HF 3359

1st Engrossment - 86th Legislature (2009 - 2010) Posted on 03/22/2010 10:17am

A bill for an act
relating to local government; authorizing Hennepin County to purchase energy
under forward pricing mechanisms; proposing coding for new law in Minnesota
Statutes, chapter 383B.

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

Section 1.

new text begin [383B.1588] ENERGY FORWARD PRICING MECHANISMS.
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new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin The following definitions apply in this section.
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new text begin (a) "Energy" means natural gas, heating oil, diesel fuel, unleaded fuel, or any other
energy source, except electric, used in Hennepin County operations.
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new text begin (b) "Forward pricing mechanism" means either:
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new text begin (1) a contract or financial instrument that obligates Hennepin County to buy or sell a
specified amount of an energy commodity at a future date and at a set price; or
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new text begin (2) an option to buy or sell the contract or financial instrument.
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new text begin Subd. 2. new text end

new text begin Authority provided. new text end

new text begin Notwithstanding any other law to the contrary,
the Hennepin County Board of Commissioners may use forward pricing mechanisms
for budget risk reduction.
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new text begin Subd. 3. new text end

new text begin Conditions. new text end

new text begin (a) Forward pricing transactions made under this section must
be made only under the conditions in this subdivision.
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new text begin (b) The amount of energy forward priced must not exceed the estimated energy
usage for Hennepin County operations for the period of time covered by the forward
pricing mechanism.
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new text begin (c) The holding period and expiration date for any forward pricing mechanism must
not exceed 24 months from the trade date of the transaction.
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new text begin (d) Separate accounts must be established for each operational energy for which
forward pricing mechanisms are used under this section.
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new text begin Subd. 4. new text end

new text begin Written policies and procedures. new text end

new text begin Before exercising authority under
subdivision 2, the Hennepin County Board of Commissioners must have written policies
and procedures governing the use of forward pricing mechanisms.
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new text begin Subd. 5. new text end

new text begin Oversight process. new text end

new text begin (a) Before exercising authority under subdivision 2,
the Hennepin County Board of Commissioners must establish an oversight process that
provides for review of the county's used of forward pricing mechanisms.
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new text begin (b) The process must include:
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new text begin (1) internal or external audit reviews;
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new text begin (2) annual reports to, and review by, an internal investment committee; and
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new text begin (3) internal management control.
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new text begin EFFECTIVE DATE. new text end

new text begin This section is effective without local approval the day
following final enactment as provided under Minnesota Statutes, section 645.023,
subdivision 1, paragraph (a).
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