Engrossments
Introduction		Posted on 03/09/2016
1st Engrossment		Posted on 03/17/2016
2nd Engrossment		Posted on 03/21/2016
3rd Engrossment		Posted on 04/01/2016
4th Engrossment		Posted on 04/18/2016

Section 1.

Minnesota Statutes 2014, section 13.719, is amended by adding a
subdivision to read:

Subd. 7.

Family and medical insurance data.

(a) For the purposes of this
subdivision, the terms used have the meanings given them in section 268B.01.

(b) Data on applicants, family members, or employers under chapter 268B are
private or nonpublic data, provided that the department may share data collected from
applicants with employers or health care providers to the extent necessary to meet the
requirements of chapter 268B or other applicable law.

Sec. 2.

Minnesota Statutes 2014, section 268.19, subdivision 1, is amended to read:

Subdivision 1.

Use of data.

(a) Except as provided by this section, data gathered
from any person under the administration of the Minnesota Unemployment Insurance Law
are private data on individuals or nonpublic data not on individuals as defined in section
13.02, subdivisions 9 and 12, and may not be disclosed except according to a district court
order or section 13.05. A subpoena is not considered a district court order. These data
may be disseminated to and used by the following agencies without the consent of the
subject of the data:

(1) state and federal agencies specifically authorized access to the data by state
or federal law;

(2) any agency of any other state or any federal agency charged with the
administration of an unemployment insurance program;

(3) any agency responsible for the maintenance of a system of public employment
offices for the purpose of assisting individuals in obtaining employment;

(4) the public authority responsible for child support in Minnesota or any other
state in accordance with section 256.978;

(5) human rights agencies within Minnesota that have enforcement powers;

(6) the Department of Revenue to the extent necessary for its duties under Minnesota
laws;

(7) public and private agencies responsible for administering publicly financed
assistance programs for the purpose of monitoring the eligibility of the program's recipients;

(8) the Department of Labor and Industry and the Commerce Fraud Bureau in the
Department of Commerce for uses consistent with the administration of their duties under
Minnesota law;

(9) the Department of Human Services and the Office of Inspector General and its
agents within the Department of Human Services, including county fraud investigators,
for investigations related to recipient or provider fraud and employees of providers when
the provider is suspected of committing public assistance fraud;

(10) local and state welfare agencies for monitoring the eligibility of the data subject
for assistance programs, or for any employment or training program administered by those
agencies, whether alone, in combination with another welfare agency, or in conjunction
with the department or to monitor and evaluate the statewide Minnesota family investment
program by providing data on recipients and former recipients of food stamps or food
support, cash assistance under chapter 256, 256D, 256J, or 256K, child care assistance
under chapter 119B, or medical programs under chapter 256B, 256D, or 256L;

(11) local and state welfare agencies for the purpose of identifying employment,
wages, and other information to assist in the collection of an overpayment debt in an
assistance program;

(12) local, state, and federal law enforcement agencies for the purpose of
ascertaining the last known address and employment location of an individual who is the
subject of a criminal investigation;

(13) the United States Immigration and Customs Enforcement has access to data on
specific individuals and specific employers provided the specific individual or specific
employer is the subject of an investigation by that agency;

(14) the Department of Health for the purposes of epidemiologic investigations;

(15) the Department of Corrections for the purpose of case planning for preprobation
and postprobation employment tracking of offenders sentenced to probation and
preconfinement and postconfinement employment tracking of committed offenders;

(16) the state auditor to the extent necessary to conduct audits of job opportunity
building zones as required under section 469.3201; and

(17) the Office of Higher Education for purposes of supporting program
improvement, system evaluation, and research initiatives including the Statewide
Longitudinal Education Data System; and

(18) the Family and Medical Benefits Division of the Department of Employment
and Economic Development to be used as necessary to administer chapter 268B.

(b) Data on individuals and employers that are collected, maintained, or used by
the department in an investigation under section 268.182 are confidential as to data
on individuals and protected nonpublic data not on individuals as defined in section
13.02, subdivisions 3 and 13, and must not be disclosed except under statute or district
court order or to a party named in a criminal proceeding, administrative or judicial, for
preparation of a defense.

(c) Data gathered by the department in the administration of the Minnesota
unemployment insurance program must not be made the subject or the basis for any
suit in any civil proceedings, administrative or judicial, unless the action is initiated by
the department.

Sec. 3.

[268B.01] DEFINITIONS.

Subdivision 1.

Scope.

For the purposes of this chapter, the terms defined in this
section have the meanings given them.

Subd. 2.

Account.

"Account" means the family and medical benefit insurance
account in the special revenue fund in the state treasury under section 268B.02.

Subd. 3.

Applicant.

"Applicant" means an individual applying for benefits under
this chapter.

Subd. 4.

Benefit.

"Benefit" means monetary payments under this chapter associated
with qualifying bonding, family, or pregnancy events.

Subd. 5.

Commissioner.

"Commissioner" means the commissioner of employment
and economic development.

Subd. 6.

Department.

"Department" means the Department of Employment and
Economic Development.

Subd. 7.

Employee.

"Employee" means an individual for whom taxes are paid on
wages under this chapter.

Subd. 8.

Employer.

"Employer" means a person or entity that employed 21 or
more employees within the state at any one time within the last four completed calendar
quarters, other than an employee, required to pay taxes under this chapter.

Subd. 9.

Health care provider.

