HF 577

1st Engrossment - 87th Legislature (2011 - 2012) Posted on 03/28/2011 12:08pm

A bill for an act
relating to state government finance; establishing the Sunset Advisory
Commission; allowing counties to provide an audit performed by a certified
public accountant firm; requiring state agencies to carry out agency duties in most
cost-effective manner whether by employing state workers or contracting with
outside sources; establishing the SAVI program for retained savings; increasing
public parking in front of Capitol building; changing provision of performance
data required in the budget proposal; implementing zero-based budgeting
principles; implementing employee gainsharing system to suggest ways to
reduce cost of government; implementing pay for performance pilot program
and allowing bond sale for programs proposed; implementing federal offset
program for collection of debts owed to state agencies; allowing for independent
or private audit for the State Agriculture Society; removing assistant agency head
positions; changing provisions for performance appraisal and pay; reducing state
workforce; providing early retirement incentives; reducing deputy positions;
modifying use of carryforward by the legislative auditor; continuing the
employee salary freeze; requiring a job classification consolidation and report;
requiring a request for proposals for system to enhance the state's audit and
collection activities; requiring dependent eligibility verification audit services for
state hospital, medical, and dental services; consolidating information technology
services; implementing the federal E-Verify program; requiring request for
proposals for recommendations for efficiencies in strategic sourcing; requiring
studies; appropriating money; amending Minnesota Statutes 2010, sections 3.85,
subdivision 3; 6.48; 15.06, subdivision 8; 16A.10, subdivisions 1a, 1b, 1c;
16A.103, subdivision 1a; 16A.11, subdivision 3; 16A.28, subdivision 3; 16B.03;
16B.99; 16C.08, subdivision 2; 16C.09; 16E.14, by adding a subdivision; 37.06;
43A.08, subdivision 1; 43A.20; 45.013; 84.01, subdivision 3; 116.03, subdivision
1; 116J.01, subdivision 5; 116J.035, subdivision 4; 174.02, subdivision 2; 241.01,
subdivision 2; Laws 2010, chapter 215, article 6, section 4; Laws 2010, chapter
361, article 3, section 8; proposing coding for new law in Minnesota Statutes,
chapters 15; 15B; 16A; 16C; 16D; 16E; 43A; proposing coding for new law as
Minnesota Statutes, chapter 3D; repealing Minnesota Statutes 2010, sections
16C.085; 43A.047; 179A.23; 197.585, subdivision 5.

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

ARTICLE 1

STATE GOVERNMENT APPROPRIATIONS

Section 1. STATE GOVERNMENT APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are appropriated to the
agencies and for the purposes specified in this article. The appropriations are from the
general fund, or another named fund, and are available for the fiscal years indicated
for each purpose. The figures "2012" and "2013" used in this article mean that the
appropriations listed under them are available for the fiscal year ending June 30, 2012, or
June 30, 2013, respectively. "The first year" is fiscal year 2012. "The second year" is fiscal
year 2013. "The biennium" is fiscal years 2012 and 2013.

			APPROPRIATIONS
			Available for the Year
			Ending June 30
				2012		2013

Sec. 2. LEGISLATURE

Subdivision 1. Total Appropriation

$

61,651,000

$

61,651,000

Appropriations by Fund
	2012	2013
General	61,523,000	61,523,000
Health Care Access	128,000	128,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2. Senate

20,068,000

20,068,000

Subd. 3. House of Representatives

27,874,000

27,874,000

During the biennium ending June 30, 2013,
any revenues received by the house of
representatives from voluntary donations
to support broadcast or print media are
appropriated to the house of representatives.

Subd. 4. Legislative Coordinating Commission

13,709,000

13,709,000

Appropriations by Fund
General	13,581,000	13,581,000
Health Care Access	128,000	128,000

From its funds, $10,000 each year is for
purposes of the legislators' forum, through
which Minnesota legislators meet with
counterparts from South Dakota, North
Dakota, and Manitoba to discuss issues of
mutual concern.

Sec. 3. GOVERNOR AND LIEUTENANT GOVERNOR

$

3,097,000

$

3,097,000

(a) This appropriation is to fund the Office of
the Governor and Lieutenant Governor.

(b) By September 1 of each year, the
commissioner of management and budget
shall report to the chairs and ranking
minority members of the senate State
Government Budget Division and the
house of representatives State Government
Finance Division any personnel costs
incurred by the Office of the Governor and
Lieutenant Governor that were supported
by appropriations to other agencies during
the previous fiscal year. The Office of the
Governor shall inform the chairs and ranking
minority members of the divisions before
initiating any interagency agreements.

(c) During the biennium ending June 30,
2013, the Office of the Governor may not
receive payments of more than $670,000
each fiscal year from other executive
agencies under Minnesota Statutes, section
15.53, to support personnel costs incurred
by the office. Payments received under this
paragraph must be deposited in a special
revenue account. Money in the account is
appropriated to the Office of the Governor.
The authority in this paragraph supersedes
other law enacted in 2011 that limits the
ability of the office to enter into agreements
relating to personnel costs with other
executive branch agencies or prevents the use
of appropriations made to other agencies for
agreements with the office under Minnesota
Statutes, section 15.53.

Sec. 4. STATE AUDITOR

$

7,964,000

$

7,964,000

Sec. 5. ATTORNEY GENERAL

$

21,712,000

$

21,712,000

Appropriations by Fund
	2012	2013
General	19,433,000	19,433,000
State Government Special Revenue	1,884,000	1,884,000
Environmental	145,000	145,000
Remediation	250,000	250,000

Of this appropriation, $65,000 in the first
year and $65,000 in the second year are
from the general fund for transfer to the
commissioner of public safety for a grant to
the Minnesota County Attorneys Association
for prosecutor and law enforcement training.

Sec. 6. SECRETARY OF STATE

$

5,193,000

$

5,193,000

Any funds available in the account
established in Minnesota Statutes, section
5.30, pursuant to the Help America Vote Act,
are appropriated for the purposes and uses
authorized by federal law.

Sec. 7. CAMPAIGN FINANCE AND PUBLIC DISCLOSURE BOARD

$

653,000

$

653,000

Sec. 8. INVESTMENT BOARD

$

132,000

$

132,000

Sec. 9. ADMINISTRATIVE HEARINGS

$

7,614,000

$

7,484,000

Appropriations by Fund
	2012	2013
General	364,000	234,000
Workers' Compensation	7,250,000	7,250,000

$130,000 in the first year is for the cost
of considering complaints filed under
Minnesota Statutes, section 211B.32. Until
June 30, 2013, the chief administrative
law judge may not make any assessment
against a county or counties under Minnesota
Statutes, section 211B.37. Any amount of
this appropriation that remains unspent at
the end of the biennium must be canceled
to the general account of the state elections
campaign fund. The base for fiscal year 2014
is $130,000, to be available for the biennium,
under the same terms.

Sec. 10. OFFICE OF ENTERPRISE TECHNOLOGY

$

4,636,000

$

4,636,000

During the biennium ending June 30, 2013,
the office must not charge fees to a public
noncommercial educational television
broadcast station for access to the state
information infrastructure.

Sec. 11. ADMINISTRATION

Subdivision 1. Total Appropriation

$

18,023,000

$

18,023,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2. Government and Citizen Services

14,736,000

14,736,000

Subd. 3. Administrative Management Support

1,502,000

1,502,000

Subd. 4. Public Broadcasting

1,785,000

1,785,000

(a) The appropriations under this section are
to the commissioner of administration for the
purposes specified.

(b) $1,002,000 the first year and $1,002,000
the second year are for matching grants for
public television.

(c) $190,000 the first year and $190,000
the second year are for public television
equipment grants. Equipment or matching
grant allocations shall be made after
considering the recommendations of the
Minnesota Public Television Association.

(d) $16,000 the first year and $16,000 the
second year are for grants to the Twin Cities
regional cable channel.

(e) $278,000 the first year and $278,000 the
second year are for community service grants
to public educational radio stations.

(f) $97,000 the first year and $97,000 the
second year are for equipment grants to
public educational radio stations.

(g) The grants in paragraphs (e) and (f)
must be allocated after considering the
recommendations of the Association of
Minnesota Public Educational Radio Stations
under Minnesota Statutes, section 129D.14.

(h) $202,000 the first year and $202,000
the second year are for equipment grants to
Minnesota Public Radio, Inc.

(i) Any unencumbered balance remaining the
first year for grants to public television or
radio stations does not cancel and is available
for the second year.

Sec. 12. CAPITOL AREA ARCHITECTURAL AND PLANNING BOARD

$

308,000

$

308,000

Sec. 13. MINNESOTA MANAGEMENT AND BUDGET

$

16,727,000

$

16,727,000

Sec. 14. REVENUE

Subdivision 1. Total Appropriation

$

128,231,000

$

140,046,000

Appropriations by Fund
	2012	2013
General	123,996,000	135,811,000
Health Care Access	1,749,000	1,749,000
Highway User Tax Distribution	2,183,000	2,183,000
Environmental	303,000	303,000

The amounts that may be spent for each
purpose are specified in subdivisions 2 and 3.

To the greatest extent possible, the
commissioner must avoid making budget
reductions to compliance activities.

Subd. 2. Tax System Management

104,991,000

116,806,000

Appropriations by Fund
General	100,756,000	112,571,000
Health Care Access	1,749,000	1,749,000
Highway User Tax Distribution	2,183,000	2,183,000
Environmental	303,000	303,000

Subd. 3. Debt Collection Management

23,240,000

23,240,000

Sec. 15. GAMBLING CONTROL

$

2,740,000

$

2,740,000

These appropriations are from the lawful
gambling regulation account in the special
revenue fund.

Sec. 16. RACING COMMISSION

$

899,000

$

899,000

These appropriations are from the racing
and card playing regulation accounts in the
special revenue fund.

Sec. 17. AMATEUR SPORTS COMMISSION

$

235,000

$

235,000

Sec. 18. COUNCIL ON BLACK MINNESOTANS

$

261,000

$

261,000

Sec. 19. COUNCIL ON CHICANO/LATINO AFFAIRS

$

246,000

$

246,000

Sec. 20. COUNCIL ON ASIAN-PACIFIC MINNESOTANS

$

227,000

$

227,000

Sec. 21. INDIAN AFFAIRS COUNCIL

$

413,000

$

413,000

Sec. 22. EXPLORE MINNESOTA TOURISM

$

8,269,000

$

8,269,000

(a) Of this amount, $12,000 each year is for a
grant to the Upper Minnesota Film Office.

(b)(1) To develop maximum private sector
involvement in tourism, $500,000 the first
year and $500,000 the second year must
be matched by Explore Minnesota Tourism
from nonstate sources. Each $1 of state
incentive must be matched with $3 of private
sector funding. Cash match is defined as
revenue to the state or documented cash
expenditures directly expended to support
Explore Minnesota Tourism programs. Up
to one-half of the private sector contribution
may be in-kind or soft match. The incentive
in the first year shall be based on fiscal
year 2011 private sector contributions. The
incentive in the second year will be based on
fiscal year 2012 private sector contributions.
This incentive is ongoing.

(2) Funding for the marketing grants is
available either year of the biennium.
Unexpended grant funds from the first year
are available in the second year.

(3) Unexpended money from the general
fund appropriations made under this section
does not cancel but must be placed in a
special marketing account for use by Explore
Minnesota Tourism for additional marketing
activities.

(c) $325,000 the first year and $325,000 the
second year are for the Minnesota Film and
TV Board. The appropriation in each year
is available only upon receipt by the board
of $1 in matching contributions of money or
in-kind contributions from nonstate sources
for every $3 provided by this appropriation,
except that each year up to $50,000 is
available on July 1 even if the required
matching contribution has not been received
by that date.

(d) A portion of the appropriation in this
section may be used for the film production
jobs program under Minnesota Statutes,
section 116U.26.

Sec. 23. MINNESOTA HISTORICAL SOCIETY

Subdivision 1. Total Appropriation

$

19,764,000

$

19,662,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2. Education and Outreach

11,109,000

11,109,000

Notwithstanding Minnesota Statutes, section
138.668, the Minnesota Historical Society
may not charge a fee for its general tours at
the Capitol, but may charge fees for special
programs other than general tours.

Subd. 3. Preservation and Access

8,337,000

8,337,000

Subd. 4. Fiscal Agent

(a) Minnesota International Center

38,000

38,000

(b) Minnesota Air National Guard Museum

14,000

-0-

(c) Minnesota Military Museum

88,000

-0-

(d) Farmamerica

112,000

112,000

(e) $66,000 the first year and $66,000 the
second year are for a grant to the city of
Eveleth to be used for the support of the
Hockey Hall of Fame Museum provided
that it continues to operate in the city. This
grant is in addition to and must not be
used to supplant funding under Minnesota
Statutes, section 298.28, subdivision 9c. This
appropriation is added to the society's budget
base.

(f) Balances Forward

Any unencumbered balance remaining in
this subdivision the first year does not cancel
but is available for the second year of the
biennium.

Subd. 5. Fund Transfer

The Minnesota Historical Society may
reallocate funds appropriated in and between
subdivisions 2 and 3 for any program
purposes and the appropriations are available
in either year of the biennium.

