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Minnesota Session Laws - 1989, Regular Session

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

  

                         Laws of Minnesota 1989 

                        CHAPTER 329-H.F.No. 654 
           An act relating to education; providing for general 
          education revenue, transportation, special programs, 
          community education, school facilities and equipment, 
          education organization and cooperation, access to 
          education excellence, school breakfast programs, 
          sexual harassment and violence policies, libraries, 
          state education agencies, education agency services, 
          Faribault academies, center for arts education, 
          providing for limits on open enrollment; appropriating 
          money; amending Minnesota Statutes 1988, sections 
          16A.1541; 16B.60, subdivision 6; 43A.08, subdivision 
          1a; 120.06, by adding a subdivision; 120.062, 
          subdivisions 4, 5, and 6; 120.17, subdivisions 3, 3b, 
          and 11a; 121.11, subdivisions 7, 12, and 14; 121.15, 
          subdivision 2; 121.612; 121.88, subdivisions 8, 9, and 
          10; 121.882, subdivision 2; 121.904, subdivision 4a, 
          and by adding a subdivision; 121.908, subdivision 5; 
          121.912, by adding a subdivision; 121.931, 
          subdivisions 3, 4, and 7; 121.934, subdivision 2; 
          121.935, subdivision 6; 121.936, subdivision 4a; 
          122.23, by adding a subdivision; 122.41; 122.43, 
          subdivision 1; 122.532, subdivisions 3 and 4, and by 
          adding a subdivision; 122.541; 122.91, subdivisions 1, 
          3, 5, and by adding subdivisions; 122.92; 122.93, 
          subdivision 2, and by adding subdivisions; 122.94, 
          subdivision 1, and by adding a subdivision; 122.95, 
          subdivision 2, and by adding a subdivision; 123.33, 
          subdivision 7; 123.3514, subdivisions 4c, 5, 7, 10, 
          and by adding a subdivision; 123.36, subdivisions 1 
          and 13, as amended; 123.39, by adding a subdivision; 
          123.58, subdivisions 4 and 9; 124.155, subdivisions 1 
          and 2; 124.19, subdivision 5, and by adding a 
          subdivision; 124.195, subdivisions 8 and 9; 124.2131, 
          subdivision 1; 124.223; 124.225; 124.243, subdivisions 
          2, 3, and by adding a subdivision; 124.244, 
          subdivisions 1 and 2; 124.245, subdivision 3b; 
          124.252, subdivision 3; 124.26, subdivisions 1c and 7, 
          and by adding a subdivision; 124.2711, subdivision 1 
          and 3; 124.2721; 124.273, subdivisions 4 and 5; 
          124.32, subdivision 1b; 124.38, subdivision 7; 124.43, 
          subdivision 1; 124.494, subdivision 2; 124.573, 
          subdivisions 2 and 2b, and by adding subdivisions; 
          124.574, subdivisions 2b, 4, and 5; 124.575, 
          subdivisions 2 and 3, and by adding a subdivision; 
          124.82, subdivision 3; 124.83, subdivisions 3, 4, and 
          6; 124A.03, subdivision 2; 124A.036, by adding a 
          subdivision; 124A.22, subdivisions 1, 2, 5, 6, 8, and 
          9, and by adding subdivisions; 124A.23, subdivision 1; 
          124A.28, subdivision 1; 124A.29; 126.151, subdivision 
          2; 126.22, subdivisions 2 and 3, and by adding a 
          subdivision; 126.23; 126.56, subdivision 4, and by 
          adding a subdivision; 126.661, by adding a 
          subdivision; 126.663, subdivisions 2 and 3; 126.67, 
          subdivisions 5 and 8; 128A.09; 129.121, by adding 
          subdivisions; 129B.41; 129B.42; 129B.44; 129B.45; 
          129B.46; 129C.10; 134.31, by adding a subdivision; 
          134.33, subdivision 1; 134.34, subdivisions 1, 2, and 
          3; 136D.22, subdivision 1; 136D.27, subdivision 1; 
          136D.72, subdivision 1; 136D.74, subdivision 2; 
          136D.82, subdivision 1; 136D.87, subdivision 1; 
          141.25, subdivision 8; 141.26, subdivision 5; 171.29, 
          subdivision 2; 273.1102, subdivision 3; 273.1398, 
          subdivision 6; 275.011, subdivision 1; 275.125, 
          subdivisions 5, 5b, 5c, 5e, 6e, 6h, 6i, 8b, 8e, 9, 9a, 
          9b, 9c, 11d, 14a, and by adding a subdivision; 275.14; 
          297A.25, subdivision 11; 326.03, subdivision 2; 
          354.094, subdivision 1 and 2; 354.66, subdivision 4; 
          354A.091, subdivision 1 and 2; 354A.094, subdivision 
          4; 363.01, by adding a subdivision; 363.06, 
          subdivision 3; 363.073, subdivision 1; 422A.101, 
          subdivision 2; 465.71; 471.38, subdivision 3; Laws 
          1959, chapter 462, section 3, subdivision 10, as 
          amended; Laws 1965, chapter 705, as amended; Laws 
          1976, chapter 20, section 4; Laws 1988, chapter 719, 
          article 5, section 84; proposing coding for new law in 
          Minnesota Statutes, chapters 121; 122; 123; 124; 124A; 
          126; 127; 129B; repealing Minnesota Statutes 1988, 
          sections 120.05, subdivision 1; 120.062, subdivision 
          8; 120.13; 120.15; 120.16; 120.77; 121.09; 121.12; 
          121.151; 121.35, subdivision 5; 121.496, subdivision 
          1; 121.83; 121.84; 121.843; 121.844; 121.845; 121.86; 
          121.882, subdivision 10; 121.902, subdivision 2; 
          121.9121, subdivision 6; 121.914, subdivisions 9 and 
          10; 122.86; 122.87; 122.88; 122.96; 123.3511; 
          123.3512; 123.581, subdivisions 1 and 6; 123.60; 
          123.601; 123.68; 123.702; 123.703; 123.704; 123.705; 
          124.12, subdivision 1; 124.2138, subdivisions 3 and 4; 
          124.217; 124.243, subdivision 4; 124.271, subdivisions 
          2b, 3, 4, and 7; 124.496; 124A.27, subdivision 7; 
          125.241, subdivision 3; 125.60, subdivision 7; 126.03; 
          126.07; 126.10; 126.11; 126.39, subdivision 11; 
          126.52, subdivision 11; 126.70, subdivision 3; 126.80; 
          126.81; 129B.11; 129B.47; 129B.48; 134.33, subdivision 
          1; 134.34, subdivision 5; 275.125, subdivisions 6f and 
          8; and 275.128; and Laws 1988, chapter 718, article 5, 
          section 4; and article 7, section 61. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1 

                       GENERAL EDUCATION REVENUE 
    Section 1.  Minnesota Statutes 1988, section 16A.1541, is 
amended to read:  
    16A.1541 [ADDITIONAL REVENUES; PRIORITY.] 
    If on the basis of a forecast of general fund revenues and 
expenditures the commissioner of finance determines that there 
will be a positive unrestricted budgetary general fund balance 
at the close of the biennium, the commissioner of finance must 
allocate money to the budget and cash flow reserve account until 
the total amount in the account equals $550,000,000 five percent 
of total general fund appropriations for the current biennium as 
established by the most recent legislative session after 
reducing the property tax levy recognition percent under section 
121.904, subdivision 4a to 27 percent. 
