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Key: (1) language to be deleted (2) new language


                         Laws of Minnesota 1989 

                        CHAPTER 263-H.F.No. 1160 
           An act relating to education; allowing school 
          districts to enter into certain contracts to reduce 
          energy and operating costs; proposing coding for new 
          law in Minnesota Statutes, chapter 124. 
     Section 1.  [124.85] [ENERGY EFFICIENCY PROJECTS.] 
    Subdivision 1.  [DEFINITIONS.] The definitions in this 
subdivision apply to this section. 
    (a) "Energy conservation measure" means a training program 
or facility alteration designed to reduce energy consumption or 
operating costs and includes: 
    (1) Insulation of the building structure and systems within 
the building; 
    (2) Storm windows and doors, caulking or weatherstripping, 
multiglazed windows and doors, heat absorbing or heat reflective 
glazed and coated window and door systems, additional glazing, 
reductions in glass area, and other window and door system 
modifications that reduce energy consumption; 
    (3) Automatic energy control systems; 
    (4) Heating, ventilating, or air conditioning system 
modifications or replacements; 
    (5) Replacement or modifications of lighting fixtures to 
increase the energy efficiency of the lighting system without 
increasing the overall illumination of a facility, unless such 
increase in illumination is necessary to conform to the 
applicable state or local building code for the lighting system 
after the proposed modifications are made; 
    (6) Energy recovery systems; 
    (7) Cogeneration systems that produce steam or forms of 
energy such as heat, as well as electricity, for use primarily 
within a building or complex of buildings; 
    (8) Energy conservation measures that provide long-term 
operating cost reductions.  
    (b) "Guaranteed energy savings contract" means a contract 
for the evaluation and recommendations of energy conservation 
measures, and for one or more energy conservation measures.  The 
contract must provide that all payments, except obligations on 
termination of the contract before its expiration, are to be 
made over time, but not to exceed ten years from the date of 
final installation, and the savings are guaranteed to the extent 
necessary to make payments for the systems. 
    (c) "Qualified provider" means a person or business 
experienced in the design, implementation, and installation of 
energy conservation measures.  A qualified provider to whom the 
contract is awarded shall give a sufficient bond to the school 
district for its faithful performance. 
    Subd. 2.  [ENERGY EFFICIENCY CONTRACT.] Notwithstanding any 
law to the contrary, a school district may enter into a 
guaranteed energy savings contract with a qualified provider to 
significantly reduce energy or operating costs. 
    Before entering into a contract under this subdivision, the 
board shall provide published notice of the meeting in which it 
proposes to award the contract, the names of the parties to the 
proposed contract, and the contract's purpose. 
    Before installation of equipment, modification, or 
remodeling, the qualified provider shall first issue a report, 
summarizing estimates of all costs of installations, 
modifications, or remodeling, including costs of design, 
engineering, installation, maintenance, repairs, or debt 
service, and estimates of the amounts by which energy or 
operating costs will be reduced. 
    Subd. 3.  [CONTRACT PROVISIONS.] Guaranteed energy savings 
contracts that include a written guarantee that savings will 
meet or exceed the cost of energy conservation measures is not 
subject to competitive bidding requirements.  The contract is 
not subject to section 123.37 or 471.345. 
    Subd. 4.  [DISTRICT ACTION.] A district may enter into a 
guaranteed energy savings contract with a qualified provider if, 
after review of the report, it finds that the amount it would 
spend on the energy conservation measures recommended in the 
report is not likely to exceed the amount to be saved in energy 
and operation costs over ten years from the date of installation 
if the recommendations in the report were followed, and the 
qualified provider provides a written guarantee that the energy 
or operating cost savings will meet or exceed the costs of the 
system.  The guaranteed energy savings contract may provide for 
payments over a period of time, not to exceed ten years. 
    Subd. 5.  [INSTALLATION CONTRACTS.] A school district may 
enter into an installment payment contract for the purchase and 
installation of energy conservation measures.  The contract must 
provide for payments of not less than one-tenth of the price to 
be paid within two years from the date of the first operation, 
and the remaining costs to be paid monthly, not to exceed a 
ten-year term from the date of the first operation. 
    Subd. 6.  [CONTRACT CONTINUANCE.] Guaranteed energy savings 
contracts may extend beyond the fiscal year in which they become 
effective.  The school district shall include in its annual 
appropriations measure for each later fiscal year any amounts 
payable under guaranteed energy savings contracts during the 
year.  Failure of a board to make such an appropriation does not 
affect the validity of the guaranteed energy savings contract or 
the school district's obligations under the contracts. 
    Sec. 2.  [EFFECTIVE DATE.] 
    Section 1 is effective the day after its final enactment. 
    Presented to the governor May 23, 1989 
    Signed by the governor May 25, 1989, 6:18 p.m.

Official Publication of the State of Minnesota
Revisor of Statutes