Sec. 24. BOARD OF THE ARTS

Subdivision 1. Total Appropriation

$

6,672,000

$

6,672,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2. Operations and Services

504,000

504,000

Subd. 3. Grants Program

4,266,000

4,266,000

Subd. 4. Regional Arts Councils

1,902,000

1,902,000

Sec. 25. MINNESOTA HUMANITIES CENTER

$

225,000

$

225,000

Sec. 26. SCIENCE MUSEUM OF MINNESOTA

$

1,009,000

$

1,009,000

Sec. 27. TORT CLAIMS

$

161,000

$

161,000

These appropriations are to be spent by the
commissioner of management and budget
according to Minnesota Statutes, section
3.736, subdivision 7. If the appropriation for
either year is insufficient, the appropriation
for the other year is available for it.

Sec. 28. MINNESOTA STATE RETIREMENT SYSTEM

Subdivision 1. Total Appropriation

$

472,000

$

481,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

During the biennium ending June 30, 2013,
payments for retirement allowances for
former legislators and surviving spouses
must be made from the legislators retirement
fund created under Minnesota Statutes,
section 3A.03, subdivision 3, and not from
the general fund.

Subd. 2. Constitutional Officers

472,000

481,000

Under Minnesota Statutes, section 352C.001,
if an appropriation in this section for either
year is insufficient, the appropriation for the
other year is available for it.

Sec. 29. MERF DIVISION ACCOUNT

$

22,750,000

$

22,750,000

These amounts are estimated to be needed
under Minnesota Statutes, section 353.505.

Sec. 30. TEACHERS RETIREMENT ASSOCIATION

$

15,454,000

$

15,454,000

The amounts estimated to be needed are as
follows:

(a) Special direct state aid. $12,954,000 the
first year and $12,954,000 the second year
are for special direct state aid authorized
under Minnesota Statutes, section 354A.12,
subdivisions 3a and 3c.

(b) Special direct state matching aid.
$2,500,000 the first year and $2,500,000
the second year are for special direct state
matching aid authorized under Minnesota
Statutes, section 354A.12, subdivision 3b.

Sec. 31. ST. PAUL TEACHERS RETIREMENT FUND

$

2,827,000

$

2,827,000

The amounts estimated to be needed for
special direct state aid to first class city
teachers retirement funds authorized under
Minnesota Statutes, section 354A.12,
subdivisions 3a and 3c.

Sec. 32. DULUTH TEACHERS RETIREMENT FUND

$

346,000

$

346,000

The amounts estimated to be needed for
special direct state aid to first class city
teachers retirement funds authorized under
Minnesota Statutes, section 354A.12,
subdivisions 3a and 3c.

Sec. 33. STATE LOTTERY

Notwithstanding Minnesota Statutes, section
349A.10, subdivision 3, the operating budget
must not exceed $29,000,000 in fiscal year
2012 and $29,000,000 in fiscal year 2013.

Sec. 34. GENERAL CONTINGENT ACCOUNTS

$

600,000

$

500,000

Appropriations by Fund
	2012	2013
General	100,000	-0-
State Government Special Revenue	400,000	400,000
Workers' Compensation	100,000	100,000

(a) The appropriations in this section
may only be spent with the approval of
the governor after consultation with the
Legislative Advisory Commission pursuant
to Minnesota Statutes, section 3.30.

(b) If an appropriation in this section for
either year is insufficient, the appropriation
for the other year is available for it.

(c) If a contingent account appropriation
is made in one fiscal year, it should be
considered a biennial appropriation.

Sec. 35. PROBLEM GAMBLING APPROPRIATION.

$225,000 in fiscal year 2012 and $225,000 in fiscal year 2013 are appropriated from
the lottery prize fund to the Gambling Control Board for a grant to the state affiliate
recognized by the National Council on Problem Gambling. The affiliate must provide
services to increase public awareness of problem gambling, education and training for
individuals and organizations providing effective treatment services to problem gamblers
and their families, and research relating to problem gambling. These services must be
complementary to and not duplicative of the services provided through the problem
gambling program administered by the commissioner of human services. Of this
appropriation, $50,000 in fiscal year 2012 and $50,000 in fiscal year 2013 are contingent
on the contribution of nonstate matching funds. Matching funds may be either cash or
qualifying in-kind contributions. The commissioner of management and budget may
disburse the state portion of the matching funds in increments of $25,000 upon receipt
of a commitment for an equal amount of matching nonstate funds. These are onetime
appropriations.

Sec. 36. APPROPRIATION; REIMBURSEMENT OF RECOUNT COSTS.

$322,000 is appropriated from the general fund to the secretary of state in fiscal year
2011 for the reimbursement of costs of recounts during the 2010 general election, to be
paid to counties consistent with the cost survey of the counties previously conducted
by the secretary of state and for reimbursement to the secretary of state costs in those
recounts already paid by the secretary of state to the counties. This appropriation remains
available until December 31, 2011.

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 37. SAVINGS; APPROPRIATION REDUCTIONS.

(a) The commissioner of management and budget must reduce general fund
appropriations to executive agencies for agency operations for the biennium ending
June 30, 2013, by $94,875,000. The Minnesota State Colleges and Universities is not
an executive agency for purposes of this section. To the greatest extent possible, these
savings must come from the reforms, efficiencies, and cost-savings measures contained in
this act, including:

(1) reduction in the number of full-time equivalent employees;

(2) salary freeze;

(3) elimination of deputy and assistant commissioner positions;

(4) consolidation of responsibilities for executive branch information technology
systems;

(5) efficiencies and cost savings in contracting; and

(6) verification of dependent eligibility for state group insurance coverage.

(b) The commissioner of management and budget must determine savings to funds
other than the general funds resulting from the reforms, efficiencies, and cost-savings
measures in this act. To the extent permitted by law, the commissioner must reduce
appropriations from those other funds by the amount of those savings, and transfer the
amount of the reductions to the general fund.

Sec. 38. ENTERPRISE REAL PROPERTY CONTRIBUTIONS.

On or before June 1, 2011, the commissioner of administration shall determine
the amount to be contributed by each executive agency to maintain the enterprise real
property technology system for the fiscal years 2012 and 2013. On or before June 15,
2011, each executive agency shall enter into an agreement with the commissioner of
administration setting forth the manner in which the executive agency shall make its
contribution to the enterprise real property system, either from uncommitted fiscal year
2011 funds or by contributing from fiscal year 2012 and fiscal year 2013 funds to the real
property enterprise system and services account to fund the total amount of $399,000 for
the biennium. Funds contributed under this section must be credited to the enterprise real
property technology system and services account.

EFFECTIVE DATE.

This section is effective the day following final enactment.

ARTICLE 2

MILITARY AFFAIRS AND VETERANS AFFAIRS

Section 1. APPROPRIATIONS.

The sums shown in the columns marked "Appropriations" are appropriated to the
agencies and for the purposes specified in this article. The appropriations are from the
general fund and are available for the fiscal years indicated for each purpose. The figures
"2012" and "2013" used in this article mean that the appropriations listed under them are
available for the fiscal year ending June 30, 2012, or June 30, 2013, respectively. "The
first year" is fiscal year 2012. "The second year" is fiscal year 2013. "The biennium" is
fiscal years 2012 and 2013.

			APPROPRIATIONS
			Available for the Year
			Ending June 30
				2012		2013

Sec. 2. MILITARY AFFAIRS

Subdivision 1. Total Appropriation

$

22,371,000

$

19,371,000

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2. Maintenance of Training Facilities

6,660,000

6,660,000

Subd. 3. General Support

2,363,000

2,363,000

Subd. 4. Enlistment Incentives

13,348,000

10,348,000

$3,000,000 the first year is for additional
costs of enlistment incentives.

If appropriations for either year of the
biennium are insufficient, the appropriation
from the other year is available. The
appropriations for enlistment incentives are
available until expended.

Sec. 3. VETERANS AFFAIRS

Subdivision 1. Total Appropriation

$

57,795,000

$

58,595,000

Appropriations by Fund
	2012	2013
General	57,695,000	58,595,000
Special Revenue	100,000	-0-

The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2. Veterans Services

13,879,000

13,779,000

$100,000 in the first year is from the
"Support Our Troops" account established
under Minnesota Statutes, section 190.19,
subdivision 2a, for a grant to the Minnesota
Assistance Council for Veterans. This is a
onetime appropriation.

$100,000 each year is for the costs of
administering the Minnesota GI Bill program
under Minnesota Statutes, section 197.791.

$353,000 each year is for grants to the
following congressionally chartered veterans
service organizations, as designated by the
commissioner: Disabled American Veterans,
Military Order of the Purple Heart, the
American Legion, Veterans of Foreign Wars,
Vietnam Veterans of America, AMVETS,
and Paralyzed Veterans of America. This
funding must be allocated in direct proportion
to the funding currently being provided by
the commissioner to these organizations.

Subd. 3. Veterans Homes

43,916,000

44,816,000

Veterans Homes Special Revenue Account.
The general fund appropriations made to
the department may be transferred to a
veterans homes special revenue account in
the special revenue fund in the same manner
as other receipts are deposited according
to Minnesota Statutes, section 198.34, and
are appropriated to the department for the
operation of veterans homes facilities and
programs.

Fergus Falls Veterans Home. Of the
general fund appropriation, $738,000 in
fiscal year 2013 is for operation of a new
21-bed specialty care/Alzheimer's unit at the
Minnesota Veterans Home in Fergus Falls.
Base funding for this program is $842,000 in
fiscal years 2014 and 2015.

Minneapolis Veterans Home. Of the
general fund appropriation, $162,000 in
fiscal year 2013 is for operation of a new
adult day care program at the Minnesota
Veterans Home in Minneapolis. Base
funding for this program is $232,000 in fiscal
years 2014 and 2015.

Veterans Homes Service Redesign.
$551,000 in fiscal year 2012 and $801,000 in
fiscal year 2013, generated from additional
nongeneral fund revenue and cost savings
from operating efficiencies, are to be used to
support the operational needs of the five state
veterans homes.

Sec. 4.

Laws 2010, chapter 215, article 6, section 4, is amended to read:

Sec. 4. VETERANS HOMES

Of the appropriation in Laws 2009, chapter
94, article 3, section 2, subdivision 3, or from
funds carried forward from fiscal year 2009:

(1) $1,000,000 $800,000 in fiscal year 2011
is for operational expenses related to the
21-bed addition at the Fergus Falls Veterans
Home; and

(2) $113,000 $313,000 in fiscal year 2011 is
for start-up expenses related to the opening of
an adult daycare facility at the Minneapolis
Veterans Home.

An appropriation in this section that is
unspent at the end of fiscal year 2011 carries
forward and is available in fiscal year 2012.

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 5. REPEALER.

Minnesota Statutes 2010, section 197.585, subdivision 5, is repealed.

EFFECTIVE DATE.

This section is effective the day following final enactment.

ARTICLE 3

STATE GOVERNMENT OPERATIONS

Section 1.

Minnesota Statutes 2010, section 3.85, subdivision 3, is amended to read:

Subd. 3.

Membership.

The commission consists of five seven members of the
senate appointed by the Subcommittee on Committees of the Committee on Rules and
Administration and five seven members of the house of representatives appointed by
the speaker. No more than five members from each chamber may be from the majority
caucus in that chamber. Members shall be appointed at the commencement of each regular
session of the legislature for a two-year term beginning January 16 of the first year of the
regular session. Members continue to serve until their successors are appointed. Vacancies
that occur while the legislature is in session shall be filled like regular appointments. If the
legislature is not in session, senate vacancies shall be filled by the last Subcommittee on
Committees of the senate Committee on Rules and Administration or other appointing
authority designated by the senate rules, and house of representatives vacancies shall be
filled by the last speaker of the house, or if the speaker is not available, by the last chair of
the house of representatives Rules Committee.

EFFECTIVE DATE.

This section is effective the day following final enactment.
Within ten days of the effective date of this section, the appointing authorities must
appoint additional members to the commission, as required by this section.

Sec. 2.

[3D.01] SHORT TITLE.

This chapter may be cited as the "Minnesota Sunset Act."

Sec. 3.

[3D.02] DEFINITIONS.

Subdivision 1.

Scope.

The definitions in this section apply to this chapter.

Subd. 2.

Advisory committee.

"Advisory committee" means a committee, council,
commission, or other entity created under state law whose primary function is to advise
a state agency.

Subd. 3.

Commission.

"Commission" means the Sunset Advisory Commission.

Subd. 4.

State agency.

"State agency" means an agency expressly made subject
to this chapter.

Sec. 4.

[3D.03] SUNSET ADVISORY COMMISSION.

Subdivision 1.

Membership.

(a) The Sunset Advisory Commission consists of 12
members appointed as follows:

(1) five senators and one public member, appointed according to the rules of the
senate, with no more than three senators from the majority caucus; and

(2) five members of the house of representatives and one public member, appointed
by the speaker of the house, with no more than three of the house members from the
majority caucus.

(b) The first members of the Sunset Advisory Commission must be appointed before
September 1, 2011, for terms ending the first Monday in January 2013.

Subd. 2.

Public member restrictions.

An individual is not eligible for appointment
as a public member if the individual or the individual's spouse is:

(1) regulated by a state agency that the commission will review during the term for
which the individual would serve;

(2) employed by, participates in the management of, or directly or indirectly has
more than a ten percent interest in a business entity or other organization regulated by a
state agency the commission will review during the term for which the individual would
serve; or

(3) required to register as a lobbyist under chapter 10A because of the person's
activities for compensation on behalf of a profession or entity related to the operation of
an agency under review.