    The amounts necessary to meet the requirements of this 
section are appropriated from the general fund. 
    Sec. 2.  Minnesota Statutes 1988, section 124.19, 
subdivision 5, is amended to read:  
    Subd. 5.  [SCHEDULE ADJUSTMENTS.] (a) It is the intention 
of the legislature to encourage efficient and effective use of 
staff and facilities by school districts.  School districts are 
encouraged to consider both cost and energy saving measures.  
    (b) Notwithstanding the provisions of subdivision 1 or 4, 
any district, including a district operating a program pursuant 
to sections 120.59 to 120.67 or 129B.42 to 129B.47, or operating 
a commissioner-designated area learning center program under 
section 129B.56, or that otherwise receives the approval of the 
commissioner to operate its instructional program to avoid an 
aid reduction in any year, may adjust the annual school schedule 
for that program throughout the calendar year so long as the 
number of instructional hours in the year is not less than the 
number of instructional hours per day specified in the rules of 
the state board multiplied by the minimum number of 
instructional days required by subdivision 1.  
    Sec. 3.  Minnesota Statutes 1988, section 124.19, is 
amended by adding a subdivision to read: 
    Subd. 7.  [ALTERNATIVE PROGRAMS.] (a) This subdivision 
applies to an alternative program that has been approved by the 
state board of education pursuant to Minnesota Rules, part 
3500.3500, as exempt from Minnesota Rules, part 3500.1500, 
requiring a school day to be at least six hours in duration.  
    (b) To receive general education revenue for a pupil in an 
alternative program, a school district must meet the 
requirements in this paragraph.  The program must be approved by 
the commissioner of education.  In approving a program, the 
commissioner may use the process used for approving state 
designated area learning centers under section 129B.56.  
    (c) In addition to the requirements in paragraph (b), to 
receive general education revenue for a pupil in an alternative 
program that has an independent study component, a school 
district must meet the requirements in this paragraph.  
    For a course having an independent study component, the 
pupil must complete coursework and receive credit for each 
course for which the aid is claimed.  
    The school district must develop with the pupil a continual 
learning plan for the pupil.  A district must allow a minor 
pupil's parent or guardian to participate in developing the 
plan, if the parent or guardian wants to participate.  The plan 
must identify the learning experiences and expected outcomes 
needed for satisfactory credit for the year and for graduation.  
The plan must be updated each year.  
    General education revenue for a pupil in an approved 
alternative program without an independent study component must 
be prorated for a pupil participating for less than a full 
school year, or its equivalent.  
    General education revenue for a pupil in an approved 
alternative program that has an independent study component must 
be prorated for a pupil receiving fewer than six credits in a 
year.  
    For an alternative program having an independent study 
component, the commissioner shall require a description of the 
courses in the program, the kinds of independent study involved, 
the expected learning outcomes of the courses, and the means of 
measuring student performance against the expected outcomes. 
    A credit for a year in an approved alternative program 
shall, for the purposes of audit, be considered to be 170 hours 
of teacher contact time and independent study time. 
    Sec. 4.  Minnesota Statutes 1988, section 124A.03, 
subdivision 2, is amended to read: 
    Subd. 2.  [REFERENDUM LEVY.] (1) (a) The levy authorized by 
section 124A.23, subdivision 2, may be increased in any the 
amount that is approved by the voters of the district at a 
referendum called for the purpose.  The referendum may be called 
by the school board or shall be called by the school board upon 
written petition of qualified voters of the district. The 
referendum shall be held on a date set by the school board.  
Only two elections may be held to approve a levy increase that 
will commence in a specific school year.  The referendum must be 
held on the first Tuesday after the first Monday in November.  
The ballot shall state the maximum amount of the increased 
levy in mills as a percentage of net tax capacity, the amount 
that will be raised by that tax capacity rate in the first year 
it is to be levied, and that the tax capacity rate shall be used 
to finance school operations.  The ballot may designate a 
specific number of years for which the referendum authorization 
shall apply.  The ballot may contain a textual portion with the 
information required in this subdivision and a question stating 
substantially the following:  
    "Shall the increase in the levy proposed by (petition to) 
the board of ........., School District No. .., be approved?"  
    If approved, the amount provided by the approved tax 
capacity rate applied to each year's gross the net tax capacity 
for the year preceding the year the levy is certified shall be 
authorized for certification for the number of years approved, 
if applicable, or until revoked or reduced by the voters of the 
district at a subsequent referendum. 
    (2) (b) A referendum on the question of revoking or 
reducing the increased levy amount authorized pursuant to clause 
(1) paragraph (a) may be called by the school board and shall be 
called by the school board upon the written petition of 
qualified voters of the district.  A levy approved by the voters 
of the district pursuant to clause (1) paragraph (a) must be 
made at least once before it is subject to a referendum on its 
revocation or reduction for subsequent years.  Only one such 
revocation or reduction election may be held to revoke or reduce 
a levy for any specific year and for years thereafter. 
    (3) A petition authorized by clause (1) shall be effective 
if signed by a number of qualified voters in excess of 15 
percent, or ten percent if the school board election is held in 
conjunction with a general election, of the average number of 
voters at the two most recent district wide school elections.  A 
referendum invoked by petition shall be held within three months 
of submission of the petition to the school board. 
    (4) (c) A petition authorized by clause (2) paragraph (a) 
or (b) shall be effective if signed by a number of qualified 
voters in excess of five 15 percent of the residents registered 
voters of the school district as determined by the most recent 
census on the day the petition is filed with the school board.  
A revocation or reduction referendum invoked by petition shall 
be held within three months of submission of the petition to the 
school board on the date specified in paragraph (a). 
    (5) (d) Notwithstanding any law to the contrary, The 
approval of 50 percent plus one of those voting on the question 
is required to pass a referendum authorized by this subdivision. 
    (6) (e) Within 30 days after the district holds a 
referendum pursuant to this clause, the district shall notify 
the commissioner of education of the results of the referendum. 
    Sec. 5.  Minnesota Statutes 1988, section 124A.22, 
subdivision 1, is amended to read: 
    Subdivision 1.  [GENERAL EDUCATION REVENUE.] The general 
education revenue for each district equals the sum of the 
district's basic revenue, compensatory education revenue, 
training and experience revenue, secondary sparsity revenue, 
elementary sparsity revenue, and supplemental revenue. 
    Sec. 6.  Minnesota Statutes 1988, section 124A.22, 
subdivision 2, is amended to read: 
    Subd. 2.  [BASIC REVENUE.] The basic revenue for each 
district equals the formula allowance times the actual pupil 
units for the school year.  The formula allowance is $2,755 for 
the 1988-1989 school year.  The formula allowance is 
$2,800 $2,838 for fiscal year 1990.  The formula allowance for 
subsequent fiscal years is $2,953.  
    Sec. 7.  Minnesota Statutes 1988, section 124A.22, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [ELIGIBILITY FOR INCREASE.] Notwithstanding 
subdivision 2 or any other law to the contrary, if a school 
board and the bargaining unit of the teachers in a school 
district have not ratified a contract by January 15, 1990, for 
the two-year period ending June 30, 1991, the district is no 
longer eligible for $25 of the formula allowance for fiscal year 
1990.  The total amount of money that would have been paid to 
districts that are not eligible according to this subdivision 
shall be allocated to eligible districts according to the number 
of actual pupil units in all of the eligible districts. 
