Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 1987, Regular Session
Key: (1) language to be deleted (2) new language
Laws of Minnesota 1987
CHAPTER 386-S.F.No. 1
An act relating to economic development; rural
development; renaming and providing powers to the
agricultural resource loan guaranty board;
establishing a mineral resources program; establishing
duties for the community development division in the
department of energy and economic development;
transferring the independent wastewater treatment
grant program from the pollution control agency to the
Minnesota public finance authority; changing the
membership of the Minnesota job skills partnership
board; establishing the rural development board;
establishing the challenge grant program; establishing
the Greater Minnesota Corporation; establishing the
state supplemental education grant program;
establishing the Minnesota public finance authority;
providing a program for revitalization of the cities
of St. Paul and Minneapolis; creating a program for
funding economic development projects in the taconite
tax relief area; permitting investment of earnings of
the northeast Minnesota economic protection trust in
venture capital enterprises; appropriating money;
amending Minnesota Statutes 1986, sections 15.039, by
adding a subdivision; 16A.80, subdivision 2a; 41A.01;
41A.02, subdivisions 3, 4, 6, 11, and by adding
subdivisions; 41A.04, subdivision 1; 41A.05,
subdivisions 1 and 2; 41A.08; 116.16, subdivisions 2,
4, 5, 9, and by adding subdivisions; 116.18,
subdivisions 2a and 3a; 116J.36, subdivisions 2, 3b,
3c, 8, 8a, and 11; 116J.37, subdivision 1, and by
adding a subdivision; 116J.955, subdivisions 1 and 2;
116L.02; 116L.03, subdivisions 1, 2, 5, and 7; 281.17;
298.292; 298.296, subdivision 2; 429.061, subdivision
2; 462.445, subdivision 1; and Laws 1983, chapter 334,
section 7; proposing coding for new law in Minnesota
Statutes, chapters 41A; 93; 116; 116J; 116L; and 136A;
proposing coding for new law as Minnesota Statutes,
chapters 116N; 116P; and 446A; repealing Minnesota
Statutes 1986, sections 116.167; 116J.951; 116J.961;
116J.965; 116L.03, subdivision 6; 116M.01; 116M.02;
116M.03; 116M.04; 116M.05; 116M.06; 116M.07; 116M.08;
116M.09; 116M.10; 116M.11; 116M.12; 116M.13; 472.11,
subdivisions 3, 5, 6, 7, 8, and 9; 472.12,
subdivisions 2, 3, and 4; 472.125; 472.13,
subdivisions 2, 3, and 4; and Laws 1969, chapters 833
and 984.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
RURAL DEVELOPMENT BOARD
Section 1. Minnesota Statutes 1986, section 116J.955,
subdivision 1, is amended to read:
116J.955 [RURAL REHABILITATION REVOLVING FUND.]
Subdivision 1. [ESTABLISHMENT.] The rural rehabilitation
revolving fund is established as an account in the state
treasury. The money transferred to the state as a result of
liquidating the rural rehabilitation corporation trust, and
money derived from transfer of the trust to the state, must be
credited to the rural rehabilitation revolving fund. The
principal amount of the rural rehabilitation revolving fund,
$9,300,000, may not be spent and must be invested by the state
investment board. The income attributable to investment of the
principal is appropriated to the commissioner for the activities
purposes of the rural development council this article.
Sec. 2. Minnesota Statutes 1986, section 116J.955,
subdivision 2, is amended to read:
Subd. 2. [EXPENDITURE OF INVESTMENT INCOME FUND.] The
commissioner may only use the income from the investment of the
rural rehabilitation revolving fund for the purposes that are
allowed under the Minnesota rural rehabilitation corporation's
charter and agreement with the United States Secretary of
Agriculture as provided in Public Law Number 499, 81st Congress,
enacted May 3, 1950 and as allowed under section 116J.961,
subdivision 8 this article. Not more than three percent of the
book value of the Minnesota rural rehabilitation corporation's
assets may be used for administrative purposes in a year without
approval of the United States Secretary of Agriculture. The
commissioner may create separate accounts within the fund for
use in accordance with the fund's purposes.
Sec. 3. [116N.01] [DEFINITIONS.]
Subdivision 1. [TERMS.] For the purposes of sections 3 to
10, the following terms have the meaning given them.
Subd. 2. [BOARD.] "Board" means the rural development
board.
Subd. 3. [COMMISSIONER.] "Commissioner" means the
commissioner of energy and economic development.
Subd. 4. [LOCAL GOVERNMENTAL UNIT.] "Local governmental
unit" means a home rule charter or statutory city when the
project is located in an incorporated area, a county when the
project is located in an unincorporated area, or an American
Indian tribal council when the project is located within a
federally recognized American Indian reservation or community.
Subd. 5. [LOW INCOME.] "Low income" means equal to or
below the nonmetropolitan median household income.
Subd. 6. [PRINCIPALLY.] "Principally" means more than half.
Subd. 7. [REGIONAL ORGANIZATION.] "Regional organization"
or "organization" means an organization selected under section
10, subdivision 3.
Subd. 8. [RURAL.] "Rural" means the area of Minnesota
located outside of the metropolitan area as defined in section
473.121, subdivision 2.
Sec. 4. [116N.02] [RURAL DEVELOPMENT BOARD.]
Subdivision 1. [MEMBERSHIP.] The rural development board
consists of the commissioner of energy and economic development,
the commissioner of jobs and training, the commissioner of
agriculture, the president of the Greater Minnesota Corporation
board, the state director of vocational technical education, the
chancellor of the state university board, the chancellor of the
state board for community colleges, the president of the
University of Minnesota or the president's designee, the chair
of the regional advisory committee, and six members from the
general public appointed by the governor, with at least one
public member from each of the regions established in section
10. Two of the public members must be local elected officials.
Two of the public members must be members of farm
organizations. One public member must represent the interests
of business, and one public member must represent the interests
of organized labor.
Subd. 2. [MEMBERSHIP TERMS.] The membership terms,
compensation, removal, and filling of vacancies of public
members of the board are as provided in section 15.0575.
Subd. 3. [CHAIR; OTHER OFFICERS.] The commissioner of
energy and economic development shall serve as chair of the
board. The board may elect other officers as necessary from its
members.
Subd. 4. [ADVISORY TASK FORCES.] The board may establish
advisory task forces under section 15.014 to advise or assist
the board in identifying and working with rural development
issues.
Subd. 5. [STAFF.] The commissioner of energy and economic
development shall provide staff, consultant support, materials,
and administrative services necessary for the board's
activities. The services must include personnel, budget,
payroll, and contract administration. The board may request
staff support from other agencies of state government as needed
for the execution of the responsibilities of the board, and the
other agencies shall furnish the staff support upon request.
Subd. 6. [FUND ALLOCATION.] The commissioner shall
allocate $6,000,000 from the rural rehabilitation revolving fund
to be used for the challenge grant program.
Sec. 5. [116N.03] [POWERS.]
Subdivision 1. [CONTRACTS.] The board may enter into
contracts and grant agreements necessary to carry out its
responsibilities.
Subd. 2. [GIFTS; GRANTS.] The board may apply for, accept,
and disburse gifts, grants, loans, or other property from the
United States, the state, private foundations, or any other
source. It may enter into an agreement required for the gifts,
grants, or loans and may hold, use, and dispose of its assets in
accordance with the terms of the gift, grant, loan, or
agreement. Money received by the board under this subdivision
must be deposited in the state treasury. The amount deposited
is appropriated to the board to carry out its duties.
Sec. 6. [116N.04] [DUTIES.]
Subdivision 1. [GENERAL DUTIES.] The board shall
investigate and evaluate new methods to enhance rural
development, particularly methods relating to economic
diversification through private enterprises, including
technologically innovative industries, value-added
manufacturing, agriprocessing, information industries, and
agricultural marketing.
Subd. 2. [ESTABLISH PROGRAM.] The board shall establish a
rural rehabilitation pilot project program to award up to
$500,000 from the rural rehabilitation revolving fund in grants
to public, nonprofit, or private organizations to support
farm-related pilot projects for rural development. Projects
must be designed to principally benefit low-income persons.
Subd. 3. [TECHNICAL ASSISTANCE.] The board shall provide
technical assistance and rural development information services
to state agencies, regional agencies, special districts, local
governments, and the public.
Subd. 4. [BUDGET.] The board shall adopt an annual budget
and work program and a biennial budget.
Subd. 5. [LEGISLATIVE REPORT.] The board shall submit a
report to the legislature by January 31 of each year. The
report must include a review of rural development in the state,
a review of the regional advisory committee activities, an
accounting of loans made under the challenge grant program, an
evaluation of rural development initiatives, and recommendations
concerning state support for rural development.
Sec. 7. [116N.05] [REGIONAL ADVISORY COMMITTEE.]
Subdivision 1. [MEMBERS.] The regional advisory committee
consists of one representative from each of the state's
development regions. Members representing the state's
development regions must be selected by a majority vote of the
regional development commissions. In regions that have
dissolved their development commissions, members must be
selected by a majority vote of the chairs of the respective
county boards of commissioners in the region. Members must
reside within the region they represent. The county boards of
commissioners and the regional development commissions selecting
members are encouraged to give preference to persons that hold
an elected office. The county boards of commissioners and the
regional development commissions shall give public notice of
vacancies on the committee and make a selection of a member from
applications received for the positions.
Subd. 2. [TERMS; COMPENSATION; OFFICERS.] The terms,
compensation, and expiration of the committee and its members
are as provided in section 15.059. A member may not serve more
than two consecutive terms. The regional advisory committee
shall elect a chair and may elect a vice-chair and other
officers as is necessary from its members.
Subd. 3. [DUTIES.] (a) The regional advisory committee
shall:
(1) administer the rural rehabilitation pilot project
program established in section 6, including the establishment of
grant eligibility criteria, solicitation and review of grant
applications, and determination of projects to be funded;
(2) develop priorities for state projects and activities
related to rural development;
(3) advise the rural development board regarding the
challenge grant program; and
(4) coordinate the plans and programs of the regional
development commissions that have an effect upon the activities
of the rural development board.
(b) The commissioner shall make agreements or contracts to
distribute grant funds to projects selected by the regional
advisory committee.
Sec. 8. [116N.06] [RURAL INVESTMENT GUIDE.]
The board, after appropriate study and public hearings as
necessary, shall adopt a comprehensive state rural investment
guide consisting of policy statements, objectives, standards,
and program criteria to guide state agencies in establishing and
implementing programs relating to rural development. The guide
must recognize the community and economic needs, the food and
agricultural policy, and the resources of rural Minnesota, and
provide a plan to coordinate and allocate public and private
resources to the rural areas of the state. The board shall
submit the guide to the appropriate committees of the
legislature.
Sec. 9. [116N.07] [BOARD REVIEW.]
The board may require state agencies to submit for review
any state program relating to rural development. The board may
comment on the program and may recommend changes consistent with
the rural investment guide.
Sec. 10. [116N.08] [CHALLENGE GRANT PROGRAM.]
Subdivision 1. [ORGANIZATION.] The board shall make
challenge grants to regional organizations to encourage private
investment, to provide jobs for low-income persons, and to
promote economic development in the rural areas of the state.
Subd. 2. [FUNDING REGIONS.] The board shall divide the
state outside of the metropolitan area as defined in section
473.121, subdivision 2, into six regions. A region's boundaries
must be coterminous with the boundaries of one or more of the
development regions established under section 462.385. The
board shall designate up to $1,000,000 for each region, to be
awarded over a period of three years. The money designated to
each region must be used for revolving loans authorized in this
section.
Subd. 3. [SELECTION OF ORGANIZATIONS TO RECEIVE CHALLENGE
GRANTS.] The board shall select at least one organization for
each region to receive the challenge grants and shall enter into
grant agreements with the organizations. An organization must
be a nonprofit corporation and must demonstrate that:
(1) its board of directors includes citizens experienced in
rural development, representatives of the regional development
commissions, and representatives from all geographic areas in
the region;
(2) it has the technical skills to analyze projects;
(3) it is familiar with other available public and private
funding sources and economic development programs;
(4) it can initiate and implement economic development
projects; and
(5) it can establish and administer a revolving loan fund.
Subd. 4. [REVOLVING LOAN FUND.] A regional organization
shall establish a board certified revolving loan fund to provide
loans to new and expanding businesses in rural Minnesota to
promote economic development. Eligible business enterprises
include technologically innovative industries, value-added
manufacturing, agriprocessing, information industries, and
agricultural marketing. Loan applications given preliminary
approval by the organization must be forwarded to the
commissioner for final approval. The amount of state money
allocated for each loan is appropriated from the rural
rehabilitation revolving fund established in section 116J.955 to
the organization's regional revolving loan fund when the
commissioner gives final approval for each loan. The amount of
money appropriated from the rural rehabilitation revolving fund
may not exceed 50 percent for each loan. The amount of
nonpublic money must equal at least 50 percent for each loan.
Subd. 5. [LOAN CRITERIA.] The following criteria apply to
loans made under the challenge grant program:
(a) Loans must be made to businesses that are not likely
to undertake a project for which loans are sought without
assistance from the challenge grant program.
(b) A loan must be used for a project designed principally
to benefit low-income persons through the creation of job
opportunities for them. Among loan applicants, priority must be
given on the basis of the number of permanent jobs created or
retained by the project and the proportion of nonstate money
leveraged by the revolving loan.
(c) The minimum loan is $5,000 and the maximum is $100,000.
(d) With the approval of the commissioner, a loan may be
used to provide up to 50 percent of the private investment
required to qualify for a grant from the economic recovery fund.
(e) A loan may not exceed 50 percent of the total cost of
an individual project.
(f) A loan may not be used for a retail development project.
(g) A business applying for a loan must be sponsored by a
resolution of the governing body of the local governmental unit
within whose jurisdiction the project is located.
Subd. 6. [REVOLVING FUND ADMINISTRATION.] (a) The board
shall establish a minimum interest rate for loans to ensure that
necessary management costs are covered.
(b) Loan repayment amounts equal to one-half of the
principal and interest must be deposited in the rural
rehabilitation revolving fund for challenge grants to the region
from which the money was originally designated. The remaining
amount of the loan repayment may be deposited in the regional
revolving loan fund for further distribution by the regional
organization, consistent with the loan criteria specified in
subdivisions 4 and 5.
(c) The first $1,000,000 of revolving loans for each region
must be matched by nonstate sources. The matching requirement
does not apply to loans made under subdivision 6, clause (b).
(d) The first $1,000,000 of revolving loans for each region
must be matched by nonstate sources. The matching requirement
does not apply to loans made under subdivision 6, clause (b).
(e) Administrative expenses of each organization may be
paid out of the interest earned on loans.
Subd. 7. [RULES.] The board shall adopt rules to implement
the duties specified in this section.
Subd. 8. [LOCAL GOVERNMENTAL UNIT LOANS.] A local
governmental unit may receive a loan under this section if the
local governmental unit has established a local revolving loan
fund and can provide at least an equal match to the loan
received from a regional organization. The maximum loan
available to a local governmental unit under this section is
$50,000. The money loaned to a local governmental unit by a
regional organization must be matched by the local revolving
loan fund and used to provide loans to businesses to promote
local economic development. One-half of the money loaned to a
local governmental unit under this section by a regional
organization must be repaid to the rural rehabilitation
revolving fund. One-half of the money may be retained by the
local governmental unit's revolving loan fund for further
distribution by the local governmental unit.
Subd. 9. [REGIONAL COOPERATION.] An organization that
receives a challenge grant shall cooperate with other regional
organizations, including regional development commissions,
community development corporations, community action agencies,
and the Minnesota small business development centers and
satellites, in carrying out challenge grant program and
technical assistance responsibilities.
Subd. 10. [REPORTING REQUIREMENTS.] An organization that
receives a challenge grant shall:
(1) submit an annual report to the board by February 15 of
each year that includes a description of projects supported by
the challenge grant program, an account of loans made during the
calendar year, the source and amount of money collected and
distributed by the challenge grant program, the program's assets
and liabilities, and an explanation of administrative expenses;
and
(2) provide for an independent annual audit to be performed
in accordance with generally accepted accounting practices and
auditing standards and submit a copy of each annual audit report
to the board.
Sec. 11. [RURAL DEVELOPMENT BOARD COMPLEMENT.]
The approved complement of the rural development board is
six and one-half positions, with six positions in the
unclassified service and one-half position in the classified
service, one of which is an executive director position.
Sec. 12. [FAMILY FARM LOANS.]
The participant's interest in a family farm loan guarantee
executed before the effective date of this article may be
assigned to a new participant.
Sec. 13. [REPEALER.]
Minnesota Statutes 1986, sections 116J.951; 116J.961;
116J.965; and 116M.05, are repealed.
Sec. 14. [APPROPRIATION.]
$600,000 is appropriated from the economic development fund
to the commissioner of energy and economic development to
administer programs under the rural development board. $300,000
is for fiscal year 1988 and $300,000 is for fiscal year 1989.
$200,000 is transferred from the economic development fund
to the commissioner of energy and economic development to
provide grants to the regional organizations selected under
section 10, subdivision 3, for technical assistance to
businesses in each region. Technical assistance includes
providing information to businesses regarding federal, state,
and local government economic development programs.
$1,000,000 is transferred from the general fund to the
rural rehabilitation revolving fund, to be used for the
challenge grant program.
ARTICLE 2
GREATER MINNESOTA CORPORATION
Section 1. [116O.01] [CITATION.]
Sections 1 to 10 may be cited as the "Greater Minnesota
Corporation act."
Sec. 2. [116O.02] [DEFINITIONS.]
Subdivision 1. [APPLICABILITY.] The definitions in this
section apply to sections 1 to 15.
Subd. 2. [BOARD.] "Board" means the board of directors of
the Greater Minnesota Corporation.
Subd. 3. [CORPORATION.] "Corporation" means the Greater
Minnesota Corporation.
Subd. 4. [FUND.] "Fund" means the greater Minnesota fund.
Subd. 5. [GREATER MINNESOTA.] ]"Greater Minnesota" means
the area of Minnesota located outside of the metropolitan area
as defined in section 473.121, subdivision 2.
Sec. 3. [116O.03] [CORPORATION; BOARD OF DIRECTORS;
POWERS.]
Subdivision 1. [NAME.] The Greater Minnesota Corporation
is a public corporation of the state and is not subject to the
laws governing a state agency except as provided in this
chapter. The business of the corporation must be conducted
under the name "Greater Minnesota Corporation."
Subd. 2. [BOARD OF DIRECTORS.] The corporation is governed
by a board of 11 directors. The term of a director is six years.
Vacancies on the board are filled by appointment of the board,
subject to the advice and consent of the senate. The board may
determine the compensation of its members.
Subd. 3. [BYLAWS.] The board of directors shall adopt
bylaws necessary for the conduct of the business of the
corporation, consistent with this chapter.
Subd. 4. [PLACES OF BUSINESS.] The board shall locate and
maintain the corporation's places of business within the state.
Subd. 5. [MEETINGS AND ACTIONS OF THE BOARD.] The board
shall meet at least twice a year and may hold additional
meetings upon giving notice in accordance with the bylaws of the
corporation. Board meetings are subject to section 471.705,
except when data described in subdivision 7 is discussed.
Subd. 6. [CLOSED MEETINGS; RECORDING.] The board of
directors may by a majority vote in a public meeting decide to
hold a closed meeting authorized under subdivision 5. The time
and place of the closed meeting must be announced at the public
meeting. A written roll of members present at the closed
meeting must be made available to the public after the closed
meeting. The proceedings of a closed meeting must be tape
recorded at the expense of the board and must be preserved by
the board for two years. The data on the tape is nonpublic data
under section 13.02, subdivision 9.