Subd. 3.

Removal.

(a) It is a ground for removal of a public member from the
commission if the member does not have the qualifications required by subdivision 2
for appointment to the commission at the time of appointment or does not maintain the
qualifications while serving on the commission. The validity of the commission's action is
not affected by the fact that it was taken when a ground for removal of a public member
from the commission existed.

(b) Except as provided in paragraph (a), a public member may be removed only as
provided in section 15.0575, subdivision 4.

Subd. 4.

Terms.

Legislative members serve at the pleasure of the appointing
authority. Public members serve two-year terms expiring the first Monday in January of
each odd-numbered year.

Subd. 5.

Limits.

Members are subject to the following restrictions:

(1) after an individual serves four years on the commission, the individual is not
eligible for appointment to another term or part of a term;

(2) a legislative member who serves a full term may not be appointed to an
immediately succeeding term; and

(3) a public member may not serve consecutive terms, and, for purposes of this
prohibition, a member is considered to have served a term only if the member has served
more than one-half of the term.

Subd. 6.

Appointments.

Appointments must be made before the second Monday of
January of each odd-numbered year.

Subd. 7.

Legislative members.

If a legislative member ceases to be a member
of the legislative body from which the member was appointed, the member vacates
membership on the commission.

Subd. 8.

Vacancies.

If a vacancy occurs, the appointing authority shall appoint a
person to serve for the remainder of the unexpired term in the same manner as the original
appointment.

Subd. 9.

Officers.

The commission shall have a chair and vice-chair as presiding
officers.

Subd. 10.

Quorum; voting.

Seven members of the commission constitute a
quorum. A final action or recommendation may not be made unless approved by a
recorded vote of at least seven members. All other actions by the commission shall be
decided by a majority of the members present and voting.

Subd. 11.

Compensation.

Each public member shall be reimbursed for expenses
as provided in section 15.0575. Compensation for legislators is as determined by the
members' legislative chamber.

Sec. 5.

[3D.04] STAFF.

The Legislative Coordinating Commission shall provide staff and administrative
services for the commission.

Sec. 6.

[3D.05] RULES.

The commission may adopt rules necessary to carry out this chapter.

Sec. 7.

[3D.06] AGENCY REPORT TO COMMISSION.

Before September 1 of the odd-numbered year before the year in which a state
agency is sunset, the agency commissioner shall report to the commission:

(1) information regarding the application to the agency of the criteria in section
3D.10;

(2) a priority-based budget for the agency;

(3) an inventory of all boards, commissions, committees, and other entities related
to the agency; and

(4) any other information that the agency commissioner considers appropriate or that
is requested by the commission.

Sec. 8.

[3D.07] COMMISSION DUTIES.

Before January 1 of the year in which a state agency subject to this chapter and its
advisory committees are sunset, the commission shall:

(1) review and take action necessary to verify the reports submitted by the agency;
and

(2) conduct a review of the agency based on the criteria provided in section 3D.10
and prepare a written report.

Sec. 9.

[3D.08] PUBLIC HEARINGS.

Before February 1 of the year a state agency subject to this chapter and its advisory
committees are sunset, the commission shall conduct public hearings concerning but not
limited to the application to the agency of the criteria provided in section 3D.10.

Sec. 10.

[3D.09] COMMISSION REPORT.

By February 1 of each even-numbered year, the commission shall present to the
legislature and the governor a report on the agencies and advisory committees reviewed.
In the report the commission shall include:

(1) its findings regarding the criteria prescribed by section 3D.10;

(2) its recommendations based on the matters prescribed by section 3D.11; and

(3) other information the commission considers necessary for a complete review
of the agency.

Sec. 11.

[3D.10] CRITERIA FOR REVIEW.

The commission and its staff shall consider the following criteria in determining
whether a public need exists for the continuation of a state agency or its advisory
committees or for the performance of the functions of the agency or its advisory
committees:

(1) the efficiency and effectiveness with which the agency or the advisory committee
operates;

(2) an identification of the mission, goals, and objectives intended for the agency or
advisory committee and of the problem or need that the agency or advisory committee
was intended to address and the extent to which the mission, goals, and objectives have
been achieved and the problem or need has been addressed;

(3) an identification of any activities of the agency in addition to those granted by
statute and of the authority for those activities and the extent to which those activities
are needed;

(4) an assessment of authority of the agency relating to fees, inspections,
enforcement, and penalties;

(5) whether less restrictive or alternative methods of performing any function that
the agency performs could adequately protect or provide service to the public;

(6) the extent to which the jurisdiction of the agency and the programs administered
by the agency overlap or duplicate those of other agencies, the extent to which the agency
coordinates with those agencies, and the extent to which the programs administered by the
agency can be consolidated with the programs of other state agencies;

(7) the promptness and effectiveness with which the agency addresses complaints
concerning entities or other persons affected by the agency, including an assessment of the
agency's administrative hearings process;

(8) an assessment of the agency's rulemaking process and the extent to which the
agency has encouraged participation by the public in making its rules and decisions and
the extent to which the public participation has resulted in rules that benefit the public;

(9) the extent to which the agency has complied with federal and state laws and
applicable rules regarding equality of employment opportunity and the rights and privacy
of individuals, and state law and applicable rules of any state agency regarding purchasing
guidelines and programs for historically underutilized businesses;

(10) the extent to which the agency issues and enforces rules relating to potential
conflicts of interest of its employees;

(11) the extent to which the agency complies with chapter 13 and follows records
management practices that enable the agency to respond efficiently to requests for public
information; and

(12) the effect of federal intervention or loss of federal funds if the agency is
abolished.

Sec. 12.

[3D.11] RECOMMENDATIONS.

(a) In its report on a state agency, the commission shall:

(1) make recommendations on the abolition, continuation, or reorganization of each
affected state agency and its advisory committees and on the need for the performance of
the functions of the agency and its advisory committees;

(2) make recommendations on the consolidation, transfer, or reorganization of
programs within state agencies not under review when the programs duplicate functions
performed in agencies under review; and

(3) make recommendations to improve the operations of the agency, its policy body,
and its advisory committees, including management recommendations that do not require
a change in the agency's enabling statute.

(b) The commission shall include the estimated fiscal impact of its recommendations
and may recommend appropriation levels for certain programs to improve the operations
of the state agency.

(c) The commission shall have drafts of legislation prepared to carry out the
commission's recommendations under this section, including legislation necessary
to continue the existence of agencies that would otherwise sunset if the commission
recommends continuation of an agency.

(d) After the legislature acts on the report under section 3D.09, the commission shall
present to the legislative auditor the commission's recommendations that do not require
a statutory change to be put into effect. Subject to the legislative audit commission's
approval, the legislative auditor may examine the recommendations and include as part
of the next audit of the agency a report on whether the agency has implemented the
recommendations and, if so, in what manner.

Sec. 13.

[3D.12] MONITORING OF RECOMMENDATIONS.

During each legislative session, the staff of the commission shall monitor legislation
affecting agencies that have undergone sunset review and shall periodically report
to the members of the commission on proposed changes that would modify prior
recommendations of the commission.

Sec. 14.

[3D.13] REVIEW OF ADVISORY COMMITTEES.

An advisory committee, the primary function of which is to advise a particular state
agency, is subject to sunset on the date set for sunset of the agency unless the advisory
committee is expressly continued by law.

Sec. 15.

[3D.14] CONTINUATION BY LAW.

During the regular session immediately before the sunset of a state agency or an
advisory committee that is subject to this chapter, the legislature may enact legislation
to continue the agency or advisory committee for a period not to exceed 12 years. This
chapter does not prohibit the legislature from:

(1) terminating a state agency or advisory committee subject to this chapter at a date
earlier than that provided in this chapter; or

(2) considering any other legislation relative to a state agency or advisory committee
subject to this chapter.

Sec. 16.

[3D.15] PROCEDURE AFTER TERMINATION.

Subdivision 1.

Termination.

Unless otherwise provided by law:

(1) if after sunset review a state agency is abolished, the agency may continue in
existence until June 30 of the following year to conclude its business;

(2) abolishment does not reduce or otherwise limit the powers and authority of the
state agency during the concluding year;

(3) a state agency is terminated and shall cease all activities at the expiration of
the one-year period; and

(4) all rules that have been adopted by the state agency expire at the expiration of
the one-year period.

Subd. 2.

Funds of abolished agency or advisory committee.

(a) Any unobligated
and unexpended appropriations of an abolished agency or advisory committee lapse on
June 30 of the year after abolishment.

(b) Except as provided by subdivision 4 or as otherwise provided by law, all money
in a dedicated fund of an abolished state agency or advisory committee on June 30 of the
year after abolishment is transferred to the general fund. The part of the law dedicating
the money to a specific fund of an abolished agency becomes void on June 30 of the year
after abolishment.

Subd. 3.

Property and records of abolished agency or advisory committee.

Unless the governor designates an appropriate state agency as prescribed by subdivision 4,
property and records in the custody of an abolished state agency or advisory committee
on June 30 of the year after abolishment must be transferred to the commissioner of
administration. If the governor designates an appropriate state agency, the property and
records must be transferred to the designated state agency.

Subd. 4.

Continuing obligations.

(a) The legislature recognizes the state's
continuing obligation to pay bonded indebtedness and all other obligations, including
lease, contract, and other written obligations, incurred by a state agency or advisory
committee abolished under this chapter, and this chapter does not impair or impede the
payment of bonded indebtedness and all other obligations, including lease, contract, and
other written obligations, in accordance with their terms. If an abolished state agency or
advisory committee has outstanding bonded indebtedness or other outstanding obligations,
including lease, contract, and other written obligations, the bonds and all other obligations,
including lease, contract, and other written obligations, remain valid and enforceable in
accordance with their terms and subject to all applicable terms and conditions of the laws
and proceedings authorizing the bonds and all other obligations, including lease, contract,
and other written obligations.

(b) The governor shall designate an appropriate state agency that shall continue to
carry out all covenants contained in the bonds and in all other obligations, including lease,
contract, and other written obligations, and the proceedings authorizing them, including
the issuance of bonds, and the performance of all other obligations, including lease,
contract, and other written obligations, to complete the construction of projects or the
performance of other obligations, including lease, contract, and other written obligations.

(c) The designated state agency shall provide payment from the sources of payment
of the bonds in accordance with the terms of the bonds and shall provide payment from
the sources of payment of all other obligations, including lease, contract, and other written
obligations, in accordance with their terms, whether from taxes, revenues, or otherwise,
until the bonds and interest on the bonds are paid in full and all other obligations,
including lease, contract, and other written obligations, are performed and paid in full.
If the proceedings so provide, all funds established by laws or proceedings authorizing
the bonds or authorizing other obligations, including lease, contract, and other written
obligations, must remain with the comptroller or the previously designated trustees. If the
proceedings do not provide that the funds remain with the comptroller or the previously
designated trustees, the funds must be transferred to the designated state agency.

Sec. 17.

[3D.16] ASSISTANCE OF AND ACCESS TO STATE AGENCIES.

The commission may request the assistance of state agencies and officers. When
assistance is requested, a state agency or officer shall assist the commission. In carrying
out its functions under this chapter, the commission or its designated staff member may
inspect the records, documents, and files of any state agency.

Sec. 18.

[3D.17] RELOCATION OF EMPLOYEES.

If an employee is displaced because a state agency or its advisory committee is
abolished or reorganized, the state agency shall make a reasonable effort to relocate the
displaced employee.

Sec. 19.

[3D.18] SAVING PROVISION.

Except as otherwise expressly provided, abolition of a state agency does not affect
rights and duties that matured, penalties that were incurred, civil or criminal liabilities that
arose, or proceedings that were begun before the effective date of the abolition.

Sec. 20.

[3D.19] REVIEW OF PROPOSED LEGISLATION CREATING AN
AGENCY.

Each bill filed in a house of the legislature that would create a new state agency or
a new advisory committee to a state agency shall be reviewed by the commission. The
commission shall review the bill to determine if:

(1) the proposed functions of the agency or committee could be administered by one
or more existing state agencies or advisory committees;

(2) the form of regulation, if any, proposed by the bill is the least restrictive form of
regulation that will adequately protect the public;

(3) the bill provides for adequate public input regarding any regulatory function
proposed by the bill; and

(4) the bill provides for adequate protection against conflicts of interest within
the agency or committee.

Sec. 21.

[3D.20] GIFTS AND GRANTS.

The commission may accept gifts, grants, and donations from any organization
described in section 501(c)(3) of the Internal Revenue Code for the purpose of funding
any activity under this chapter. All gifts, grants, and donations must be accepted in an
open meeting by a majority of the voting members of the commission and reported in the
public record of the commission with the name of the donor and purpose of the gift, grant,
or donation. Money received under this section is appropriated to the commission.

Sec. 22.

[3D.21] EXPIRATION.

Subdivision 1.

Group 1.

The following agencies are sunset and expire on June
30, 2012: Department of Health, Department of Human Rights, Department of Human
Services, all health-related licensing boards listed in section 214.01, Council on Affairs
of Chicano/Latino People, Council on Black Minnesotans, Council on Asian-Pacific
Minnesotans, Indian Affairs Council, Council on Disabilities, and all advisory groups
associated with these agencies.

