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HF 3359

1st Committee Engrossment - 86th Legislature (2009 - 2010) Posted on 03/19/2013 07:29pm

KEY: stricken = removed, old language.
underscored = added, new language.
1.1A bill for an act
1.2relating to local government; authorizing Hennepin County to purchase energy
1.3under forward pricing mechanisms;proposing coding for new law in Minnesota
1.4Statutes, chapter 383B.

1.6    Section 1. [383B.1588] ENERGY FORWARD PRICING MECHANISMS.
1.7    Subdivision 1. Definitions. The following definitions apply in this section.
1.8(a) "Energy" means natural gas, heating oil, diesel fuel, unleaded fuel, or any other
1.9energy source, except electric, used in Hennepin County operations.
1.10(b) "Forward pricing mechanism" means either:
1.11(1) a contract or financial instrument that obligates Hennepin County to buy or sell a
1.12specified amount of an energy commodity at a future date and at a set price; or
1.13(2) an option to buy or sell the contract or financial instrument.
1.14    Subd. 2. Authority provided. Notwithstanding any other law to the contrary,
1.15the Hennepin County Board of Commissioners may use forward pricing mechanisms
1.16for budget risk reduction.
1.17    Subd. 3. Conditions. (a) Forward pricing transactions made under this section must
1.18be made only under the conditions in this subdivision.
1.19(b) The amount of energy forward priced must not exceed the estimated energy
1.20usage for Hennepin County operations for the period of time covered by the forward
1.21pricing mechanism.
1.22(c) The holding period and expiration date for any forward pricing mechanism must
1.23not exceed 24 months from the trade date of the transaction.
2.1(d) Separate accounts must be established for each operational energy for which
2.2forward pricing mechanisms are used under this section.
2.3    Subd. 4. Written policies and procedures. Before exercising authority under
2.4subdivision 2, the Hennepin County Board of Commissioners must have written policies
2.5and procedures governing the use of forward pricing mechanisms.
2.6    Subd. 5. Oversight process. (a) Before exercising authority under subdivision 2,
2.7the Hennepin County Board of Commissioners must establish an oversight process that
2.8provides for review of the county's used of forward pricing mechanisms.
2.9(b) The process must include:
2.10(1) internal or external audit reviews;
2.11(2) annual reports to, and review by, an internal investment committee; and
2.12(3) internal management control.
2.13EFFECTIVE DATE.This section is effective without local approval the day
2.14following final enactment as provided under Minnesota Statutes, section 645.023,
2.15subdivision 1, paragraph (a).