Subd. 7. [APPLICATION AND INVESTIGATIVE DATA.] The
following data is classified as private data with regard to data
on individuals under section 13.02, subdivision 12, or as
nonpublic data with regard to data not on individuals under
section 13.02, subdivision 9, whichever is applicable:
(1) financial data, statistics, and information furnished
in connection with assistance or proposed assistance under
section 6, including credit reports, financial statements,
statements of net worth, income tax returns, either personal or
corporate, and any other business and personal financial
records; or
(2) security information, trade secret information, or
labor relations information, as defined in section 13.37,
subdivision 1, disclosed to members of the corporation board or
employees of the corporation under section 6.
Subd. 8. [CONFLICT OF INTEREST.] A director, employee, or
officer of the corporation may not participate in or vote on a
decision of the board relating to an organization in which the
director has either a direct or indirect financial interest.
Subd. 9. [CONTRIBUTIONS TO PUBLIC OFFICIALS; DISCLOSURE.]
Each director shall file a statement with the ethical practices
board disclosing the nature, amount, date, and recipient of any
contribution made to a public official, political committee,
political fund, or political party, as defined in chapter 10A,
that:
(1) was made within the four years preceding appointment to
the Greater Minnesota board; and
(2) was subject to the reporting requirements of chapter
10A.
The statement must be updated annually during the
director's term to reflect contributions made to public
officials during the appointed director's tenure.
Sec. 4. [116O.04] [CORPORATE PERSONNEL.]
Subdivision 1. [GENERALLY.] The board shall appoint and
set the compensation for a president, who serves as chief
executive officer of the corporation, and who may appoint
subordinate officers. The board may designate the president as
its general agent. Subject to the control of the board, the
president shall employ employees, consultants, and agents the
president considers necessary. The staff of the corporation
must include individuals knowledgeable in commercial and
industrial financing, research and development, economic
development, and general fiscal affairs. The board shall define
the duties and designate the titles of the employees and agents.
Subd. 2. [STATUS OF EMPLOYEES.] Employees, officers, and
directors of the corporation are not state employees, but, at
the option of the board, may participate in the state retirement
plan and the state deferred compensation plan for employees in
the unclassified service and an insurance plan administered by
the commissioner of employee relations.
Subd. 3. [CONTRIBUTIONS TO PUBLIC OFFICIALS; DISCLOSURE.]
The president shall file a statement with the ethical practices
board disclosing the nature, amount, date, and recipient of any
contribution made to a public official which:
(1) was made within the four years preceding employment
with the greater Minnesota board; and
(2) was subject to the reporting requirements of chapter
10A.
The statement must be updated annually during the
president's employment to reflect contributions made to public
officials during the president's tenure.
Sec. 5. [116O.05] [POWERS OF THE CORPORATION.]
(a) Except as otherwise provided in this article, the
corporation has the powers granted to a business corporation by
section 302A.161, subdivisions 3; 4; 5; 7; 8; 9; 11; 12; 13,
except that the corporation may not act as a general partner in
any partnership; 14; 15; 16; 17; 18; and 22.
(b) The state is not liable for the obligations of the
corporation.
(c) Section 302A.041 applies to this article and the
corporation in the same manner that it applies to business
corporations established under chapter 302A.
Sec. 6. [116O.06] [FINANCIAL ASSISTANCE.]
Subdivision 1. [FINANCIAL ASSISTANCE; TYPES.] The
corporation may provide financial assistance to sole
proprietorships, businesses, or for-profit or nonprofit
organizations. Financial assistance includes, but is not
limited to, loan guarantees or insurance, direct loans, and
interest subsidy payments. The corporation may participate in
loans by purchasing from a lender up to 50 percent of each loan.
Subd. 2. [EQUITY INVESTMENTS.] The corporation may acquire
an interest in a product or a private business entity, except
that the corporation may not acquire an interest in a business
entity engaged in a trade or industry whose profits are directly
regulated by the commissioner of commerce or the department of
public service. The corporation may enter into joint venture
agreements with other private corporations to promote economic
development and job creation.
Subd. 3. [GREATER MINNESOTA FINANCE AUTHORITY.] The board
may designate the greater Minnesota finance authority to provide
financial assistance. The authority, if established, consists
of seven members, five of whom are members of the general public
appointed by the board with experience in business development,
finance, banking, or venture capital. The president of the
corporation and one board member must be members of the
authority. Members of the authority shall serve without
compensation, but shall receive necessary and actual expenses
while engaged in the business of the corporation.
Subd. 4. [STANDARDS.] The board may establish minimum
interest rates, security requirements, restrictions on the
amount of the corporation's financial participation in a
project, and other financial standards the board determines
necessary to establish in providing financial assistance.
Subd. 5. [PREFERENCE.] In providing financial assistance,
the corporation must give preference to sole proprietorships,
businesses, or organizations that are starting or expanding
their operations in greater Minnesota.
Sec. 7. [116O.07] [ON-SITE RESEARCH.]
The corporation may construct, acquire, lease, own, or
operate one or more on-site research facilities in Minnesota.
Sec. 8. [116O.08] [REGIONAL RESEARCH INSTITUTES.]
Subdivision 1. [ESTABLISHMENT.] The board may establish up
to four regional research institutes in greater Minnesota. Each
institute shall be located at or near a post-secondary education
institution whose primary focus is comparable to the mission of
the institute.
Subd. 2. [PURPOSE.] The purpose of the institutes is to
provide applied research and development services to
individuals, businesses, or organizations for the purposes of
developing the region's economy through the utilization of the
region's resources and the development of technology. Research
and development services may include on-site research, product
development grants, testing of production techniques and product
quality, marketing and business management assistance, and
feasibility studies.
Subd. 3. [INSTITUTE ADMINISTRATION; STAFF.] The board
shall appoint a director to manage the operation of the
institute. The director may employ employees and enter into
contracts with post-secondary education governing boards for
research services of post-secondary institution staff,
facilities, or equipment.
Subd. 4. [RESEARCH CONTRACTS.] The director of each
institute may enter into contracts with individuals, businesses,
or organizations to provide research and development assistance
at institute facilities or at other sites the director
determines appropriate. The board shall establish the overall
contract guidelines.
Subd. 5. [PRODUCT DEVELOPMENT GRANTS.] The director of
each institute may provide product development grants to those
individuals, businesses, or for-profit or nonprofit
organizations that, without financial assistance, would not be
able to undertake the development of a product or
technology-related service. The board shall establish
eligibility criteria and the terms of the product development
grants.
Subd. 6. [INSTITUTE ADVISORY BOARD.] A regional research
institute advisory board may be appointed by the board. The
advisory board may consist of representatives of public
post-secondary institutions in the area surrounding the
institute, business owners, and members of the general public.
Terms and removal of members must be set by the board and the
members of each advisory board shall serve without compensation
but shall receive their necessary and actual expenses. The
purpose of the advisory board is to provide the institute
director assistance in operating the institute, review contract
proposals and provide recommendations relating to product
development grants.
Subd. 7. [DESIGNATED RESEARCH INSTITUTE.] The agricultural
utilization research institute established in section 9 is
designated as one of the regional research institutes authorized
under this section.
Sec. 9. [116O.09] [AGRICULTURAL UTILIZATION RESEARCH
INSTITUTE.]
Subdivision 1. [ESTABLISHMENT.] The corporation shall
establish an agricultural utilization research institute to
promote the establishment of new products and product uses and
the expansion of existing markets for the state's agricultural
commodities and products. The institute must be located near an
existing agricultural research facility in the agricultural
region of the state.
Subd. 2. [DUTIES.] In addition to the duties and powers
assigned to the institutes in section 8, the agricultural
utilization research institute shall:
(1) identify the various market segments characterized by
Minnesota's agricultural industry, address each segment's
individual needs, and identify development opportunities in each
segment;
(2) develop and implement a utilization program for each
segment that addresses its development needs and identifies
techniques to meet those needs;
(3) coordinate research among the public and private
organizations and individuals specifically addressing procedures
to transfer new technology to businesses, farmers and
individuals; and
(4) provide research grants to public and private
educational institutions and other organizations that are
undertaking basic and applied research that would promote the
development of the various agricultural industries.
Subd. 3. [STAFF.] The corporation shall provide staff to
the agricultural utilization research institute and assist in
carrying out the duties of the agricultural utilization research
institute.
Subd. 4. [AGRICULTURAL RESEARCH GRANTS.] The institute may
make matching grants for agricultural product utilization
research to the University of Minnesota, a state university, a
community college, a Minnesota private college or university, an
area vocational technical institute, a private corporation, or a
person. Grants may be matched from private sources, including
farm commodity groups and farm organizations.
Subd. 5. [ADVISORY BOARD.] A 26-member advisory board is
established to identify priorities for the agricultural
utilization research institute. Members of the advisory board
are appointed by the board. The advisory board consists of:
the chair of the Minnesota house of representatives agricultural
committee; the chair of the Minnesota senate agricultural
committee; a representative from each of the 10 largest
agricultural-related businesses in the state as determined by
the corporation; a member from each of the appropriate trade
organizations representing producers of beef cattle, dairy,
corn, soybeans, pork, wheat, turkey, barley, wild rice, edible
beans, eggs, and potatoes; a member of the Farmers's Union; and
a member of the Farm Bureau. Terms and removal of members must
be set by the board and members of the advisory board serve
without compensation but shall receive their necessary and
actual expenses.
The advisory board shall annually provide a list of
priorities and suggested research and marketing studies that
should be performed by the agricultural utilization research
institute.
Sec. 10. [116O.10] [RESEARCH ADVISORY BOARD.]
Subdivision 1. [ESTABLISHMENT.] The board shall establish
a research advisory board to provide advisory assistance to the
board and the research institutes. The research advisory board
consists of seven members appointed by the board. Terms and
removal of members must be set by the board and research
advisory board members shall serve without compensation but
shall receive their necessary and actual expenses while engaged
in the business of the corporation. The membership of the
advisory board must have representatives that are experienced or
have expertise in technology, applied research, agriculture,
business, labor, or productivity.
Subd. 2. [DUTIES.] The research advisory board has the
following duties and responsibilities:
(a) Identify specific areas where research and development
will contribute to the productivity of the state's businesses
and farms.
(b) Determine specific areas where financial assistance for
research and development could assist the development of
businesses and create new employment opportunities.
(c) Advise the board in the development and establishment
of the regional research institutes and the research grants to
public and private post-secondary education institutions.
(d) Advise public and private post-secondary education
institutions on the research and development needs of businesses
in Minnesota.
(e) Review the applications and make recommendations to the
board for research grants to public and private post-secondary
education institutions.
(f) Develop guidelines for an effective peer review process
for evaluating scientifically- or technologically-related
financial assistance.
Sec. 11. [116O.11] [RESEARCH GRANTS TO EDUCATION UNITS.]
Subdivision 1. [GRANTS GENERALLY.] The board may make
matching grants to public and private post-secondary education
institutions or units within those institutions, including the
natural resource research institute, for applied research and
development. Grants are to be made for projects which will
likely result in assisting economic and employment development
in greater Minnesota. The corporation board shall not give
final approval to a research grant until it has received an
evaluation and recommendation from the research advisory board
established in section 10.
Sec. 12. [116O.12] [GREATER MINNESOTA FUND.]
(a) The greater Minnesota fund is created in the state
treasury. The board may require the commissioner of finance to
create separate accounts within the fund for use in accordance
with the fund's purposes. Money in the fund not needed for the
immediate purposes of the corporation may be invested by the
corporation in any way authorized by section 11A.24. Money in
the fund is appropriated to the corporation to be used as
provided in this chapter.
(b) The fund consists of:
(1) money appropriated and transferred from other state
funds;
(2) fees and charges collected by the corporation;
(3) income from investments and purchases;
(4) revenue from loans, rentals, royalties, dividends, and
other proceeds collected in connection with lawful corporate
purposes; and
(5) gifts, donations, and bequests made to the corporation.
Sec. 13. [116O.13] [AGRICULTURAL PROJECT UTILIZATION
FUND.]
The agricultural project utilization fund is a fund in the
state treasury. Money in the fund is appropriated to the
agricultural utilization research institute to be used for
agricultural research grants as provided in section 9,
subdivision 4, and for the agricultural utilization research
institute.
Sec. 14. [116O.14] [AUDITS.]
The corporation board shall contract with a certified
public accounting firm to do a financial and compliance audit of
the corporation and any subsidiary annually in accordance with
generally accepted accounting standards.
The books and records of the corporation and any
subsidiary, fund, or entity to be administered or governed by
the corporation are subject to audit without previous notice by
the legislative auditor.
Sec. 15. [116O.15] [REPORTS.]
The board shall report to the appropriate committees of the
legislature and the governor on the activities of the
corporation by January 1 of each year. The report must include,
at least, a description of projects supported by the
corporation, an account of all grants made by the corporation
during the calendar year, the source and amount of all money
collected and distributed by the corporation, the corporation's
assets and liabilities, an explanation of administrative
expenses, and any amendments to the operational plan. Reports
must be made to the legislature as required by section 3.195.
Sec. 16. [REGISTERED NAME.]
Notwithstanding Minnesota Statutes, section 302A.117, the
secretary of state shall register the name "Greater Minnesota
Corporation" on behalf of the corporation.
Sec. 17. [INITIAL APPOINTMENTS.]
Notwithstanding section 3, subdivision 2, the governor
shall appoint the initial members of the board of directors of
the Greater Minnesota Corporation, subject to the advice and
consent of the senate, as follows: four to six-year terms, four
to four-year terms, and three to two-year terms. As the terms
of the initial appointments expire, appointments must be made by
the board, subject to the advice and consent of the senate.
Sec. 18. [NATURAL RESOURSES RESEARCH INSTITUTE.]
The Greater Minnesota Corporation board and the University
of Minnesota board of regents may examine the feasibility of
entering into a formal agreement for joint administration or
transfer of the natural resources research institute from the
University to the corporation. The corporation and board of
regents shall report to the governor and legislative by January
15, 1988. The report must include recommendations for the
structure for administrating the institution, the potential use
of university staff and facilities, funding sources and whether
the institute should be transferred to the Greater Minnesota
Corporation. The corporation may not establish a regional
institute whose research focus is comparable to the present
research undertaken at the natural resources research institute.
Sec. 19. [VENTURE CAPITAL STUDY.]
The Greater Minnesota Corporation shall study the effect
and the possible administrative and legal structure of the
establishment of a for-profit venture capital corporation. This
venture capital corporation may be capitalized by a state
appropriation that in turn may be converted into shares of stock
owned by every resident of the state. This corporation would
invest only in Minnesota companies or production facilities
located in the state with a preference to ventures that utilize
the state's resources and intermediate products and services.
The venture capital corporation would invest in local capital
venture pools that are managed by experienced private venture
capital firms and this corporation would only provide investment
capital for product development and start-up business
development. The venture capital corporation would target its
investment capital to products and businesses that reduce costs
to the state's residents and government jurisdictions such as
products that improve resource efficiency or products that
improve the independence of the physically disabled.
The study may be completed directly by the Greater
Minnesota Corporation or the corporation may contract with a
business, state agency, organization, or individual to complete
the study. The study must include the examination of at least
the following:
(1) the anticipated demand for venture capital that meets
the investment criteria of the venture capital corporation;
(2) an estimation of the start-up costs of the venture
capital corporation;
(3) an estimation of on-going administrative costs of the
venture capital corporation including shareholder-related costs;
(4) the most appropriate legal structure for the venture
capital corporation including recommendations for the enabling
legislation for the corporation;
(5) an estimation of the potential additional investment
through stock purchases by Minnesota residents;
(6) an inventory of experienced and interested local
venture capital firms that the corporation would utilize in
distributing its venture capital; and
(7) an analysis of the type of products that meet the
investment criteria of the venture capital corporation.
The Greater Minnesota Corporation shall submit the study to
the legislature and the governor by July 1, 1988.
Sec. 20. [DISSOLUTION.]
In the event of dissolution of the Greater Minnesota
Corporation for any reason, the state of Minnesota, upon action
by the governor, and after consultation with the legislative
advisory commission, may require the liquidation of all holdings
and investments and the return of the proceeds of that
liquidation and any wholly-owned assets of the corporation to
the state, in exchange for the assumption of all outstanding
obligations of the corporation.
If the corporation is dissolved, or certain of its
functions transferred to another entity, the assets and
liabilities and property associated with the dissolved or
transferred functions must return to the state or to the entity
designated by law.
Sec. 21. [OPERATIONAL PLAN.]
The board of directors of the Greater Minnesota Corporation
shall prepare a comprehensive operational plan and submit the
plan to the governor and the legislature by November 15, 1987.
The operational plan must at least include operating procedures,
accounting procedures, grant procedures, loan procedures,
personnel procedures, investment procedures, and board conduct
and ethics.
If the board proposes to make equity investments under
section 6, subdivision 2, the board shall explain in the report
how the investments will be made, how much money will be
invested in them, how much private money is expected to be
invested in the same investments, and why equity investments
would be more desirable and effective than the other means of
promoting development that are available to the board. No
equity investments may be made unless the board has first
submitted the information required by this section.
In addition, the operational plan must include a budget
proposal and a five-year strategic plan setting out its
objectives and general strategy for achieving the objectives.
It must identify sources and amounts of available
nongovernmental money and the purposes for which the money may
be used.
Sec. 22. [LOAN PROGRAMS TERMINATED; ADMINISTRATION; CREDIT
OF REPAYMENTS.]
The following loan programs administered by the Minnesota
energy and economic development authority are terminated: the
special assistance program under section 116M.07, subdivision
11, except for the small business development loans; the
technology product loan program; the tourism loan program
created under section 116M.07; the energy loan insurance program
under section 116M.11; the energy development fund program under
section 116M.12; and the Minnesota fund program under sections
472.11 to 472.13. Loan repayments, earnings, releases from
insurance reserve accounts, and other income from these programs
must be paid to the commissioner of energy and economic
development, who shall deposit them in the state treasury and
credit them to the greater Minnesota fund.
Sec. 23. [LOAN PROGRAM ADMINISTRATION.]
Subdivision 1. [POWERS.] To administer the loan programs
transferred to the department of energy and economic development
by section 22, the commissioner of energy and economic
development has the powers in this section.
Subd. 2. [PERSONAL PROPERTY.] The commissioner may
acquire, hold, and dispose of personal property where necessary
or appropriate to protect a loan in which the department has an
interest.
Subd. 3. [REAL PROPERTY.] The commissioner may acquire
real property, or an interest in real property, in the
department's name, by purchase or foreclosure, where the
acquisition is necessary or appropriate to protect a loan in
which the department has an interest and may sell, transfer, and
convey the property to a buyer and, in the event the sale,
transfer, or conveyance cannot be effected with reasonable
promptness or at a reasonable price, may lease the property to a
tenant.
Subd. 4. [INSURANCE.] The commissioner may procure
insurance against a loss in connection with the department's
property in the amounts, and from the insurers, as may be
necessary or desirable.
Subd. 5. [LOAN TERMS; MODIFICATION.] The commissioner may
consent, whenever it is considered necessary or desirable to
increase the probability that the loan will be repaid, to the
modification of the rate of interest, time of payment, or
installment of principal or interest, or other term, of a
contract or agreement to which the department is a party.
Subd. 6. [FINANCIAL INFORMATION.] Financial information,
including credit reports, financial statements, and net worth
calculations, received or prepared by the department regarding a
department loan, financial assistance, or insurance is private
data with regard to data on individuals as defined in section
13.02, subdivision 12 and nonpublic data with regard to data not
on individuals as defined in section 13.02, subdivision 9.
Subd. 7. [ROYALTY PAYMENTS.] The department may receive
payments in the form of royalties, dividends, or other proceeds
in connection with technology-related products, energy
conservation products, or other equipment which it has purchased
or in which it has participated.