Subd. 2.

Group 2.

The following agencies are sunset and expire on June 30, 2014:
Department of Education, Board of Teaching, Minnesota Office of Higher Education, and
all advisory groups associated with these agencies.

Subd. 3.

Group 3.

The following agencies are sunset and expire on June 30, 2016:
Department of Commerce, Department of Employment and Economic Development,
Department of Labor and Industry, all non-health-related licensing boards listed in
section 214.01 except as otherwise provided in this section, Explore Minnesota Tourism,
Public Utilities Commission, Iron Range Resources and Rehabilitation Board, Bureau of
Mediation Services, Combative Sports Commission, Amateur Sports Commission, and all
advisory groups associated with these agencies.

Subd. 4.

Group 4.

The following agencies are sunset and expire on June 30, 2018:
Department of Corrections, Department of Public Safety, Department of Transportation,
Peace Officer Standards and Training Board, Corrections Ombudsman, and all advisory
groups associated with these agencies.

Subd. 5.

Group 5.

The following agencies are sunset and expire on June 30, 2020:
Department of Agriculture, Department of Natural Resources, Pollution Control Agency,
Board of Animal Health, Board of Water and Soil Resources, and all advisory groups
associated with these agencies.

Subd. 6.

Group 6.

The following agencies are sunset and expire on June 30, 2022:
Department of Administration, Department of Management and Budget, Department of
Military Affairs, Department of Revenue, Department of Veterans Affairs, Arts Board,
Minnesota Zoo, Office of Administrative Hearings, Campaign Finance and Public
Disclosure Board, Capitol Area Architectural and Planning Board, Office of Enterprise
Technology, Minnesota Racing Commission, and all advisory groups associated with
these agencies.

Subd. 7.

Continuation.

Following sunset review of an agency, the legislature may
act within the same legislative session in which the sunset report was received on Sunset
Advisory Commission recommendations to continue or reorganize the agency.

Subd. 8.

Other groups.

The commission may review, under the criteria in
section 3D.10, and propose to the legislature an expiration date for any agency, board,
commission, or program not listed in this section.

Sec. 23.

Minnesota Statutes 2010, section 6.48, is amended to read:

6.48 EXAMINATION OF COUNTIES; COST, FEES.

(a) All the powers and duties conferred and imposed upon the state auditor shall
be exercised and performed by the state auditor in respect to the offices, institutions,
public property, and improvements of several counties of the state. At least once in each
year, if funds and personnel permit, the state auditor may visit, without previous notice,
each county and make a thorough examination of all accounts and records relating to the
receipt and disbursement of the public funds and the custody of the public funds and
other property. If the audit is performed by a private certified public accountant, 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. The
state auditor shall prescribe and install systems of accounts and financial reports that shall
be uniform, so far as practicable, for the same class of offices. A copy of the report of
such examination shall be filed and be subject to public inspection in the office of the state
auditor and another copy in the office of the auditor of the county thus examined. The state
auditor may accept the records and audit, or any part thereof, of the Department of Human
Services in lieu of examination of the county social welfare funds, if such audit has been
made within any period covered by the state auditor's audit of the other records of the
county. If any such examination shall disclose malfeasance, misfeasance, or nonfeasance
in any office of such county, such report shall be filed with the county attorney of the
county, and the county attorney shall institute such civil and criminal proceedings as the
law and the protection of the public interests shall require.

(b) The county receiving any examination shall pay to the state general fund,
notwithstanding the provisions of section 16A.125, the total cost and expenses of such
examinations, including the salaries paid to the examiners while actually engaged in
making such examination. The state auditor on deeming it advisable may bill counties,
having a population of 200,000 or over, monthly for services rendered and the officials
responsible for approving and paying claims shall cause said bill to be promptly paid. The
general fund shall be credited with all collections made for any such examinations.

(c) Notwithstanding paragraph (a), a county may provide for an audit to be
performed by a certified public accountant firm meeting the requirements of section
326A.05. A county must notify the state auditor before January 1 of a year in which
the county intends to have an audit performed by a certified public accounting firm. A
county currently using a certified public accounting firm must notify the state auditor
before January 1 of a year in which the county intends for the state auditor to audit the
county. The audit performed under this paragraph must meet the standards and be in the
form required by the state auditor. The state auditor may require additional information
from the certified public accountant firm as the state auditor deems in the public interest,
but the state auditor must accept the audit unless the state auditor determines that it does
not meet recognized industry auditing standards or is not in the form required by the state
auditor. A county audited by a certified public accountant firm cannot be required to pay
to the state general fund any costs for state auditor services.

Sec. 24.

Minnesota Statutes 2010, section 15.06, subdivision 8, is amended to read:

Subd. 8.

Number of deputy commissioners; no assistant commissioners.

Unless
specifically authorized by statute, other than section 43A.08, subdivision 2 Except for
the Department of Veterans Affairs, no department or agency specified in subdivision 1
shall have more than one deputy commissioner. No department or agency specified in
subdivision 1 may employ an assistant commissioner.

Sec. 25.

[15.062] COST-EFFECTIVE PROVISION OF SERVICES.

(a) The head or governing board of each state department or agency, including the
Minnesota state colleges and universities, must carry out the agency's powers and duties
in the most cost-effective manner possible. The agency head or governing board must
determine if the most cost-effective manner of carrying out each of the agency's powers
and duties is to hire state employees or to contract with outside sources.

(b) If an agency decides to seek an outside vendor to perform work currently done
by state employees, the agency must permit groups of state employees to compete for the
business by submitting responses to the agency's solicitation documents. Notwithstanding
section 16A.127 or any other law to the contrary, no statewide or agency indirect costs
may be assessed to a group of agency employees with respect to work performed under
a contract awarded to a group of employees under this section. This section supersedes
any provision of law preventing a state agency from entering into a contract with a state
employee.

Sec. 26.

[15.76] SAVI PROGRAM.

Subdivision 1.

Program established.

The state agency value initiative (SAVI)
program is established to encourage state agencies to identify cost-effective and efficiency
measures in agency programs and operations that result in cost savings for the state. All
state agencies, including Minnesota State Colleges and Universities, may participate in
this program.

Subd. 2.

Retained savings.

(a) In order to encourage innovation and creative
cost savings by state employees, upon approval of the commissioner of management
and budget, 50 percent of any appropriations for agency operations that remain unspent
at the end of a biennium because of unanticipated innovation, efficiencies, or creative
cost-savings may be carried forward and retained by the agency to fund specific agency
proposals or projects. Agencies choosing to spend retained savings funds must ensure that
project expenditures do not create future obligations beyond the amounts available from
the retained savings. The retained savings must be used only to fund projects that directly
support the agency's mission. This section does not restrict authority granted by other law
to carry forward money for a different period or for different purposes.

(b) This section supersedes any contrary provision of section 16A.28.

Subd. 3.

Special peer review panel; review process.

(a) Each participating agency
must organize a peer review panel that will determine which proposal or project receives
funding from the SAVI program. The peer review panel must be comprised of department
employees who are credited with cost-savings initiatives and department managers. The
ratio between managers and department employees must be balanced.

(b) An agency may spend money for a project recommended for funding by the
peer review panel after:

(1) the agency has posted notice of spending for the proposed project on the agency
Web site for at least 30 days; and

(2) the commissioner of management and budget has approved spending money
from the SAVI account for the project.

(c) Before approving a project, the commissioner of management and budget
must submit the request to the Legislative Advisory Commission for its review and
recommendation. Upon receiving a request from the commissioner, the Legislative
Advisory Commission shall post notice of the request on a legislative Web site for at least
30 days. Failure of the commission to make a recommendation within this 30-day period
is considered a negative recommendation. A recommendation of the commission must be
made at a meeting of the commission unless a written recommendation is signed by all
the members entitled to vote on the item.

Subd. 4.

SAVI-dedicated account.

Each agency that participates in the SAVI
program shall have a SAVI-dedicated account in the special revenue fund, or other
appropriate fund as determined by the commissioner of management and budget, into
which the agency's savings are deposited. The agency will manage and review projects
that are funded from this account. Money in the account is appropriated to the participating
agency for purposes authorized by this section.

Subd. 5.

Expiration.

This section expires June 30, 2018.

EFFECTIVE DATE.

This section is effective June 30, 2013, and first applies to
funds to be carried forward from the biennium ending June 30, 2013, to the biennium
beginning July 1, 2013.

Sec. 27.

[15B.055] PUBLIC ACCESS TO PARKING SPACES.

To provide the public with greater access to legislative proceedings, all parking
spaces on Aurora Avenue in front of the Capitol building must be reserved for the public.
Revenue derived from public parking in these spaces must be deposited in the general fund.

Sec. 28.

Minnesota Statutes 2010, section 16A.10, subdivision 1a, is amended to read:

Subd. 1a.

Purpose of performance data.

Performance data shall be presented in
the budget proposal to:

(1) provide information so that the legislature can determine the extent to which
state programs and activities are successful;

(2) encourage agencies to develop clear and measurable goals and objectives for
their programs and activities; and

(3) strengthen accountability to Minnesotans by providing a record of state
government's performance in providing effective and efficient services.

Sec. 29.

Minnesota Statutes 2010, section 16A.10, subdivision 1b, is amended to read:

Subd. 1b.

Performance data format.

(a) As part of the budget proposal, agencies
shall:

(1) describe the goals and objectives of each agency program and activity; and

(2) present performance data that measures the performance of programs and
activities in meeting program goals and objectives.

(b) Measures reported must be outcome-based and objective, and may include
indicators of outputs, efficiency, outcomes, and other measures relevant to understanding
each program and activity.

(c) Agencies shall present as much historical information as needed to understand
major trends and shall set targets for future performance issues where feasible and
appropriate. The information shall appropriately highlight agency performance issues that
would assist legislative review and decision making.

(d) For purposes of this subdivision, subdivision 1a, and section 16A.106, the terms
"program" and "activity" are used in the same manner as the terms are used in state
budgeting. However, the commissioner may authorize an agency to define these terms in a
different manner if that allows for a more effective presentation of performance data.

Sec. 30.

Minnesota Statutes 2010, section 16A.10, subdivision 1c, is amended to read:

Subd. 1c.

Performance measures for change items.

For each change item in the
budget proposal requesting new or increased funding, the budget document must present
proposed performance measures that can be used to determine if the new or increased
funding is accomplishing its goals. To the extent possible, each budget change item
must identify relevant Minnesota Milestones and other statewide goals and indicators
related to the proposed initiative. The commissioner must report to the Subcommittee on
Government Accountability established under section 3.885, subdivision 10, regarding the
format to be used for the presentation and selection of Minnesota Milestones and other
statewide goals and indicators.

Sec. 31.

Minnesota Statutes 2010, section 16A.103, subdivision 1a, is amended to read:

Subd. 1a.

Forecast parameters.

The forecast must assume the continuation of
current laws and reasonable estimates of projected growth in the national and state
economies and affected populations. Revenue must be estimated for all sources provided
for in current law. Expenditures must be estimated for all obligations imposed by law and
those projected to occur as a result of variables outside the control of the legislature.
Expenditures for the current biennium must be based on actual appropriations or, for
forecasted programs, the amount needed to fund the formula in law. The base for
expenditures projections for the next biennium is the amount appropriated in the second
year of the current biennium, except as provided by other law, or, for forecasted programs,
the amount needed to fund the formula in law. Expenditure estimates must not include an
allowance for inflation.

Sec. 32.

[16A.106] ZERO-BASED BUDGETING PRINCIPLES.

(a) The detailed budget presented to the legislature must include:

(1) a description of each budget activity for which the agency or entity receives
an appropriation in the current biennium or for which the agency or entity requests an
appropriation in the next biennium;

(2) for each budget activity, three alternative funding levels or alternative ways of
performing the budget activity, at least one of which is less than the previous biennium's
actual expenditures for that budget activity, a summary of the priorities that would be
accomplished within each level compared to a zero budget, and the additional increments
of value that would be added by the higher funding levels compared to what would be
accomplished if there were no funding for the activity; and

(3) for each budget activity, performance data as specified in section 16A.10,
subdivision 1b, the predicted effect of the three alternative funding levels on future
performance, and also one or more measures of cost efficiency and effectiveness of
program delivery, which must include comparisons to other states or entities with similar
programs.

(b) The commissioner's budget preparation guidelines and instructions must contain
requirements, deadlines, and technical assistance to facilitate implementation of this
section. After consultation with the legislative commission on planning and fiscal policy,
the commissioner's instructions may establish parameters for the three alternative funding
levels required in clause (3).

(c) The governor's recommendations must prioritize the budget activities within an
agency or program area. To the extent activities in more than one agency or program area
are meeting the same goals, the recommendations must prioritize budget activities across
agencies or programs with the same goals, and this prioritization must include agencies or
programs not subject to zero-based budgeting principles that biennium.

(d) Expenditures for debt service under section 16A.642, subdivision 10, are not
subject to zero-based budgeting principles.

EFFECTIVE DATE.

(a) The zero-based budgeting principles in this section first
apply to the following budget proposals for the biennium beginning July 1, 2013:

(1) legislative branch;

(2) judicial branch;

(3) Minnesota State Colleges and Universities system; and

(4) approximately half of expenditure programs in the executive branch, designated
by the governor, in consultation with the chairs and lead minority members of the senate
Finance Committee and the house of representatives Ways and Means Committee.