    Sec. 8.  Minnesota Statutes 1988, section 124A.22, 
subdivision 5, is amended to read: 
    Subd. 5.  [DEFINITIONS.] The definitions in this 
subdivision apply only to subdivision 6.  
    (a) "High school" means a secondary school that has pupils 
enrolled in at least the 10th, 11th, and 12th grades.  If there 
is no secondary school in the district that has pupils enrolled 
in at least the 10th, 11th, and 12th grades, the commissioner 
shall designate one school in the district as a high school for 
the purposes of this section. 
    (b) "Secondary average daily membership" means, for a 
district that has only one high school, the average daily 
membership of resident pupils in grades 7 through 12.  For a 
district that has more than one high school, "secondary average 
daily membership" for each high school means the product of the 
average daily membership of resident pupils in grades 7 through 
12 in the high school, times the ratio of six to the number of 
grades in the high school. 
    (c) "Attendance area" means the total surface area of the 
district, in square miles, divided by the number of high schools 
in the district. 
    (d) "Isolation index" for a high school means the square 
root of one-half the attendance area plus the distance in miles, 
according to the usually traveled routes, between the high 
school and the nearest high school.  
    (e) "Qualifying high school" means a high school that has 
an isolation index greater than 23 and that has secondary 
average daily membership of less than 400.  
    (f) "Qualifying elementary school" means an elementary 
school that is located 20 miles or more from the nearest 
elementary school or from the nearest elementary school within 
the district and, in either case, has an elementary average 
daily membership of an average of 20 or fewer per grade. 
    (g) "Elementary average daily membership" means, for a 
district that has only one elementary school, the average daily 
membership of resident pupils in kindergarten through grade 6.  
For a district that has more than one elementary school, 
"average daily membership" for each school means the average 
daily membership of kindergarten through grade 6 multiplied by 
the ratio of seven to the number of grades in the elementary 
school. 
    Sec. 9.  Minnesota Statutes 1988, section 124A.22, 
subdivision 6, is amended to read: 
    Subd. 6.  [SECONDARY SPARSITY REVENUE.] A district's 
secondary sparsity revenue for a school year equals the sum of 
the results of the following calculation for each qualifying 
high school in the district: 
    (1) the formula allowance for the school year, multiplied 
by 
    (2) the secondary average daily membership of the high 
school, multiplied by 
    (3) the quotient obtained by dividing 400 minus the 
secondary average daily membership by 400 plus the secondary 
daily membership, multiplied by 
    (4) the lesser of one or the quotient obtained by dividing 
the isolation index minus 23 by ten. 
    Sec. 10.  Minnesota Statutes 1988, section 124A.22, is 
amended by adding a subdivision to read:  
    Subd. 6a.  [ELEMENTARY SPARSITY REVENUE.] A district's 
elementary sparsity revenue equals the sum of the following 
amounts for each qualifying elementary school in the district:  
    (1) the formula allowance for the year, multiplied by 
    (2) the elementary average daily membership of the school, 
multiplied by 
    (3) the quotient obtained by dividing 140 minus the 
elementary average daily membership by 140 plus the average 
daily membership.  
    Sec. 11.  Minnesota Statutes 1988, section 124A.22, 
subdivision 8, is amended to read: 
    Subd. 8.  [SUPPLEMENTAL REVENUE.] If a district's minimum 
allowance exceeds the sum of its basic revenue, compensatory 
revenue, training and experience revenue, secondary sparsity 
revenue, and elementary sparsity revenue per actual pupil unit 
for a school year, the district shall receive supplemental 
revenue equal to the amount of the excess times the actual pupil 
units for the school year. 
    Sec. 12.  Minnesota Statutes 1988, section 124A.22, 
subdivision 9, is amended to read: 
    Subd. 9.  [DEFINITIONS FOR SUPPLEMENTAL REVENUE.] (a) The 
definitions in this subdivision apply only to subdivision 8. 
    (b) "1987-1988 revenue" means the sum of the following 
categories of revenue for a district for the 1987-1988 school 
year: 
    (1) basic foundation revenue, tier revenue, and declining 
pupil unit revenue, according to Minnesota Statutes 1986, as 
supplemented by Minnesota Statutes 1987 Supplement, chapter 
124A, plus any reduction to second tier revenue, according to 
Minnesota Statutes 1986, section 124A.08, subdivision 5; 
    (2) teacher retirement and FICA aid, according to Minnesota 
Statutes 1986, sections 124.2162 and 124.2163; 
    (3) chemical dependency aid, according to Minnesota 
Statutes 1986, section 124.246; 
    (4) gifted and talented education aid, according to 
Minnesota Statutes 1986, section 124.247; 
    (5) arts education aid, according to Minnesota Statutes 
1986, section 124.275; 
    (6) summer program aid and levy, according to Minnesota 
Statutes 1986, sections 124A.03 and 124A.033; 
    (7) programs of excellence grants, according to Minnesota 
Statutes 1986, section 126.60; and 
    (8) liability insurance levy, according to Minnesota 
Statutes 1986, section 466.06. 
    For the purpose of this subdivision, intermediate districts 
and other employing units, as defined in Minnesota Statutes 
1986, section 124.2161, shall allocate the amount of their 
teacher retirement and FICA aid for fiscal year 1988 among their 
participating school districts.  
    (c) "Minimum allowance" for a district means: 
    (1) the district's 1987-1988 revenue, according to 
subdivision 1; divided by 
    (2) the district's 1987-1988 actual pupil units, adjusted 
for the change in secondary pupil unit weighting from 1.4 to 
1.35 made by Laws 1987, chapter 398; plus 
    (3) $105 $143 for fiscal year 1990 and $258 for subsequent 
fiscal years. 
    Sec. 13.  Minnesota Statutes 1988, section 124A.23, 
subdivision 1, is amended to read: 
    Subdivision 1.  [GENERAL EDUCATION TAX CAPACITY RATE.] The 
commissioner of revenue shall establish the general education 
tax capacity rate and certify it to the commissioner of 
education by September 1 of each year for levies payable in the 
following year.  The general education tax capacity rate shall 
be a rate, rounded up to the nearest tenth of a mill percent, 
that, when applied to the adjusted gross tax capacity for all 
districts, raises the amount specified in this subdivision.  The 
general education tax capacity rate for the 1990 fiscal year 
shall be the rate that raises $1,100,580,000 $1,156,000,000 for 
fiscal year 1991 and $1,213,800,000 for subsequent fiscal 
years.  The general education tax capacity rate certified by the 
commissioner of revenue may not be changed due to changes or 
corrections made to a district's adjusted gross tax capacity 
after the tax capacity rate has been certified.  
    Sec. 14.  [INSTRUCTIONS TO THE DEPARTMENT OF EDUCATION FOR 
1989 LEVY LIMITS.] 
    Notwithstanding sections 2, 6, 8, 10, and 12, or any other 
law to the contrary, the department shall determine for the 
1989-1990 school year only, levies under Minnesota Statutes, 
chapter 124A as they were authorized before the enactment of 
this article.  
    Sec. 15.  [CONVERSION OF EXISTING REFERENDUM LEVIES.] 