"Health care provider" means an individual who is
licensed, certified, or otherwise authorized under law to practice in the individual's state
of practice as a physician, osteopath, physician assistant, chiropractor, advanced practice
registered nurse, optometrist, licensed psychologist, licensed independent clinical social
worker, dentist, or podiatrist. "Chiropractor" means only a chiropractor who provides
manual manipulation of the spine to correct a subluxation demonstrated to exist by an x-ray.

Subd. 10.

Pregnancy.

"Pregnancy" means prenatal care or incapacity of a woman
due to pregnancy, childbirth, or related health conditions.

Subd. 11.

Family care.

"Family care" means an applicant caring for a family
member with a serious health condition.

Subd. 12.

Bonding.

"Bonding" means a biological or adoptive parent in conjunction
with the birth or adoption of a child, or a foster parent in conjunction with the placement
of a child in foster care.

Subd. 13.

Covered employment.

"Covered employment" has the meaning given in
section 268.035, subdivision 12.

Subd. 14.

Noncovered employment.

"Noncovered employment" has the meaning
given in section 268.035, subdivision 20.

Subd. 15.

Qualified health care provider.

"Qualified health care provider" means
a health care provider who, in the judgment of the commissioner, has the qualifications
necessary to diagnose or treat a particular health condition or conditions associated with
benefits sought under this chapter.

Subd. 16.

Serious health condition.

"Serious health condition" means an illness,
injury, impairment, or physical or mental condition that involves:

(1) inpatient care in a hospital, hospice, or residential medical care facility; or

(2) continuing treatment by a health care provider.

Subd. 17.

Wage credits.

"Wage credits" has the meaning given in section 268.035,
subdivision 27.

Subd. 18.

High quarter.

"High quarter" has the meaning given in section 268.035,
subdivision 19.

Subd. 19.

Maximum weekly benefit amount.

"Maximum weekly benefit amount"
means the state's average weekly wage as calculated under section 268.035, subdivision 23.

Subd. 20.

ICD code.

"ICD code" means the code under the International
Classification of Diseases, Clinical Modification/Coding System, for the most recent
edition commonly used.

Subd. 21.

Medical benefit program.

"Medical benefit program" means the program
administered under this chapter for the collection of taxes and payment of benefits related
to pregnancy benefits.

Subd. 22.

Family benefit program.

"Family benefit program" means the program
administered under this chapter for the collection of taxes and payment of benefits related
to family care and bonding.

Subd. 23.

State's average weekly wage.

"State's average weekly wage" means the
weekly wage calculated under section 268.035, subdivision 23.

Subd. 24.

Family member.

"Family member" means an employee's child, adult
child, spouse, sibling, parent, foster parent, mother-in-law, father-in-law, grandchild,
grandparent, or stepparent.

Sec. 4.

[268B.02] FAMILY AND MEDICAL BENEFIT INSURANCE PROGRAM
CREATION.

Subdivision 1.

Creation.

A family and medical benefit insurance program is created
to be administered by the commissioner according to the terms of this chapter.

Subd. 2.

Creation of division.

A Family and Medical Benefit Insurance Division is
created within the department under the authority of the commissioner. The commissioner
shall appoint a director of the division. The division shall administer and operate the
benefit program under this chapter.

Subd. 3.

Rulemaking.

The commissioner may adopt rules to implement the
provisions of this chapter.

Subd. 4.

Account creation; appropriation.

The family and medical benefit
insurance account is created in the special revenue fund in the state treasury. Money in
this account is appropriated to the commissioner to pay benefits under and to administer
this chapter.

Sec. 5.

[268B.03] ELIGIBILITY.

Subdivision 1.

Applicant.

An applicant who is providing family care, is bonding,
or is pregnant, who satisfies the conditions of this section is eligible to receive benefits
subject to the provisions of this chapter.

Subd. 2.

Wage credits.

An applicant must have sufficient wage credits from an
employer as defined in section 268B.01, subdivision 8, to establish a benefit account under
section 268.07, subdivision 2. Wage credits from an employer during a period in which
the employer has successfully opted out of the benefit program being applied for may not
be used for the purposes of this subdivision.

Subd. 3.

Seven-day qualifying event.

The period for which an applicant is seeking
benefits must be or have been based on a single period of at least seven days related to
pregnancy, family care, or bonding. The days need not be consecutive.

Subd. 4.

Ineligible.

An applicant is not eligible for benefits for any day in which the
applicant worked for pay.

Subd. 5.

Certification by health care provider.

Except for bonding benefits, the
application for benefits must be certified in writing by a qualified health care professional.

Subd. 6.

Records release.

An individual whose medical records are necessary to
determine eligibility for benefits under this chapter must sign and date a legally effective
waiver authorizing release to the department of medical and other records to the limited
extent necessary to administer this chapter.

Subd. 7.

Self-employed applicant.

(a) To be eligible for benefits, a self-employed
individual who has elected coverage under section 268B.11 must fulfill only the
requirements, to the extent possible, of subdivisions 3, 4, 5, and 6 in addition to the
requirements under paragraph (b).

(b) A self-employed individual must provide documents sufficient to prove the
existence of the individual's business as well as how long that business has been in
operation. The commissioner must determine that the business was not created for the
purpose of obtaining benefits under this chapter.

Sec. 6.

[268B.04] APPLICATIONS.

Subdivision 1.

Application forms.

The commissioner must create application
forms, to be available both online and on paper, for each of the following:

(1) an application for family care benefits;

(2) an application for bonding benefits; and

(3) an application for pregnancy benefits.

Subd. 2.

Content of applications.