Sec. 24. [REPEALER.]
Minnesota Statutes 1986, sections 116M.11; 116M.12; 472.11,
subdivisions 3, 5, 6, 7, 8, and 9; 472.12, subdivisions 2, 3,
and 4; 472.125; and 472.13, subdivisions 2, 3, and 4, are
repealed.
Sec. 25. [APPROPRIATION.]
$6,500,000 is appropriated from the general fund for
transfer to the greater Minnesota fund, to be available until
expended. $3,500,000 is appropriated from the rural
rehabilitation revolving fund for transfer to the agricultural
product utilization fund, to be available until expended.
Sec. 26. [EFFECTIVE DATE.]
This article is effective the day following final
enactment, except that sections 19 to 22 are effective July 1,
1987; and section 6, subdivisions 1 to 3, are effective July 1,
1988.
ARTICLE 3
MINNESOTA PUBLIC FACILITIES AUTHORITY
Section 1. Minnesota Statutes 1986, section 116.16,
subdivision 2, is amended to read:
Subd. 2. [DEFINITIONS.] In this section and sections
116.17 and 116.18:
(1) Agency means the Minnesota pollution control agency
created by this chapter;
(2) Municipality means any county, city, and town, the
metropolitan waste control commission established in chapter 473
and the metropolitan council when acting under the provisions of
that chapter or an Indian tribe or an authorized Indian tribal
organization, and any other governmental subdivision of the
state responsible by law for the prevention, control, and
abatement of water pollution in any area of the state;
(3) Pollution control fund means the Minnesota state water
pollution control fund created by subdivision 1;
(4) Bond account means the Minnesota state water pollution
control bond account created in the state bond fund by section
116.17, subdivision 4;
(5) Terms defined in section 115.01 have the meanings
therein given them;
(6) The eligible cost of any municipal project, except as
otherwise provided in clauses (7) and (8), includes (a)
preliminary planning to determine the economic, engineering, and
environmental feasibility of the project; (b) engineering,
architectural, legal, fiscal, economic, sociological, project
administrative costs of the agency and the municipality, and
other investigations and studies; (c) surveys, designs, plans,
working drawings, specifications, procedures, and other actions
necessary to the planning, design, and construction of the
project; (d) erection, building, acquisition, alteration,
remodeling, improvement, and extension of disposal systems; (e)
inspection and supervision of construction; and (f) all other
expenses of the kinds enumerated in section 475.65.
(7) For state independent grant and matching grant purposes
hereunder, the eligible cost for grant applicants shall be the
eligible cost as determined by the United States environmental
protection agency under the Federal Water Pollution Control Act,
as amended, United States Code, title 33, section 1314, et seq
sections 1281 to 1299.
(8) Notwithstanding clause (7), for state grants under the
state independent grants program, the eligible cost includes the
acquisition of land for stabilization ponds, the construction of
collector sewers for totally unsewered statutory and home rule
charter cities and towns described under section 368.01,
subdivision 1 or 1a, that are in existence on January 1, 1985,
and the provision of reserve capacity sufficient to serve the
reasonable needs of the municipality for 20 years in the case of
treatment works and 40 years in the case of sewer systems.
Notwithstanding clause (7), for state grants under the state
independent grants program, the eligible cost does not include
the provision of service to seasonal homes, or cost increases
from contingencies that exceed three percent of as-bid costs or
cost increases from unanticipated site conditions that exceed an
additional two percent of as-bid costs.
(9) Authority means the Minnesota public facilities
authority established in section 20.
Sec. 2. Minnesota Statutes 1986, section 116.16,
subdivision 4, is amended to read:
Subd. 4. [DISBURSEMENTS.] Disbursements from the fund
shall be made by the state treasurer upon order of the
commissioner of finance at the times and in the amounts
requested by the agency or the Minnesota public facilities
authority in accordance with the applicable state and federal
law governing such disbursements; except that no appropriation
or loan of state funds for any project shall be disbursed to any
municipality until and unless the agency has by resolution
determined the total estimated cost of the project, and
ascertained that financing of the project is assured by:
(1) A grant to the municipality by an agency of the federal
government within the amount of funds then appropriated to that
agency and allocated by it to projects within the state; or
(2) A grant of funds appropriated by state law; or
(3) A loan authorized by state law; or
(4) The appropriation of proceeds of bonds or other funds
of the municipality to a fund for the construction of the
project; or
(5) Any or all of the means referred to in paragraphs (1)
to (4); and
(6) An irrevocable undertaking, by resolution of the
governing body of the municipality, to use all funds so made
available exclusively for the construction of the project, and
to pay any additional amount by which the cost of the project
exceeds the estimate, by the appropriation to the construction
fund of additional municipal funds or the proceeds of additional
bonds to be issued by the municipality; and
(7) Conformity of the project and of the loan or grant
application with the state water pollution control plan as
certified to the federal government and with all other
conditions under applicable state and federal law for a grant of
state or federal funds of the nature and in the amount involved.
Sec. 3. Minnesota Statutes 1986, section 116.16,
subdivision 5, is amended to read:
Subd. 5. [RULES.] (a) The agency shall promulgate
permanent rules and may promulgate emergency rules for the
administration of grants and loans authorized to be made from
the fund or from federal funds under the Federal Water Pollution
Control Act, as amended, which rules, however, shall not be
applicable to the issuance of bonds by the commissioner of
finance as provided in section 116.17. The rules shall contain
as a minimum:
(1) procedures for application by municipalities;
(2) conditions for the administration of the grant or loan;
(3) criteria for the ranking of projects in order of
priority for grants or loans, based on factors including the
extent and nature of pollution, technological feasibility,
assurance of proper operation, maintenance and replacement, and
participation in multimunicipal systems; and
(4) such other matters as the agency and the director find
necessary to the proper administration of the grant program.
(b) Except as otherwise provided in sections 116.16 to
116.18, the rules for the administration of state independent
grants must comply, to the extent practicable, with provisions
relating directly to protection of the environment contained in
the Federal Water Pollution Control Act, as amended, and
regulations and guidelines of the United States environmental
protection agency promulgated under the act, except provisions
regarding allocation contained in section 205 of the act and
regulations and guidelines promulgated under section 205 of the
act. This provision does not require approval from federal
agencies for the issuance of grants or for the construction of
projects under the state independent grants program.
(c) For purposes of awarding independent state grants, the
agency may by rule waive the federal 20-year planning
requirement for municipalities with a population of less than
1,500.
Sec. 4. Minnesota Statutes 1986, section 116.16,
subdivision 9, is amended to read:
Subd. 9. [APPLICATIONS.] Applications by municipalities
for grants or loans from the fund shall be made to the director
of the agency authority on forms requiring information
prescribed by rules of the agency. The authority shall send the
application to the agency within ten days of receipt. The
director shall certify to the agency authority those
applications which appear to meet the criteria set forth in
sections 116.16 to 116.18 and the rules promulgated hereunder,
and the agency authority shall award the grants or loans on the
basis of the criteria and priorities established by the agency
in its rules and in sections 116.16 to 116.18. A municipality
that is designated under agency rules to receive state or
federal funding for a project and that does not make a timely
application for or that refuses the funding is not eligible for
either state or federal funding for that project in that fiscal
year or the subsequent year.
Sec. 5. Minnesota Statutes 1986, section 116.16, is
amended by adding a subdivision to read:
Subd. 11. [AWARDS OF GRANTS AND LOANS.] Upon certification
by the director of the pollution control agency, the authority
shall notify a municipality that is to receive a grant or loan
and advise the municipality of the grant agreement or loan form
or other document that must be executed to complete the grant or
loan. Upon certification from the director that the work has
been completed and that payment is proper, the authority shall
pay to the municipality the periodic grant or loan payment.
Sec. 6. Minnesota Statutes 1986, section 116.16, is
amended by adding a subdivision to read:
Subd. 12. [AMENDMENTS.] A municipality that seeks an
amendment to a previously awarded grant or loan shall follow the
procedure in subdivision 9 for applying to the authority. The
request for a grant or loan amendment must be forwarded by the
authority to the director of the pollution control agency for
consideration, and the authority shall process a grant or loan
amendment that is approved by the director.
Sec. 7. Minnesota Statutes 1986, section 116.18,
subdivision 2a, is amended to read:
Subd. 2a. [STATE MATCHING GRANTS PROGRAM BEGINNING OCTOBER
1, 1984 1987.] For projects tendered, on or after October
1, 1984 1987, a grant of federal money under section 201(g),
section 202, 203, or 206(f) of the Federal Water Pollution
Control Act, as amended, United States Code, title 33, sections
1251 to 1376, at 55 percent or more of the eligible cost for
construction of the treatment works, state money appropriated
under subdivision 1 must be expended for up to 30 50 percent of
the nonfederal share of the eligible cost of construction for
municipalities for which the construction would otherwise impose
significant financial hardship; provided, that not less than ten
percent of the eligible cost must be paid by the municipality or
agency constructing the project. If a municipality is tendered
federal and state grants in a percentage cumulatively exceeding
90 percent of the eligible cost of construction, the state
pollution control agency shall reduce the grant to the
municipality under this chapter to the extent necessary to
ensure that not less than ten percent of the eligible cost will
be paid by the municipality. The amounts of the matching grants
must be based on per connection capital cost, median household
income, and per capita adjusted assessed valuation with
populations of 25,000 or less.
Sec. 8. Minnesota Statutes 1986, section 116.18,
subdivision 3a, is amended to read:
Subd. 3a. [STATE INDEPENDENT GRANTS PROGRAM.] (a) The
agency Minnesota public facilities authority may award
independent grants for projects certified by the state pollution
control director for 50 percent or, if the agency requires
advanced treatment, 65 population of the municipality is 25,000
or less, 80 percent of the eligible cost of construction. The
agency may award independent grants for up to an additional 30
percent or, if the agency requires advanced treatment, up to an
additional 25 percent of the eligible cost of construction to
municipalities for which the construction would otherwise impose
significant financial hardship; the amounts of the additional
grants shall be based on per connection capital cost, median
household income, and per capita adjusted assessed valuation.
These grants may be awarded in separate steps for planning and
design in addition to actual construction. Until December 31,
1990, not more than 20 percent of the total amount of grants
awarded under this subdivision in any single fiscal year may be
awarded to a single grantee.
(b) Up to ten percent of the money to be awarded as grants
under this subdivision in any single fiscal year shall be set
aside for municipalities having substantial economic development
projects that cannot come to fruition without municipal
wastewater treatment improvements. The agency shall forward its
municipal needs list to the commissioner of energy and economic
development authority at the beginning of each fiscal year, and
the commissioner authority shall review the list and identify
those municipalities having substantial economic development
projects. After the first 90 percent of the total available
money is allocated to municipalities in accordance with agency
priorities, the set-aside shall be used by the agency authority
to award grants to remaining municipalities that have been
identified.
(c) Grants may also be awarded under this subdivision to
reimburse municipalities willing to proceed with projects and be
reimbursed in a subsequent year conditioned upon appropriation
of sufficient money under subdivision 1 for that year. The
maximum amount of the reimbursement the agency may commit in any
single fiscal year is equal to the amount newly appropriated to
the state grants programs for that year.
(d) A municipality that applies for a state independent
grant to be reimbursed for a project must receive an additional
five percent of the total eligible cost of construction beyond
the normal percentage to which the municipality is entitled
under paragraph (a).
Sec. 9. [STATE INDEPENDENT GRANTS PROGRAM.]
(a) The state pollution control agency may award
independent grants for projects for 50 percent or, if the
population of the municipality is 25,000 or less, 80 percent of
the eligible cost of construction. These grants may be awarded
in separate steps for planning and design in addition to actual
construction. Until December 31, 1990, not more than 20 percent
of the total amount of grants awarded under this section in a
fiscal year may be awarded to a single grantee.
(b) Up to ten percent of the money to be awarded as grants
under this section in a fiscal year must be set aside for
municipalities having substantial economic development projects
that cannot come to fruition without municipal wastewater
treatment improvements. The agency shall forward its municipal
needs list to the authority at the beginning of each fiscal
year, and the authority shall review the list and identify those
municipalities having substantial economic development projects.
After the first 90 percent of the total available money is
allocated to municipalities in accordance with agency
priorities, the set-aside must be used by the authority to award
grants to remaining municipalities that have been identified.
(c) Grants may also be awarded under this section to
reimburse municipalities willing to proceed with projects and be
reimbursed in a subsequent year conditioned upon appropriation
of sufficient money under Minnesota Statutes, section 116.18,
subdivision 1, for that year.
(d) A municipality that applies for a state independent
grant to be reimbursed for a project must receive an additional
five percent of the total eligible cost of construction beyond
the normal percentage to which the municipality is entitled
under paragraph (a).
Sec. 10. Minnesota Statutes 1986, section 116J.36,
subdivision 2, is amended to read:
Subd. 2. [DEFINITIONS.] In this section:
(a) "Authority" means the Minnesota public facilities
authority.
(b) "Construction costs" means all costs associated with
the construction, modification or expansion of a district
heating system except for preliminary planning costs and
detailed design costs. Construction costs include the cost of
debt service from the time a construction loan is made until
five years after the beginning of the operation of the district
heating system constructed or the part of the system being
modified or expanded.
(b) (c) "District heating" means the use of a central
energy conversion facility to produce hot water or steam for a
district heating system. District heating facilities may also
produce electricity in addition to hot water or steam.
(c) (d) "Municipality" means any county, home rule charter
or statutory city, town, school district or a municipal power
agency formed pursuant to sections 453.53 to 453.62.
Municipality also means a public utility, as defined in section
452.01, subdivision 3, owned and operated by a city, however
organized. For purposes of a district heating system only,
municipality also means a nonprofit corporation organized
pursuant to the provisions of chapter 317 whose membership is
limited to the mayor and governing body of the city in which the
district heating system is located.
(d) (e) "District heating system" means any existing or
proposed facility for (1) the production, through cogeneration
or otherwise, of hot water or steam to be used for district
heating, or (2) the transmission and distribution of hot water
or steam for district heating either directly to heating
consumers or to another facility or facilities for transmission
and distribution, or (3) any part or combination of the
foregoing facilities.
(e) (f) "Qualified energy improvement" means a
cost-effective capital improvement to public land, buildings, or
energy using systems, other than a district heating system,
including the purchase or installation of equipment to reduce
the usage of conventional energy sources or to use alternative
energy resources. Qualified energy improvements also include
waste-to-energy facilities that meet the criteria specified in
subdivision 8a and any rule adopted under that subdivision.
Qualified energy improvements shall meet all environmental and
permitting standards established by state and federal law.
Sec. 11. Minnesota Statutes 1986, section 116J.36,
subdivision 3b, is amended to read:
Subd. 3b. [GRANT ELIGIBILITY, DISTRICT HEATING.] The
commissioner of energy and economic development authority may
provide district heating system planning grants to
municipalities for planning related to the development of
district heating systems certified by the director of public
service as eligible to receive planning grants. The
municipality must demonstrate that a community heatload survey
and map have been successfully completed, that potential
district heating load is sufficiently large to justify further
consideration, and that sufficient resources are available for
the municipality to meet its financial requirements. Eligible
planning grant costs include project definition, development of
preliminary financing and distribution system plans, and
obtaining commitment for detailed planning or design and
preparation of a final report. The amount of the grant to a
municipality is limited to 90 percent of eligible planning costs
and shall not exceed $70,000 as established by rule or emergency
rule.
Sec. 12. Minnesota Statutes 1986, section 116J.36,
subdivision 3c, is amended to read:
Subd. 3c. [GRANT ELIGIBILITY, QUALIFIED ENERGY
IMPROVEMENTS.] The commissioner of energy and economic
development authority may provide qualified energy improvement
planning grants to municipalities for planning related to the
development of qualified energy improvements certified by the
director of public service as eligible to receive planning
grants. The municipality must demonstrate that sufficient
resources are available for the municipality to meet its
financial requirements. Eligible planning grant costs include
definition of the improvement, development of preliminary
financing plans, and obtaining commitment for detailed planning
or design and preparation of a final report. The amount of a
grant to a municipality is limited to 90 percent of eligible
planning costs and must not exceed $100,000 as established by
rule or emergency rule.
Sec. 13. Minnesota Statutes 1986, section 116J.36,
subdivision 8, is amended to read:
Subd. 8. [LOAN APPROVAL.] The commissioner of energy and
economic development director of public service shall prepare
and submit to the energy and economic development authority
separate priority lists of loan requests for district heating
systems and qualified energy improvements. The priority list
for district heating loans shall contain the supporting
information required by must be based on the requirements under
subdivisions 3, 4, 5, 6, and 7. The priority list for qualified
energy improvements shall contain the supporting information
required by must be based on the requirements under subdivisions
3a, 3c, 4a, 5, and 6. The recommendation of the authority shall
be transmitted to the commissioner of finance. The commissioner
of finance shall sell bonds and the authority shall make loans
for district heating projects and qualified energy improvements
only upon the recommendation of the authority director of public
service.
Sec. 14. Minnesota Statutes 1986, section 116J.36,
subdivision 8a, is amended to read:
Subd. 8a. [CRITERIA FOR QUALIFIED ENERGY IMPROVEMENTS.]
Qualified energy improvements eligible for loans must meet
criteria established in rule by the commissioner of energy and
economic development director of public service. Rules shall
include criteria for analyzing the cost-effectiveness of
improvements. Rules relating to qualified energy improvements
involving a waste-to-energy facility must be adopted in
consultation with the waste management board, the authority, and
the pollution control agency. An improvement involving a
waste-to-energy facility must be part of a solid waste
management plan approved by the pollution control agency or a
plan approved under section 473.803.
Sec. 15. Minnesota Statutes 1986, section 116J.36,
subdivision 11, is amended to read:
Subd. 11. [RULES.] The commissioner of energy and economic
development shall adopt rules and may adopt emergency rules
necessary to carry out the programs of this section. The
director of public service shall adopt rules for the
administration of programs under this section. The commissioner
of energy and economic development director of public service
may adopt emergency rules pursuant to sections 14.29 to 14.36,
meeting the requirements of this section. The rules shall
contain as a minimum:
(a) Procedures for application by municipalities; and
(b) Criteria for reviewing grant and loan applications.
Sec. 16. Minnesota Statutes 1986, section 116J.37,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITIONS.] In this section:
(a) "Commissioner" means the commissioner of energy and
economic development. Upon passage of legislation creating a
body known as the Minnesota energy public facilities authority,
the duties assigned to the commissioner in this section are
delegated to the authority.
(b) "Maxi-audit" has the meaning given in section 116J.06,
subdivision 12.
(c) "Energy conservation investments" mean all capital
expenditures that are associated with conservation measures
identified in a maxi-audit and that have a ten-year or less
payback period. Public school districts that received a federal
institutional building grant in 1984 to convert a heating system
to wood, and that apply for an energy conservation investment
loan to match a federal grant for wood conversion, shall be
allowed to calculate payback of conservation measures based on
the costs of the traditional fuel in use prior to the wood
conversion.
Sec. 17. Minnesota Statutes 1986, section 116J.37, is
amended by adding a subdivision to read:
Subd. 8. [TECHNICAL SUPPORT.] The director of public
service shall prepare and submit to the authority the technical
evaluation of all applicants under this section.
Sec. 18. [446A.01] [MINNESOTA PUBLIC FACILITIES AUTHORITY
ACT.]
Sections 18 to 26 may be cited as the "Minnesota public
facilities authority act."
Sec. 19. [446A.02] [DEFINITIONS.]
Subdivision 1. [APPLICABILITY.] For the purposes of
sections 18 to 26, the terms in this section have the meanings
given them.
Subd. 2. [AUTHORITY.] "Authority" means the Minnesota
public facilities authority.