    The department of education shall convert the referendum 
levy authority existing under Minnesota Statutes, section 
124A.03, for 1988 taxes payable in 1989, for future years, as 
follows: 
    The tax capacity rate equals the rate determined by 
dividing the district's maximum levy under Minnesota Statutes, 
section 124A.03, for 1988 taxes payable in 1989 by the 
district's 1987 net tax capacity.  A district's maximum levy for 
all subsequent years for which the levy is authorized equals the 
amount provided by the tax capacity rate applied to the net tax 
capacity for the year preceding the year the levy is certified. 
    However, if a district's levy is limited to a dollar 
amount, the maximum levy under Minnesota Statutes, section 
124A.03, must not exceed the dollar amount. 
    Sec. 16.  [ADDITIONAL CONVERSION PROCEDURES.] 
    For a referendum levy authorized after December 1, 1988, 
and before the effective date of section 4, the department of 
education shall convert the approved levy amount to the 
appropriate net tax capacity rate.  Levy amounts approved prior 
to the effective date of this act are validated. 
    Sec. 17.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated.  
    Subd. 2.  [GENERAL AND SUPPLEMENTAL EDUCATION AID.] For 
general and supplemental education aid:  
  $1,222,815,000     .....     1990
  $1,293,366,000     .....     1991
    The 1990 appropriation includes $174,824,000 for 1989 and 
$1,047,991,000 for 1990.  
    The 1991 appropriation includes $177,889,000 for 1990 and 
$1,115,477,000 for 1991.  
    Subd. 3.  [EXCEPTIONAL NEED AID.] For exceptional need aid 
according to Minnesota Statutes, section 124.217:  
    $420,000 ..... 1990 
    $ 70,000 ..... 1991 
    The 1990 appropriation includes $23,000 for 1989 and 
$397,000 for 1990.  
    The 1991 appropriation includes $70,000 for 1990 and $0 for 
1991. 
    Sec. 18.  [REPEALER.] 
    Minnesota Statutes 1988, section 124.217 is repealed July 
1, 1990, and section 275.125, subdivision 6f, is repealed July 
1, 1989. 

                               ARTICLE 2

                         PUPIL TRANSPORTATION 
    Section 1.  Minnesota Statutes 1988, section 123.39, is 
amended by adding a subdivision to read: 
    Subd. 14.  The board may provide transportation for a pupil 
who is a custodial parent and that pupil's child between the 
pupil's home and a child care provider and between the provider 
and the school.  The board shall establish criteria for 
transportation it provides according to this subdivision.  
    Sec. 2.  Minnesota Statutes 1988, section 124.223, is 
amended to read: 
    124.223 [TRANSPORTATION AID AUTHORIZATION.] 
    School transportation and related services for which state 
transportation aid is authorized are: listed in this section. 
    (1) [TO AND FROM SCHOOL; BETWEEN SCHOOLS.] (a) State 
transportation aid is authorized for transportation or board of 
resident elementary pupils who reside one mile or more from the 
public schools which they could attend; transportation or board 
of resident secondary pupils who reside two miles or more from 
the public schools which they could attend; transportation to 
and from schools the resident pupils attend according to a 
program approved by the commissioner of education, or between 
the schools the resident pupils attend for instructional 
classes; transportation of resident elementary pupils who reside 
one mile or more from a nonpublic school actually attended; 
transportation of resident secondary pupils who reside two miles 
or more from a nonpublic school actually attended; but with 
respect to transportation of pupils to nonpublic schools 
actually attended, only to the extent permitted by sections 
123.76 to 123.79; transportation of pupils a pupil who are is a 
custodial parents to and from parent and that pupil's child 
between the pupil's home and the child care provider of child 
care services for the pupil's child and between the provider and 
the school, if the home and provider are within the attendance 
area of the school the pupil attends;. 
    (b) For the purposes of this clause (1), a district may 
designate a licensed day care facility or, respite care 
facility, the residence of a relative, or the residence of a 
person chosen by the pupil's parent or guardian as the home of a 
pupil for part or all of the day, if requested by the pupil's 
parent or guardian and if that facility or residence is within 
the attendance area of the school the pupil attends;. 
    (c) State transportation aid is authorized for 
transportation to and from school of an elementary pupil who 
moves during the school year within an area designated by the 
district as a mobility zone, but only for the remainder of the 
school year.  The attendance areas of schools in a mobility zone 
must be contiguous.  To be in a mobility zone, a school must 
meet both of the following requirements: 
    (i) more than 50 percent of the pupils enrolled in the 
school are eligible for free or reduced school lunch; and 
    (ii) the pupil withdrawal rate for the last year is more 
than 12 percent. 
    (d) A pupil withdrawal rate is determined by dividing: 
    (i) the sum of the number of pupils who withdraw from the 
school, during the school year, and the number of pupils 
enrolled in the school as a result of transportation provided 
under this paragraph, by 
    (ii) the number of pupils enrolled in the school. 
    (e) The district may establish eligibility requirements for 
individual pupils to receive transportation in the mobility zone.
    (2)  [OUTSIDE DISTRICT.] State transportation aid is 
authorized for transportation to and from or board and lodging 
in another district, of resident pupils of a district without a 
secondary school;.  The pupils may attend a classified secondary 
school in another district and shall receive board and lodging 
in or transportation to and from a district having a classified 
secondary school at the expense of the district of the pupil's 
residence;. 
    (3)  [SECONDARY VOCATIONAL CENTERS.] State transportation 
aid is authorized for transportation to and from a state board 
approved secondary vocational center for secondary vocational 
classes for resident pupils of any of the districts who are 
members of or participating in programs at that center;. 
    (4)  [HANDICAPPED.] State transportation aid is authorized 
for transportation or board and lodging of a handicapped pupil 
when that pupil cannot be transported on a regular school bus, 
the conveying of handicapped pupils between home or a respite 
care facility and school and within the school plant, necessary 
transportation of handicapped pupils from home or from school to 
other buildings, including centers such as developmental 
achievement centers, hospitals and treatment centers where 
special instruction or services required by section 120.17 are 
provided, within or outside the district where services are 
provided, and necessary transportation for resident handicapped 
pupils required by section 120.17, subdivision 4a.  
Transportation of handicapped pupils between home or a respite 
care facility and school shall not be subject to any distance 
requirement for children not yet enrolled in kindergarten or to 
the requirement in clause (1) that elementary pupils reside at 
least one mile from school and secondary pupils reside at least 
two miles from school in order for the transportation to qualify 
for aid;. 
    (5)  [BOARD AND LODGING; NONRESIDENT HANDICAPPED.] State 
transportation aid is authorized for, when necessary, board and 
lodging for nonresident handicapped pupils in a district 
maintaining special classes;. 
    (6)  [SHARED TIME.] State transportation aid is authorized 
for transportation from one educational facility to another 
within the district for resident pupils enrolled on a shared 
time basis in educational programs, and necessary transportation 
required by section 120.17, subdivision 9, for resident 
handicapped pupils who are provided special instruction and 
services on a shared time basis;. 
    (7)  [FARIBAULT STATE ACADEMIES.] State transportation aid 
is authorized for transportation for residents to and from the 
Minnesota state academy for the deaf or the Minnesota state 
academy for the blind;. 
    (8)  [SUMMER INSTRUCTIONAL PROGRAMS.] State transportation 
aid is authorized for services described in clauses (1) to (7), 
(9), and (10) when provided in conjunction with a summer program 
that meets the requirements of section 124A.27, subdivision 9;. 