(a) All three application forms under subdivision
1 must require, at a minimum, the following:

(1) the name, birth date, home address, and mailing address of the applicant;

(2) the Social Security number, or other unique identification number, of the applicant;

(3) a description of the qualifying event underlying the requested benefit;

(4) the date for which benefits are sought began or will begin, if known;

(5) the date for which benefits are sought ended or will end, if known;

(6) whether the benefits are sought on an intermittent basis;

(7) whether the applicant has applied for or received any other paid benefits, whether
public or private, based on the same event underlying the benefits sought or during the
same time period for which the applicant is seeking benefits;

(8) a description of any benefits listed under clause (7);

(9) a signed and dated certification that all the information contained in the
application is true and correct, to the best of the applicant's knowledge; and

(10) a list of all the applicant's employers for the past 79 weeks.

(b) In addition to the requirements of paragraph (a), an application for family care
benefits must contain, at a minimum, the following:

(1) the name, birth date, home address, and mailing address of the family member
for whom the applicant has provided or will be providing care;

(2) the family member's relationship to the applicant;

(3) the Social Security number, or other unique identification number, of the family
member for whom the applicant has provided or will be providing care;

(4) a certification from the care recipient, or the care recipient's authorized
representative, that all the information contained in the application is true and correct,
to the best of that individual's knowledge;

(5) a legally effective authorization, signed and dated by the care recipient or the
care recipient's authorized representative, for disclosure of medical information needed by
the department to fulfill its duties under this chapter; and

(6) a signed and dated certification by a qualified health care provider treating the
care recipient:

(i) describing the nature of the serious medical condition or conditions of the care
recipient;

(ii) stating whether care by another individual is necessary in the treatment, or will
aid in the recovery, of the care recipient;

(iii) describing the nature of the care under item (ii);

(iv) stating or estimating the dates benefits are needed; and

(v) listing the ICD code or codes, if any, of the serious medical condition or
conditions underlying the application for benefits.

(c) In addition to the requirements of paragraph (a), an application for benefits for
bonding must contain, at a minimum, the following:

(1) proof of the birth, adoption, or placement in foster care, as appropriate, of the
child for whom bonding benefits are sought; and

(2) a legally effective authorization, signed and dated by the applicant or other
authorized representative of the child for whom bonding benefits are sought, for disclosure
of medical information needed by the department to fulfill its duties under this chapter.

(d) In addition to the requirements of paragraph (a), an application for pregnancy
benefits must contain, at a minimum, the following:

(1) a legally effective authorization, signed and dated by the applicant or the
applicant's authorized representative, for disclosure of medical information needed by the
department to fulfill its duties under this chapter; and

(2) a signed and dated certification by a qualified health care provider treating the
applicant:

(i) describing the reason or reasons that pregnancy care is needed;

(ii) stating or estimating the dates care is needed; and

(iii) listing the ICD code or codes, if any, of the condition or conditions underlying
the application for benefits.

Subd. 3.

Online access.

The commissioner must, to the extent possible, create a
system allowing for all aspects of the applications under this section to be completed
online. This includes the use of electronic signatures.

Subd. 4.

Administrative efficiencies.

To the maximum extent feasible, the
commissioner must use the same or similar procedures for applications under this section
as for applications for benefits under chapter 268.

Sec. 7.

[268B.05] DETERMINATION OF APPLICATION.

Upon the filing of a complete application for benefits, the commissioner shall examine
the application and on the basis of facts found by the commissioner and records maintained
by the department, the application shall be determined to be valid or invalid within two
weeks. If the application is determined to be valid, the commissioner shall promptly notify
the applicant and any other interested party as to the week when benefits commence,
the weekly benefit amount payable, and the maximum duration of those benefits. If the
application is determined to be invalid, the commissioner shall notify the applicant and
any other interested party of that determination and the reasons for it. If the processing
of the application is delayed for any reason, the commissioner shall notify the applicant,
in writing, within two weeks of the date the application for benefits is filed of the reason
for the delay. Unless the applicant or any other interested party, within 30 days, requests
a hearing before a benefit judge, the determination is final. For good cause shown, the
30-day period may be extended. At any time within one year from the date of a monetary
determination, the commissioner, upon request of the applicant or on the commissioner's
own initiative, may reconsider the determination if it is found that an error in computation
or identity has occurred in connection with the determination or that additional wages
pertinent to the applicant's status have become available, or if that determination has been
made as a result of a nondisclosure or misrepresentation of a material fact.

Sec. 8.

[268B.06] EMPLOYER NOTIFICATION.

(a) Upon a determination under section 268B.05 that an applicant is entitled to
benefits, the commissioner must promptly send a notification to each current employer
of the applicant, if any, in accordance with paragraph (b).

(b) The notification under paragraph (a) must include, at a minimum:

(1) the name of the applicant;

(2) that the applicant has applied for and received benefits;

(3) that the applicant has been identified as an employee of the employer;

(4) the week the benefits commence;

(5) the weekly benefit amount payable;

(6) the maximum duration of benefits;

(7) an explanation of why the notification has been sent; and

(8) descriptions of the employer's right to participate in a hearing under section
268B.05, and appeal process under section 268B.07.

Sec. 9.

[268B.07] APPEAL PROCESS.

Subdivision 1.

Hearing.

(a) The commissioner shall designate a chief benefit judge.

(b) Upon a timely appeal to a determination having been filed or upon a referral
for direct hearing, the chief benefit judge must set a time and date for a de novo due
process hearing and send notice to an applicant and an employer, by mail or electronic
transmission, not less than ten calendar days before the date of the hearing.

