grant award
cycles per calendar year and must ensure that grants are awarded and deployed under the
program as expeditiously as possible.
new text end

new text begin Subd. 2. new text end

new text begin Priority. new text end

new text begin In awarding grants under this section, the commissioner must give
priority to awarding grants that will fund projects that will:
new text end

new text begin (1) be undertaken in census tracts that are overburdened or underserved, including
communities disproportionately affected by agriculture loss, building loss, wildfire risk,
low incomes, high energy costs, rates of asthma, rates of diabetes, rates of heart disease,
low life expectancy, high housing costs, lack of green space, lack of indoor plumbing,
presence of lead paint, proximity to hazardous waste and related facilities, particulate matter
exposure, linguistic isolation, or unemployment; and
new text end

new text begin (2) provide multiple public benefits.
new text end

new text begin Subd. 3. new text end

new text begin Appropriation. new text end

new text begin (a) Each year of a biennium, commencing on July 1 in each
odd-numbered year and ending on and including June 30 in the next odd-numbered year,
1.5 percent of the market value of the environment and natural resources trust fund on June
30 one year before the start of the biennium is appropriated to the commissioner of natural
resources to provide grants under the grant program.
new text end

new text begin (b) Money appropriated from the trust fund under this subdivision must supplement the
traditional sources of funding environment and natural resources activities and may not be
used as a substitute.
new text end

new text begin (c) Any appropriated funds not encumbered before the appropriation expires must be
credited to the principal of the trust fund.
new text end

new text begin Subd. 4. new text end

new text begin Administrative expenses. new text end

new text begin (a) Up to five percent of the money appropriated to
the commissioner under subdivision 3 may be used by the commissioner for administering
and monitoring grants under this section.
new text end

new text begin (b) A recipient of a grant awarded under this section may not use more than five percent
of the grant for administrative expenses.
new text end

new text begin Subd. 5. new text end

new text begin Improper expenditure of funds. new text end

new text begin The commissioner may require a recipient
of a grant under this section to return all money awarded to the recipient if the recipient
does not use the money to complete the project in accordance with the applicable agreement.
new text end

new text begin Subd. 6. new text end

new text begin Reporting. new text end

new text begin By February 1 each year, the commissioner must submit a report
to the chairs and ranking minority members of the house of representatives and senate
committees and divisions with jurisdiction over environment and natural resources on the
administration of this section during the previous fiscal year, including administrative
expenses and the grants awarded.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin If the constitutional amendment in article 1, section 1, is approved
by the voters at the 2024 general election, this section is effective January 1, 2025.
new text end

Sec. 4.

new text begin [116X.05] ENVIRONMENT AND NATURAL RESOURCES TRUST FUND
COMMUNITY GRANT ADVISORY COUNCIL; REPORTING.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment. new text end

new text begin The commissioner of natural resources must establish
an Environment and Natural Resources Trust Fund Community Grant Advisory Council.
new text end

new text begin Subd. 2. new text end

new text begin Membership; terms. new text end

new text begin (a) The commissioner, in consultation with the
commissioners of health and the Pollution Control Agency, must appoint 11 residents of
Minnesota to the advisory council, and the appointees must include:
new text end

new text begin (1) two members who are members of the Ojibwe Tribe;
new text end

new text begin (2) two members who are members of the Dakota Tribe; and
new text end

new text begin (3) four members who identify as Black or African American, Hispanic or Latino, Asian,
or Pacific Islander or as members of a community of color.
new text end

new text begin (b) In addition to the members appointed under paragraph (a), the commissioner, in
consultation with the commissioners of health and the Pollution Control Agency, may
appoint up to eight additional residents of Minnesota to the advisory council when, in the
commissioner's discretion, it is necessary to ensure that the advisory council is sufficiently
representative of various Minnesota communities.
new text end

new text begin (c) The commissioner must make appointments to the advisory council under this
subdivision that result in substantially equal representation of rural, suburban, and urban
communities.
new text end

new text begin (d) The membership appointed under paragraphs (a) and (b) must include persons who:
new text end

new text begin (1) have experience or expertise in the science, policy, or practice of the protection,
conservation, preservation, and enhancement of the state's air, water, land, fish, wildlife,
and other natural resources, including expertise in understanding the cultural context in
which these activities are undertaken from the perspective of Tribal communities;
new text end

new text begin (2) have strong knowledge of environment and natural resource issues around the state,
including those that are of particular importance to Tribal communities; and
new text end

new text begin (3) have demonstrated the ability to work in a collaborative environment.
new text end

new text begin (e) Members serve staggered three-year terms, beginning in January of the first year and
continuing through the end of December of the final year. Members continue to serve until
their replacement is named. Initial appointees may be appointed to terms of less than three
years to establish a structure of staggered terms.
new text end

new text begin (f) A member appointed under this subdivision may not be a registered lobbyist.
new text end

new text begin Subd. 3. new text end

new text begin Duties. new text end

new text begin (a) The advisory council must:
new text end

new text begin (1) advise the commissioner on developing forms and applications and reporting for
grants awarded under the grant program;
new text end

new text begin (2) review proposed grant program policies and budgets for the upcoming year;
new text end

new text begin (3) propose changes to the grant program, as needed;
new text end

new text begin (4) review other relevant information;
new text end

new text begin (5) make recommendations to the legislature and the commissioner for improving
management of the grant program; and
new text end

new text begin (6) review and advise on recipient eligibility.
new text end

new text begin (b) The commissioner must provide the council with the information required to perform
its duties under this subdivision.
new text end

new text begin Subd. 4. new text end

new text begin Per diem. new text end

new text begin Members of the council are entitled to per diem and reimbursement
for expenses incurred in the services of the commission, as provided in section 15.059,
subdivision 3.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the day on which the
constitutional amendment in article 1, section 1, is approved by the voters at the 2024 general
election.
new text end