    (9)  [COOPERATIVE ACADEMIC AND VOCATIONAL.] State 
transportation aid is authorized for transportation to, from or 
between educational facilities located in any of two or more 
school districts jointly offering academic classes or secondary 
vocational classes not provided at a secondary vocational center 
for resident pupils of any of these districts; and. 
    (10)  [NONPUBLIC SUPPORT SERVICES.] State transportation 
aid is authorized for necessary transportation within district 
boundaries between a nonpublic school and a public school or a 
neutral site for nonpublic school pupils who are provided pupil 
support services pursuant to section 123.935. 
    Sec. 3.  Minnesota Statutes 1988, section 124.225, is 
amended to read: 
    124.225 [TRANSPORTATION AID ENTITLEMENT.] 
    Subdivision 1.  [DEFINITIONS.] For purposes of this 
section, the terms defined in this subdivision have the meanings 
given to them. 
    (a) "FTE" means a transported full-time equivalent pupil 
whose transportation is authorized for aid purposes by section 
124.223. 
    (b) "Authorized cost for regular transportation" means the 
sum of: 
    (1) all expenditures for transportation in the regular 
category, as defined in clause paragraph (e), clause (1), for 
which aid is authorized in section 124.223, plus 
    (2) an amount equal to one year's depreciation on the 
district's school bus fleet and mobile units computed on a 
straight line basis at the rate of 12-1/2 percent per year of 
the cost of the fleet, plus 
    (3) an amount equal to one year's depreciation on district 
school buses reconditioned by the department of corrections 
computed on a straight line basis at the rate of 33-1/3 percent 
per year of the cost to the district of the reconditioning, plus 
    (4) an amount equal to one year's depreciation on the 
district's type three school buses, as defined in section 
169.44, subdivision 15, which were purchased after July 1, 1982, 
for authorized transportation of pupils, with the prior approval 
of the commissioner, computed on a straight line basis at the 
rate of 20 percent per year of the cost of the type three school 
buses.  
    (c) "Adjusted authorized predicted cost per FTE" means the 
authorized cost predicted by a multiple regression formula 
determined by the department of education, and adjusted pursuant 
to subdivision 7a. 
    (d) "Aid entitlement per FTE Regular transportation 
allowance" for the 1989-1990 school year means the adjusted 
authorized predicted cost per FTE, inflated pursuant to 
subdivision 7b.  
    (e) For purposes of this section, "transportation category" 
means a category of transportation service provided to pupils.:  
    (1) For the purposes of this section, transportation 
categories for the 1986-1987 and 1987-1988 school years are as 
follows: 
    (i) regular transportation is transportation services 
provided during the regular school year under section 124.223, 
clauses (1) and (2), excluding transportation between schools 
under section 124.223, clause (1); and 
    (ii) nonregular transportation is transportation services 
provided between schools under section 124.223, clause (1); and 
transportation services provided under section 124.223, clauses 
(3), (4), (5), (6), (7), (8), (9), and (10). 
    (2) For purposes of this section, for the 1988-1989 school 
year and after:  
    (i) (1) regular transportation is transportation services 
provided during the regular school year under section 124.223, 
clauses (1) and (2), excluding the following transportation 
services provided under section 124.223, clause (1):  
transportation between schools; noon transportation to and from 
school for kindergarten pupils attending half-day sessions; late 
transportation home from school for pupils involved in after 
school activities; transportation of pupils to and from schools 
located outside their normal attendance areas under the 
provisions of a plan for desegregation mandated by the state 
board of education or under court order; and transportation of 
elementary pupils to and from school within a mobility zone; 
    (ii) (2) nonregular transportation is transportation 
services provided under section 124.223, clause (1), that are 
excluded from the regular category, and transportation services 
provided under section 124.223, clauses (3), (4), (5), (6), (7), 
(8), (9), and (10).; 
    (3) excess transportation is transportation to and from 
school for secondary pupils residing at least one mile but less 
than two miles from the public school they could attend or from 
the nonpublic school actually attended, and transportation to 
and from school for pupils residing less than one mile from 
school who are transported because of extraordinary traffic 
hazards; and 
    (4) desegregation transportation is transportation of 
pupils to and from schools located outside their normal 
attendance areas under a plan for desegregation mandated by the 
state board or under court order.  
    (f) "Mobile unit" means a vehicle or trailer designed to 
provide facilities for educational programs and services, 
including diagnostic testing, guidance and counseling services, 
and health services.  A mobile unit located off nonpublic school 
premises is a neutral site as defined in section 123.932, 
subdivision 9. 
    (g) "Current year" means the school year for which aid will 
be paid.  
    (h) "Base year" means the second school year preceding the 
school year for which aid will be paid.  
    (i) "Base cost" for the 1984-1985 and 1985-1986 base years 
means the authorized regular transportation cost per FTE in the 
base year in the regular transportation category, excluding 
summer school transportation.  Base cost for the 1986-1987 and 
1987-1988 base year and after years means the ratio of: 
    (1) the sum of: 
    (i) the authorized cost in the base year for regular 
transportation as defined in clause (b), plus 
    (ii) the actual cost in the base year for excess 
transportation to and from school of secondary pupils who live 
more than one mile but less than two miles from the public 
school that they could attend or from the nonpublic school 
actually attended, plus 
    (iii) the actual cost in the base year for transportation 
costs which are necessary because of extraordinary traffic 
hazards as defined in paragraph (e), clause (3), 
    (2) to the sum of: 
    (i) the number of FTE pupils transported in the regular 
category in the base year, plus 
    (ii) the number of secondary FTE pupils transported to and 
from school in the base year who live more than one mile but 
less than two miles from the public school that they could 
attend or from the nonpublic school actually attended, plus 
    (iii) the number of FTE pupils residing less than one mile 
from school who were transported to and from school in the base 
year because of extraordinary traffic hazards in the excess 
category in the base year.  
    (j) Base cost for the 1988-1989 base year and later years 
means the ratio of: 
    (1) the sum of the authorized cost in the base year for 
regular transportation as defined in clause (b) plus the actual 
cost in the base year for excess transportation as defined in 
clause (e); 
    (2) to the sum of the number of weighted FTE pupils 
transported in the regular and excess categories in the base 
year. 
    (k) "Predicted base cost" for the 1986-1987 and 1987-1988 
base years means the base cost as predicted by subdivision 3. 
    (l) "Predicted base cost" for the 1988-1989 base year and 
later years means the predicted base cost as computed in 
subdivision 3a. 
    (m) "Pupil weighting factor" for the excess transportation 
category for a school district means the lesser of one, or the 
result of the following computation: 
    (1) divide the square mile area of the school district by 
the number of FTE pupils transported in the regular and excess 
categories in the base year; 
    (2) raise the result in clause (1) to the one-fifth power; 
    (3) divide four-tenths by the result in clause (2). 
    The pupil weighting factor for the regular transportation 
category is one. 
    (n) "Weighted FTE's"  means the number of FTE's in each 
transportation category multiplied by the pupil weighting factor 
for that category. 
    (o) "Sparsity index" for a school district means the 
greater of .005 or the ratio of the square mile area of the 
school district to the sum of the number of weighted FTE's 
transported by the district in the regular and excess categories 
in the base year. 
    (p) "Density index" for a school district means the greater 
of one or the result obtained by subtracting the product of the 
district's sparsity index times 20 from two. 