(c) The commissioner may adopt rules on procedures for hearings. The rules need
not conform to common law or statutory rules of evidence and other technical rules of
procedure.

(d) The chief benefit judge has discretion regarding the method by which the hearing
is conducted.

Subd. 2.

Decision.

(a) After the conclusion of the hearing, upon the evidence
obtained, the benefit judge must send by mail or electronic transmission to all parties, the
decision, reasons for the decision, and written findings of fact.

(b) Decisions of a benefit judge are not precedential.

Subd. 3.

Request for reconsideration.

Any party, or the commissioner, may,
within 30 calendar days of the receipt of the benefit judge's decision, file a request for
reconsideration asking the judge to reconsider that decision.

Subd. 4.

Appeal to Court of Appeals.

Any final determination on a request for
reconsideration may be appealed by any party directly to the Minnesota Court of Appeals.

Subd. 5.

Benefit judges.

(a) Only employees of the department who are attorneys
licensed to practice law in Minnesota may serve as a chief benefit judge, senior benefit
judges who are supervisors, or benefit judges.

(b) The chief benefit judge must assign a benefit judge to conduct a hearing and may
transfer to another benefit judge any proceedings pending before another benefit judge.

Sec. 10.

[268B.08] BENEFITS.

Subdivision 1.

Weekly benefit amount.

(a) Subject to the maximum weekly benefit
amount, an applicant's weekly benefit is calculated by adding the amounts obtained by
applying the following percentage to an applicant's average weekly wage earned with an
employer as defined in section 268B.01, subdivision 8:

(1) 80 percent of wages that do not exceed 50 percent of the state's average weekly
wage; plus

(2) 66 percent of wages that exceed 50 percent of the state's average weekly wage
but not 100 percent; plus

(3) 55 percent of wages that exceed 100 percent of the state's average weekly wage.

(b) The average weekly wage of the applicant under paragraph (a) must be calculated
by dividing the high quarter wage credits of the applicant by 13.

(c) The state's average weekly wage is the average wage as calculated under section
268.035, subdivision 23, at the time a benefit amount is first determined.

(d) Notwithstanding any other provision in this section, weekly benefits must not
exceed the maximum weekly benefit amount applicable at the time benefit payments
commence.

Subd. 2.

Timing of payment.

Except as otherwise provided for in this chapter,
benefits must be paid weekly.

Subd. 3.

Method of payment.

The commissioner may pay benefits using any
method or methods authorized for the payment of unemployment insurance benefits
under chapter 268.

Subd. 4.

Maximum length of benefits.

In a 52-week period, an applicant may
receive a total of 12 weeks of benefits under this chapter.

Subd. 5.

Minimum period for which benefits payable.

Any claim for benefits
must be based on a single-qualifying benefit period of at least seven days. Thereafter,
benefits may be paid for a minimum increment of one day.

Subd. 6.

Total paid benefits not to exceed average weekly wage.

An applicant's
combined weekly employer paid wage replacement benefits and benefits under this
chapter must not exceed an applicant's average weekly wage. Benefits under this chapter
must be reduced so those combined benefits do not exceed that amount.

Subd. 7.

Withholding of federal tax.

If the Internal Revenue Service determines
that benefits are subject to federal income tax, and an applicant elects to have federal
income tax deducted and withheld from the applicant's benefits, the commissioner must
deduct and withhold the amount specified in the Internal Revenue Code in a manner
consistent with state law.

EFFECTIVE DATE.

This section is effective January 1, 2020.

Sec. 11.

[268B.09] EMPLOYMENT PROTECTIONS.

Subdivision 1.

Retaliation prohibited.

An employer must not retaliate against an
employee for requesting or obtaining benefits, or for exercising any other right under
this chapter.

Subd. 2.

Waiver of rights void.

An agreement by an individual to waive, release,
or commute rights to benefits under this chapter is void. An employer may not obstruct or
impede an application for benefits.

Subd. 3.

No assignment of benefits.

Any assignment, pledge, or encumbrance
of benefits is void. Benefits are exempt from levy, execution, attachment, or any other
remedy provided for the collection of debt. Any waiver of this subdivision is void.

Subd. 4.

Remedies.

In addition to any other remedies available by law, an individual
injured by a violation of this section may bring a civil action seeking any damages
recoverable by law, together with costs and disbursements, including reasonable attorney
fees, and may receive injunctive and other equitable relief as determined by a court.

Subd. 5.

Leave and employment rights not created.

This chapter does not create
a right to employment leave to an individual receiving benefits under this chapter. This
chapter does not create a right to return to an employment position before, during, or after
the receipt of benefits under this chapter.

Sec. 12.

[268B.10] SUBSTITUTION OF OTHER PLAN; EMPLOYER
EXCLUSION.

Subdivision 1.

Application for exclusion.

An employer may apply to the
commissioner to be excluded from either or both the family or medical benefit programs
under this chapter.

Subd. 2.

Requirements for approving exclusion.

The commissioner must approve
an application for exclusion from a program under this chapter if the commissioner finds
that the employer provides a benefit plan that:

(1) covers all of the employees that would be covered by a program under this chapter;

(2) provides an amount of employer provided wage benefits that when combined
with other employer paid and employee paid wage benefits is approximately equal to or
greater than that provided under the program; and

(3) does not require employee payments that exceed employee payments required
under this chapter.

Subd. 3.

Audit and investigation.