(b) The zero-based budgeting principles in this section apply to all budget proposals
for the biennium beginning July 1, 2015, and after.

Sec. 33.

Minnesota Statutes 2010, section 16A.11, subdivision 3, is amended to read:

Subd. 3.

Part two: detailed budget.

(a) Part two of the budget, the detailed budget
estimates both of expenditures and revenues, must contain any statements on the financial
plan which the governor believes desirable or which may be required by the legislature.
The detailed estimates shall include the governor's budget arranged in tabular form.

(b) For programs designated for the zero-based budgeting principles under section
16A.106, the budget must be prepared according to the requirements of that section.

(c) For programs not designated for zero-based budgeting principles under section
16A.106, tables listing expenditures for the next biennium must show the appropriation
base for each year as defined in section 16A.103, subdivision 1c. The appropriation base
is the amount appropriated for the second year of the current biennium. The tables must
separately show any adjustments to the base required by current law or policies of the
commissioner of management and budget. For forecasted programs, the tables must also
show the amount of the forecast adjustments, based on the most recent forecast prepared
by the commissioner of management and budget under section 16A.103. For all programs,
the tables must show the amount of appropriation changes recommended by the governor,
after adjustments to the base and forecast adjustments, and the total recommendation of
the governor for that year.

(c) (d) The detailed estimates must include a separate line listing the total cost of
professional and technical service contracts for the prior biennium and the projected costs
of those contracts for the current and upcoming biennium. They must also include a
summary of the personnel employed by the agency, reflected as full-time equivalent
positions.

(d) (e) The detailed estimates for internal service funds must include the number of
full-time equivalents by program; detail on any loans from the general fund, including
dollar amounts by program; proposed investments in technology or equipment of $100,000
or more; an explanation of any operating losses or increases in retained earnings; and a
history of the rates that have been charged, with an explanation of any rate changes and
the impact of the rate changes on affected agencies.

Sec. 34.

Minnesota Statutes 2010, section 16A.28, subdivision 3, is amended to read:

Subd. 3.

Lapse.

Any portion of any appropriation not carried forward and remaining
unexpended and unencumbered at the close of a fiscal year lapses to the fund from which
it was originally appropriated. Except as provided in section 15.76, any appropriation
amounts not carried forward and remaining unexpended and unencumbered at the close of
a biennium lapse to the fund from which the appropriation was made.

EFFECTIVE DATE.

This section is effective June 30, 2013.

Sec. 35.

[16A.90] EMPLOYEE GAINSHARING SYSTEM.

The commissioner shall establish a program to provide onetime bonus compensation
to state employees for efforts made to reduce the costs of operating state government or for
ways of providing better or more efficient state services. The commissioner may make a
onetime award to an employee or group of employees whose suggestion or involvement in
a project is determined by the commissioner to have resulted in documented cost-savings
to the state. The maximum award is ten percent of the documented savings in the
first fiscal year in which the savings are realized. The award must be paid from the
appropriation to which the savings accrued.

Sec. 36.

[16A.93] MINNESOTA PAY FOR PERFORMANCE ACT.

Sections 16A.93 to 16A.96 may be cited as the "Minnesota Pay for Performance
Act of 2011."

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 37.

[16A.94] PROGRAM.

Subdivision 1.

Pilot program established.

The commissioner shall implement a
pilot program to demonstrate the feasibility and desirability of using state appropriation
bonds to pay for certain services based on performance and outcomes for the people served.

Subd. 2.

Oversight committee.

(a) The commissioner shall appoint an oversight
committee to:

(1) identify criteria to select one or more services to be included in the pilot program;

(2) identify the conditions of performance and desired outcomes for the people
served by each service selected;

(3) identify criteria to evaluate whether a service has met the performance
conditions; and

(4) provide any other advice or assistance requested by the commissioner.

(b) The oversight committee must include the commissioners of the Departments
of Human Services, Employment and Economic Development, and Administration, or
their designees; a representative of a nonprofit organization that has participated in a
pay-for-performance program; and any other person or organization that the commissioner
determines would be of assistance in developing and implementing the pilot program.

Subd. 3.

Contracts.

The commissioner and the commissioner of the agency with
a service to be provided through the pilot program shall enter into a contract with the
selected provider. The contract must specify the service to be provided, the time frame in
which it is to be provided, the outcome required for payment, and any other terms deemed
necessary or convenient for implementation of the pilot program. The commissioner
shall pay a provider that has met the terms and conditions of a contract with money
appropriated to the commissioner from the special appropriation bond proceeds account
established in section 16A.96. At a minimum, before the commissioner pays a provider,
the commissioner must determine that the state's return on investment is positive.

Subd. 4.

Return on investment calculation.

The commissioner, in consultation
with the oversight committee, must establish the method and data required for calculating
the state's return on investment. The data at a minimum must include:

(1) state income taxes and any other revenues collected in the year after the service
was provided that would not have been collected without the service; and

(2) costs avoided by the state by providing the service.

A positive return on investment for the state will cover the state's costs in financing
and administering the pilot program through documented increased state tax revenue
or cost avoidance.

Subd. 5.

Report to governor and legislature.

The commissioner must report to the
governor and legislative committees with jurisdiction over capital investment, finance, and
ways and means, and the services included in the pilot program, by January 15 of each
year following a year in which the pilot program is operating. The report must describe
and discuss the criteria for selection and evaluation of services to be provided through
the program, the net benefits to the state of the program, the state's return on investment,
the cost of the services provided by other means in the most recent past, the time frame
for payment for the services, and the timing and costs for sale and issuance of the bonds
authorized in section 16A.96.

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 38.

[16A.96] MINNESOTA PAY FOR PERFORMANCE PROGRAM;
APPROPRIATION BONDS.

Subdivision 1.

Definitions.

(a) The definitions in this subdivision apply to this
section.

(b) "Appropriation bond" means a bond, note, or other similar instrument of the state
payable during a biennium from one or more of the following sources:

(1) money appropriated by law in any biennium for debt service due with respect
to obligations described in subdivision 2, paragraph (b);

(2) proceeds of the sale of obligations described in subdivision 2, paragraph (b);

(3) payments received for that purpose under agreements and ancillary arrangements
described in subdivision 2, paragraph (d); and

(4) investment earnings on amounts in clauses (1) to (3).

(c) "Debt service" means the amount payable in any biennium of principal, premium,
if any, and interest on appropriation bonds.

Subd. 2.

Authority.

(a) Subject to the limitations of this subdivision, the
commissioner of management and budget may sell and issue appropriation bonds of the
state under this section for the purposes of the Minnesota pay for performance program
established in sections 16A.93 to 16A.96. Proceeds of the bonds must be credited to
a special appropriation bond proceeds account in the state treasury. Net income from
investment of the proceeds, as estimated by the commissioner, must be credited to the
special appropriation bond proceeds account.

(b) Appropriation bonds may be sold and issued in amounts that, in the opinion of
the commissioner, are necessary to provide sufficient funds for achieving the purposes
authorized as provided under paragraph (a), and pay debt service, pay costs of issuance,
make deposits to reserve funds, pay the costs of credit enhancement, or make payments
under other agreements entered into under paragraph (d); provided, however, that bonds
issued and unpaid shall not exceed $20,000,000 in principal amount, excluding refunding
bonds sold and issued under subdivision 4. During the biennium ending June 30, 2013,
the commissioner may sell and issue bonds only in an amount that the commissioner
determines will result in principal and interest payments less than the amount of savings to
be generated through pay-for-performance contracts under section 16A.94. For programs
achieving savings under a pay-for-performance contract, the commissioner must reduce
general fund appropriations by at least the amount of principal and interest payments on
bonds issued under this section.

(c) Appropriation bonds may be issued in one or more series on the terms and
conditions the commissioner determines to be in the best interests of the state, but the term
on any series of bonds may not exceed 20 years.

(d) At the time of, or in anticipation of, issuing the appropriation bonds, and at any
time thereafter, so long as the appropriation bonds are outstanding, the commissioner
may enter into agreements and ancillary arrangements relating to the appropriation
bonds, including but not limited to trust indentures, liquidity facilities, remarketing or
dealer agreements, letter of credit agreements, insurance policies, guaranty agreements,
reimbursement agreements, indexing agreements, or interest exchange agreements. Any
payments made or received according to the agreement or ancillary arrangement shall be
made from or deposited as provided in the agreement or ancillary arrangement. The
determination of the commissioner included in an interest exchange agreement that the
agreement relates to an appropriation bond shall be conclusive.

Subd. 3.

Form; procedure.

(a) Appropriation bonds may be issued in the form
of bonds, notes, or other similar instruments, and in the manner provided in section
16A.672. In the event that any provision of section 16A.672 conflicts with this section,
this section shall control.

(b) Every appropriation bond shall include a conspicuous statement of the limitation
established in subdivision 6.

(c) Appropriation bonds may be sold at either public or private sale upon such terms
as the commissioner shall determine are not inconsistent with this section and may be sold
at any price or percentage of par value. Any bid received may be rejected.

(d) Appropriation bonds may bear interest at a fixed or variable rate.

Subd. 4.

Refunding bonds.

The commissioner from time to time may issue
appropriation bonds for the purpose of refunding any appropriation bonds then
outstanding, including the payment of any redemption premiums on the bonds, any
interest accrued or to accrue to the redemption date, and costs related to the issuance
and sale of the refunding bonds. The proceeds of any refunding bonds may, in the
discretion of the commissioner, be applied to the purchase or payment at maturity of the
appropriation bonds to be refunded, to the redemption of the outstanding bonds on any
redemption date, or to pay interest on the refunding bonds and may, pending application,
be placed in escrow to be applied to the purchase, payment, retirement, or redemption.
Any escrowed proceeds, pending such use, may be invested and reinvested in obligations
that are authorized investments under section 11A.24. The income earned or realized on
the investment may also be applied to the payment of the bonds to be refunded or interest
or premiums on the refunded bonds, or to pay interest on the refunding bonds. After
the terms of the escrow have been fully satisfied, any balance of the proceeds and any
investment income may be returned to the general fund or, if applicable, the appropriation
bond proceeds account for use in any lawful manner. All refunding bonds issued under
this subdivision must be prepared, executed, delivered, and secured by appropriations in
the same manner as the bonds to be refunded.

Subd. 5.

Appropriation bonds as legal investments.

Any of the following entities
may legally invest any sinking funds, money, or other funds belonging to them or under
their control in any appropriation bonds issued under this section:

(1) the state, the investment board, public officers, municipal corporations, political
subdivisions, and public bodies;

(2) banks and bankers, savings and loan associations, credit unions, trust companies,
savings banks and institutions, investment companies, insurance companies, insurance
associations, and other persons carrying on a banking or insurance business; and

(3) personal representatives, guardians, trustees, and other fiduciaries.

Subd. 6.

No full faith and credit; state not required to make appropriations.

The appropriation bonds are not public debt of the state, and the full faith, credit, and
taxing powers of the state are not pledged to the payment of the appropriation bonds or to
any payment that the state agrees to make under this section. Appropriation bonds shall
not be obligations paid directly, in whole or in part, from a tax of statewide application
on any class of property, income, transaction, or privilege. Appropriation bonds shall be
payable in each fiscal year only from amounts that the legislature may appropriate for debt
service for any fiscal year, provided that nothing in this section shall be construed to
require the state to appropriate funds sufficient to make debt service payments with respect
to the bonds in any fiscal year.

Subd. 7.

Appropriation of proceeds.

The proceeds of appropriation bonds and
interest credited to the special appropriation bond proceeds account are appropriated to the
commissioner for payment of contract obligations under the pay for performance program,
as permitted by state and federal law, and nonsalary expenses incurred in conjunction
with the sale of the appropriation bonds.

Subd. 8.

Appropriation for debt service.

The amount needed to pay principal and
interest on appropriation bonds issued under this section is appropriated each year to the
commissioner from the general fund subject to the repeal, unallotment under section
16A.152, or cancellation otherwise pursuant to subdivision 6.

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 39.

Minnesota Statutes 2010, section 16B.03, is amended to read:

16B.03 APPOINTMENTS.

The commissioner is authorized to appoint staff, including two one deputy
commissioners commissioner, in accordance with chapter 43A.

Sec. 40.

[16C.075] E-VERIFY.

A contract for services valued in excess of $50,000 must require certification from
the vendor and any subcontractors that, as of the date services on behalf of the state of
Minnesota will be performed, the vendor and all subcontractors have implemented or are
in the process of implementing the federal E-Verify program for all newly hired employees
in the United States who will perform work on behalf of the state of Minnesota.

EFFECTIVE DATE.

This section is effective July 1, 2011, and applies to contracts
entered into on or after that date.

Sec. 41.

Minnesota Statutes 2010, section 16C.08, subdivision 2, is amended to read:

Subd. 2.

Duties of contracting agency.

(a) Before an agency may seek approval of
a professional or technical services contract valued in excess of $5,000, it must provide
the following:

(1) a description of how the proposed contract or amendment is necessary and
reasonable to advance the statutory mission of the agency;

(2) a description of the agency's plan to notify firms or individuals who may be
available to perform the services called for in the solicitation;

(3) a description of the performance measures or other tools, including accessibility
measures if applicable, that will be used to monitor and evaluate contract performance; and

(4) an explanation detailing, if applicable, why this procurement is being pursued
unilaterally by the agency and not as an enterprise procurement.