Subd. 3. [COMMISSIONER.] "Commissioner" means the
commissioner of energy and economic development.
Subd. 4. [FEDERAL WATER POLLUTION CONTROL ACT.] "Federal
Water Pollution Control Act" means the Federal Water Pollution
Control Act, as amended, United States Code, title 33, sections
1281 to 1299.
Subd. 5. [GOVERNMENTAL UNIT.] "Governmental unit" means a
state agency, home rule charter or statutory city, county,
sanitary district, or other governmental subdivision.
Subd. 6. [PROJECT.] "Project" means the acquisition,
construction, improvement, expansion, repair, or rehabilitation
of all or part of any structure, facility, or equipment
necessary for a wastewater treatment system or water supply
system.
Sec. 20. [446A.03] [MINNESOTA PUBLIC FACILITIES
AUTHORITY.]
Subdivision 1. [MEMBERSHIP.] The Minnesota public
facilities authority consists of the commissioner of energy and
economic development, the commissioner of finance, the director
of public service, the director of the pollution control agency,
and three additional members appointed by the governor from the
general public with the advice and consent of the senate.
Subd. 2. [CHAIR; OTHER OFFICERS.] The commissioner of
energy and economic development shall serve as the chair and
chief executive officer of the authority. The authority may
elect other officers as necessary from its members.
Subd. 3. [MEMBERSHIP TERMS.] The membership terms,
compensation, removal, and filling of vacancies of public
members of the authority are as provided in section 15.0575.
Subd. 4. [BOARD ACTIONS.] A majority of the authority,
excluding vacancies, constitutes a quorum to conduct its
business, to exercise its powers, and for all other purposes.
Subd. 5. [EXECUTIVE DIRECTOR.] The commissioner shall
employ, with the concurrence of the authority, an executive
director. The director shall perform duties that the authority
may require in carrying out its responsibilities. The executive
director's position is in the unclassified service.
Subd. 6. [ADMINISTRATIVE SERVICES.] The commissioner shall
provide administrative services to the authority.
Subd. 7. [PERSONAL LIABILITY.] Members and officers of the
authority are not liable personally for any debt or obligation
of the authority.
Sec. 21. [446A.04] [POWERS; DUTIES.]
Subdivision 1. [BYLAWS; RULES.] The authority shall adopt
bylaws for its organization and internal management. The
commissioner may adopt rules covering the authority's
operations, properties, and facilities.
Subd. 2. [POWER TO SUE; ENTER CONTRACTS.] The authority
may sue and be sued. The authority may make and enter into
contracts, leases, and agreements necessary to perform its
duties and exercise its powers.
Subd. 3. [GIFTS; GRANTS.] The authority may apply for,
accept, and disburse gifts, grants, loans, or other property
from the United States, the state, private sources, or any other
source for any of its purposes. Money received by the authority
under this subdivision must be deposited in the state treasury
and is appropriated to the authority to carry out its duties.
Subd. 4. [CONTRACT FOR SERVICES.] The authority may retain
or contract for the services of accountants, financial advisors,
and other consultants or agents needed to perform its duties and
exercise its powers.
Subd. 5. [FEES.] The authority may set and collect fees
for costs incurred by the authority for its financings and the
establishment and maintenance of reserve funds.
Sec. 22. [446A.05] [PROJECT LOANS.]
Subdivision 1. [LOANS.] The authority may make and
contract to make loans to governmental units to finance projects
that the governmental unit may construct or acquire. A loan may
not be used to pay current expenses or obligations, except for
temporary financing. A loan must be secured by notes or bonds
of the borrowing governmental unit.
Subd. 2. [RULES.] The commissioner may adopt rules
governing loans awarded under this section.
Sec. 23. [446A.06] [INDEPENDENT WASTEWATER TREATMENT
GRANTS.]
Subdivision 1. [AWARD OF GRANTS.] The authority shall
award independent state grants to municipalities selected by the
pollution control agency upon certification by the agency that
the municipalities' projects and applications have been reviewed
and approved by the agency in accordance with sections 116.16 to
116.18 and agency rules.
Subd. 2. [RULES.] The commissioner shall adopt rules
containing procedures for the administration of the authority's
duties as provided in subdivision 1.
Sec. 24. [446A.07] [WATER POLLUTION CONTROL REVOLVING
FUND.]
Subdivision 1. [ESTABLISHMENT OF FUND.] The authority
shall establish a water pollution control revolving fund to
provide loans for the purposes and eligible costs authorized
under title VI of the Federal Water Pollution Control Act. The
fund must be credited with repayments.
Subd. 2. [STATE FUNDS.] A state matching fund is
established to be used in compliance with federal matching
requirements specified in the Federal Water Pollution Control
Act. A state grant and loan fund is established to provide
grants and loans to governmental units for the planning and
construction of treatment works as specified in section 116.16,
subdivision 2, paragraphs (6), (7), and (8).
Subd 3. [CAPITALIZATION GRANT AGREEMENT.] The authority
shall enter an agreement with the administrator of the United
States Environmental Protection Agency to receive capitalization
grants for the revolving fund. The authority may exercise
powers necessary to comply with the requirements specified in
the agreement, which must be in compliance with the Federal
Water Pollution Control Act.
Subd. 4. [INTENDED USE PLAN.] The pollution control agency
shall annually prepare and submit to the United States
Environmental Protection Agency an intended use plan. The plan
must identify the intended uses of the amounts available to the
water pollution control revolving fund, including a list of
wastewater treatment projects and other eligible activities to
be funded during the fiscal year. The agency may not submit the
plan until it has received the review and comment of the
authority or until 30 days have elapsed since the plan was
submitted to the authority, whichever occurs first.
Subd. 5. [APPLICATIONS.] Applications by municipalities
and other entities identified in the annual intended use plan
for loans from the water pollution control revolving fund must
be made to the authority on forms requiring information
prescribed by the rules of the agency adopted under this
section. The authority shall send the applications to the
agency within ten days of receipt. The director shall certify
to the authority those applications that appear to meet the
criteria set forth in the Federal Water Pollution Control Act,
this section, and rules of the agency.
Subd. 6. [AWARD AND TERMS OF LOANS.] The authority shall
award loans to those municipalities and other entities certified
by the agency. The terms and conditions of the loans must be in
conformance with the Federal Water Pollution Control Act, this
section, and rules of the agency, and authority adopted under
this section.
Subd. 7. [LOAN CONDITIONS.] When making loans from the
revolving fund, the authority shall comply with the conditions
of the Federal Water Pollution Control Act, including:
(a) Loans must be made at or below market interest rates,
including interest-free loans, at terms not to exceed 20 years.
(b) The annual principal and interest payments must begin
no later than one year after completion of a project. Loans
must be fully amortized no later than 20 years after project
completion.
(c) A loan recipient shall establish a dedicated source of
revenue for repayment of the loan.
(d) The fund must be credited with all payments of
principal and interest on all loans.
Subd. 8. [OTHER USES OF REVOLVING FUND.] The water
pollution control revolving fund may be used as provided in
title VI of the Federal Water Pollution Control Act, including
the following uses:
(1) to buy or refinance the debt obligation of governmental
units for treatment works incurred after March 7, 1985, at or
below market rates;
(2) to guarantee or purchase insurance for local
obligations to improve credit market access or reduce interest
rates;
(3) to provide a source of revenue or security for the
payment of principal and interest on revenue or general
obligation bonds issued by the authority if the bond proceeds
are deposited in the fund;
(4) to provide loan guarantees for similar revolving funds
established by a governmental unit other than state agencies;
(5) to earn interest on fund accounts; and
(6) to pay the reasonable costs incurred by the authority
and the agency of administering the fund and conducting
activities required under the Federal Water Pollution Control
Act, including water quality management planning under section
205(j) of the act and water quality standards continuing
planning under section 303(e) of the act.
Amounts spent under clause (6) may not exceed the amount
allowed under the Federal Water Pollution Control Act. Five
percent of the revolving loan fund repayments may be used by the
agency and the authority for the purposes listed in clause (6).
Subd. 9. [PAYMENTS.] Payments from the fund must be made
in accordance with the applicable state and federal law
governing the payments, except that no payment for a project may
be made to a governmental unit until and unless the authority
has determined the total estimated cost of the project and
ascertained that financing of the project is assured by:
(1) a loan authorized by state law or the appropriation of
proceeds of bonds or other money of the governmental unit to a
fund for the construction of the project; and
(2) an irrevocable undertaking, by resolution of the
governing body of the governmental unit, to use all money made
available for the project exclusively for the project, and to
pay any additional amount by which the cost of the project
exceeds the estimate by the appropriation to the construction
fund of additional money or the proceeds of additional bonds to
be issued by the governmental unit.
Subd. 10. [RULES OF THE AUTHORITY.] The commissioner shall
adopt rules containing procedures for the administration of the
authority's duties as provided in this section, including loan
interest rates, the amounts of loans, and municipal financial
need.
Subd. 11. [RULES OF THE AGENCY.] The agency shall adopt
rules relating to the procedure for preparation of the annual
intended use plan and other matters that the agency considers
necessary for proper loan administration.
Sec. 25. [446A.08] [HEALTH CARE EQUIPMENT LOANS.]
Subdivision 1. [AUTHORITY.] The authority may make or
participate in making health care equipment loans. The loans
may be made only from the proceeds of bonds or notes issued
under subdivision 2. Before making a commitment for a loan, the
authority shall forward the application to the commissioner of
health for review under subdivision 3. The authority may not
approve or enter into a commitment for a loan unless the
application has been approved by the commissioner of health.
Subd. 2. [BONDS AND NOTES.] The authority may issue its
bonds and notes to provide money for the purposes specified in
subdivision 1. The principal amount of bonds and notes issued
and outstanding under this subdivision at any time may not
exceed $95,000,000. The bonds and notes issued to make the
loans may not be insured by the authority but must be insured by
a letter of credit or bond insurance issued by a private insurer.
Subd. 3. [ADMINISTRATION.] (a) The commissioner of health
shall review each loan application received from the authority
to determine whether the application is an eligible
application. An application is eligible if the following
criteria are satisfied:
(1) the hospital is owned and operated by a county,
district, municipality, or nonprofit corporation;
(2) the loan would not be used to refinance existing debt;
(3) the hospital was unable to obtain suitable financing
from other sources;
(4) the loan is necessary to establish or maintain patient
access to an essential health care service that would not
otherwise be available within a reasonable distance from the
facility; and
(5) the equipment to be financed by the loan is
cost-effective and efficient.
(b) The authority shall determine whether the allocation
available for the health care equipment loan program is
sufficient for all eligible applications received during a
specified time. If the allocations are sufficient, the
authority shall approve all eligible applications. If the
allocations are not sufficient, the authority shall compare the
relative merits of the eligible applications with respect to the
criteria in paragraph (a), clauses (4) and (5), rank the
applications in order of priority, and approve the applications
in order of priority to the extent possible within the available
allocation.
(c) The authority may charge a reasonable fee under section
16A.128 to an applicant for the costs of review of the
application. The authority shall transfer to the commissioner
of health from the fees collected an amount sufficient to pay
the costs of the commissioner of health in the review of
applications. The commissioner of health and the authority may
each adopt permanent rules to implement subdivisions 1 to 3.
Sec. 26. [446A.09] [REPORT; AUDIT.]
The authority shall report to the legislature and the
governor by January 1 of each year. The report must include a
complete operating and financial statement covering the
authority's operations during the year, including amounts of
income from all sources. Books and records of the authority are
subject to audit by the legislative auditor in the manner
prescribed for state agencies.
Sec. 27. [GOVERNOR'S ACTION.]
The governor may request the administrator of the
environmental protection agency to make available to the state,
capitalization grants to be deposited in the water pollution
control revolving fund, for the fiscal year beginning October 1,
1987. The governor may request that up to 75 percent of the
amount allotted to the state for the fiscal year beginning
October 1, 1987, be made available for deposit in the water
pollution control revolving fund.
Sec. 28. [466A.10] [TRANSFER OF AUTHORITY.]
Subdivision 1. [WATER POLLUTION CONTROL GRANTS.] (a) The
responsibilities of the pollution control agency for the state
independent wastewater treatment grant program under Minnesota
Statutes, section 116.18, subdivision 3a, are transferred on
July 1, 1988, to the Minnesota public facilities authority under
Minnesota Statutes, section 15.039, except that the commissioner
of energy and economic development and the director of the
pollution control agency shall determine which classified and
unclassified positions associated with these responsibilities
are transferred.
(b) Any continuing obligation with respect to grants made
before September 30, 1984, under Minnesota Statutes 1984,
section 116.18, subdivision 2, remains with the pollution
control agency.
(c) The pollution control agency shall continue to
administer the combined sewer overflow program under Minnesota
Statutes, section 116.162, and the appropriations for the
program.
Subd. 2. [OTHER RESPONSIBILITIES.](a) The responsibilities
for the health care equipment loan program under section
116M.07, subdivisions 7a, 7b, and 7c; the public school energy
conservation loan program under section 116J.37; and the
district heating and qualified energy improvement loan program
under section 116J.36, are transferred from the Minnesota energy
and economic development authority to the Minnesota public
facilities authority. The director of public service shall
continue to administer the municipal energy grant and loan
programs under section 116J.36 and the school energy loan
program under section 116J.37 until the commissioner of energy
and economic development has adopted rules to implement the
financial administration of the programs as provided under
sections 10 to 17.
(b) Except as otherwise provided in this paragraph, section
15.039 applies to the transfer of responsibilities. The
transfer includes eight and one-half positions from the
financial management division of the department of energy and
economic development to the community development division of
the department of energy and economic development. The
commissioner of energy and economic development and the director
of public service shall determine which classified and
unclassified positions associated with the responsibilities of
the grant and loan programs under section 116J.36 and the school
energy loan program under section 116J.37 are transferred to the
director of public service and which positions are transferred
to the commissioner of energy and economic development in order
to carry out the purposes of this article.
Sec. 29. [466A.11] [PROGRAM ADMINISTRATION.]
Subdivision 1. [POWERS.] In implementing the purposes and
the programs transferred to the authority by section 28,
subdivision 2, the authority has the powers in this section.
Subd. 2. [RULES.] It may adopt, amend, and repeal rules,
including emergency rules, necessary to effectuate its purposes.
Subd. 3. [PERSONAL PROPERTY.] It may acquire, hold, and
dispose of personal property for its corporate purposes.
Subd. 4. [REAL PROPERTY.] It may acquire real property, or
an interest in real property, in its own name, by purchase or
foreclosure, where the acquisition is necessary or appropriate
to protect a loan in which the authority has an interest and may
sell, transfer, and convey the property to a buyer and, in the
event the sale, transfer, or conveyance cannot be effected with
reasonable promptness or at a reasonable price, may lease the
property to a tenant.
Subd. 5. [NOTES; MORTGAGES; OBLIGATIONS; SALE OF.] It may
sell, at public or private sale, any note, mortgage or other
instrument or obligation evidencing or securing a loan.
Subd. 6. [INSURANCE.] It may procure insurance against a
loss in connection with its property in the amounts, and from
the insurers, as may be necessary or desirable.
Subd. 7. [LOAN TERMS; MODIFICATION.] It may consent,
whenever it considers it necessary or desirable in the
fulfillment of its purpose, to the modification of the rate of
interest, time of payment, installment of principal or interest,
or other term, of a contract or agreement to which the authority
is a party.
Subd. 8. [LOAN PAYMENTS; INTEREST AND AMORTIZATION.] It
may establish and collect reasonable interest and amortization
payments on loans, and in connection with them may establish and
collect or authorize the collection of reasonable fees and
charges or require money to be placed in escrow, sufficient to
provide for the payment and security of its bonds, notes,
commitments and other obligations and for their servicing, to
provide reasonable allowances for or insurance against losses
which may be incurred and to cover the cost of issuance of
obligations and technical, consultative, and project assistance
services.
Subd. 9. [INVESTMENTS.] (a) It may cause any money not
required for immediate disbursement, including the general
reserve account, to be invested in direct obligations of or
obligations guaranteed as to principal and interest by the
United States, or in insured savings accounts, up to the amount
of the insurance, in any institution the accounts of which are
insured by the federal savings and loan insurance corporation or
to be deposited in a savings or other account in a bank insured
by the federal deposit insurance corporation or to be invested
in time certificates of deposit issued by a bank insured by the
federal deposit insurance corporation and maturing within one
year or less and in the investments described in section 11A.24,
subdivision 4, except clause (d) of subdivision 4. It may
deposit money in excess of the amount insured with security as
provided in chapter 118.
(b) Notwithstanding paragraph (a), it may invest and
deposit money into accounts established pursuant to resolutions
or indentures securing its bonds or notes in investments and
deposit accounts or certificates, and with security, agreed upon
with the holders or a trustee for the holders.
Subd. 10. [CONSULTATIVE AND TECHNICAL SERVICES.] It may
provide general consultative and technical services to assist in
financing the entities to which loans may be made. It may enter
into agreements or other transactions concerning the receipt or
provision of those services.
Subd. 11. [FINANCIAL INFORMATION.] Financial information,
including credit reports, financial statements and net worth
calculations, received or prepared by the authority regarding an
authority loan, financial assistance, or insurance is private
data with regard to data on individuals as defined in section
13.02, subdivision 12 and nonpublic data with regard to data not
on individuals as defined in section 13.02, subdivision 9.
Subd. 12. [APPROPRIATIONS; GIFTS; GRANTS.] The authority
may accept appropriations, gifts, grants, bequests, and devises
and use or dispose of them for its purposes. All gifts, grants,
bequests, and revenues from those sources are appropriated to
the authority.
Subd. 13. [PROCEEDS APPROPRIATED TO AUTHORITY.] Proceeds
of the authority's bonds, notes, and other obligations; amounts
granted or appropriated to the authority for the making or
purchase or the insurance or guaranty of loans or for bond
reserves; income from investment; money in the funds; and all
revenues from loans, fees, and charges of the authority
including rentals, royalties, dividends, or other proceeds in
connection with technology-related products, energy conservation
products, or other equipment are annually appropriated to the
authority for the accomplishment of its corporate purposes and
must be spent, administered, and accounted for in accordance
with the applicable provisions of all bond and note resolutions,
indentures, and other instruments, contracts, and agreements of
the agency. Notwithstanding section 16A.28, these
appropriations are available until expended.
Subd. 14. [GENERAL PURPOSE.] The authority may do all
things necessary and proper to fulfill its purpose.
Sec. 30. [REPEALER.]
Minnesota Statutes 1986, section 116.167, is repealed.
Sec. 31. [APPROPRIATION.]
$800,000 is appropriated from the economic development fund
to the commissioner of energy and economic development to
administer programs under the Minnesota public facilities
authority. $400,000 is for fiscal year 1988 and $400,000 is for
fiscal year 1989.
Sec. 32. [EFFECTIVE DATE.]
Sections 1, 2, 4, 5, 6, 8, 23, and 28, subdivision 1, are
effective on July 1, 1988.
Section 9 is repealed July 1, 1988.
ARTICLE 4
COMMUNITY DEVELOPMENT
Section 1. [116J.980] [COMMUNITY DEVELOPMENT DIVISION.]
Subdivision 1. [DUTIES.] The community development
division is a division within the department of energy and
economic development. It shall:
(1) be responsible for administering all state community
development and assistance programs, including the economic
recovery fund, the outdoor recreation grant program, the rural
development board programs, the community development
corporation program, the urban revitalization program, the
Minnesota public facilities authority loan and grant programs,
and the enterprise zone program;
(2) be responsible for state administration of federally
funded community development and assistance programs, including
the small cities development grant program and land and water
conservation program;
(3) provide technical assistance to rural communities for
community development in cooperation with regional development
commissions;
(4) coordinate the development and review of state rural
development policies;
(5) provide staff and consultant services to the rural
development board; and
(6) be responsible for coordinating community assistance
and development programs in cooperation with regional
development commissions.