The commissioner may investigate and audit
plans for which an exclusion was approved under this section both before and after an
exclusion is approved.

EFFECTIVE DATE.

This section is effective July 1, 2019, for exclusions
commencing January 1, 2020, and thereafter.

Sec. 13.

[268B.11] SELF-EMPLOYED ELECTION OF COVERAGE.

(a) A self-employed individual may file with the commissioner, by electronic
transmission in a format prescribed by the commissioner, an election that the individual is
covered as an employee for not less than two calendar years. Upon the approval of the
commissioner, sent by United States mail or electronic transmission, the individual is
covered as an employee under this chapter beginning the calendar quarter after the date
of approval or beginning in a later calendar quarter if requested by the employer. The
individual ceases to be covered as of the first day of January of any calendar year only if,
at least 30 calendar days before the first day of January, the individual has filed with the
commissioner, by electronic transmission in a format prescribed by the commissioner, a
notice to that effect.

(b) The commissioner must terminate any election agreement under this section
upon 30 calendar days' notice sent by mail or electronic transmission if the individual is
delinquent on any taxes due under this chapter.

(c) The individual electing under this section must pay both the employer and
employee taxes under section 268B.12.

(d) The individual must comply with the requirements imposed on employers and
employees under this chapter except to the extent the commissioner determines requiring
compliance is unreasonable.

Sec. 14.

[268B.111] SMALL EMPLOYER ELECTION OF COVERAGE.

An employer of less than 21 employees may elect to be an employer subject to
chapter 268B. An election must be filed with the commissioner by electronic transmission
in a format prescribed by the commissioner. An election must be for not less than two
calendar years following the year of election. The commissioner shall notify an employer
of the effective date of an election which must be the beginning of the first quarter the
commissioner determines is administratively practical.

Sec. 15.

[268B.12] TAXATION.

Subdivision 1.

Employer.

(a) Each taxpaying employer under the state's
unemployment insurance program must pay a tax on the wages paid to employees in
covered employment for each calendar year. The tax must be paid on all wages up to the
maximum specified by this section.

(b) Each reimbursing employer under the state's unemployment insurance law must
pay a tax on the wages paid to employees in covered employment in the same amount
and manner as provided by paragraph (a).

Subd. 2.

Employee.

Each employee on whose wages a tax is paid under this
section must pay a tax equal to that of the employer under this section. The employer
shall withhold employee taxes from the wages of an employee and make payment to the
commissioner on behalf of an employee.

Subd. 3.

Wages subject to tax.

The maximum wages subject to tax in a calendar
year is equal to the maximum earnings in that year subject to the FICA Old-Age,
Survivors, and Disability Insurance tax.

Subd. 4.

Annual tax rates.

The employer tax rates for the calendar year beginning
January 1, 2020, shall be as follows:

(1) for employers participating in both family and medical benefit programs, .......
percent;

(2) for an employer participating in only the medical benefit program and opting out
of the family benefit program, ....... percent; and

(3) for an employer participating in only the family benefit program and opting out
of the medical benefit program, ....... percent.

Subd. 5.

Tax rate adjustments.

(a) Each calendar year following the calendar year
beginning January 1, 2020, except calendar year 2021, the commissioner must adjust the
annual tax rates using the formula in paragraph (b).

(b) To calculate the employer tax rates for a calendar year, the commissioner must:

(1) multiply 1.45 times the amount disbursed from the account for the 52-week
period ending September 30 of the prior year;

(2) subtract the amount in the account on that September 30 from the resulting figure;

(3) divide the resulting figure by twice the total wages in covered employment of
employees of employers that have not opted out of both the family and medical benefit
programs. For employees of employers that have opted out of one of the two programs,
count only the proportion of wages in covered employment associated with the program of
which the employer did not opt out; and

(4) round the resulting figure down to the nearest one-tenth of one percent.

(c) For calendar year 2021, the calculation shall be as provided in paragraph
(b), except that the disbursements in clause (1) shall be those for the 39 weeks ending
September 30, and projected disbursements for the next 13 weeks.

(d) The commissioner must not increase or decrease the employer tax rate by more
than 0.1 percent each year.

(e) The commissioner must apportion the tax rate between the family and medical
benefit programs based on the relative proportion of expenditures for each program during
the preceding year.

Subd. 6.

Tax rate limits.

The aggregate tax rate of employers and employees under
this chapter must not be less than ....... percent or more than ....... percent annually.

Subd. 7.

Collection of taxes; efficiencies.

For collection of taxes under this section,
the commissioner must, to the maximum extent possible, use the same collection process
as that used for collection of unemployment insurance taxes.

Subd. 8.

Deposit of taxes.

All taxes collected under this section must be deposited
into the account.

Sec. 16.

[268B.13] COLLECTION OF TAXES.

Subdivision 1.

Amount computed presumed correct.

Any amount due from an
employer, as computed by the commissioner, is presumed to be correctly determined and
assessed, and the burden is upon the employer to show its incorrectness. A statement
by the commissioner of the amount due is admissible in evidence in any court or
administrative proceeding and is prima facie evidence of the facts in the statement.

Subd. 2.

Priority of payments.

(a) Any payment received from an employer must
be applied in the following order:

(1) taxes due under this chapter; then

(2) interest on past due taxes; then

(3) penalties, late fees, administrative service fees, and costs.