    (q) "Contract transportation index" for a school district 
means the greater of one or the result of the following 
computation: 
    (1) multiply the district's sparsity index by 20; 
    (2) select the greater of one or the result in clause (1); 
    (3) multiply the district's percentage of regular FTE's 
transported using vehicles that are not owned by the school 
district by the result in clause (2). 
    (r) "Adjusted predicted base cost" for the 1988-1989 base 
year and after means the predicted base cost as computed in 
subdivision 3a as adjusted under subdivision 7a. 
    (s) "Regular transportation allowance" for the 1990-1991 
school year and after means the adjusted predicted base cost, 
inflated and adjusted under subdivision 7b. 
    (t) "Minimum regular transportation allowance" for the 
1990-1991 school year and after means the result of the 
following computation: 
    (1) compute the sum of the district's basic transportation 
aid for the 1989-1990 school year according to subdivision 8a 
and the district's excess transportation levy for the 1989-1990 
school year according to section 275.125, subdivision 5e, clause 
(a); 
    (2) divide the result in clause (1) by the sum of the 
number of weighted FTE's transported by the district in the 
regular and excess transportation categories in the 1989-1990 
school year; 
    (3) select the lesser of the result in clause (2) or the 
district's base cost for the 1989-1990 base year according to 
paragraph (j). 
    Subd. 3.  [FORMULA.] For each school year, the state shall 
pay to each school district for all pupil transportation and 
related services for which the district is authorized by law to 
receive state aid an amount determined according to this 
section.  The department of education shall conduct multiple 
regression analysis using the terms specified in subdivision 4b 
for each school year the 1986-1987 and 1987-1988 base years to 
predict the base cost for each district.  Each year The 
department shall use a formula shall be derived based upon the 
regression analysis, and shall be used to determine a predicted 
base cost for each district.  The amount determined for each 
district shall be adjusted according to the provisions of 
subdivisions 7a and 7b. 
    Subd. 3a.  [PREDICTED BASE COST.] A district's predicted 
base cost for the 1988-1989 base year and later years equals the 
result of the following computation:  
    (a) Multiply the transportation formula allowance by the 
district's sparsity index raised to the one-fourth power.  The 
transportation formula allowance is $406 for the 1988-1989 base 
year.  
    (b) Multiply the result in clause (a) by the district's 
density index raised to the 35/100 power.  
    (c) Multiply the result in clause (b) by the district's 
contract transportation index raised to the 1/20 power.  
    Subd. 4b.  [FORMULA TERMS.] (a) To predict the logarithm of 
the base cost for each district pursuant to subdivision 3 for 
the 1985-1986 base year, the multiple regression formula shall 
use the following terms for each district: 
    (1) the logarithm of the lesser of (a) the number of 
authorized FTE's per square mile transported by the district in 
the regular transportation category, or (b) 200; 
    (2) whether the district is nonrural, based upon criteria 
established by the department of education; and 
    (3) the logarithm of the percentage of all FTE's 
transported in the regular category using buses that are not 
owned by the district.  
    (b) To predict the logarithm of the base cost for each 
district according to subdivision 3 for the 1986-1987 and 
1987-1988 base year and thereafter, years the multiple 
regression formula shall use the following terms for each 
district: 
    (1) the logarithm of the lesser of: 
    (A) 200; or 
    (B) the quotient obtained by dividing the sum of: 
    (i) the number of FTE pupils transported in the regular 
category in the base year, plus 
    (ii) the number of secondary FTE pupils transported to and 
from school in the base year who live more than one mile but 
less than two miles from the public school that they could 
attend or from the nonpublic school actually attended, plus 
    (iii) the number of FTE pupils residing less than one mile 
from school who were transported to and from school in the base 
year because of extraordinary traffic hazards in the excess 
category in the base year, 
    (C) by the area of the district in square miles; 
    (2) whether the district is nonrural, based upon criteria 
established by the department of education; and 
    (3) the logarithm of the percentage of all FTE's 
transported in the regular category using buses that are not 
owned by the district. 
    Subd. 7a.  [BASE YEAR SOFTENING FORMULA.] Each district's 
predicted base cost determined for each school year the 
1986-1987 and 1987-1988 base years according to subdivision 3 
shall be adjusted as provided in this clause subdivision to 
determine the district's adjusted authorized predicted cost per 
FTE for that year.  
    (a) If the base cost of the district is within five percent 
of the predicted base cost, the district's adjusted authorized 
predicted cost per FTE shall be equal to the base cost.  
    (b) If the base cost of the district is more than five 
percent greater than the predicted base cost, the district's 
adjusted authorized predicted cost per FTE shall be equal to 105 
percent of the predicted base cost, plus 40 percent of the 
difference between (i) the base cost, and (ii) 105 percent of 
the predicted base cost.  However, in no case shall a district's 
adjusted authorized predicted cost per FTE be less than 80 
percent of base cost.  
     (c) If the base cost of the district is more than five 
percent less than the predicted base cost, the district's 
adjusted authorized predicted cost per FTE shall be equal to 95 
percent of the predicted base cost, minus 40 percent of the 
difference between (i) 95 percent of predicted base cost, and 
(ii) the base cost.  However, in no case shall a district's 
adjusted authorized predicted cost per FTE be more than 120 
percent of base cost.  
     (d) For the 1988-1989 base year and later years, each 
district's predicted base cost determined according to 
subdivision 3a must be adjusted as provided in this subdivision 
to determine the district's adjusted predicted base cost for 
that year.  The adjusted predicted base cost equals 50 percent 
of the district's base cost plus 50 percent of the district's 
predicted base cost, but the adjusted predicted base cost cannot 
be less than 80 percent, nor more than 110 percent, of the base 
cost. 
    Subd. 7b.  [INFLATION FACTORS.] The adjusted authorized 
predicted cost per FTE determined for a district under 
subdivision 7a for the base year shall be increased by 6.0 
percent to determine the district's aid entitlement per FTE for 
the 1986-1987 school year, by 4.9 percent to determine the 
district's aid entitlement per FTE for the 1987-1988 school 
year, and by 4.1 percent to determine the district's aid 
entitlement per FTE for the 1988-1989 school year. and by 5.8 
percent to determine the district's regular transportation 
allowance for the 1989-1990 school year.  The adjusted predicted 
base cost determined for a district under subdivision 7a for the 
base year must be increased by 5.4 percent to determine the 
district's regular transportation allowance for the 1990-1991 
school year, but the regular transportation allowance for a 
district cannot be less than the district's minimum regular 
transportation allowance according to subdivision 1, paragraph 
(t). 
     Subd. 7c.  [TRANSPORTATION REVENUE.] Beginning in the 
1990-1991 school year, the transportation revenue for each 
district equals the sum of the district's regular transportation 
revenue and the district's nonregular transportation revenue. 
     (a) The regular transportation revenue for each district 
equals the district's regular transportation allowance according 
to subdivision 7b times the sum of the number of FTE's 
transported by the district in the regular and desegregation 
categories in the current school year. 
    (b) The nonregular transportation revenue for each district 
equals the district's actual cost in the current school year for 
nonregular transportation services, minus the amount of regular 
transportation revenue attributable to FTE's transported in the 
desegregation category in the current school year. 