Sec. 5. new text begin COUNCIL ORGANIZATION; REPORT.
new text end

new text begin By January 15, 2026, the commissioner of natural resources must submit a report to the
chairs and ranking minority members of the house of representatives and senate committees
and divisions with jurisdiction over environment and natural resources on the organizational
structure and membership of the Environment and Natural Resources Trust Fund Community
Grant Advisory Council required under Minnesota Statutes, section 116X.05.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the day on which the
constitutional amendment in article 1, section 1, is approved by the voters at the 2024 general
election.
new text end

Sec. 6. new text begin INITIAL REPORTING DATES.
new text end

new text begin Notwithstanding Minnesota Statutes, section 116X.03, subdivision 6, the commissioner
of natural resources is not required to submit the report required under that section before
February 1, 2027.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin If the constitutional amendment in article 1, section 1, is approved
by the voters at the 2024 general election, this section is effective January 1, 2025.
new text end

Sec. 7. new text begin FINANCIAL REVIEW OF GRANT AND BUSINESS SUBSIDY
RECIPIENTS.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) As used in this section, the following terms have the
meanings given.
new text end

new text begin (b) "Grant" means a grant or business subsidy funded by an appropriation in this act.
new text end

new text begin (c) "Grantee" means a business entity as defined in Minnesota Statutes, section 5.001.
new text end

new text begin Subd. 2. new text end

new text begin Financial information required; determination of ability to perform. new text end

new text begin Before
an agency awards a competitive, legislatively named, single-source, or sole-source grant,
the agency must assess the risk that a grantee cannot or would not perform the required
duties. In making this assessment, the agency must review the following information:
new text end

new text begin (1) the grantee's history of performing duties similar to those required by the grant,
whether the size of the grant requires the grantee to perform services at a significantly
increased scale, and whether the size of the grant will require significant changes to the
operation of the grantee's organization;
new text end

new text begin (2) for a grantee that is a nonprofit organization, the grantee's Form 990 or Form 990-EZ
filed with the Internal Revenue Service in each of the prior three years. If the grantee has
not been in existence long enough or is not required to file Form 990 or Form 990-EZ, the
grantee must demonstrate to the grantor's satisfaction that the grantee is exempt and must
instead submit the grantee's most recent board-reviewed financial statements and
documentation of internal controls;
new text end

new text begin (3) for a for-profit business, three years of federal and state tax returns, current financial
statements, certification that the business is not under bankruptcy proceedings, and disclosure
of any liens on its assets. If a business has not been in business long enough to have three
years of tax returns, the grantee must demonstrate to the grantor's satisfaction that the grantee
has appropriate internal financial controls;
new text end

new text begin (4) evidence of registration and good standing with the secretary of state under Minnesota
Statutes, chapter 317A, or other applicable law;
new text end

new text begin (5) if the grantee's total annual revenue exceeds $750,000, the grantee's most recent
financial audit performed by an independent third party in accordance with generally accepted
accounting principles; and
new text end

new text begin (6) certification, provided by the grantee, that none of its principals have been convicted
of a financial crime.
new text end

new text begin Subd. 3. new text end

new text begin Additional measures for some grantees. new text end

new text begin The agency may require additional
information and must provide enhanced oversight for grants that have not previously received
state or federal grants for similar amounts or similar duties and so have not yet demonstrated
the ability to perform the duties required under the grant on the scale required.
new text end

new text begin Subd. 4. new text end

new text begin Assistance from administration. new text end

new text begin An agency without adequate resources or
experience to perform obligations under this section may contract with the commissioner
of administration to perform the agency's duties under this section.
new text end

new text begin Subd. 5. new text end

new text begin Agency authority to not award grant. new text end

new text begin If an agency determines that there is
an appreciable risk that a grantee receiving a competitive, single-source, or sole-source
grant cannot or would not perform the required duties under the grant agreement, the agency
must notify the grantee and the commissioner of administration and give the grantee an
opportunity to respond to the agency's concerns. If the grantee does not satisfy the agency's
concerns within 45 days, the agency must not award the grant.
new text end

new text begin Subd. 6. new text end

new text begin Legislatively named grantees. new text end

new text begin If an agency determines that there is an
appreciable risk that a grantee receiving a legislatively named grant cannot or would not
perform the required duties under the grant agreement, the agency must notify the grantee,
the commissioner of administration, the chair and ranking minority member of the Ways
and Means Committee in the house of representatives, the chair and ranking minority member
of the Finance Committee in the senate, and the chairs and ranking minority members of
the committees in the house of representatives and the senate with primary jurisdiction over
the bill in which the money for the grant was appropriated. The agency must give the grantee
an opportunity to respond to the agency's concerns. If the grantee does not satisfy the agency's
concerns within 45 days, the agency must delay award of the grant until adjournment of the
next regular or special legislative session.
new text end

new text begin Subd. 7. new text end

new text begin Effect. new text end

new text begin The requirements of this section are in addition to other requirements
imposed by law; the commissioner of administration under Minnesota Statutes, sections
16B.97 and 16B.98; or agency grant policy.
new text end