(b) Paragraph (a) is the priority used for all payments received from an employer,
regardless of how the employer may designate the payment to be applied, except when:

(1) there is an outstanding lien and the employer designates that the payment made
should be applied to satisfy the lien;

(2) a court or administrative order directs that the payment be applied to a specific
obligation;

(3) a preexisting payment plan provides for the application of payment; or

(4) the commissioner agrees to apply the payment to a different priority.

Subd. 3.

Costs.

(a) Any employer that fails to pay any amount when due under this
chapter is liable for any filing fees, recording fees, sheriff fees, costs incurred by referral
to any public or private collection agency, or litigation costs, including attorney fees,
incurred in the collection of the amounts due.

(b) If any tendered payment of any amount due is not honored when presented to a
financial institution for payment, any costs assessed to the department by the financial
institution and a fee of $25 must be assessed to the person.

(c) Costs and fees collected under this subdivision are credited to the account.

Subd. 4.

Interest on amounts past due.

If any amounts due from an employer
under this chapter, except late fees, are not received on the date due, the unpaid balance
bears interest at the rate of one percent per month or any part of a month. Interest collected
under this subdivision is payable to the account.

Subd. 5.

Interest on judgments.

Regardless of section 549.09, if judgment is
entered upon any past due amounts from an employer under this chapter, the unpaid
judgment bears interest at the rate specified in subdivision 4 until the date of payment.

Subd. 6.

Credit adjustments; refunds.

(a) If an employer makes an application for
a credit adjustment of any amount paid under this chapter within four years of the date
that the payment was due, in a manner and format prescribed by the commissioner, and
the commissioner determines that the payment or any portion thereof was erroneous,
the commissioner must make an adjustment and issue a credit without interest. If a
credit cannot be used, the commissioner must refund, without interest, the amount
erroneously paid. The commissioner, on the commissioner's own motion, may make a
credit adjustment or refund under this subdivision.

(b) Any refund returned to the commissioner is considered unclaimed property
under chapter 345.

(c) If a credit adjustment or refund is denied in whole or in part, a determination of
denial must be sent to the employer by United States mail or electronic transmission. The
determination of denial is final unless an employer files an appeal within 20 calendar days
after receipt of the determination.

Subd. 7.

Priorities under legal dissolutions or distributions.

In the event of
any distribution of an employer's assets according to an order of any court, including
any receivership, assignment for benefit of creditors, adjudicated insolvency, or similar
proceeding, taxes then or thereafter due must be paid in full before all other claims
except claims for wages of not more than $1,000 per former employee that are earned
within six months of the commencement of the proceedings. In the event of an employer's
adjudication in bankruptcy under federal law, taxes then or thereafter due are entitled to
the priority provided in that law for taxes due.

Sec. 17.

[268B.14] ADMINISTRATIVE COSTS.

For the calendar year beginning January 1, 2020, and each calendar year thereafter,
the commissioner may spend up to seven percent of projected benefit payments for that
calendar year for the administration of this chapter.

Sec. 18.

[268B.15] PUBLIC OUTREACH.

The commissioner may use administrative funds for the purpose of outreach and
education for employees regarding this chapter. This may include providing grants to
public and private persons and entities.

Sec. 19.

[268B.16] APPLICANT'S FALSE REPRESENTATIONS;
CONCEALMENT OF FACTS; PENALTY.

(a) Any applicant who knowingly makes a false statement or representation,
knowingly fails to disclose a material fact, or makes a false statement or representation
without a good-faith belief as to the correctness of the statement or representation in order
to obtain or in an attempt to obtain benefits may be assessed, in addition to any other
penalties, an administrative penalty of ineligibility of benefits for 13 to 104 weeks.

(b) A determination of ineligibility setting out the weeks the applicant is ineligible
must be sent to the applicant by United States mail or electronic transmission. The
determination is final unless an appeal is filed within 30 calendar days after receipt of
the determination.

Sec. 20.

[268B.17] EMPLOYER MISCONDUCT; PENALTY.

(a) The commissioner must penalize an employer if that employer or any employee,
officer, or agent of that employer is in collusion with any applicant for the purpose of
assisting the applicant in receiving benefits fraudulently. The penalty is $500 or the
amount of benefits determined to be overpaid, whichever is greater.

(b) The commissioner must penalize an employer if that employer or any employee,
officer, or agent of that employer:

(1) made a false statement or representation knowing it to be false;

(2) made a false statement or representation without a good-faith belief as to the
correctness of the statement or representation; or

(3) knowingly failed to disclose a material fact.

(c) The penalty is the greater of $500 or 50 percent of the following resulting from
the employer's action:

(1) the amount of any overpaid benefits to an applicant;

(2) the amount of benefits not paid to an applicant that would otherwise have
been paid; or

(3) the amount of any payment required from the employer under this chapter that
was not paid.

(d) Penalties must be paid within 30 calendar days of issuance of the determination
of penalty and credited to the account.

(e) The determination of penalty is final unless the employer files an appeal within
30 calendar days after the sending of the determination of penalty to the employer by
United States mail or electronic transmission.

Sec. 21.

[268B.18] RECORDS; AUDITS.

(a) Each employer must keep true and accurate records on individuals performing
services for the employer, containing the information the commissioner may require
under this chapter. The records must be kept for a period of not less than four years
in addition to the current calendar year.

(b) For the purpose of administering this chapter, the commissioner has the power to
investigate, audit, examine, or cause to be supplied or copied, any books, correspondence,
papers, records, or memoranda that are the property of, or in the possession of, an
employer or any other person at any reasonable time and as often as may be necessary.