Subd. 2. [GENERAL COMPLEMENT AUTHORITY.] The community
development division may combine all related state and federal
complement positions into general fund positions, to carry out
the responsibilities under subdivision 1. The number of general
fund positions must not exceed the aggregate number of all state
and federal positions that are to be combined. Records of the
actual number of employee hours charged to each state and
federal account must be maintained for each general fund
position.
Sec. 2. [116J.981] [MAIN STREET PROGRAM.]
The commissioner shall develop and administer a main street
program to assist cities in the revitalization of their
businesses. The purpose of the program is to strengthen local
organization and local management of business districts so that
cities become more self-reliant and not dependent on future
state financial assistance. The staff dedicated for this
program shall assist cities that request assistance in the
following manner:
(1) improving the organization of a city's business
district including the leadership skills of business owners and
city officials;
(2) establishing a marketing strategy to promote a city's
business district to residents of the surrounding trade area;
(3) providing technical assistance in the design and
rehabilitation of buildings in a city's business district
including historic preservation; and
(4) establishing a strategy to strengthen existing
businesses, recruit new businesses, diversify the mix of
businesses, and develop vacant property in a city's business
district.
Sec. 3. [116J.982] [COMMUNITY DEVELOPMENT CORPORATIONS.]
Subdivision 1. [DEFINITIONS.] For the purposes of this
section, the terms in this subdivision have the meanings given
them:
(a) "Commissioner" means the commissioner of energy and
economic development.
(b) "Economic development region" means an area so
designated in the governor's executive order number 60, dated
June 12, 1970, as amended.
(c) "Federal poverty level" means the income level
established by the United States Community Services
Administration in Code of Federal Regulations, title 45, section
1060.2-2.
(d) "Low income" means an annual income below the federal
poverty level.
Subd. 2. [ADMINISTRATION.] The commissioner shall
administer this section and shall enforce the rules related to
the community development corporations adopted by the
commissioner. The commissioner may amend, suspend, repeal or
otherwise modify these rules as provided for in chapter 14.
Subd. 3. [GRANTS; CORPORATIONS ELIGIBLE.] (a) The
commissioner shall designate a community development corporation
as eligible to receive grants under this section if the
corporation is a nonprofit corporation incorporated under
chapter 317 and meets the other criteria in this subdivision.
(b) The corporation, in its articles of incorporation or
bylaws, shall designate a specific geographic community within
which it will operate. As least ten percent of the population
within the designated community must have low incomes. Within
the metropolitan area as defined in section 473.121, subdivision
2, a designated community must be an identifiable neighborhood
or a combination of neighborhoods or home rule charter or
statutory cities, townships, unincorporated areas, or
combinations of those entities. Outside the metropolitan area,
designated communities, so far as possible, may not cross
existing economic development boundaries. If a proposed
geographic area overlaps the designated community of a community
development corporation existing before August 1, 1987, the
proposed community development corporation shall obtain the
written consent of the existing community development
corporation before the proposed corporation may be designated as
eligible to receive grants under this section.
(c) The corporation shall limit voting membership to
residents of its designated area.
(d) The corporation shall have a board of directors with 15
to 30 members unless the corporation can demonstrate to the
satisfaction of the commissioner that a smaller or larger board
is more advantageous. At least 40 percent of the directors must
have incomes that do not exceed 80 percent of the county median
family income or 80 percent of the statewide median family
income as determined by the state demographer, whichever is
less, and the remaining directors must be members of the
business or financial community and the community at large. To
the greatest extent possible, and at least 60 percent of, the
directors must be residents of the designated community.
Directors who meet the income limitations of this paragraph must
be elected by the members of the corporation. The remaining
directors may be elected by the members or appointed by the
directors who meet the income limitations of this paragraph.
(e) The corporation shall hire low-income residents of the
designated community to fill nonmanagerial and nonprofessional
positions.
(f) The corporation shall demonstrate that it has or will
have the technical skills to analyze projects, that it is
familiar with other available public and private funding sources
and economic development programs, and that it is capable of
packaging economic development projects.
Subd. 4. [GRANT APPROVAL FOR PROJECTS.] The commissioner
shall approve a grant to a community development corporation
only for a project carried on within the designated community,
except when the corporation demonstrates that a project carried
on outside will have a significant impact inside the designated
community.
Subd. 5. [USE OF GRANT.] The commissioner may approve a
grant to a community development corporation for planning,
including organization of the corporation, training of the
directors, creation of a comprehensive community economic
development plan, and development of a proposal for a venture
grant, or for establishment of a business venture, including
assistance to an existing business venture, purchase of partial
or full ownership of a business venture, or development of
resources or facilities necessary for the establishment of a
business venture.
Subd. 6. [ASSIGNEE.] The commissioner must be named as an
assignee of the rights of a state-funded community development
corporation on any loan or other evidence of debt provided by a
community development corporation to a private enterprise. The
assignment of rights must provide that it will be effective upon
the dormancy or cessation of existence of the community
development corporation. "Dormancy" for the purpose of this
section means the continuation of the corporation in name only
without any functioning officers or activities. Upon the
cessation of the activities of a state-funded community
development corporation, any assigned money paid to the
commissioner must be deposited in the state treasury and
credited to the general fund.
Subd. 7. [FACTORS FOR GRANT APPROVAL.] Factors considered
by the commissioner in approving a grant to a community
development corporation must include the creation of employment
opportunities, the maximization of profit, and the effect on
securing money from sources other than the state.
Subd. 8. [PROHIBITION.] Grants under this section are not
available for programs conducted by churches or religious
organizations or for securing or developing social services.
Subd. 9. [NO EXCLUSION.] A person may not be excluded from
participation in a program funded under this section because of
race, color, religion, sex, age, or national origin.
Sec. 4. [TRANSFER OF RESPONSIBILITIES.]
Subdivision 1. [COMMUNITY DEVELOPMENT CORPORATIONS.] The
responsibilities of the Minnesota energy and economic
development authority for community development corporations
under Minnesota Statutes, section 116M.04, are transferred under
Minnesota Statutes, section 15.039, to the commissioner of
energy and economic development.
Subd. 2. [OTHER PROGRAMS.] The main street program, the
Minnesota community improvement program, the governor's design
team, and the Minnesota beautiful program are transferred under
Minnesota Statutes, section 15.039, from the state planning
agency to the department of energy and economic development.
The four incumbents of the state planning agency responsible for
the administration of these programs are transferred to the
department of energy and economic development.
Sec. 5. [REPEALER.]
Minnesota Statutes, section 116M.04, is repealed.
Sec. 6. [EFFECTIVE DATE.]
This article is effective July 1, 1987.
ARTICLE 5
MINNESOTA ENERGY AND ECONOMIC DEVELOPMENT AUTHORITY
Section 1. Minnesota Statutes 1986, section 15.039, is
amended by adding a subdivision to read:
Subd. 5a. [OBLIGATIONS.] The new agency is the legal
successor in all respects of the agency whose responsibilities
are transferred. The bonds, resolutions, contracts, and
liabilities of the agency whose responsibilities are transferred
become the bonds, resolutions, contracts, and liabilities of the
new agency.
Sec. 2. Minnesota Statutes 1986, section 16A.80,
subdivision 2a, is amended to read:
Subd. 2a. [EXEMPT AGENCIES.] This section does not apply
to:
(1) the housing finance agency;
(2) the state board of investment;
(3) the iron range resources and rehabilitation board;
(4) the higher education coordinating board; and
(5) the higher education facilities authority; and
(6) the energy and economic development authority.
Sec. 3. [116.55) [WASTE TIRE RECYCLING LOANS AND GRANTS.]
The pollution control agency may make waste tire recycling
loans to businesses. Applications for the loans are not
complete unless the waste tire recycling project for which the
loan is to be made is certified to be technically feasible by
the director of the pollution control agency. The agency may
make grants from the waste tire recycling account for studies
necessary to demonstrate the technical and economic feasibility
of a proposed waste tire recycling project. A grant must be
less than $30,000 and may not exceed 75 percent of the costs of
the study. The agency shall adopt rules for administration of
waste tire recycling grants and loans.
Sec. 4. [RESPONSIBILITIES TRANSFERRED TO POLLUTION CONTROL
AGENCY.]
The responsibilities for the waste tire recycling loan and
grant program under section 116M.07, subdivision 3, are
transferred from the Minnesota energy and economic development
authority to the pollution control agency. Minnesota Statutes,
section 15.039, applies to the transfer of responsibilities.
Sec. 5. [TRANSFER OF RESPONSIBILITIES.]
The responsibilities of the Minnesota energy and economic
development authority that are not transferred to any other
agency are transferred to the commissioner of energy and
economic development under Minnesota Statutes, section 15.039.
Sec. 6. [REPEALER.]
Minnesota Statutes 1986, sections 116M.01; 116M.02;
116M.03; 116M.06; 116M.07; 116M.08; 116M.09; 116M.10; 116M.105;
and 116M.13, are repealed.
Sec. 7. [EFFECTIVE DATE.]
This article is effective July 1, 1987.
ARTICLE 6
URBAN REVITALIZATION PROGRAMS
Section 1. Minnesota Statutes 1986, section 281.17, is
amended to read:
281.17 [PERIOD FOR REDEMPTION.]
The period of redemption for all lands sold to the state at
a tax judgment sale shall be three years from the date of sale
to the state of Minnesota if the land is within an incorporated
area unless it is: (a) nonagricultural homesteaded land as
defined in section 273.13, subdivision 22, (b) homesteaded
agricultural land as defined in section 273.13, subdivision 23,
paragraph (a), or (c) seasonal recreational land as defined in
section 273.13, subdivision 27, paragraph (a), or subdivision
22, paragraph (c), in which event the period of redemption is
five years from the date of sale to the state of Minnesota.
The period of redemption for homesteaded lands as defined
in section 273.13, subdivision 22, located in a targeted
neighborhood as defined in section 4 and sold to the state at a
tax judgment sale is two years from the date of sale. The
period of redemption for other lands in a targeted neighborhood
as defined in section 4 and sold to the state at a tax judgment
sale is one year from the date of sale.
The period of redemption for all other lands sold to the
state at a tax judgment sale shall be five years from the date
of sale.
Sec. 2. Minnesota Statutes 1986, section 429.061,
subdivision 2, is amended to read:
Subd. 2. [ADOPTION; INTEREST.] At such meeting or at any
adjournment thereof the council shall hear and pass upon all
objections to the proposed assessment, whether presented orally
or in writing. The council may amend the proposed assessment as
to any parcel and by resolution adopt the same as the special
assessment against the lands named in the assessment roll.
Notice of any adjournment of the hearing shall be adequate if
the minutes of the meeting so adjourned show the time and place
when and where the hearing is to be continued.
The council may consider any objection to the amount of a
proposed assessment as to a specific parcel of land at an
adjourned hearing upon further notice to the affected property
owner as it deems advisable. At the adjourned hearing the
council or a committee of it may hear further written or oral
testimony on behalf of the objecting property owner and may
consider further written or oral testimony from appropriate city
officials and other witnesses as to the amount of the
assessment. The council or committee shall prepare a record of
the proceedings at the adjourned hearing and written findings as
to the amount of the assessment. The amount of the assessment
as finally determined by the council shall become a part of the
adopted assessment roll. No appeal may be taken as to the
amount of any assessment adopted under this section unless
written objection signed by the affected property owner is filed
with the municipal clerk prior to the assessment hearing or
presented to the presiding officer at the hearing. All
objections to the assessments not received at the assessment
hearing in the manner prescribed by this subdivision are waived,
unless the failure to object at the assessment hearing is due to
a reasonable cause.
If the adopted assessment differs from the proposed
assessment as to any particular lot, piece, or parcel of land,
the clerk must mail to the owner a notice stating the amount of
the adopted assessment. Owners must also be notified by mail of
any changes adopted by the council in interest rates or
prepayment requirements from those contained in the notice of
the proposed assessment.
The assessment, with accruing interest, shall be a lien
upon all private and public property included therein, from the
date of the resolution adopting the assessment, concurrent with
general taxes; but the lien shall not be enforceable against
public property as long as it is publicly owned, and during such
period the assessment shall be recoverable from the owner of
such property only in the manner and to the extent provided in
section 435.19. Except as provided below, all assessments
shall be payable in equal annual installments extending over
such period, not exceeding 30 years, as the resolution
determines, payable on the first Monday in January in each year,
but the number of installments need not be uniform for all
assessments included in a single assessment roll if a uniform
criterion for determining the number of installments is provided
by the resolution. Assessments on property located in a
targeted neighborhood as defined in section 4 may be payable in
variable annual installments if the resolution provides for a
variable payment. The first installment of each assessment
shall be included in the first tax rolls completed after its
adoption and shall be payable in the same year as the taxes
contained therein; except that the payment of the first
installment of any assessment levied upon unimproved property
may be deferred until a designated future year, or until the
platting of the property or the construction of improvements
thereon, upon such terms and conditions and based upon such
standards and criteria as may be provided by resolution of the
council. If special assessments against the property have been
deferred pursuant to this subdivision, the governmental unit
shall file with the county recorder in the county in which the
property is located a certificate containing the legal
description of the affected property and of the amount
deferred. In any event, every assessment the payment of which
is so deferred, when it becomes payable, shall be divided into a
number of installments such that the last installment thereof
will be payable not more than 30 years after the levy of the
assessment. All assessments shall bear interest at such rate as
the resolution determines, not exceeding eight percent per
annum, except that the rate may in any event equal the average
annual interest rate on bonds issued to finance the improvement
for which the assessments are levied. To the first installment
of each assessment shall be added interest on the entire
assessment from a date specified in the resolution levying the
assessment, not earlier than the date of the resolution, until
December 31 of the year in which the first installment is
payable, and to each subsequent installment shall be added
interest for one year on all unpaid installments; or
alternatively, any assessment may be made payable in equal
annual installments including principal and interest, each in
the amount annually required to pay the principal over such
period with interest at such rate as the resolution determines,
not exceeding the maximum period and rate specified above. In
the latter event no prepayment shall be accepted under
subdivision 3 without payment of all installments due to and
including December 31 of the year of prepayment, together with
the original principal amount reduced only by the amounts of
principal included in such installments, computed on an annual
amortization basis. When payment of an assessment is deferred,
as authorized in this subdivision, interest thereon for the
period of deferment may be made payable annually at the same
times as the principal installments of the assessment would have
been payable if not deferred; or interest for this period may be
added to the principal amount of the assessment when it becomes
payable; or, if so provided in the resolution levying the
assessment, interest thereon to December 31 of the year before
the first installment is payable may be forgiven.
Sec. 3. Minnesota Statutes 1986, section 462.445,
subdivision 1, is amended to read:
Subdivision 1. [SCHEDULE OF POWERS.] An authority shall be
a public body corporate and politic and shall have all the
powers necessary or convenient to carry out the purposes of
sections 462.415 to 462.705 (but not the power to levy and
collect taxes or special assessments except as provided in
sections 462.515 to 462.545 with respect to redevelopment
projects only) including the following powers in addition to
others granted in these sections:
(1) To sue and be sued; to have a seal, which shall be
judicially noticed, and to alter the same at pleasure; to have
perpetual succession; and to make, and from time to time to
amend and repeal, rules and regulations not inconsistent with
these sections;
(2) To employ an executive director, technical experts, and
such officers, agents, and employees, permanent and temporary,
as it may require, and determine their qualifications, duties,
and compensation; for such legal services as it may require, to
call upon the chief law officer of the municipality or to employ
its own counsel and legal staff; so far as practicable, to use
the services of local public bodies, in its area of operation,
such local public bodies, if requested, to make such services
available;
(3) To delegate to one or more of its agents or employees
such powers or duties as it may deem proper;
(4) Within its area of operation to undertake, prepare,
carry out, and operate projects and to provide for the
construction, reconstruction, improvement, extension,
alteration, or repair of any project or part thereof;
(5) Subject to the provisions of section 462.511, to give,
sell, transfer, convey, or otherwise dispose of real or personal
property or any interest therein and to execute such leases,
deeds, conveyances, negotiable instruments, purchase agreements,
and other contracts or instruments, and take such action, as may
be necessary or convenient to carry out the purposes of these
sections;
(6) Within its area of operation to acquire real or
personal property or any interest therein by gifts, grant,
purchase, exchange, lease, transfer, bequest, devise, or
otherwise, and by the exercise of the power of eminent domain,
in the manner provided by Minnesota Statutes 1945, chapter 117,
and any amendments thereof or supplements thereto, to acquire
real property which it may deem necessary for its purposes under
these sections, after the adoption by it of a resolution
declaring that the acquisition of the real property is necessary
to eliminate one or more of the conditions found to exist in the
resolution adopted pursuant to section 462.425 or found to exist
by section 462.415, subdivision 5, or is necessary to carry out
a redevelopment project as defined in section 462.421,
subdivision 13;
(7) Within its area of operation, and without the adoption
of an urban renewal plan, to acquire, by all means as set forth
in clause (6) of this subdivision, including by the exercise of
the power of eminent domain, in the manner provided by chapter
117, and without the adoption of a resolution provided for in
subdivision 1, clause (6), real property, and to demolish,
remove, rehabilitate or reconstruct the buildings and
improvements or construct new buildings and improvements
thereon, or to so provide through other means as set forth in
Laws 1974, chapter 228, or to grade, fill and construct
foundations or otherwise prepare the site for improvements, and
to dispose of said property pursuant to section 462.525,
provided that the provisions of section 462.525 requiring
conformance to an urban renewal plan shall not apply, and to
finance such activities by means of the redevelopment project
fund or by means of tax increments or tax increment bonds or by
the methods of financing provided for in section 462.545 or by
means of contributions from the municipality provided for in
section 462.581, clause (9), or by any combination of such
means; provided that, real property with buildings or
improvements thereon shall only be acquired when the buildings
or improvements are substandard; and provided further that the
exercise of the power of eminent domain under this clause shall
be limited to real property which contains buildings and
improvements which are vacated and substandard. For the purpose
of this subparagraph, substandard buildings or improvements mean
hazardous buildings as defined in section 463.15, subdivision 3,
or buildings or improvements that are dilapidated or
obsolescent, faultily designed, lack adequate ventilation,
light, or sanitary facilities, or any combination of these or
other factors that are detrimental to the safety or health of
the community.
(8) Within its area of operation to determine the level of
income constituting low or moderate family income. Such income
level shall be that level below which there is not available
within the area of operation a substantial supply of decent,
safe and sanitary housing provided by private enterprise without
subsidy at prices or rents within the financial means of persons
and families of such incomes. The authority may establish
various income levels for various family sizes. In making its
determination the authority may consider income levels which may
be established by the federal housing administration or a
similar or successor federal agency for the purpose of federal
loan guarantees or subsidies for persons of low or moderate
income. The authority may use such determination as a basis for
the maximum amount of income for admissions to housing
development projects owned or operated by it;
(9) To provide in federally assisted projects such
relocation payments and assistance as may be necessary to comply
with the requirements of the Federal Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970,
and any amendments or supplements thereto.
Sec. 4. [DEFINITIONS.]
Subdivision 1. [APPLICABILITY.] The definitions in this
section apply to sections 4 to 10.
Subd. 2. [CITY.] "City" means the city of Minneapolis or
the city of Saint Paul. For each city, a port authority,
housing and redevelopment authority, or other agency or
instrumentality, the jurisdiction of which is the territory of
the city, is included within the meaning of city.
Subd. 3. [CITY COUNCIL.] "City council" means either the
city council of Minneapolis or the city council of Saint Paul.