    Subd. 8a.  [TRANSPORTATION AID.] (a) For the 1988-1989 
school year and thereafter 1989-1990 school years, a district's 
transportation aid is equal to the sum of its basic 
transportation aid under subdivision 8b, its nonregular 
transportation aid under subdivision 8i, and its nonregular 
transportation levy equalization aid under subdivision 8j, minus 
its contracted services aid reduction under subdivision 8k and 
minus its basic transportation levy limitation for the levy 
attributable to that school year under section 275.125, 
subdivision 5. 
    (b) For 1990-1991 and later school years, a district's 
transportation aid equals the product of: 
    (1) the difference between the transportation revenue and 
the sum of: 
    (i) the maximum basic transportation levy for that school 
year under section 275.125, subdivision 5, plus 
    (ii) the maximum nonregular transportation levy for that 
school year under section 275.125, subdivision 5c, plus 
    (iii) the contracted services aid reduction under 
subdivision 8k, 
    (2) times the ratio of the sum of the actual amounts levied 
under section 275.125, subdivisions 5 and 5c, to the sum of the 
maximum levies under section 275.125, subdivisions 5 and 5c. 
    (c) If the total appropriation for transportation aid for 
any fiscal year is insufficient to pay all districts the full 
amount of aid earned, the department of education shall reduce 
each district's aid in proportion to the number of resident 
pupils in average daily membership in the district to the state 
total average daily membership, and shall reduce the 
transportation levy of off-formula districts in the same 
proportion. 
    Subd. 8b.  [BASIC AID COMPUTATION.] A district's basic 
transportation aid pursuant to this section for each school year 
the 1988-1989 and 1989-1990 school years shall equal the 
district's aid entitlement per FTE determined according to 
subdivision 7b, times the total number of authorized FTE's 
transported in the regular category in the district in 
the current school year.  
    Subd. 8i.  [NONREGULAR TRANSPORTATION AID.] (a) A 
district's nonregular transportation aid shall be determined 
according to this subdivision.  
    (b) For the 1986-1987 and 1987-1988 school years, 
nonregular transportation aid shall equal (1) 20 percent of the 
first $10 of actual cost in the current year for nonregular 
transportation services per total pupil unit, plus 40 percent of 
the next $10 of actual cost in the current year for nonregular 
transportation services per total pupil unit, plus 60 percent of 
the actual cost in the current year for nonregular 
transportation services per total pupil unit which exceeds $20, 
times (2) the number of total pupil units in the district in the 
current year.  
    (c) For the 1988-1989 and 1989-1990 school year and 
thereafter years, nonregular transportation aid equals (1) 60 
percent of the actual cost in the current year for nonregular 
transportation services per total pupil unit which exceeds $30, 
times (2) the number of total pupil units in the district in the 
current year. 
    Subd. 8j.  [NONREGULAR TRANSPORTATION LEVY EQUALIZATION 
AID.] For the 1984-1985 school year and each year 
thereafter 1988-1989 and 1989-1990 school years, a district's 
nonregular transportation levy equalization aid shall be 
determined pursuant to this subdivision.  
    (a) Unreimbursed nonregular transportation revenue shall 
equal the actual cost in the current school year for nonregular 
transportation services, minus the district's nonregular 
transportation aid computed pursuant to subdivision 8i.  
    (b) The nonregular transportation levy is the levy 
authorized by section 275.125, subdivision 5c.  
    (c) Nonregular transportation levy equalization aid for a 
district shall equal the product of (1) its unreimbursed 
nonregular transportation revenue, minus the nonregular 
transportation levy limitation for that year, times (2) the 
ratio of the district's actual nonregular transportation levy to 
its nonregular transportation levy limitation.  
    Subd. 8k.  [CONTRACTED SERVICES AID REDUCTION.] (a) For the 
1984-1985 school year and each year thereafter, each district's 
transportation aid shall be reduced according to the provisions 
of this subdivision, if the district contracted for some or all 
of the transportation services provided in the regular category. 
    (b) For the 1988-1989 and 1989-1990 school years, the 
department of education shall compute this subtraction by 
conducting the multiple regression analysis specified in 
subdivision 3 and computing the district's aid under two 
circumstances, once including the coefficient of the factor 
specified in subdivision 4b, clause (3), and once excluding the 
coefficient of that factor.  The aid subtraction shall equal the 
difference between the district's aid computed under these two 
circumstances.  
     (c) For 1990-1991 and later school years, the department of 
education shall determine the subtraction by computing the 
district's regular transportation revenue under two 
circumstances, once including the factor specified in 
subdivision 3a, clause (c), and once excluding the factor.  The 
aid subtraction equals the difference between the district's 
revenue computed under the two circumstances. 
    Subd. 8l.  [ALTERNATIVE ATTENDANCE PROGRAMS.] A district 
that serves enrolls nonresident pupils in programs under 
sections 120.062, 120.075, 120.0751, 120.0752, 123.3515, 126.22, 
and 129B.52 to 129B.55 shall provide authorized transportation 
to the pupil within the attendance area for the school that the 
pupil attends.  The state shall pay transportation aid 
attributable to the pupil to the serving nonresident district 
according to this section.  The resident district of the pupil's 
residence need not provide or pay for transportation between the 
pupil's residence and the district's border.  
    Subd. 9.  [DISTRICT REPORTS.] Each district shall report 
data to the department as required by the department to 
implement the transportation aid formula.  If a district's final 
transportation aid payment is adjusted after the final aid 
payment has been made to all districts, the adjustment shall be 
made by increasing or decreasing the district's aid for the next 
fiscal year.  
    Subd. 10.  [DEPRECIATION.] Any school district which that 
owns school buses or mobile units shall transfer annually from 
the undesignated fund balance account in its transportation fund 
to the reserved fund balance account for bus purchases in its 
transportation fund at least an amount equal to 12-1/2 percent 
of the original cost of each type one or type two bus or mobile 
unit until the original cost of each type one or type two bus or 
mobile unit is fully amortized, plus 20 percent of the original 
cost of each type three bus included in the district's 
authorized cost under the provisions of subdivision 1, clause 
paragraph (b), clause (4), until the original cost of each type 
three bus is fully amortized, plus 33-1/3 percent of the cost to 
the district as of July 1 of each year for school bus 
reconditioning done by the department of corrections until the 
cost of the reconditioning is fully amortized; provided, if the 
district's transportation aid or levy is reduced pursuant to 
subdivision 8a because the appropriation for that year is 
insufficient, this amount shall be reduced in proportion to the 
reduction pursuant to subdivision 8a as a percentage of the sum 
of 
    (1) the district's total transportation aid without the 
reduction pursuant to subdivision 8a, plus 
    (2) the district's basic transportation levy limitation 
under section 275.125, subdivision 5, plus 
    (3) the district's contract services aid reduction under 
subdivision 8k, plus 
    (4) the district's nonregular transportation levy 
limitation under section 275.125, subdivision 5c district's 
transportation revenue under subdivision 7c.  