(c) An employer or other person that refuses to allow an audit of its records by the
department or that fails to make all necessary records available for audit in the state upon
request of the commissioner may be assessed an administrative penalty of $500. The
penalty collected is credited to the account.

Sec. 22.

[268B.19] SUBPOENAS; OATHS.

(a) The commissioner or benefit judge has authority to administer oaths and
affirmations, take depositions, certify to official acts, and issue subpoenas to compel the
attendance of individuals and the production of documents and other personal property
necessary in connection with the administration of this chapter.

(b) Individuals subpoenaed, other than applicants or officers and employees of an
employer that is the subject of the inquiry, must be paid witness fees the same as witness
fees in civil actions in district court. The fees need not be paid in advance.

(c) The subpoena is enforceable through the district court in Ramsey County.

Sec. 23.

[268B.20] MEDIATION AND CONCILIATION.

The department must offer mediation and conciliation services to employers and
applicants to resolve disputes concerning benefits under this chapter. The commissioner
shall notify parties of the availability of those services and may by rule extend appeal
deadlines to accommodate conciliation and mediation.

Sec. 24.

Minnesota Statutes 2014, section 290.01, subdivision 19b, is amended to read:

Subd. 19b.

Subtractions from federal taxable income.

For individuals, estates,
and trusts, there shall be subtracted from federal taxable income:

(1) net interest income on obligations of any authority, commission, or
instrumentality of the United States to the extent includable in taxable income for federal
income tax purposes but exempt from state income tax under the laws of the United States;

(2) if included in federal taxable income, the amount of any overpayment of income
tax to Minnesota or to any other state, for any previous taxable year, whether the amount
is received as a refund or as a credit to another taxable year's income tax liability;

(3) the amount paid to others, less the amount used to claim the credit allowed under
section 290.0674, not to exceed $1,625 for each qualifying child in grades kindergarten
to 6 and $2,500 for each qualifying child in grades 7 to 12, for tuition, textbooks, and
transportation of each qualifying child in attending an elementary or secondary school
situated in Minnesota, North Dakota, South Dakota, Iowa, or Wisconsin, wherein a
resident of this state may legally fulfill the state's compulsory attendance laws, which
is not operated for profit, and which adheres to the provisions of the Civil Rights Act
of 1964 and chapter 363A. For the purposes of this clause, "tuition" includes fees or
tuition as defined in section 290.0674, subdivision 1, clause (1). As used in this clause,
"textbooks" includes books and other instructional materials and equipment purchased
or leased for use in elementary and secondary schools in teaching only those subjects
legally and commonly taught in public elementary and secondary schools in this state.
Equipment expenses qualifying for deduction includes expenses as defined and limited in
section 290.0674, subdivision 1, clause (3). "Textbooks" does not include instructional
books and materials used in the teaching of religious tenets, doctrines, or worship, the
purpose of which is to instill such tenets, doctrines, or worship, nor does it include books
or materials for, or transportation to, extracurricular activities including sporting events,
musical or dramatic events, speech activities, driver's education, or similar programs. No
deduction is permitted for any expense the taxpayer incurred in using the taxpayer's or
the qualifying child's vehicle to provide such transportation for a qualifying child. For
purposes of the subtraction provided by this clause, "qualifying child" has the meaning
given in section 32(c)(3) of the Internal Revenue Code;

(4) income as provided under section 290.0802;

(5) to the extent included in federal adjusted gross income, income realized on
disposition of property exempt from tax under section 290.491;

(6) to the extent not deducted or not deductible pursuant to section 408(d)(8)(E)
of the Internal Revenue Code in determining federal taxable income by an individual
who does not itemize deductions for federal income tax purposes for the taxable year, an
amount equal to 50 percent of the excess of charitable contributions over $500 allowable
as a deduction for the taxable year under section 170(a) of the Internal Revenue Code,
under the provisions of Public Law 109-1 and Public Law 111-126;

(7) for individuals who are allowed a federal foreign tax credit for taxes that do not
qualify for a credit under section 290.06, subdivision 22, an amount equal to the carryover
of subnational foreign taxes for the taxable year, but not to exceed the total subnational
foreign taxes reported in claiming the foreign tax credit. For purposes of this clause,
"federal foreign tax credit" means the credit allowed under section 27 of the Internal
Revenue Code, and "carryover of subnational foreign taxes" equals the carryover allowed
under section 904(c) of the Internal Revenue Code minus national level foreign taxes to
the extent they exceed the federal foreign tax credit;

(8) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (7), or 19c, clause (12), in the case of a
shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
delayed depreciation. For purposes of this clause, "delayed depreciation" means the amount
of the addition made by the taxpayer under subdivision 19a, clause (7), or subdivision 19c,
clause (12), in the case of a shareholder of an S corporation, minus the positive value of
any net operating loss under section 172 of the Internal Revenue Code generated for the
tax year of the addition. The resulting delayed depreciation cannot be less than zero;

(9) job opportunity building zone income as provided under section 469.316;

(10) to the extent included in federal taxable income, the amount of compensation
paid to members of the Minnesota National Guard or other reserve components of the
United States military for active service, including compensation for services performed
under the Active Guard Reserve (AGR) program. For purposes of this clause, "active
service" means (i) state active service as defined in section 190.05, subdivision 5a, clause
(1); or (ii) federally funded state active service as defined in section 190.05, subdivision
5b, and "active service" includes service performed in accordance with section 190.08,
subdivision 3;

(11) to the extent included in federal taxable income, the amount of compensation
paid to Minnesota residents who are members of the armed forces of the United States
or United Nations for active duty performed under United States Code, title 10; or the
authority of the United Nations;