Subd. 4. [CITY MATCHING MONEY.] "City matching money"
means the money of a city specified in a revitalization and
financing program to be spent to implement a revitalization
program. The sources of city matching money may include:
(1) money from the general fund or a special fund of a city
used to implement a revitalization program;
(2) money paid or repaid to a city from the proceeds of a
grant that a city has received from the federal government, a
profit or nonprofit corporation, or another entity or
individual, that is to be used to implement a revitalization
program;
(3) tax increments received by a city under sections 273.71
to 273.78 or other law, if eligible, to be spent in the targeted
neighborhood;
(4) the greater of the fair market value or the cost to the
city of acquiring land, buildings, equipment, or other real or
personal property that a city contributes, grants, or loans to a
profit or nonprofit corporation, or other entity or individual
in connection with the implementation of a revitalization
program;
(5) city money to be used to install, reinstall, repair, or
improve the infrastructure facilities of a targeted neighborhood;
(6) money contributed by a city to pay issuance costs or to
otherwise provide financial support for revenue bonds or
obligations issued by a city for a project or program related to
the implementation of a revitalization program;
(7) money derived from fees received by a city in
connection with its community development activities that are to
be used in implementing a revitalization program.
City matching money does not include:
(1) city money used to provide a service or exercise a
function that is ordinarily provided throughout the city, unless
an increased level of the service or function is to be provided
in a targeted neighborhood in accordance with a revitalization
program;
(2) the proceeds of revenue bonds issued by the city under
chapter 458, 462C, 472, or 474; or
(3) administrative expenses that are incurred in connection
with the planning or implementation of sections 4 to 10.
Subd. 5. [COMMISSIONER.] "Commissioner" means the
commissioner of energy and economic development.
Subd. 6. [LOST UNIT.] "Lost unit" means a rental housing
unit that is lost as a result of revitalization activities
because it is demolished, converted to an owner-occupied unit
that is not a cooperative, converted to a nonresidential use, or
if the gross rent to be charged exceeds 125 percent of the gross
rent charged for the unit six months before the start of
rehabilitation.
Subd. 7. [TARGETED NEIGHBORHOOD.] "Targeted neighborhood"
means an area including one or more census tracts as determined
and measured by the bureau of census of the United States
Department of Commerce that meet the criteria of section 5,
subdivision 2, and any additional area designated under section
5, subdivision 3.
Subd. 8. [TARGETED NEIGHBORHOOD MONEY.] "Targeted
neighborhood money" means the money designated in the
revitalization program to be used to implement the
revitalization program.
Subd. 9. [TARGETED NEIGHBORHOOD REVITALIZATION AND
FINANCING PROGRAM.] "Targeted neighborhood revitalization and
financing program," "revitalization program," or "program" means
the targeted neighborhood revitalization and financing program
adopted in accordance with section 6.
Sec. 5. [DESIGNATION OF TARGETED NEIGHBORHOODS.]
Subdivision 1. [CITY AUTHORITY.] A city may by resolution
designate targeted neighborhoods within its borders after
adopting detailed findings that the designated neighborhoods
meet the eligibility requirements in subdivision 2 or 3.
Subd. 2. [ELIGIBILITY REQUIREMENTS FOR TARGETED
NEIGHBORHOODS.] An area within a city is eligible for
designation as a targeted neighborhood if the area meets two of
the following three requirements:
(a) The area had an unemployment rate that was twice the
unemployment rate for the Minneapolis and Saint Paul standard
metropolitan statistical area as determined by the 1980 federal
decennial census.
(b) The median household income in the area was no more
than half the median household income for the Minneapolis and
Saint Paul standard metropolitan statistical area as determined
by the 1980 federal decennial census.
(c) The area is characterized by residential dwelling units
in need of substantial rehabilitation. An area qualifies under
this clause if 25 percent or more of the residential dwelling
units are in substandard condition as determined by the city or
70 percent or more of the residential dwelling units in the area
were built before 1940 as determined by the 1980 federal
decennial census.
Subd. 3. [ADDITIONAL AREA ELIGIBLE FOR INCLUSION IN
TARGETED NEIGHBORHOOD.] The city may add to the area designated
as a targeted neighborhood under subdivision 2 additional area
extending up to four contiguous city blocks in all directions
from the designated targeted neighborhood. For the purpose of
this subdivision, "city block" has the meaning determined by the
city.
Sec. 6. [TARGETED NEIGHBORHOOD REVITALIZATION AND
FINANCING PROGRAM REQUIREMENTS.]
Subdivision 1. [COMPREHENSIVE REVITALIZATION AND FINANCING
PROGRAM.] (a) For each targeted neighborhood for which a city
requests state financial assistance under section 7, the city
must prepare a comprehensive revitalization and financing
program that includes the following:
(1) the revitalization objectives of the city for the
targeted neighborhood;
(2) the specific activities or means by which the city
intends to pursue and implement the revitalization objectives;
(3) the extent to which the activities identified in clause
(2) will benefit low and moderate income families, will
alleviate the blighted condition of the targeted neighborhood,
or will otherwise assist in the revitalization of the targeted
neighborhood;
(4) a statement of the intended outcomes to be achieved by
implementation of the revitalization program, how the outcomes
will be measured both qualitatively and quantitatively, and the
estimated time over which they will occur; and
(5) a financing program and budget that identifies the
financial resources necessary to implement the revitalization
program.
(b) The financing program and budget must include the
following items:
(1) the estimated total cost to implement the
revitalization program;
(2) the estimated cost to implement each activity in the
revitalization program identified in paragraph (a), clause (2);
(3) the estimated amount of financial resources that will
be available from all sources other than from the appropriation
available under section 7 to implement the revitalization
program;
(4) the estimated amount of the appropriation available
under section 7 that will be necessary to implement the
revitalization program;
(5) a description of the activities identified in the
revitalization program for which the state appropriation will be
used and the time or times at which the state appropriation will
be committed or spent; and
(6) a statement of how the city intends to meet the
requirement for a financial contribution matching the state
appropriation from city matching money in accordance with
section 7, subdivision 3.
Subd. 2. [TARGETED NEIGHBORHOOD PARTICIPATION IN
REVITALIZATION PROGRAM DEVELOPMENT.] The city shall develop a
process to consult the residents in the targeted neighborhood
concerning the development, drafting, and implementation of the
revitalization program. The process may include the
establishment of an advisory board in each city. The process
must include at least one public hearing in addition to a public
hearing held by the advisory board.
Subd. 3. [ADVISORY BOARD.] The governing body of the city
may establish a nine-member advisory board to assist the city in
implementing the revitalization program. The advisory board
shall consist of two city council members appointed by the city
council, one county commissioner appointed by the county board
of the county in which the city is located, two legislators
appointed by the city legislative delegation, and four residents
who reside in a targeted neighborhood appointed by the city
council. The advisory board shall advise the city on the
preparation of the revitalization program including the
conversion from absent-owner rental housing to home ownership,
the promotion of commercial and industrial growth in targeted
neighborhoods, and the integration of human service programs and
the redevelopment in targeted neighborhoods.
Subd. 4. [PRELIMINARY CITY REVIEW; STATE AGENCY
REVIEW.] Before adoption of the revitalization program under
subdivision 5, the city must submit a draft program to the
commissioner and the Minnesota housing finance agency for their
comment. The city may not adopt the revitalization program
until comments have been received from the state agencies or 30
days have elapsed without response after the program was sent to
them. Comments received by the city from the state agencies
within the 30-day period must be responded to in writing by the
city before adoption of the program by the city.
Subd. 5. [CITY APPROVAL.] The city may adopt the
revitalization program only after holding a public hearing after
the program has been prepared. Notice of the hearing must be
provided in a newspaper of general circulation in the city and
in the targeted neighborhood not less than ten days nor more
than 30 days before the date of the hearing.
Subd. 6. [PROGRAM CERTIFICATION.] A certification by the
city that a revitalization program has been approved by the city
council for the targeted neighborhood must be provided to the
commissioner together with a copy of the program. A copy of the
program must also be provided to the Minnesota housing finance
agency.
Subd. 7. [REVITALIZATION PROGRAM MODIFICATION.] The
revitalization program may be modified at any time by the city
council after a public hearing, notice of which is published in
a newspaper of general circulation in the city and in the
targeted neighborhood not less than ten days nor more than 30
days before the date of the hearing. If the city council
determines that the proposed modification is a significant
modification to the program originally certified under
subdivision 6, it must implement the revitalization program
approval and certification process of subdivisions 3 to 6 for
the proposed modification.
Sec. 7. [PAYMENT; CITY MATCHING MONEY; DRAWDOWN; USES OF
STATE MONEY.]
Subdivision 1. [PAYMENT OF STATE MONEY.] Upon receipt from
a city of the certification that a revitalization program has
been adopted or modified, the commissioner shall, within 30
days, pay to the city the amount of state money identified as
necessary to implement the revitalization program or program
modification. State money may be paid to the city only to the
extent that the appropriation limit for the city specified in
subdivision 2 is not exceeded. Once the state money has been
paid to the city, it becomes targeted neighborhood money for use
by the city in accordance with an adopted revitalization program
and subject only to the restrictions on its use in sections 4 to
10.
Subd. 2. [ALLOCATION.] A city may receive a part of the
appropriations made available that is the proportion that the
population of the city bears to the combined population of
Minneapolis and Saint Paul. One city may agree to reduce its
entitlement amount so that the other may receive an amount more
than its entitlement amount. The population of each city for
the purposes of this subdivision is determined according to the
most recent estimates available to the commissioner. Interest
earned by a city from money paid to the city must be repaid to
the commissioner annually unless the revitalization program
identifies the interest as necessary to implement the
revitalization program and the requirement for city matching
money is satisfied with respect to the interest.
Subd. 3. [CITY MATCHING MONEY; DRAWDOWN OF STATE MONEY;
RESTRICTION ON USE OF STATE MONEY.] A city may spend state money
only if the revitalization program identifies city matching
money to be used to implement the program in an amount equal to
the state appropriation. A city must keep the state money in a
segregated fund for accounting purposes. No state money may be
used to pay the general administrative expenses of a city that
are incurred in connection with the planning or implementation
of sections 4 to 10.
Sec. 8. [CITY POWERS AND ELIGIBLE USES OF TARGETED
NEIGHBORHOOD MONEY.]
Subdivision 1. [CONSOLIDATION OF EXISTING POWERS IN
TARGETED NEIGHBORHOODS.] A city may exercise any of its
corporate powers within a targeted neighborhood including, but
not limited to, all of the powers enumerated and granted by
chapters 458, 462, 462C, 472, 472A, and 474. For the purposes
of chapter 458, a targeted neighborhood is considered an
industrial development district. A city may exercise the powers
of chapter 458 in conjunction with, and in addition to,
exercising the powers granted by chapters 462 and 462C in order
to promote and assist housing construction and rehabilitation
within a targeted neighborhood. For the purposes of section
462C.02, subdivision 9, a targeted neighborhood is considered a
"targeted area."
Subd. 2. [GRANTS AND LOANS.] In addition to the authority
granted by other law, a city may make grants and loans to
individuals, for-profit and nonprofit corporations, and other
organizations to implement a revitalization program. The grants
and loans must contain the terms concerning use of money,
repayment, and other conditions the city deems proper to
implement a revitalization program.
Subd. 3. [ELIGIBLE USES OF TARGETED NEIGHBORHOOD
MONEY.] The city may spend targeted neighborhood money for any
purpose authorized by subdivision 1 or 2. Use of targeted
neighborhood money must be authorized in a revitalization
program.
Sec. 9. [HAZARDOUS BUILDING PENALTY.]
A city may assess a penalty equal to one percent of the
assessed value of a building located in a targeted neighborhood
defined in section 4 that the city determined to be hazardous as
defined in section 463.15, subdivision 3. The city shall send a
written notice to the address to which the property tax
statement is sent at least 90 days before it may assess the
penalty. If the owner of the building has not paid the penalty
and fixed the property within 30 days after receiving notice of
the penalty, the penalty is considered delinquent and is
increased by 25 percent each 60 days the penalty is not paid and
the property remains hazardous. For the purposes of this
section, a penalty that is delinquent is considered a delinquent
property tax and subject to Minnesota Statutes, chapters 279,
280, and 281, in the same manner as delinquent property taxes.
Sec. 10. [ANNUAL AUDIT AND REPORT.]
Subdivision 1. [ANNUAL FINANCIAL AUDIT.] In 1988 and
subsequent years, at the end of each calendar year, the
legislative auditor shall conduct a financial audit to review
the spending of state money under sections 4 to 10. Before
spending state money to implement a revitalization program, the
city must consult with the legislative auditor to determine
appropriate accounting methods and principles that will assist
the legislative auditor in conducting its financial audit. The
results of the financial audit must be submitted to the
legislative audit commission, the commissioner, and the
Minnesota housing finance agency.
Subd. 2. [ANNUAL REPORT.] A city that begins to implement
a revitalization program in a calendar year must, by March 1 of
the succeeding calendar year, provide a detailed report on the
revitalization program or programs being implemented in the
city. The report must describe the status of the program
implementation and analyze whether the intended outcomes
identified in section 6, subdivision 1, paragraph (a), clause
(4), are being achieved. The report must include at least the
following:
(1) the number of housing units removed, created, lost,
replaced, relocated, and assisted as a result of the program.
The level of rent of the units and the income of the households
affected must be included in the report;
(2) the number and type of commercial establishments
removed, created, and assisted as a result of a revitalization
program. The report must include information regarding the
number of new jobs created by category, whether the jobs are
full time or part time, and the salary or wage levels of both
new and expanded jobs in the affected commercial establishments;
(3) a description of a statement of the cost of the public
improvement projects that are part of the program and the number
of jobs created per each $20,000 of funds expended on commercial
projects and applicable public improvement projects;
(4) the increase in the assessed valuation for the city as
a result of the assistance to commercial and housing assistance;
and
(5) the amount of private investment that is a result of
the use of public money in a targeted neighborhood.
The report must be submitted to the commissioner, the
Minnesota housing finance agency, and the legislative audit
commission, and must be available to the public.
Sec. 11. [APPROPRIATION; DISTRIBUTION.]
$9,000,000 is appropriated from the general fund to the
commissioner of energy and economic development for payment to
the cities of Minneapolis and Saint Paul as provided in section
7. $4,500,000 is for fiscal year 1988 and $4,500,000 is for
fiscal year 1989.
Sec. 12. [REPEALER.]
Laws 1969, chapters 833 and 984, are repealed.
Sec. 13. [EFFECTIVE DATE; LOCAL APPROVAL.]
Sections 4 to 11 are effective for the city of Minneapolis
the day after compliance with section 645.021, subdivision 3, by
the governing body of the city of Minneapolis.
Sections 4 to 11 are effective for the city of Saint Paul
the day after compliance with section 645.021, subdivision 3, by
the governing body of the city of Saint Paul.
ARTICLE 7
NATURAL RESOURCES
Section 1. [93.001] [POLICY FOR MINERAL DEVELOPMENT.]
It is the policy of the state to provide for the
diversification of the state's mineral economy through long-term
support of mineral exploration, evaluation, development,
production, and commercialization.
Sec. 2. [93.002] [MINERAL COORDINATING COMMITTEE.]
Subdivision 1. [ESTABLISHMENT.] The mineral coordinating
committee is established to plan for diversified mineral
development. The mineral coordinating committee consists of the
director of the minerals division of the department of natural
resources, the director of the Minnesota geological survey, the
director of the University of Minnesota mineral resources
research center, and the director of the natural resources
research institute. The director of the minerals division of
the department of natural resources shall serve as chair. A
member of the committee may designate another person of the
member's organization to act in the member's place. The
commissioner of natural resources shall provide staff and
administrative services necessary for the committee's activities.
Subd. 2. [MINERAL DIVERSIFICATION PLAN.] The mineral
coordinating committee shall prepare and adopt a ten-year plan
for mineral diversification. The plan must include a strategy
to:
(1) increase the knowledge of the state's mineral potential;
(2) stimulate the development of mineral resources in the
state; and
(3) promote basic minerals research.
The plan must also include a two-year plan that establishes
funding priorities for the minerals programs under subdivision
3. The funding priorities must be updated every two years.
Subd. 3. [MINERALS PROGRAMS.] The mineral diversification
plan must address at least the following: aeromagnetic surveys,
glacial till geochemistry surveys, geologic drilling and
mapping, LMIC minerals data base, drill core examination and
assay, industrial minerals characterization and research,
bedrock geochemistry, nonferrous minerals research, reclamation
studies, economic evaluation of mineral resources, improved
geophysical and remote sensing base, acquisition of sampling
equipment and analyses, determination of mineral rights
ownership, ferrous minerals research, evaluation of mineral
resource occurrence, evaluation of value added processes, ore
deposit modeling, and basic mineral research.
Subd. 4. [SUBMISSION OF PLAN AND FUNDING PRIORITIES.] (a)
The minerals coordinating committee shall submit the minerals
diversification plan to the legislature by December 31, 1987.
(b) By January 15 of each odd-numbered year, the minerals
coordinating committee shall submit the two-year funding
priority plan required under subdivision 2 to the chairs of the
house appropriations and environment and natural resources
committees and the chairs of the senate finance and environment
and natural resources committees.
Sec. 3. [APPROPRIATION.]
Subdivision 1. [MINERALS PROGRAMS.] $1,000,000 is
appropriated from the general fund to the commissioner of
natural resources to accelerate geological mapping of the state,
accelerate evaluation of the state's mineral potential and other
natural resources, and provide analytical support for the
minerals industry according to the mineral diversification plan
or a minerals industry acceleration plan developed by the
minerals coordinating committee. $500,000 is for fiscal year
1988 and $500,000 is for fiscal year 1989.
Subd. 2. [COUNTY FORESTRY ASSISTANCE PROGRAMS.] $1,750,000
is appropriated from the general fund to the commissioner of
natural resources for grants to counties or groups of counties
for county forestry assistance programs. $875,000 is for fiscal
year 1988 and $875,000 is for fiscal year 1989. The
commissioner of natural resources shall make the appropriation
available to counties with the amount proportional to the
acreage of commercial tax-forfeited forested land managed by the
county. As a condition of receiving money, the commissioner of
natural resources shall require work plans, semiannual progress
reports, and final project reports.
Subd. 3. [FORESTRY MANAGEMENT.] $250,000 is appropriated
from the general fund to the commissioner of natural resources
for implementation of the forestry management plan required in
Minnesota Statutes, section 89.011, on land that is not managed
for the school trust fund. $125,000 is for fiscal year 1988 and
$125,000 is for fiscal year 1989.
Sec. 4. [EFFECTIVE DATE.]
This article is effective the day following final enactment.
ARTICLE 8
IRON RANGE RESOURCES AND REHABILITATION
Section 1. [298.2213] [NORTHEAST MINNESOTA ECONOMIC DEVELOPMENT
FUND.]
Subdivision 1. [APPROPRIATION.] $4,000,000 is appropriated
from the general fund to the commissioner of iron range
resources and rehabilitation. $300,000 of this appropriation
must be used in the same manner as money appropriated under
Minnesota Statutes, section 298.17.
Subd. 2. [PURPOSE OF EXPENDITURES.] The money appropriated
in this section may be used for projects and programs for which
technological and economic feasibility have been demonstrated
and that have the following purposes:
(1) creating and maintaining productive, permanent, skilled
employment, including employment in technologically innovative
businesses; and
(2) encouraging diversification of the economy and
promoting the development of minerals, alternative energy
sources utilizing indigenous fuels, forestry, small business,
and tourism.