(b) In addition to paragraph (a), the agency must certify that:

(1) no current state employee is able and available to perform the services called
for by the contract;

(2) (1) the normal competitive bidding mechanisms will not provide for adequate
performance of the services;

(3) (2) reasonable efforts will be made to publicize the availability of the contract
to the public;

(4) (3) the agency will develop and implement a written plan providing for the
assignment of specific agency personnel to manage the contract, including a monitoring
and liaison function, the periodic review of interim reports or other indications of past
performance, and the ultimate utilization of the final product of the services;

(5) (4) the agency will not allow the contractor to begin work before the contract is
fully executed unless an exception under section 16C.05, subdivision 2a, has been granted
by the commissioner and funds are fully encumbered;

(6) (5) the contract will not establish an employment relationship between the state
or the agency and any persons performing under the contract; and

(7) (6) in the event the results of the contract work will be carried out or continued
by state employees upon completion of the contract, the contractor is required to include
state employees in development and training, to the extent necessary to ensure that after
completion of the contract, state employees can perform any ongoing work related to the
same function; and

(8) the agency will not contract out its previously eliminated jobs for four years
without first considering the same former employees who are on the seniority unit layoff
list who meet the minimum qualifications determined by the agency.

(c) A contract establishes an employment relationship for purposes of paragraph (b),
clause (6) (5), if, under federal laws governing the distinction between an employee and
an independent contractor, a person would be considered an employee.

Sec. 42.

Minnesota Statutes 2010, section 16C.09, is amended to read:

16C.09 PROCEDURE FOR SERVICE CONTRACTS.

(a) Before entering into or approving a service contract, the commissioner must
determine, at least, that:

(1) no current state employee is able and available to perform the services called
for by the contract;

(2) (1) the work to be performed under the contract is necessary to the agency's
achievement of its statutory responsibilities and there is statutory authority to enter into
the contract;

(3) (2) the contract will not establish an employment relationship between the state
or the agency and any persons performing under the contract;

(4) (3) the contractor and agents are not employees of the state, except as authorized
in section 15.062;

(5) (4) the contracting agency has specified a satisfactory method of evaluating and
using the results of the work to be performed; and

(6) (5) the combined contract and amendments will not exceed five years without
specific, written approval by the commissioner according to established policy, procedures,
and standards, or unless otherwise provided for by law. The term of the original contract
must not exceed two years, unless the commissioner determines that a longer duration is
in the best interest of the state.

(b) For purposes of paragraph (a), clause (1), employees are available if qualified
and:

(1) are already doing the work in question; or

(2) are on layoff status in classes that can do the work in question.

An employee is not available if the employee is doing other work, is retired, or has decided
not to do the work in question.

(c) (b) This section does not apply to an agency's use of inmates pursuant to sections
241.20 to 241.23 or to an agency's use of persons required by a court to provide:

(1) community service; or

(2) conservation or maintenance services on lands under the jurisdiction and control
of the state.

Sec. 43.

[16D.20] FEDERAL OFFSET PROGRAM.

(a) The commissioner may enter into an agreement with the United States Secretary
of the Treasury to participate in an offset program authorized under United States Code,
title 31, section 3716, for the collection of debts owed to state agencies. The agreement
may provide for the United States to submit debts owed to federal agencies for offset
against state payments, similar to the procedures for offsetting debts owed to state
agencies from federal payments.

(b) The commissioner shall reduce any state payment by the amount of any federal
debt submitted in accordance with the agreement authorized by this section, and pay such
amount to the appropriate federal official in accordance with the procedures specified
in such agreement.

(c) The commissioner may, by rule, establish a reasonable administrative fee to be
charged to the debtor for the contingency fee-based processing of state payment offsets for
the recovery of federal nontax debts or the contingency fee-based processing of federal
payment offsets for the recovery of state tax and nontax debt. The fee is a separate debt
and may be withheld from any refund, reimbursement, or other money held for the debtor.

(d) An agreement under this section must not allow for offset of payments if the
debt that would be subject to the offset is being contested or if the time for appealing the
determination of the debt has not yet expired.

EFFECTIVE DATE.

This section is effective the day following final enactment. As
soon as possible after that date, the commissioner must discuss an agreement authorized
under this section with appropriate federal officials, and if an agreement is entered into,
the commissioner must begin to implement it to collect debts owed to the state as soon as
possible.

Sec. 44.

Minnesota Statutes 2010, section 37.06, is amended to read:

37.06 SECRETARY; LEGISLATIVE AUDITOR; DUTIES; REPORT.

The secretary shall keep a complete record of the proceedings of the annual meetings
of the State Agricultural Society and all meetings of the board of managers and any
committee of the board, keep all accounts of the society other than those kept by the
treasurer of the society, and perform other duties as directed by the board of managers. On
or before December 31 each year, the secretary shall report to the governor for the fiscal
year ending October 31 all the proceedings of the society during the current year and its
financial condition as appears from its books. This report must contain a full, detailed
statement of all receipts and expenditures during the year.

The books and accounts of the society for the fiscal year must be examined and
audited annually by an independent auditor, either a private auditor or the legislative
auditor. If the audit is conducted by the legislative auditor, the cost of the examination
must be paid by the society to the state and credited to the general fund.

A summary of this examination, certified by the legislative auditor, must be
appended to the secretary's report, along with the legislative auditor's recommendations
and the proceedings of the first annual meeting of the society held following the secretary's
report, including addresses made at the meeting as directed by the board of managers. The
summary, recommendations, and proceedings must be printed in the same manner as the
reports of state officers. Copies of the report must be printed annually and distributed as
follows: to each society or association entitled to membership in the society, to each
newspaper in the state, and the remaining copies as directed by the board of managers.

Sec. 45.

Minnesota Statutes 2010, section 43A.08, subdivision 1, is amended to read:

Subdivision 1.

Unclassified positions.

Unclassified positions are held by employees
who are:

(1) chosen by election or appointed to fill an elective office;

(2) heads of agencies required by law to be appointed by the governor or other
elective officers, and the executive or administrative heads of departments, bureaus,
divisions, and institutions specifically established by law in the unclassified service;

(3) deputy and assistant agency heads and one confidential secretary in the agencies
listed in subdivision 1a and in the Office of Strategic and Long-Range Planning section
15.06, subdivision 1;

(4) the confidential secretary to each of the elective officers of this state and, for the
secretary of state and state auditor, an additional deputy, clerk, or employee;

(5) intermittent help employed by the commissioner of public safety to assist in
the issuance of vehicle licenses;

(6) employees in the offices of the governor and of the lieutenant governor and one
confidential employee for the governor in the Office of the Adjutant General;

(7) employees of the Washington, D.C., office of the state of Minnesota;

(8) employees of the legislature and of legislative committees or commissions;
provided that employees of the Legislative Audit Commission, except for the legislative
auditor, the deputy legislative auditors, and their confidential secretaries, shall be
employees in the classified service;

(9) presidents, vice-presidents, deans, other managers and professionals in
academic and academic support programs, administrative or service faculty, teachers,
research assistants, and student employees eligible under terms of the federal Economic
Opportunity Act work study program in the Perpich Center for Arts Education and the
Minnesota State Colleges and Universities, but not the custodial, clerical, or maintenance
employees, or any professional or managerial employee performing duties in connection
with the business administration of these institutions;

(10) officers and enlisted persons in the National Guard;

(11) attorneys, legal assistants, and three confidential employees appointed by the
attorney general or employed with the attorney general's authorization;

(12) judges and all employees of the judicial branch, referees, receivers, jurors, and
notaries public, except referees and adjusters employed by the Department of Labor
and Industry;

(13) members of the State Patrol; provided that selection and appointment of State
Patrol troopers must be made in accordance with applicable laws governing the classified
service;

(14) examination monitors and intermittent training instructors employed by the
Departments of Management and Budget and Commerce and by professional examining
boards and intermittent staff employed by the technical colleges for the administration of
practical skills tests and for the staging of instructional demonstrations;

(15) student workers;

(16) executive directors or executive secretaries appointed by and reporting to any
policy-making board or commission established by statute;

(17) employees unclassified pursuant to other statutory authority;

(18) intermittent help employed by the commissioner of agriculture to perform
duties relating to pesticides, fertilizer, and seed regulation;

(19) the administrators and the deputy administrators at the State Academies for the
Deaf and the Blind; and

(20) chief executive officers in the Department of Human Services.

Sec. 46.

Minnesota Statutes 2010, section 43A.20, is amended to read:

43A.20 PERFORMANCE APPRAISAL AND PAY.

(a) The commissioner shall design and maintain a performance appraisal system
under which each employee in the civil service in the executive branch shall be evaluated
and counseled on work performance at least once a year. The performance appraisal
system must include three components:

(1) evaluation of the individual employee's performance relative to goals for that
individual, which must constitute a majority of the overall determination of an employee's
performance;

(2) evaluation of the performance of the individual employee's program, defined by
the agency head, toward meeting targeted outcomes for the program; and

(3) evaluation of the performance of the entire agency toward meeting targeted
outcomes for the agency.

(b) Individual pay increases for all employees not represented by an exclusive
representative certified pursuant to chapter 179A shall be based on the evaluation
evaluations required by paragraph (a) and other factors consistent with paragraph (a)
that the commissioner negotiates in collective bargaining agreements or includes in the
plans developed pursuant to section 43A.18. Collective bargaining agreements entered
into pursuant to chapter 179A may, and are encouraged to, provide for pay increases
based on employee work performance. An employee in the executive branch may not
receive an increase in salary or wages based on cost of living or progression to another
step or lane unless the employee's supervisor certifies that the employee's performance
has been satisfactory.

(c) This section does not apply to faculty and administrators in the Minnesota State
Colleges and University system.

(d) This section supersedes any conflicting provision of other law.

EFFECTIVE DATE.

This section is effective July 1, 2011. For employees covered
by a collective bargaining agreement, this section applies to collective bargaining
agreements entered into on or after that date.

Sec. 47.

[43A.347] REDUCTION IN STATE WORK FORCE; EARLY
RETIREMENT PROGRAM.

Subdivision 1.

Required reduction.

(a) The number of full-time equivalent
employees employed in the executive branch, and the costs directly associated with
employing those persons, must be reduced by at least 12 percent by June 30, 2013, and 15
percent by June 30, 2015, and thereafter, compared to the number of full-time equivalent
positions and the costs directly associated with those positions on January 1, 2011.

(b) An appointing authority may use any or all of the following to achieve this
requirement: attrition, a hard hiring freeze, early retirement incentives authorized in this
section, restructuring of benefit or pension programs as authorized by other law, furloughs,
and layoffs. The early retirement program in this section is enacted as a tool to assist in
complying with the required 15 percent reduction.

(c) For purposes of this section:

(1) "costs directly associated" with employing people means the cost of salaries and
benefits, including the costs of employer contributions to public pension plans; and

(2) "executive branch" does not include the Minnesota State Colleges and
Universities.

Subd. 2.

Analysis.

Before authorizing an early retirement under subdivision 3 or
4, the commissioner must perform analysis, including actuarial analysis, as necessary to
determine the maximum number of employees to whom incentives will be offered, and the
percentage of resulting savings estimated to be needed to pay pension funds to cover costs
to the funds of the incentive in this section. The commissioner must use this analysis in
determining how to best implement this section.

Subd. 3.

Pension early retirement incentive.

(a) The commissioner of management
and budget may authorize an executive branch appointing authority to offer an early
retirement incentive under this subdivision to an employee who upon retirement would be
immediately eligible to receive an annuity from the public pension plan under which the
employee is covered immediately before separation from state service. The commissioner
may establish time periods during which the incentive may be offered and during which
the incentive must be accepted, may establish limits on the number of employees to whom
an appointing authority, or all appointing authorities collectively, may offer the incentive,
and may establish other conditions for the incentive.

(b) For an employee offered an incentive under this subdivision, for each full
year of service credit that the employee has in a plan administered by the Minnesota
State Retirement System, the Public Employees Retirement Association, or the Teachers
Retirement Association, the employee must be granted an additional month of service
credit in the plan under which the employee is covered immediately before separation
from state service under this subdivision.

(c) Upon request of an appointing authority considering offering an incentive under
this subdivision, the executive director of the public pension plan in which an employee
would be granted additional service credit under this subdivision must prepare an estimate
of the present value of the additional service credit that would be granted to an employee
under this subdivision. For each employee accepting an incentive under this subdivision,
the appointing authority offering the incentive must pay the applicable public pension
plan, from the first dollars of savings achieved through offering the incentive, the present
value of the additional service credit granted to the employee, taking into account the date
payment will be received from the appointing authority. The appointing authority must
make this payment to the pension plan within one year of the date the employee accepting
the incentive leaves state service.

Subd. 4.

Insurance early retirement incentive.

The commissioner of management
and budget may authorize an executive appointing authority to offer the incentive
originally offered under Laws 2010, chapter 337, to employees who retire from state
service during periods that the commissioner specifies before June 30, 2015. The terms and
conditions specified in Laws 2010, chapter 337, apply to an incentive offered under this
subdivision, except for the dates specified in that law for accepting the incentive and for
retiring, and except that the prohibition on reemployment or contracting is for the period
specified in this section, instead of the shorter period specified in Laws 2010, chapter 337.

Subd. 5.