(12) an amount, not to exceed $10,000, equal to qualified expenses related to a
qualified donor's donation, while living, of one or more of the qualified donor's organs
to another person for human organ transplantation. For purposes of this clause, "organ"
means all or part of an individual's liver, pancreas, kidney, intestine, lung, or bone marrow;
"human organ transplantation" means the medical procedure by which transfer of a human
organ is made from the body of one person to the body of another person; "qualified
expenses" means unreimbursed expenses for both the individual and the qualified donor
for (i) travel, (ii) lodging, and (iii) lost wages net of sick pay, except that such expenses
may be subtracted under this clause only once; and "qualified donor" means the individual
or the individual's dependent, as defined in section 152 of the Internal Revenue Code. An
individual may claim the subtraction in this clause for each instance of organ donation for
transplantation during the taxable year in which the qualified expenses occur;

(13) in each of the five tax years immediately following the tax year in which an
addition is required under subdivision 19a, clause (8), or 19c, clause (13), in the case of a
shareholder of a corporation that is an S corporation, an amount equal to one-fifth of the
addition made by the taxpayer under subdivision 19a, clause (8), or 19c, clause (13), in the
case of a shareholder of a corporation that is an S corporation, minus the positive value of
any net operating loss under section 172 of the Internal Revenue Code generated for the
tax year of the addition. If the net operating loss exceeds the addition for the tax year, a
subtraction is not allowed under this clause;

(14) to the extent included in the federal taxable income of a nonresident of
Minnesota, compensation paid to a service member as defined in United States Code, title
10, section 101(a)(5), for military service as defined in the Servicemembers Civil Relief
Act, Public Law 108-189, section 101(2);

(15) to the extent included in federal taxable income, the amount of national service
educational awards received from the National Service Trust under United States Code,
title 42, sections 12601 to 12604, for service in an approved Americorps National Service
program;

(16) to the extent included in federal taxable income, discharge of indebtedness
income resulting from reacquisition of business indebtedness included in federal taxable
income under section 108(i) of the Internal Revenue Code. This subtraction applies only
to the extent that the income was included in net income in a prior year as a result of the
addition under subdivision 19a, clause (13);

(17) the amount of the net operating loss allowed under section 290.095, subdivision
11, paragraph (c);

(18) the amount of expenses not allowed for federal income tax purposes due
to claiming the railroad track maintenance credit under section 45G(a) of the Internal
Revenue Code;

(19) the amount of the limitation on itemized deductions under section 68(b) of the
Internal Revenue Code;

(20) the amount of the phaseout of personal exemptions under section 151(d) of
the Internal Revenue Code; and

(21) to the extent included in federal taxable income, the amount of qualified
transportation fringe benefits described in section 132(f)(1)(A) and (B) of the Internal
Revenue Code. The subtraction is limited to the lesser of the amount of qualified
transportation fringe benefits received in excess of the limitations under section
132(f)(2)(A) of the Internal Revenue Code for the year or the difference between the
maximum qualified parking benefits excludable under section 132(f)(2)(B) of the Internal
Revenue Code minus the amount of transit benefits excludable under section 132(f)(2)(A)
of the Internal Revenue Code; and

(22) the amount received in benefits under chapter 268B.

Sec. 25. EFFECTIVE DATE INTENTION.

The intention of the legislature is that benefits under Minnesota Statutes, chapter
268B, shall not be applied for nor paid until January 1, 2020, and thereafter. The sections
of this article are effective August 1, 2016, unless specifically provided otherwise in
this article.

SF 2558

Bill Text Versions

Current Version - 4th Engrossment

ARTICLE 1

FAMILY AND MEDICAL BENEFITS

Section 1.

Subd. 7.

Family and medical insurance data.

Sec. 2.

Subdivision 1.

Use of data.

Sec. 3.

[268B.01] DEFINITIONS.

Subdivision 1.

Scope.

Subd. 2.

Account.

Subd. 3.

Applicant.

Subd. 4.

Benefit.

Subd. 5.

Commissioner.

Subd. 6.

Department.

Subd. 7.

Employee.

Subd. 8.

Employer.

Subd. 9.

Health care provider.

Subd. 10.

Pregnancy.

Subd. 11.

Family care.

Subd. 12.

Bonding.

Subd. 13.

Covered employment.

Subd. 14.

Noncovered employment.

Subd. 15.

Qualified health care provider.

Subd. 16.

Serious health condition.

Subd. 17.

Wage credits.

Subd. 18.

High quarter.

Subd. 19.

Maximum weekly benefit amount.

Subd. 20.

ICD code.

Subd. 21.

Medical benefit program.

Subd. 22.

Family benefit program.

Subd. 23.

State's average weekly wage.

Subd. 24.

Family member.

Sec. 4.

[268B.02] FAMILY AND MEDICAL BENEFIT INSURANCE PROGRAM CREATION.

Subdivision 1.

Creation.

Subd. 2.

Creation of division.

Subd. 3.

Rulemaking.

Subd. 4.

Account creation; appropriation.

Sec. 5.

[268B.03] ELIGIBILITY.

Subdivision 1.

Applicant.

Subd. 2.

Wage credits.

Subd. 3.

Seven-day qualifying event.

Subd. 4.

[268B.02] FAMILY AND MEDICAL BENEFIT INSURANCE PROGRAM
CREATION.

[268B.10] SUBSTITUTION OF OTHER PLAN; EMPLOYER
EXCLUSION.