Subd. 3. [USE OF MONEY.] The money appropriated under this
section may be used to provide loans, loan guarantees, interest
buy-downs, and other forms of participation with private sources
of financing, provided that a loan to a private enterprise must
be for a principal amount not to exceed one-half of the cost of
the project for which financing is sought, and the rate of
interest on a loan must be no less than the lesser of eight
percent or the rate of interest set by the Minnesota development
board for comparable small business development loans at that
time.
Money appropriated in this section must be expended only in
or for the benefit of the tax relief area defined in Minnesota
Statutes, section 273.134, and as otherwise provided in this
section.
Subd. 4. [PROJECT APPROVAL.] The board shall by August 1,
1987, and each year thereafter prepare a list of projects to be
funded from the money appropriated in this section with
necessary supporting information including descriptions of the
projects, plans, and cost estimates. A project must not be
approved by the board unless it finds that:
(1) the project will materially assist, directly or
indirectly, the creation of additional long-term employment
opportunities;
(2) the prospective benefits of the expenditure exceed the
anticipated costs; and
(3) in the case of assistance to private enterprise, the
project will serve a sound business purpose.
To be proposed by the board, a project must be approved by
at least eight iron range resources and rehabilitation board
members and the commissioner of iron range resources and
rehabilitation. The list of projects must be submitted to the
legislative advisory commission for its review. The list with
the recommendation of the legislative advisory commission must
be submitted to the governor, who shall, by November 15 of each
year, approve, disapprove, or return for further consideration,
each project. The money for a project may be spent only upon
approval of the project by the governor.
The board may submit supplemental projects for approval at
any time. Supplemental projects must be submitted to the
members of the legislative advisory commission for their review
and recommendations of further review. If a recommendation is
not provided within ten days, no further review by the
legislative advisory commission is required, and the governor
shall approve or disapprove each project or return it for
further consideration. If the recommendation by a member is for
further review, the governor shall submit the request to the
legislative advisory commission for its review and
recommendation. Failure or refusal of the commission to make a
recommendation promptly is a negative recommendation.
Subd. 5. [ADVISORY COMMITTEES.] Before submission to the
board of a proposal for a project for expenditure of money
appropriated under this section, the commissioner of iron range
resources and rehabilitation shall appoint a technical advisory
committee consisting of at least seven persons who are
knowledgeable in areas related to the objectives of the
proposal. If the project involves investment in a scientific
research proposal, at least four of the committee members must
be knowledgeable in the specific scientific research area
relating to the project. Members of the committees must be
compensated as provided in Minnesota Statutes, section 15.059,
subdivision 3. The board shall not act on a proposal until it
has received the evaluation and recommendations of the technical
advisory committee.
Subd. 6. [USE OF REPAYMENTS AND EARNINGS.] Principal and
interest received in repayment of loans made under this section
must be deposited in the state treasury and are appropriated to
the board for the purposes of this section.
Sec. 2. Minnesota Statutes 1986, section 298.292, is
amended to read:
298.292 [POLICY.]
Subdivision 1. [PURPOSES.] The legislature is cognizant of
the severe economic dislocations and widespread unemployment
that result when a single industry on which an area is largely
dependent, experiences a drastic reduction in activity. The
northeast Minnesota economic protection trust fund is hereby
created to be devoted to economic rehabilitation and
diversification of industrial enterprises where these conditions
ensue as the result of the decline of such a single industry.
Priority shall be given to using the northeast Minnesota
economic protection trust fund for the following purposes:
(a) (1) projects and programs that are designed to create
and maintain productive, permanent, skilled employment,
including employment in technologically innovative businesses;
(b) (2) projects and programs to encourage diversification
of the economy and to promote the development of minerals,
alternative energy sources utilizing indigenous fuels, forestry,
small business, and tourism; and
(c) (3) projects and programs for which technological and
economic feasibility have been demonstrated;.
(d) Subd. 2. [USE OF MONEY.] Money in the northeast
Minnesota economic protection trust fund may be used for the
following purposes:
(1) to provide loans, loan guarantees, interest buy-downs
and other forms of participation with private sources of
financing, but a loan to a private enterprise shall be for a
principal amount not to exceed one-half of the cost of the
project for which financing is sought, and the rate of interest
on a loan shall be no less than the lesser of eight percent or
an interest rate three percentage points less than a full faith
and credit obligation of the United States government of
comparable maturity, at the time that the loan is approved;
(e) funding (2) to fund reserve accounts established to
secure the payment when due of the principal of and interest on
bonds issued pursuant to section 298.2211; and
(f) (3) to pay in periodic payments or in a lump sum
payment any or all of the interest on bonds issued pursuant to
chapter 474 for the purpose of constructing, converting, or
retrofitting heating facilities in connection with district
heating systems or systems utilizing alternative energy sources;
and
(4) to invest in a venture capital fund or enterprise that
will provide capital to other entities that are engaging in, or
that will engage in, projects or programs that have the purposes
set forth in subdivision 1. No investments may be made in a
venture capital fund or enterprise unless at least two other
unrelated investors make investments of at least $500,000 in the
venture capital fund or enterprise, and the investment by the
northeast Minnesota economic protection trust fund may not
exceed the amount of the largest investment by an unrelated
investor in the venture capital fund or enterprise. For
purposes of this subdivision, an "unrelated investor" is a
person or entity that is not related to the entity in which the
investment is made or to any individual who owns more than 40
percent of the value of the entity, in any of the following
relationships: spouse, parent, child, sibling, employee, or
owner of an interest in the entity that exceeds ten percent of
the value of all interests in it. For purposes of determining
the limitations under this clause, the amount of investments
made by an investor other than the northeast Minnesota economic
protection trust fund is the sum of all investments made in the
venture capital fund or enterprise during the period beginning
one year before the date of the investment by the northeast
Minnesota economic protection trust fund.
Money from the trust fund shall be expended only in or for
the benefit of the tax relief area defined in section 273.134.
Sec. 3. Minnesota Statutes 1986, section 298.296,
subdivision 2, is amended to read:
Subd. 2. [EXPENDITURE OF FUNDS.] Before January 1, 2002,
funds may be expended on projects and for administration of the
trust fund only from the net interest, earnings, and dividends
arising from the investment of the trust at any time, including
net interest, earnings, and dividends that have arisen prior to
July 13, 1982, plus $10,000,000 made available for use in fiscal
year 1983, except that any amount required to be paid out of the
trust fund to provide the property tax relief specified in Laws
1977, chapter 423, article X, section 4, and to make school bond
payments and payments to recipients of taconite production tax
proceeds pursuant to section 298.225, may be taken from the
corpus of the trust. On and after January 1, 2002, funds may be
expended on projects and for administration from any assets of
the trust. Annual administrative costs, not including detailed
engineering expenses for the projects, shall not exceed five
percent of the net interest, dividends, and earnings arising
from the trust in the preceding fiscal year.
Principal and interest received in repayment of loans made
pursuant to this section, and earnings on other investments made
under section 298.292, subdivision 2, clause (4), shall be
deposited in the state treasury and credited to the trust.
These receipts are appropriated to the board for the purposes of
sections 298.291 to 298.298.
Sec. 4. [EFFECTIVE DATE.]
Section 2 is effective the day following final enactment.
ARTICLE 9
MINNESOTA AGRICULTURAL AND ECONOMIC DEVELOPMENT PROGRAM
Section 1. Minnesota Statutes 1986, section 41A.01, is
amended to read:
41A.01 [PURPOSE.]
Sections 41A.01 to 41A.06 41A.08 provide a framework for an
agricultural resource loan guaranty program, the purposes of
which are to further the development of the state's agricultural
resources and improve the market for its agricultural
products and economic development in the state. All credit
advanced pursuant to loan guaranty commitments is to be secured
by subrogation of the state to mortgage security and other
security interests granted to the private lender, in proportion
to the amount advanced by the state. A loan guaranty board is
established to investigate the feasibility of each project, its
conformity to public policy and to environmental standards, the
qualifications of the owners, operators, and lenders, and the
nature and extent of the security, prior to commitment. The
board shall also seek to secure financial participation by
private persons not supported by the guaranty, to assure that in
these respects each project satisfies and will continue to
satisfy criteria which are adequate in the judgment of the board.
Sec. 2. Minnesota Statutes 1986, section 41A.02,
subdivision 3, is amended to read:
Subd. 3. [AGRICULTURAL RESOURCE LOAN GUARANTY MINNESOTA
AGRICULTURAL AND ECONOMIC DEVELOPMENT BOARD; BOARD.]
"Agricultural resource loan guaranty Minnesota agricultural and
economic development board" or "board" means consists of the
commissioner of finance as chair, the commissioner of
agriculture, the commissioner of commerce, the commissioner of
energy and economic development, and the director of the
pollution control agency, the president of the Greater Minnesota
Corporation, and two public members with experience in finance,
appointed by the Greater Minnesota Corporation.
Sec. 3. Minnesota Statutes 1986, section 41A.02,
subdivision 4, is amended to read:
Subd. 4. [AGRICULTURAL RESOURCE LOAN GUARANTY MINNESOTA
AGRICULTURAL AND ECONOMIC DEVELOPMENT FUND; GUARANTY DEVELOPMENT
FUND.] "Agricultural resource loan guaranty Minnesota
agricultural and economic development fund" or "guaranty
development fund" means the fund created by section 41A.05.
Sec. 4. Minnesota Statutes 1986, section 41A.02,
subdivision 6, is amended to read:
Subd. 6. [AGRICULTURAL RESOURCE PROJECT; PROJECT.]
"Agricultural resource project" or "project" means (1) any
facility, or portion of a facility, located in the state which
is operated or to be operated primarily for the production from
agricultural resources of marketable products, (2) buildings,
equipment, and land used for the commercial production of
turkeys or turkey products, (3) a facility or portion of a
facility used for the commercial production of fish or of
products made from commercially-produced fish or rough fish, as
defined in section 97A.015, subdivision 43, that are not
commercially produced, or (4) real or personal property used or
useful in connection with a revenue-producing enterprise, or a
combination of two or more revenue-producing enterprises engaged
in a business, that is not used for the production of livestock,
other than poultry, or for the production of crops, plants, or
milk. The land in clause (2) is limited to land on which
buildings and equipment are situated and immediately surrounding
land used for storage, waste disposal, or other functions
directly related to the commercial production of turkeys or
turkey products at that project site. The land in clause (2)
does not include land used for the growing or raising of crops
or the grazing of livestock other than poultry. A project
includes a facility or portion of a facility for mixing or
producing substances to be mixed with other substances for use
as a fuel or as a substitute for petroleum or petrochemical
feedstocks.
Sec. 5. Minnesota Statutes 1986, section 41A.02,
subdivision 11, is amended to read:
Subd. 11. [LENDER.] "Lender" means a corporation or any
investment or commercial banking institution, savings and loan
institution, insurance company, investment company, or other
financial institution or institutional investor making,
purchasing, or participating in a loan or any part of a loan, or
a public entity authorized to make agricultural loans.
Sec. 6. Minnesota Statutes 1986, section 41A.02, is
amended by adding a subdivision to read:
Subd. 16. [ELIGIBLE SMALL BUSINESS.] "Eligible small
business" means:
(1) an enterprise determined by the board to constitute a
small business concern as defined in regulations of the United
States Small Business Administration under United States Code,
title 15, sections 631 to 647; or
(2) a business eligible to receive assistance under section
12.
Sec. 7. Minnesota Statutes 1986, section 41A.02, is
amended by adding a subdivision to read:
Subd. 17. [SMALL BUSINESS DEVELOPMENT LOAN.] "Small
business development loan" means a loan to a business that is an
"eligible small business" to finance capital expenditures on an
interim or long-term basis to acquire or improve land, acquire,
construct, rehabilitate, remove, or improve buildings, or to
acquire and install fixtures and equipment useful to conduct a
small business, including facilities of a capital nature useful
or suitable for a business engaged in an enterprise promoting
employment including, without limitation, facilities included
within the meaning of the term "project" as defined in sections
474.02, subdivisions 1 to 1f, and 474.03, subdivision 4.
Sec. 8. [41A.021] [SUCCESSOR STATUS.]
The board is the legal successor in all respects of the
agricultural resource loan guaranty board established by Laws
1984, chapter 502, article 10, and all bonds, resolutions,
contracts, and liabilities of the agricultural resource loan
guaranty board are the bonds, resolutions, contracts, and
liabilities of the board as renamed and reconstituted by section
41A.02, subdivision 3.
Sec. 9. [41A.022] [MINNESOTA ENERGY AND ECONOMIC
DEVELOPMENT AUTHORITY; SUCCESSOR STATUS.]
The board is the legal successor in all respects of the
Minnesota energy and economic development authority under the
general bond resolution for the Minnesota small business
development loan program, as amended and restated by the
authority on September 24, 1986. All bonds, resolutions,
contracts, and liabilities of the Minnesota energy and economic
development authority relating to the Minnesota small business
development loan program are the bonds, resolutions, contracts,
and liabilities of the Minnesota agricultural and economic
development board.
Sec. 10. [41A.023] [POWERS.]
In addition to other powers granted by this chapter, the
board may:
(1) sue and be sued;
(2) acquire, hold, lease, and transfer any interest in real
and personal property for its corporate purposes;
(3) sell at public or private sale any instrument or
obligation evidencing a loan;
(4) obtain insurance on its property;
(5) obtain municipal bond insurance, letters of credit,
surety obligations, or similar agreements from financial
institutions;
(6) enter into other agreements or transactions, without
regard to chapter 16B, that the board considers necessary or
appropriate to carry out the purposes of this chapter with
federal or state agencies, political subdivisions of the state,
or other persons, firms, or corporations;
(7) establish and collect fees without regard to chapter 14
and section 16A.128;
(8) accept appropriations, gifts, grants, and bequests;
(9) use money received from any source for any legal
purpose or program of the board;
(10) participate in loans for agricultural resource
projects in accordance with section 11;
(11) provide small business development loans in accordance
with section 12; and
(12) guarantee or insure bonds or notes issued by the board.
Sec. 11. [41A.035] [AGRICULTURAL RESOURCES LOAN
PARTICIPATION.]
The board may participate in loans made to finance
agricultural resource projects by purchasing from a lender up to
75 percent of the amount of each eligible loan. If the loan
participated in is for $500,000 or less, the loan may be for 100
percent of the cost of the project. If the loan participated in
exceeds $500,000, the loan may not exceed 80 percent of the cost
of the project. The lender shall service the loan or cause it
to be serviced in a manner that equally protects the lender's
and the board's interests.
Sec. 12. [41A.036] [SMALL BUSINESS DEVELOPMENT LOANS.]
Subdivision 1. [LOANS; LIMITATIONS.] (a) The board may
make, purchase, or participate with financial institutions in
making or purchasing small business development loans not
exceeding $1,000,000 in principal amount with respect to small
business loans made or purchased by the board and not exceeding
$1,000,000 principal amount with respect to the board's share
when the board participates in making or purchasing small
business loans.
(b) With respect to loans that the board makes or purchases
or participates in, the board may determine or provide for their
servicing, the percentage of board participation, if any, the
times the loans or participations are payable and the amounts of
payment, their amount and interest rates, their security, if
any, and other terms, conditions, and provisions necessary or
convenient in connection with them and may enter into all
necessary contracts and security instruments in connection with
them. The board may enter into commitments to purchase or
participate with financial institutions or other persons upon
the terms, conditions, and provisions determined by it. Loans
or participations may be serviced by financial institutions or
other persons designated by the board.
(c) The board shall obtain the best available security for
all loans. The board may provide for or require the insurance
or guaranteeing of the loans or board participations in whole or
in part by the federal government or a department, agency, or
instrumentality of it, by an appropriate board account, or by a
private insurer.
Subd. 2. [SMALL BUSINESS DEVELOPMENT LOANS;
PREFERENCES.] The following eligible small businesses have
preference among all business applicants for small business
development loans:
(1) businesses located in rural areas of the state that are
experiencing the most severe unemployment rates in the state;
(2) businesses that are likely to expand and provide
additional permanent employment in rural areas of the state;
(3) businesses located in border communities that
experience a competitive disadvantage due to location;
(4) businesses that have been unable to obtain traditional
financial assistance due to a disadvantageous location, minority
ownership, or other factors rather than due to the business
having been considered a poor financial risk;
(5) businesses that utilize state resources and reduce
state dependence on outside resources, and that produce products
or services consistent with the long-term social and economic
needs of the state; and
(6) businesses located in designated enterprise zones, as
described in section 273.1312, subdivision 4.
Subd. 3. [LOCAL GOVERNMENTAL UNIT SPONSOR; RESOLUTION.] A
business applying for a loan must be sponsored by a resolution
of the governing body of the local governmental unit within
whose jurisdiction the project is located. For purposes of this
paragraph, "local governmental unit" means a home rule charter
or statutory city when the project is located in an incorporated
area, a county when the project is located in an unincorporated
area, or an American Indian tribal council when the project is
located within a federally recognized American Indian
reservation or community.
Sec. 13. Minnesota Statutes 1986, section 41A.04,
subdivision 1, is amended to read:
Subdivision 1. [REQUIREMENTS.] (a) Any applicant may file
a written application with the state commissioner of energy and
economic development on behalf of the board, to be considered by
the agricultural resource loan guaranty board, for a guaranty by
the state of a portion of a loan or for issuance of bonds for an
agricultural resource project. In general, the application must
provide information similar to that required by an investment
banking or other financial institution considering such a
project for debt financing. Specifically, each application must
include in brief but precise form the following information, as
supplied by the applicant, the borrower, or the lender:
(1) a description of the scope, nature, extent, and
location of the proposed project, including the identity of the
borrower and a preliminary or conceptual design of the project;
(2) a description of the technology to be used in the
project and the prior construction and operating experience of
the borrower with such projects;
(3) a detailed estimate of the items comprising the total
cost of the project, including escalation and contingencies,
with explanation of the assumptions underlying the estimate;
(4) a general description of the financial plan for the
project, including the mortgage and security interests to be
granted for the security of the guaranteed loan or the bonds,
and all sources of equity, grants, or contributions or of
borrowing the repayment of which is not to be secured by the
mortgage and security interests, or, if so secured, is expressly
subordinated to the guaranteed loan;
(5) an environmental report analyzing potential
environmental effects of the project, any necessary or proposed
mitigation measures, and other relevant data available to the
applicant to enable the board to make an environmental
assessment;
(6) a list of applications to be filed and estimated dates
of approvals of permits required by federal, state, and local
government agencies as conditions for construction and
commencement of operation of the project;
(7) an estimated construction schedule;
(8) an analysis of the estimated cost of production of and
market for the product, including economic factors justifying
the analysis and proposed and actual marketing contracts,
letters of intent, and contracts for the supply of feedstock;
(9) a description of the management experience of the
borrower in organizing and undertaking similar projects;
(10) pro forma cash flow statements for the first five
years of project operation including income statements and
balance sheets;
(11) a description of the borrower's organization and,
where applicable, a copy of its articles of incorporation or
partnership agreement and bylaws;
(12) the estimated amount of the loan or bonds and
percentage of the guaranty requested, the proposed repayment
schedule, and other terms and conditions and security provisions
of the loan;
(13) an estimate of the amounts and times of receipt of
guaranty fees, sales and use taxes, property tax increments, and
any other governmental charges which may be available for the
support of the state guaranty agricultural development fund as a
result of the construction of the project, with an analysis of
the assumptions on which the estimate is based;
(14) a copy of any lending commitment issued by a lender to
the borrower;
(15) a statement from the lender, if identified, as to its
general experience in financing and servicing debt incurred for
projects of the size and general type of the project, and its
proposed servicing and monitoring plan; and
(16) additional information required by the board.