Best practices.

In implementing this section, the commissioner of
management and budget and affected agencies shall utilize best practices as identified by
other states that have implemented early retirement programs.

Subd. 6.

Hiring freeze.

To promote streamlined government and reduced costs,
no state appointing authority may fill by outside hire a position vacated through state
employee participation in an early retirement incentive under this section.

Subd. 7.

Reemployment prohibition.

An employee who receives an early
retirement incentive under this section may not be reemployed with the state or enter into
a contract with the state as a consultant for five years after termination.

Subd. 8.

Savings.

Savings resulting from implementation of this section, after
any payments made under subdivisions 3 and 4, must cancel back to the fund in which
the savings occurred.

Subd. 9.

Not applicable to elected officials.

A state elected official is not a state
employee for purposes of this section.

Sec. 48.

Minnesota Statutes 2010, section 45.013, is amended to read:

45.013 POWER TO APPOINT STAFF.

The commissioner of commerce may appoint four one deputy commissioners, four
assistant commissioners, and an assistant to the commissioner. Those positions, as well as
that of and a confidential secretary, are in the unclassified service. The commissioner may
appoint other employees necessary to carry out the duties and responsibilities entrusted to
the commissioner.

Sec. 49.

Minnesota Statutes 2010, section 84.01, subdivision 3, is amended to read:

Subd. 3.

Employees; delegation.

Subject to the provisions of Laws 1969, chapter
1129, and to other applicable laws The commissioner shall organize the department and
employ up to three assistant commissioners, each of whom shall serve at the pleasure of
the commissioner in the unclassified service, one of whom shall have responsibility for
coordinating and directing the planning of every division within the agency, and such other
officers, employees, and agents as the commissioner may deem necessary to discharge the
functions of the department, define the duties of such officers, employees, and agents and
to delegate to them any of the commissioner's powers, duties, and responsibilities subject
to the control of, and under the conditions prescribed by, the commissioner. Appointments
to exercise delegated power shall be by written order filed with the secretary of state.

Sec. 50.

Minnesota Statutes 2010, section 116.03, subdivision 1, is amended to read:

Subdivision 1.

Office.

(a) The office of commissioner of the Pollution Control
Agency is created and is under the supervision and control of the commissioner, who is
appointed by the governor under the provisions of section 15.06.

(b) The commissioner may appoint a deputy commissioner and assistant
commissioners who shall be in the unclassified service.

(c) The commissioner shall make all decisions on behalf of the agency that are not
required to be made by the agency under section 116.02.

Sec. 51.

Minnesota Statutes 2010, section 116J.01, subdivision 5, is amended to read:

Subd. 5.

Departmental organization.

(a) The commissioner shall organize the
department as provided in section 15.06.

(b) The commissioner may establish divisions and offices within the department.
The commissioner may employ four deputy commissioners in the unclassified service.

(c) The commissioner shall:

(1) employ assistants and other officers, employees, and agents that the commissioner
considers necessary to discharge the functions of the commissioner's office;

(2) define the duties of the officers, employees, and agents, and delegate to them any
of the commissioner's powers, duties, and responsibilities, subject to the commissioner's
control and under conditions prescribed by the commissioner.

(d) The commissioner shall ensure that there are at least three employment and
economic development officers in state offices in nonmetropolitan areas of the state who
will work with local units of government on developing local employment and economic
development.

Sec. 52.

Minnesota Statutes 2010, section 116J.035, subdivision 4, is amended to read:

Subd. 4.

Delegation of powers.

The commissioner may delegate, in written orders
filed with the secretary of state, any powers or duties subject to the commissioner's
control to officers and employees in the department. Regardless of any other law, the
commissioner may delegate the execution of specific contracts or specific types of
contracts to the commissioner's deputies, an assistant commissioner, deputy or a program
director if the delegation has been approved by the commissioner of administration and
filed with the secretary of state.

Sec. 53.

Minnesota Statutes 2010, section 174.02, subdivision 2, is amended to read:

Subd. 2.

Unclassified positions.

The commissioner may establish four positions
in the unclassified service at the appoint a deputy and assistant commissioner, assistant
to commissioner or and a personal secretary levels. No more than two of these positions
shall be at the deputy commissioner level in the unclassified service.

Sec. 54.

Minnesota Statutes 2010, section 241.01, subdivision 2, is amended to read:

Subd. 2.

Deputies Deputy.

The commissioner of corrections may appoint and
employ no more than two a deputy commissioners commissioner. The commissioner may
also appoint a personal secretary, who shall serve at the commissioner's pleasure in the
unclassified civil service.

Sec. 55.

Laws 2010, chapter 361, article 3, section 8, is amended to read:

Sec. 8. USE OF CARRYFORWARD.

The restrictions in Minnesota Statutes, section 16A.281, on the use of money carried
forward from one biennium to another shall not apply to money the legislative auditor
carried forward from the previous biennium for use in fiscal years 2010 and 2011 ending
June 30, 2009, or the biennium ending June 30, 2011. The legislative auditor may use the
carry forward money for costs related to the conduct of audits related to funds authorized
in the Minnesota Constitution, Article XI, section 15, and audits related to the institutions,
offices, and functions of Minnesota State Colleges and Universities.

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 56. SALARY FREEZE.

(a) Effective July 1, 2011, a state employee may not receive a salary or wage increase
before July 1, 2013. This section prohibits any increases, including but not limited to:
across-the-board increases; cost-of-living adjustments; increases based on longevity;
step increases; increases in the form of lump-sum payments; increases in employer
contributions to deferred compensation plans; or any other pay grade adjustments of any
kind. This section does not prohibit an increase in the rate of salary and wages for an
employee who is promoted or transferred to a position with greater responsibilities and
with a higher salary or wage rate. For purposes of this section, "state employee" means an
"employee" as defined in Minnesota Statutes, section 43A.02, subdivision 21, but does not
include faculty or administrators in the Minnesota State Colleges and Universities.

(b) A state appointing authority may not enter into a collective bargaining agreement
or implement a compensation plan that increases salary or wages in a manner prohibited
by this section. Neither a state appointing authority nor an exclusive representative of state
employees may request interest arbitration in relation to an increase in salary or wages that
is prohibited by this section, and an arbitrator may not issue an award that would increase
salary or wages in a manner prohibited by this section.

EFFECTIVE DATE.

Paragraph (b) is effective the day following final enactment.
Paragraph (a) is effective June 30, 2011.

Sec. 57. STATE JOB CLASSIFICATIONS.

The commissioner of management and budget shall report to the legislature by
January 15, 2012, on a process to redesign and consolidate the job classification plan for
executive branch employees, with a goal of assigning all classified positions to no more
than 50 job families. The process must lead to development of a new job classification
plan designed to enhance the ability of state agencies to flexibly manage their workforces
to meet changing needs and demands of the agency, and to enhance the ability of state
employees to transfer to other positions for which they are qualified. In developing this
process, the commissioner must meet and confer with the exclusive representatives of each
affected bargaining unit. The report to the legislature must identify implementation issues.

Sec. 58. DEPARTMENT OF REVENUE; REQUEST FOR PROPOSALS.

(a) The commissioner of revenue shall issue a request for proposals for a contract to
implement a system of tax analytics and business intelligence tools to enhance the state's
tax collection process and revenues by improving the means of identifying candidates
for audit and collection activities and prioritizing those activities to provide the highest
returns on auditors' and collection agents' time. The request for proposals must require
that the system recommended and implemented by the contractor:

(1) leverage the Department of Revenue's existing data and other available data
sources to build models that more effectively and efficiently identify accounts for audit
review and collections;

(2) leverage advanced analytical techniques and technology such as pattern
detection, predictive modeling, clustering, outlier detection and link analysis to identify
suspect accounts for audit review and collections;

(3) leverage a variety of approaches and analytical techniques to rank accounts and
improve the success rate and the return on investment of department employees engaged
in audit activities;

(4) leverage technology to make the audit process more sustainable and stable, even
with turnover of department auditing staff;

(5) provide optimization capabilities to more effectively prioritize collections and
increase the efficiency of employees engaged in collections activities; and

(6) incorporate mechanisms to decrease wrongful auditing and reduce interference
with Minnesota taxpayers who are fully complying with the laws.

(b) Based on reasonable responses to the request for proposals, the commissioner
shall enter into a contract for the services specified in paragraph (a) by October 1, 2011.

(c) Incorporating the system of tax analytics and business intelligence tools under
the contract in this section, the commissioner of revenue shall identify and collect tax
liabilities from individuals and businesses that currently do not pay all taxes owed.
The commissioner may enter into additional contracts and retain up to five percent
administrative costs as necessary to implement this section. A contract may incorporate a
vendor financing option. This financing option may not make the vendor's compensation
contingent on the amount collected as a result of an audit or an assessment determined
by the vendor.

(d) $11,504,000 for the fiscal year ending June 30, 2012, and $23,269,000 for
the fiscal year ending June 30, 2013, are appropriated from the general fund to the
commissioner of revenue for purposes of this section. This initiative is expected to result
in new general fund revenues of $133,000,000 for the biennium ending June 30, 2013.

(e) The commissioner of revenue must report to the chairs of the house of
representatives Ways and Means and senate Finance Committees by March 1, 2012, and
January 15, 2013, on collection of additional revenue under this section.

(f)(1) If the commissioner of revenue determines that the initiative under this section
will result in new general fund revenues of less than $133,000,000 for the biennium
ending June 30, 2013, the commissioner must notify the commissioner of management
and budget of the amount of new general fund revenues anticipated under this section.

(2) Upon receiving a notice from the commissioner of revenue under clause (1), the
commissioner of management and budget must reduce general fund appropriations to
executive agencies for agency operations for the biennium ending June 30, 2013, by an
amount equal to the difference between $133,000,000 and the amount of new general fund
revenues anticipated by the commissioner of revenue under the notice in clause (1).

EFFECTIVE DATE.

This section is effective the day following final enactment.

Sec. 59. REVENUE FROM FEDERAL OFFSET PROGRAM.

(a) It is expected that implementation of authority under Minnesota Statutes, section
16D.20, will result in increased revenues to the general fund of at least $36,600,000
during the biennium ending June 30, 2013. If the commissioner of revenue determines
that implementation of Minnesota Statutes, section 16D.20, will result in new general
fund revenues of less than $36,600,000 for the biennium ending June 30, 2013, the
commissioner must notify the commissioner of management and budget of the amount of
new general fund revenues anticipated under Minnesota Statutes, section 16D.20.

(b) Upon receiving a notice from the commissioner of revenue under paragraph (a),
the commissioner of management and budget must reduce general fund appropriations to
executive agencies for agency operations for the biennium ending June 30, 2013, by an
amount equal to the difference between $36,600,000 and the amount of new general fund
revenues anticipated by the commissioner of revenue under the notice in paragraph (a).

Sec. 60. STATE EMPLOYEE GROUP INSURANCE PLAN DEPENDENT
ELIGIBILITY VERIFICATION AUDIT SERVICES.

Subdivision 1.

Request for proposals.

By September 1, 2011, the commissioner
of management and budget shall issue a request for proposals for a contract to provide
dependent eligibility verification audit services for state-paid hospital, medical, and dental
benefits provided to participants in the state employee group insurance program and their
dependents. The request for proposals must require that the vendor will:

(1) conduct a document-model dependent eligibility verification audit of all plans
offered under Minnesota Statutes, sections 43A.22 to 43A.31;

(2) identify ineligible dependents covered by the plans and report those findings to
the commissioner and third-party administrators of the state's employee health plans, as
directed by the commissioner; and

(3) implement a process for ongoing eligibility verification following the conclusion
of the dependent eligibility verification audit required by this section.

Subd. 2.

Additional vendor criteria.

The request for proposals required by
subdivision 1 must require the vendor to provide the following minimum capabilities and
experience in performing the services described in subdivision 1:

(1) a rules-based platform employing auto-adjudication for making objective
eligibility determinations;

(2) assigned eligibility advocates to assist employees through the verification
process;

(3) a formal claims and appeals process; and

(4) experience in the performance of dependent eligibility verification audits for
other states.

Subd. 3.

Contract required.

By January 1, 2012, the commissioner must enter
into a contract for the services specified in subdivision 1. The contract must incorporate
a performance-based vendor financing option that compensates the vendor based on the
amount of savings generated by the work performed under the contract.

Sec. 61. STRATEGIC SOURCING REQUEST FOR PROPOSALS.

Subdivision 1.

Request for proposals.

By July 1, 2011, the commissioner
of administration shall issue a request for proposals for a contract to provide
recommendations for efficiencies in strategic sourcing to the commissioner. For the
purposes of this section, "strategic sourcing" has the meaning given in Minnesota Statutes,
section 16C.02, subdivision 20. The request for proposals shall require the vendor to
provide recommendations for improvements to methods used by the commissioner
to analyze and reduce spending on goods and services, including, but not limited to,
spend analysis, product standardization, contract consolidation, negotiations, multiple
jurisdiction purchasing alliances, reverse and forward auctions, life-cycle costing, and
other techniques.

Subd. 2.

Proof of concept phase.

The request for proposal shall require the selected
vendor, at no cost to the state, to begin work on the contract by assisting the commissioner
in implementing its proposed solution on selected state procurement processes to
demonstrate the savings provided by the recommendations. The system provided by the
vendor must be capable of application to the state procurement system.

Subd. 3.

Full implementation and payment.

The request for proposal must require
the state to implement the recommendations provided by the vendor in the entire state
procurement system if the work done under the requirements of subdivision 2 provides
material savings to the state. After the full implementation of the system provided by the
vendor, the vendor shall be paid by the state from the savings attributable to the work done
by the vendor, according to the terms and performance measures negotiated in the contract.

Subd. 4.

Selection of vendor.

The commissioner of administration shall select a
vendor from the responses to the request for proposal by September 1, 2011.

Subd. 5.

Progress report.

The commissioner shall provide a report describing the
progress made under this section to the governor and the chairs and ranking minority
members of the legislative committees with jurisdiction over the commissioner of
administration by January 15, 2012.

Sec. 62. REPEALER.

Minnesota Statutes 2010, sections 16C.085; 43A.047; and 179A.23, are repealed.

ARTICLE 4

CONSOLIDATION OF INFORMATION TECHNOLOGY SERVICES

Section 1.

Minnesota Statutes 2010, section 16B.99, is amended to read:

16B.99 GEOSPATIAL INFORMATION OFFICE.

Subdivision 1.

Creation.

The Minnesota Geospatial Information Office is created
under the supervision of the commissioner of administration chief geospatial information
officer, who is appointed by the chief information officer.

Subd. 2.

Responsibilities; authority.

The office has authority to provide
coordination, guidance, and leadership, and to plan the implementation of Minnesota's
geospatial information technology. The office must identify, coordinate, and guide
strategic investments in geospatial information technology systems, data, and services to
ensure effective implementation and use of Geospatial Information Systems (GIS) by state
agencies to maximize benefits for state government as an enterprise.

Subd. 3.

Duties.

The office must:

(1) coordinate and guide the efficient and effective use of available federal,
state, local, and public-private resources to develop statewide geospatial information
technology, data, and services;

(2) provide leadership and outreach, and ensure cooperation and coordination for all
Geospatial Information Systems (GIS) functions in state and local government, including
coordination between state agencies, intergovernment coordination between state and local
units of government, and extragovernment coordination, which includes coordination with
academic and other private and nonprofit sector GIS stakeholders;

(3) review state agency and intergovernment geospatial technology, data, and
services development efforts involving state or intergovernment funding, including federal
funding;

(4) provide information to the legislature regarding projects reviewed, and
recommend projects for inclusion in the governor's budget under section 16A.11;

(5) coordinate management of geospatial technology, data, and services between
state and local governments;

(6) provide coordination, leadership, and consultation to integrate government
technology services with GIS infrastructure and GIS programs;

(7) work to avoid or eliminate unnecessary duplication of existing GIS technology
services and systems, including services provided by other public and private organizations
while building on existing governmental infrastructures;

(8) promote and coordinate consolidated geospatial technology, data, and services
and shared geospatial Web services for state and local governments; and

(9) promote and coordinate geospatial technology training, technical guidance, and
project support for state and local governments.

Subd. 4.

Duties of chief geospatial information officer.

(a) In consultation with the
state geospatial advisory council, the commissioner of administration, the commissioner
of management and budget, and the Minnesota chief geospatial information officer, the
chief geospatial information officer must identify when it is cost-effective for agencies to
develop and use shared information and geospatial technology systems, data, and services.
The chief geospatial information officer may require agencies to use shared information
and geospatial technology systems, data, and services.

(b) The chief geospatial information officer, in consultation with the state
geospatial advisory council, must establish reimbursement rates in cooperation with the
commissioner of management and budget to bill agencies and other governmental entities
sufficient to cover the actual development, operation, maintenance, and administrative
costs of the shared systems. The methodology for billing may include the use of
interagency agreements, or other means as allowed by law.

Subd. 5.

Fees.

(a) The chief geospatial information officer must set fees under
section 16A.1285 that reflect the actual cost of providing information products and
services to clients. Fees collected must be deposited in the state treasury and credited to
the Minnesota Geospatial Information Office revolving account. Money in the account
is appropriated to the chief geospatial information officer for providing Geospatial
Information Systems (GIS) consulting services, software, data, Web services, and map
products on a cost-recovery basis, including the cost of services, supplies, material, labor,
and equipment as well as the portion of the general support costs and statewide indirect
costs of the office that is attributable to the delivery of these products and services. Money
in the account must not be used for the general operation of the Minnesota Geospatial
Information Office.

(b) The chief geospatial information officer may require a state agency to make an
advance payment to the revolving account sufficient to cover the agency's estimated
obligation for a period of 60 days or more. If the revolving account is abolished or
liquidated, the total net profit from the operation of the account must be distributed to the
various funds from which purchases were made. For a given period of time, the amount of
total net profit to be distributed to each fund must reflect the same ratio of total purchases
attributable to each fund divided by the total purchases from all funds.

Subd. 6.

Accountability.

The chief geospatial information officer is appointed by
the commissioner of administration and must work closely with the Minnesota chief
information officer who shall advise on technology projects, standards, and services.

Subd. 7.

Discretionary powers.

The office may:

(1) enter into contracts for goods or services with public or private organizations
and charge fees for services it provides;

(2) apply for, receive, and expend money from public agencies;

(3) apply for, accept, and disburse grants and other aids from the federal government
and other public or private sources;

(4) enter into contracts with agencies of the federal government, local government
units, the University of Minnesota and other educational institutions, and private persons
and other nongovernment organizations as necessary to perform its statutory duties;

(5) appoint committees and task forces to assist the office in carrying out its duties;

(6) sponsor and conduct conferences and studies, collect and disseminate
information, and issue reports relating to geospatial information and technology issues;

(7) participate in the activities and conferences related to geospatial information
and communications technology issues;

(8) review the Geospatial Information Systems (GIS) technology infrastructure
of regions of the state and cooperate with and make recommendations to the governor,
legislature, state agencies, local governments, local technology development agencies,
the federal government, private businesses, and individuals for the realization of GIS
information and technology infrastructure development potential;

(9) sponsor, support, and facilitate innovative and collaborative geospatial systems
technology, data, and services projects; and

(10) review and recommend alternative sourcing strategies for state geospatial
information systems technology, data, and services.

Subd. 8.

Geospatial advisory councils created.

The chief geospatial information
officer must establish a governance structure that includes advisory councils to provide
recommendations for improving the operations and management of geospatial technology
within state government and also on issues of importance to users of geospatial technology
throughout the state.

(a) A statewide geospatial advisory council must advise the Minnesota Geospatial
Information Office regarding the improvement of services statewide through the
coordinated, affordable, reliable, and effective use of geospatial technology. The
commissioner of administration chief information officer must appoint the members of the
council. The members must represent a cross-section of organizations including counties,
cities, universities, business, nonprofit organizations, federal agencies, and state agencies.
No more than 20 percent of the members may be employees of a state agency. In addition,
the chief geospatial information officer must be a nonvoting member.

(b) A state government geospatial advisory council must advise the Minnesota
Geospatial Information Office on issues concerning improving state government services
through the coordinated, affordable, reliable, and effective use of geospatial technology.
The commissioner of administration chief information officer must appoint the members
of the council. The members must represent up to 15 state government agencies and
constitutional offices, including the Office of Enterprise Technology and the Minnesota
Geospatial Information Office. The council must be chaired by the chief geographic
information officer. A representative of the statewide geospatial advisory council must
serve as a nonvoting member.

(c) Members of both the statewide geospatial advisory council and the state
government advisory council must be recommended by a process that ensures that each
member is designated to represent a clearly identified agency or interested party category
and that complies with the state's open appointment process. Members shall serve a
term of two years.

(d) The Minnesota Geospatial Information Office must provide administrative
support for both geospatial advisory councils.

(e) This subdivision expires June 30, 2011.

Subd. 9.

Report to legislature.

By January 15, 2010, the chief geospatial
information officer must provide a report to the chairs and ranking minority members of
the legislative committees with jurisdiction over the policy and budget for the office. The
report must address all statutes that refer to the Minnesota Geospatial Information Office
or land management information system and provide any necessary draft legislation to
implement any recommendations.

Sec. 2.

[16E.0151] RESPONSIBILITY FOR INFORMATION TECHNOLOGY
SERVICES AND EQUIPMENT.

(a) The chief information officer is responsible for providing or entering into
managed services contracts for the provision of the following information technology
systems and services to state agencies:

(1) state data centers;

(2) mainframes including system software;

(3) servers including system software;

(4) desktops including system software;

(5) laptop computers including system software;

(6) a data network including system software;

(7) database, electronic mail, office systems, reporting, and other standard software
tools;

(8) business application software and related technical support services;

(9) help desk for the components listed in clauses (1) to (8);

(10) maintenance, problem resolution, and break-fix for the components listed in
clauses (1) to (8); and

(11) regular upgrades and replacement for the components listed in clauses (1) to (8).

(b) All state agency employees whose work primarily involves functions specified in
paragraph (a) are employees of the Office of Enterprise Technology. The chief information
officer may assign employees of the office to perform work exclusively for another
executive agency.

(c) The chief information officer may allow a state agency to obtain services
specified in paragraph (a) through a contract with an outside vendor when the value of an
outside vendor contract can be demonstrated. Sections 16C.08, subdivision 2, paragraph
(b), clause (1); 16C.09, paragraph (a), clause (1); and 43A.047 do not apply to these
contracts with outside vendors. The chief information officer must require that agency
contracts with outside vendors ensure that systems and services are compatible with
standards established by the Office of Enterprise Technology.

(d) In exercising authority under this section, the chief information officer
must cooperate with the commissioner of administration on contracts for acquisition
of information technology systems and services. The authority granted to the chief
information officer does not limit the procurement, contract management, and contract
review authority of the commissioner of administration under chapter 16C, including
authority of the commissioner to enter into and manage cooperative purchasing
agreements with other states.

(e) The State Lottery and Statewide Radio Board are not state agencies for purposes
of this section.

Sec. 3.

[16E.036] ADVISORY COMMITTEE.

(a) The Technology Advisory Committee is created to advise the chief information
officer. The committee consists of six members appointed by the governor who are
individuals actively involved in business planning for state executive branch agencies, one
county member designated by the Association of Minnesota Counties, and one member
appointed by the governor to represent private businesses.

(b) Membership terms, removal of members, and filling of vacancies are as provided
in section 15.059. Members do not receive compensation or reimbursement for expenses.

(c) The committee shall select a chair from its members. The chief information
officer shall provide administrative support to the committee.

(d) The committee shall advise the chief information officer on:

(1) development and implementation of the state information technology strategic
plan;

(2) critical information technology initiatives for the state;

(3) standards for state information architecture;

(4) identification of business and technical needs of state agencies;

(5) strategic information technology portfolio management, project prioritization,
and investment decisions;

(6) the office's performance measures and fees for service agreements with executive
branch agencies;

(7) management of the state enterprise technology revolving fund; and

(8) the efficient and effective operation of the office.

Sec. 4.

Minnesota Statutes 2010, section 16E.14, is amended by adding a subdivision
to read:

Subd. 6.

Technology improvement account.

The technology improvement account
is established as an account in the enterprise technology fund. Money in the account is
appropriated to the chief information officer for the purpose of funding a project that will
result in improvements in state information and telecommunications technology. The
chief information officer may spend money from the account on behalf of a state agency
or group of agencies or may transfer money in the account to a state agency or group of
agencies only according to an agreement under which: (1) the chief information officer
has determined that savings generated by the project to be funded from the account will
exceed the cost of the project; and (2) the agency or agencies sponsoring the project have
developed a plan for recouping the project costs to the fund.

Sec. 5. TRANSFERS.

(a) Powers, duties, responsibilities, assets, personnel, and unexpended appropriations
relating to functions assigned to the chief information officer in Minnesota Statutes,
section 16E.0151, are transferred to the Office of Enterprise Technology from all other
state agencies, as defined in Minnesota Statutes, section 16E.03, subdivision 1, paragraph
(e), effective July 1, 2011. By January 15, 2012, the chief information officer shall submit
to the legislature any statutory changes needed to complete implementation of the transfer
in this section.

(b) Prior to the transfer mandated by paragraph (a), the chief information officer must
enter into a service-level agreement with each state agency governing the provision of
information technology systems and services in Minnesota Statutes, section 16E.0151. The
agreements must specify the services to be provided and the charges for these services. As
specified in Minnesota Statutes, section 16E.0151, an agency may choose to obtain these
services from an outside vendor, rather than from the Office of Enterprise Technology.

(c) Powers, duties, responsibilities, assets, personnel, and unexpended appropriations
relating to geospatial information systems are transferred from the commissioner of
administration to the Office of Enterprise Technology.

(d) Minnesota Statutes, section 15.039, applies to transfers in this section. Executive
branch officials may use authority under Minnesota Statutes, section 16B.37, as necessary
to implement this section.

Sec. 6. STUDY.

The chief information officer in the Office of Enterprise Technology shall report
to the chairs and ranking minority members of the house of representatives and senate
committees with jurisdiction over state government finance by January 15, 2012, on
the feasibility and desirability of the office entering into service-level agreements with
the State Lottery and the Statewide Radio Board regarding provision of information
technology systems and services to those entities.

Sec. 7. REVISOR'S INSTRUCTION.

The revisor of statutes shall recodify Minnesota Statutes, section 16B.99, into
Minnesota Statutes, chapter 16E.