(b) The applicant shall pay upon filing of the application
a fee equal to .25 percent of the amount of the loan guaranty or
bond requested. The fee shall be paid to the commissioner of
finance and deposited in the general fund. If the board
determines not to issue a commitment for the project, the fee
shall be refunded to the applicant, less the board's cost of
processing, reviewing, and evaluating the application. If the
board issues a commitment for the project and the application
fee exceeds the board's cost of processing, reviewing, and
evaluating the application, the balance shall be transferred
from the general fund to the project account in the guaranty
fund and credited against the amount of the commitment fee
required in section 41A.03, subdivision 3, clause (j). The
county or rural development finance authority may require the
proposed borrower under the project to pay the application fee.
(c) If the application is made by an applicant other than
the county or rural development finance authority and tax
increment financing is to be used for the project, the
application must include a copy of a resolution adopted by the
governing body of the county or rural development finance
authority in which the project is located. The resolution must
authorize the use of tax increment financing for the project as
required by section 41A.06, subdivision 5.
Sec. 14. Minnesota Statutes 1986, section 41A.05,
subdivision 1, is amended to read:
Subdivision 1. [ESTABLISHMENT OF FUND.] For the purpose of
developing the state's agricultural resources by extending
credit on real estate security, the agricultural resource loan
guaranty The Minnesota agricultural and economic development
fund is established as a special and dedicated fund to be held
and invested separately from all other funds of the state. All
money appropriated to the fund, and all guaranty fees, retail
sales taxes, property tax increments, and other money from any
source which may be credited to the fund pursuant to law or
pursuant to the terms of grants, contributions, or contracts are
appropriated and shall remain available for the purposes of the
fund until those purposes have been fully accomplished to the
board to carry out the purposes of this chapter. The board
may maintain or establish within the guaranty Minnesota
agricultural and economic development fund reserve
funds accounts, project accounts, trustee accounts, special
guaranty fund accounts, or other restrictions it determines
necessary or appropriate to carry out the purposes of this
chapter. Except as otherwise provided in this section, the fund
may be used only for paying amounts due under loan guaranties
and principal and interest assistance contracts entered into by
the state, pursuant to the agricultural resource loan guaranty
program. The board may enter into pledge and escrow agreements
or indentures of trust with a trustee for the purpose of
maintaining the accounts.
Sec. 15. Minnesota Statutes 1986, section 41A.05,
subdivision 2, is amended to read:
Subd. 2. [ISSUANCE OF BONDS.] (a) Subject to section
16A.80, upon application pursuant to section 41A.04, The board
by resolution may exercise the powers of a rural development
authority under sections 362A.01 to 362A.05 and the powers of a
municipality under chapter 474 for the purposes of providing
money to pay the costs of financing a project, including the
issuance of bonds and the loan application of the bond proceeds
pursuant to a lease, loan, loan guaranty, loan participation, or
other agreement. The bonds must be issued, sold, and secured on
the terms and conditions and in the manner determined by
resolution of the board. Sections Section 16A.80 and 474.23 do
does not apply to the bonds. Notwithstanding subdivision 1, a
reserve established for the bonds provided by the borrower,
including out of bond proceeds, may be deposited and held in a
separate account in the guaranty Minnesota agricultural and
economic development fund and applied to the last installments
of principal or interest on the bonds, subject to the reserves
being withdrawn for any purpose permitted by subdivision 1. The
board may by resolution or indenture pledge any or all amounts
in the guaranty fund, including any reserves and investment
income on amounts in the fund, to secure the payment of
principal and interest on any or all series of bonds, upon the
terms and conditions as provided in the resolution or
indenture. To the extent the board deems necessary or desirable
to prevent interest on bonds from becoming subject to federal
income taxation, (1) the amounts in the guaranty fund shall be
invested in obligations or securities with restricted yields and
(2) the investment income on the amounts are released from the
pledge securing the bonds or loan guaranty and appropriately
applied to prevent taxation.
(b) Bonds issued pursuant to this chapter are not general
obligations of the state or the board. The full faith and
credit and taxing powers of the state and the board are not and
may not be pledged for the payment of the bonds. No person may
compel the levy of a tax for the payment or compel the
appropriation of money of the state or the board for the payment
of the bonds, except as specifically provided in this chapter.
(c) The issuance of bonds pursuant to this subdivision is
subject to sections 474.18 to 474.25. For purposes of
sections 474.16 474A.01 to 474.20 474A.21, the board is a local
issuer and may apply for allocations of authority to issue
private activity obligations and may enter into an agreement for
the issuance of obligations by another issuer.
Sec. 16. [41A.065] [CERTIFIED DEVELOPMENT COMPANY.]
Subdivision 1. [PURPOSE; OBJECTIVES.] The board may
create, promote, and assist a development company that will
qualify as a certified development company for the purposes of
United States Code, title 15, section 697, and Code of Federal
Regulations, title 13, section 108.503.
The board shall utilize the development company program to
stimulate the state's economic activity.
The development company and its directors and officers
shall comply with the organizational, operational, regulatory,
and reporting requirements as promulgated by the United States
Small Business Administration and the guidelines contained in
the bylaws, articles of incorporation, and standard operating
procedure prescribed by the Small Business Administration.
Subd. 2. [CAPITAL, LOAN LIMITS; MEMBERSHIP REQUIREMENTS.]
The capital for a certified development company must be derived
from corporate holders or members, each of whom must not have
more than ten percent of the voting control of the development
company. The company must have a minimum of ten members. The
members of the company from each economic development region
must represent, to the greatest extent practical, the same
proportion of the membership of the company as the population of
the economic development region is of the population of the
state. The loan limit of each member must be established at the
time of its acceptance as a member and must be computed on the
basis of the financial information contained in or made a part
of its application for membership. Loan limits must be
established at the thousand dollar amount nearest the amount
computed in accordance with the provisions of the articles of
incorporation and this section.
Subd. 3. [MEMBERS.] Members must be representatives of
local government, community organizations, financial
institutions, and businesses in Minnesota and must, upon
application, have been accepted for membership by a majority
vote of the members of the board of directors present at a
regular or special meeting of the board at which there is a
quorum. A "financial institution" is a business organization
recognized under Minnesota or federal law as a banking
institution, trust company, savings and loan association,
insurance company, or a corporation, partnership, foundation or
other institution licensed to do business in the state of
Minnesota and engaged primarily in lending or investing money.
Subd. 4. [MEMBERSHIP APPLICATIONS.] Applications for
membership must be submitted to the development company's board
of directors on forms provided by the corporation and
accompanied by additional information as the form may require.
Application forms must provide that if the application is
approved and the applicant accepted for membership by the
development company's board of directors before withdrawal of
the application, the applicant agrees to become a member upon
the acceptance and to assume the rights and obligations of a
member. Notice of approval or rejection of an application must
be forwarded, by certified or registered United States mail, to
the applicant for the attention of the person signing the
application, within 15 days following the date when the approval
or rejection is made. Approval of the application constitutes
acceptance of the applicant as a member of the corporation.
Subd. 5. [OFFICERS.] The executive officers of the
development company are a president, one or more vice presidents
including the executive vice president, a secretary, and a
treasurer. None of the officers, except the president, need be
directors. One person may hold the offices and perform the
duties of any two or more of the offices. The development
company's board of directors by majority vote may leave unfilled
for any period it may fix any office except that of president,
treasurer, or secretary.
Subd. 6. [ASSISTANCE.] The commissioner of energy and
economic development shall make available the professional staff
of the department to provide services to the development company
including, but not limited to, accounting, legal, and business
assistance services. The staff must have the capability to
package, process, close and service loans made through the
development company.
Subd. 7. [REPORTS.] The development company shall submit
to the Small Business Administration annual reports on its
operation. When requested by the Small Business Administration,
interim reports of a similar nature must be provided. The
reports must be provided in accordance with the instructions and
attachments set forth by the Small Business Administration. The
development company shall comply with all regulations issued
under the small business investment act of 1958, as amended, as
well as applicable state and federal laws affecting its
operation.
Subd. 8. [REVOLVING ACCOUNT.] The development company may
charge a one-time processing fee up to the maximum allowed by
the Small Business Administration on a debenture issued for loan
purposes. In addition, a fee for servicing loans may be imposed
up to the maximum allowed by the Small Business Administration
based on the unpaid balance of each debenture. These fees must
be deposited in the state treasury and credited to a special
account. Money in the account is appropriated to the board to
pay the costs of administering the program, including personnel
costs; compensate members of the board of directors under
section 15.0575, subdivision 3, and to create and operate a pool
of money for investment in projects that further the purposes of
this section.
Sec. 17. Minnesota Statutes 1986, section 41A.08, is
amended to read:
41A.08 [STAFF.]
Subdivision 1. [EMPLOYEES.] Subject to all other
applicable laws governing employees of or employment by a
department or agency of the state, the commissioner of energy
and economic development, on behalf of the board, may retain or
employ the officers, employees, agents, contractors, and
consultants the commissioner determines necessary or appropriate
to discharge the functions of the board in respect to the
agricultural resource loan program. The commissioner shall
define their duties and responsibilities.
Subd. 2. [EXECUTIVE DIRECTOR.] The commissioner shall
employ, with the concurrence of the board, an executive
director. The executive director shall perform the duties that
the board may require in carrying out its responsibilities. The
executive director's position is in the unclassified service.
Sec. 18. [RESPONSIBILITIES TRANSFERRED TO MINNESOTA
DEVELOPMENT BOARD.]
Subdivision 1. [TRANSFER.] The responsibilities under the
general bond resolution for the Minnesota small business
development loan program, as amended and restated by the
authority on September 24, 1986, and the responsibilities for
the certified development company program under section 116M.05
are transferred from the Minnesota energy and economic
development authority to the Minnesota agricultural and economic
development board. Money designated or committed to the small
business development loan program is transferred to the
Minnesota agricultural and economic development fund, to be
credited to a separate account to be used to carry out the
purposes specified in section 9. This transfer includes four
classified positions and one unclassified position from the
financial management division of the department of energy and
economic development. Minnesota Statutes, section 15.039
applies to the transfer of responsibilities.
Subd. 2. [POWERS CONTINUED.] To carry out the purposes
specified in sections 9 and 19, the board may exercise the
powers granted to the Minnesota energy and economic development
authority under Minnesota Statutes 1986, sections 116M.06,
116M.07, and 116M.08, notwithstanding the repeal of those
sections.
Sec. 19. [LOAN REPAYMENTS.]
The commissioner of energy and economic development shall
credit money received before July 1, 1987, from loan repayments,
earnings, releases from insurance reserve accounts, and other
income from the following programs to the Minnesota agricultural
and economic development fund: the special assistance program
under section 116M.07, subdivision 11, except for the small
business development loans; the technology product loan program;
the tourism loan program created under section 116M.07; the
energy loan insurance program under section 116M.11; the energy
development fund program under section 116M.12; and the
Minnesota fund program under sections 472.11 to 472.13. The
commissioner of energy and economic development shall credit
money received on or after July 1, 1987, to the greater
Minnesota fund.
Sec. 20. [41A.066] [HAZARDOUS WASTE PROCESSING FACILITY LOANS.]
Subdivision 1. [AUTHORITY TO MAKE LOANS.] The Minnesota
agricultural and economic development board may make, purchase,
or participate in making or purchasing hazardous waste
processing facility loans in any amount, and may enter into
commitments therefor. A private person proposing to develop and
operate a hazardous waste processing facility is eligible to
apply for a loan under this subdivision. Applications must be
made to the Minnesota agricultural and economic development
board. The Minnesota agricultural and economic development
board shall forward the applications to the waste management
board for review pursuant to section 115A.162. If the waste
management board does not certify the application, the Minnesota
agricultural and economic development board may not approve the
application nor make the loan. If the waste management board
certifies the application, the Minnesota agricultural and
economic development board shall approve the application and
make the loan if money is available for it and if the Minnesota
agricultural and economic development board finds that:
(1) development and operation of the facility as proposed
by the applicant is economically feasible;
(2) there is a reasonable expectation that the principal
and interest on the loan will be fully repaid; and
(3) the facility is unlikely to be developed and operated
without a loan from the Minnesota agricultural and economic
development board.
The Minnesota agricultural and economic development board
and the waste management board shall establish coordinated
procedures for loan application, certification, and approval.
The Minnesota agricultural and economic development board
may use the Minnesota agricultural and economic development fund
to provide financial assistance to any person whose hazardous
waste processing facility loan application has been certified by
the waste management board and approved by the Minnesota
agricultural and economic development board, and for this
purpose may exercise the powers granted in Minnesota Statutes
1986, section 116M.06, subdivision 2, with respect to any loans
made or bonds issued under this subdivision regardless of
whether the applicant is an eligible small business.
The Minnesota agricultural and economic development board
may issue bonds and notes in the aggregate principal amount of
$10,000,000 for the purpose of making, purchasing, or
participating in making or purchasing hazardous waste processing
facility loans.
The Minnesota agricultural and economic development board
may adopt emergency rules under sections 14.29 to 14.36 to
implement the loan program under this subdivision. Emergency
rules adopted by the Minnesota agricultural and economic
development board remain in effect for 360 days or until
permanent rules are adopted, whichever occurs first.
Subd. 2. [MINNESOTA ENERGY AND ECONOMIC DEVELOPMENT
AUTHORITY; SUCCESSOR STATUS.] Notwithstanding the repeal of
section 116M.07, subdivision 9, the Minnesota agricultural and
economic development board is the legal successor in all
respects of the Minnesota energy and economic development
authority for the hazardous waste processing facility loan
program for a project or facility described under Minnesota
Statutes 1986, section 116M.03, subdivision 15, with respect to
which the Minnesota energy and economic development authority
passed a preliminary resolution before May 1, 1987. All
resolutions of the Minnesota energy and economic development
authority relating to the projects or facilities are the
resolutions of the Minnesota agricultural and economic
development board.
Sec. 20. [INSTRUCTION TO REVISOR.]
The revisor of statutes is directed to change the phrase
"agricultural resource loan guaranty board" wherever it appears
in Minnesota Statutes to "Minnesota agricultural and economic
development board" in the next and subsequent editions of the
statutes.
Sec. 21. [INSTRUCTION TO REVISOR.]
The revisor of statutes is directed to change the phrase
"agricultural resource loan guaranty fund" wherever it appears
in Minnesota Statutes to "Minnesota agricultural and economic
development fund" in the next and subsequent editions of the
statutes.
Sec. 22. [APPROPRIATION.]
$400,000 is transferred from the economic development fund
to the Minnesota agricultural and economic development fund.
$200,000 is for fiscal year 1988 and $200,000 is for fiscal year
1989.
Sec. 23. [EFFECTIVE DATE.]
Sections 18 and 19 are effective the day following final
enactment.
ARTICLE 10
EDUCATION AND TRAINING PROGRAMS
Section 1. Minnesota Statutes 1986, section 116L.02, is
amended to read:
116L.02 [JOBS JOB SKILLS PARTNERSHIP PROGRAM.]
The Minnesota job skills partnership program is created to
act as a catalyst to bring together employers with specific
training needs with educational or other nonprofit institutions
which can design programs to fill those needs. The partnership
shall work closely with employers to train and place workers in
identifiable positions as well as assisting educational or other
nonprofit institutions in developing training programs that
coincide with current and future employer requirements. The
partnership shall provide grants to educational or other
nonprofit institutions for the purpose of training displaced
workers. A participating business must match the grant-in-aid
made by the Minnesota job skills partnership. Preference must
be given to a business located in a rural area. The match may
be in the form of funding, equipment, or faculty.
Sec. 2. Minnesota Statutes 1986, section 116L.03,
subdivision 2, is amended to read:
Subd. 2. [APPOINTMENT.] Members shall be appointed as
follows: four members appointed by the speaker of the house;
one member appointed by the minority leader of the house; four
members appointed by the majority leader of the senate; one
member appointed by the minority leader of the senate; The
Minnesota job skills partnership board consists of: eight
members appointed by the governor; and, the commissioners of the
departments commissioner of energy and economic development,
education, and jobs and training the commissioner of jobs and
training, and the state director of vocational technical
education.
Sec. 3. Minnesota Statutes 1986, section 116L.03,
subdivision 1, is amended to read:
Subdivision 1. [MEMBERS.] The partnership shall be
governed by a board of 21 11 directors.
Sec. 4. Minnesota Statutes 1986, section 116L.03,
subdivision 5, is amended to read:
Subd. 5. [TERMS.] The terms of appointed members shall be
for four years except for the initial appointments. The initial
appointments of the speaker and majority leader shall be as
follows: two members for two years, two members for three years
and one member for four years. The initial appointments of the
governor shall have the following terms: two members each for
one, two, three, and four years.
Sec. 5. Minnesota Statutes 1986, section 116L.03,
subdivision 7, is amended to read:
Subd. 7. [OFFICES.] The commissioner of jobs and training
higher education coordinating board shall, upon request, provide
office space and support staff and administrative services for
the board.
Sec. 6. [136A.134] [GRANTS TO DISLOCATED RURAL WORKERS.]
Subdivision 1. [ESTABLISHMENT OF PROGRAM.] The higher
education coordinating board shall develop policies and
procedures to administer a dislocated rural worker grant program
and to allocate program money to eligible institutions and shall
supervise the operation of the program.
Subd. 2. [ELIGIBLE INSTITUTIONS.] For purposes of this
section, "eligible institution" has the meaning given it in
section 136A.101.
Subd. 3. [APPLICANTS.] An applicant may be considered for
a dislocated rural worker grant if the applicant:
(1) is a resident of rural Minnesota;
(2) is enrolled in an adult farm management program or a
program designed to provide preparation for available employment
within the local labor market or in an area to which the
individual is willing to relocate;
(3) has met the financial need criteria established by the
board; and
(4) can demonstrate that one of the following criteria has
been met:
(i) the applicant or applicant's spouse has been separated
from employment or has received a notice of separation from
employment as a result of job obsolescence, plant shutdown,
regional decline in the applicant's customary occupation, or
industry slowdown, and the applicant or the applicant's spouse
is unlikely to return to work for that employer or in that
occupation within 12 months following separation from employment;
(ii) the applicant is a displaced homemaker; or
(iii) the applicant or the applicant's spouse is a farmer
who can demonstrate severe household financial need.
Subd. 4. [PROGRAM RECIPIENTS.] An eligible institution
shall select a recipient of a dislocated rural worker grant in
accordance with guidelines, policies, and rules established by
the board. The board may adopt emergency rules for awarding
grants only for the fiscal year beginning July 1, 1987.
Subd. 5. [PROGRAM COORDINATION; INFORMATION.] The board
shall develop and provide information to dislocated workers in
rural areas about post-secondary education opportunities and
student financial aid programs. The board shall also provide
for the coordination of dislocated rural worker grants with
other available student financial aid programs. Dislocated
rural worker grants must be awarded in a manner that maximizes
the use of existing federal and state student financial aid
programs.
Sec. 7. [REPEALER.]
Minnesota Statutes 1986, section 116L.03, subdivision 6, is
repealed.
Sec. 8. Laws 1983, chapter 334, section 7, is amended to
read:
Sec. 7. [REPEALER.]
Sections 1 to 6 116L.01; 116L.02; 116L.03, subdivisions 1,
2, 3, 4, 5, and 7; 116L.04; and 116L.05, 1, 2, 3, 4, 5, and 7
are repealed June 30, 1987 1989.
Sec. 9. [SUPPLEMENTAL EDUCATION GRANT PROGRAM FUNDING.]
$500,000 is appropriated from the general fund to the
higher education coordinating board for the dislocated rural
worker grant program established in section 3, to be available
until June 30, 1989.
$1,000,000 is appropriated from the general fund to the
higher education coordinating board for the Minnesota job skills
partnership program. $500,00 is for fiscal year 1988 and
$500,000 is for fiscal year 1989.
Approved June 3, 1987
Official Publication of the State of Minnesota
Revisor of Statutes