    Sec. 4.  Minnesota Statutes 1988, section 275.125, 
subdivision 5, is amended to read: 
    Subd. 5.  [BASIC TRANSPORTATION LEVY.] Each year, a school 
district may levy for school transportation services an amount 
not to exceed the amount raised by the basic transportation tax 
capacity rate times the adjusted gross tax capacity of the 
district for the preceding year.  The commissioner of revenue 
shall establish the basic transportation tax capacity rate and 
certify it to the commissioner of education by September 1 of 
each year for levies payable in the following year.  The basic 
transportation tax capacity rate shall be a rate, rounded up to 
the nearest hundredth of a mill percent, that, when applied to 
the adjusted gross tax capacity of taxable property for all 
districts, raises the amount specified in this subdivision.  The 
basic transportation tax capacity rate for transportation for 
the 1990 fiscal year shall be the rate that 
raises $72,681,200 $82,063,200 for fiscal year 1991 and 
$86,166,400 for subsequent fiscal years.  The basic 
transportation tax capacity rate certified by the commissioner 
of revenue must not be changed due to changes or corrections 
made to a district's adjusted gross tax capacity after the tax 
capacity rate has been certified. 
    Sec. 5.  Minnesota Statutes 1988, section 275.125, 
subdivision 5b, is amended to read: 
    Subd. 5b.  [TRANSPORTATION LEVY OFF-FORMULA ADJUSTMENT.] 
(a) In any the 1989 and 1990 fiscal year years, if the basic 
transportation levy under subdivision 5 in a district 
attributable to a particular the fiscal year exceeds the 
transportation aid computation under section 124.225, 
subdivisions 8b, 8i, 8j, and 8k, the district's levy limitation 
shall be adjusted as provided in this subdivision.  In the year 
following each next fiscal year, the district's transportation 
levy shall be reduced by an amount equal to the difference 
between (1) the amount of the basic transportation levy under 
subdivision 5, and (2) the sum of the district's transportation 
aid computation pursuant to section 124.225, subdivisions 8b, 
8i, 8j, and 8k, and the amount of any subtraction made from 
special state aids pursuant to section 124.2138, subdivision 2, 
less the amount of any aid reduction due to an insufficient 
appropriation as provided in section 124.225, subdivision 8a.  
     (b) For 1991 and later fiscal years, in a district if the 
basic transportation levy under subdivision 5 attributable to 
that fiscal year is more than the difference between (1) the 
district's transportation revenue under section 124.225, 
subdivision 7c, and (2) the sum of the district's maximum 
nonregular levy under subdivision 5c and the district's 
contracted services aid reduction under section 124.225, 
subdivision 8k, and the amount of any reduction due to 
insufficient appropriation under section 124.225, subdivision 
8a, the district's transportation levy in the next fiscal year 
must be reduced by the amount of the excess. 
    Sec. 6.  Minnesota Statutes 1988, section 275.125, 
subdivision 5c, is amended to read: 
    Subd. 5c.  [NONREGULAR TRANSPORTATION LEVY.] A school 
district may also make a levy for unreimbursed nonregular 
transportation costs pursuant to this subdivision.  The amount 
of the levy shall not exceed the product of:  
    (a) the district's unreimbursed nonregular transportation 
revenue determined pursuant to section 124.225, subdivision 8j, 
clause (a), times 
    (b) the lesser of 
    (i) one, or 
    (ii) the ratio of the district's adjusted gross tax 
capacity for the preceding year per total pupil unit in the 
school year to which the levy is attributable, to $83,800. be 
the result of the following computation: 
    (a) multiply 
    (1) the amount of the district's nonregular transportation 
revenue under section 124.225, subdivision 7c that is more than 
the product of $30 times the district's actual pupil units, by 
    (2) 60 percent; 
    (b) subtract the result in clause (a) from the district's 
total nonregular transportation revenue; 
    (c) multiply the result in clause (b) by the lesser of one 
or the ratio of (i) the quotient derived by dividing the 
adjusted gross tax capacity of the district for the year before 
the year the levy is certified by the actual pupil units in the 
district for the school year to which the levy is attributable, 
to (ii) $9,722. 
    Sec. 7.  Minnesota Statutes 1988, section 275.125, 
subdivision 5e, is amended to read: 
    Subd. 5e.  [EXCESS TRANSPORTATION LEVY.] A school district 
may make a levy for excess transportation costs according to 
this subdivision.  The amount of the levy shall be the result of 
the following computation: 
    (a) Multiply the lesser of (1) the regular transportation 
allowance for the fiscal year to which the levy is attributable, 
or (2) the base cost computed using data for the current 
school fiscal year according to section 124.225, subdivision 1, 
paragraph (i) to which the levy is attributable, by the sum of 
the number of secondary FTE pupils transported to and from 
school in the current year who live more than one mile but less 
than two miles from the public school which they could attend or 
the nonpublic school actually attended, plus the number of FTE 
pupils residing less than one mile from school who were 
transported to and from school in the current year due to 
extraordinary traffic hazards number of weighted FTE pupils 
transported in the excess category in the district in the 
current school year.  
    (b) Add to the result in paragraph (a) the actual cost in 
the current fiscal year to which the levy is attributable of 
other related services that are necessary because of 
extraordinary traffic hazards.  
    Sec. 8.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated. 
    Subd. 2.  [TRANSPORTATION AID.] For transportation aid 
under Minnesota Statutes, section 124.225: 
     $91,979,000     .....     1990
     $99,265,000     .....     1991
    The 1990 appropriation includes $12,773,000 for 1989 and 
$79,206,000 for 1990. 
    The 1991 appropriation includes $13,978,000 for 1990 and 
$85,287,000 for 1991. 
    Subd. 3.  [TRANSPORTATION AID FOR POST-SECONDARY ENROLLMENT 
OPTIONS.] For transportation of pupils attending post-secondary 
institutions according to Minnesota Statutes, section 123.3514: 
     $50,000     .....     1990
     $50,000     .....     1991
    Subd. 4.  [TRANSPORTATION AID FOR ENROLLMENT OPTIONS.] For 
transportation of pupils attending nonresident districts 
according to Minnesota Statutes, section 120.0621 or section 
123.3515: 
     $50,000     .....     1990
     $50,000     .....     1991
    Sec. 9.  [SECTIONS NOT EFFECTIVE.] 
    The amendments to Minnesota Statutes 1988, section 124.225, 
made by Laws 1989, chapter 222, section 14, if enacted, are not 
effective. 
    The amendments to Minnesota Statutes 1988, section 275.125, 
subdivision 5b, made by Laws 1989, chapter 222, section 32, if 
enacted, are not effective. 
    The amendments to Minnesota Statutes 1988, section 275.125, 
subdivision 5c, made by Laws 1989, chapter 222, section 33, if 
enacted, are not effective. 
     The amendments to Minnesota Statutes 1988, section 275.125, 
subdivision 5e, made by Laws 1989, chapter 222, section 34, if 
enacted, are not effective. 

                                ARTICLE 3

                            SPECIAL PROGRAMS 
    Section 1.  Minnesota Statutes 1988, section 120.17, 
subdivision 3, is amended to read: 
    Subd. 3.  [RULES OF THE STATE BOARD.] The state board shall 
promulgate rules relative to qualifications of essential 
personnel, courses of study, methods of instruction, pupil 
eligibility, size of classes, rooms, equipment, supervision, 
parent consultation, and any other rules it deems necessary for 
instruction of handicapped children.  These rules shall provide 
standards and procedures appropriate for the implementation of 
and within the limitations of subdivisions 3a and 3b.  These 
rules shall also provide standards for the discipline, control, 
management and protection of handicapped children.  The state 
board shall not adopt rules for pupils served in level 1, 2, or 
3, as defined in Minnesota Rules, part 3525.2340, establishing 
either case loads or the maximum number of pupils that may be 
assigned to special education teachers.  The state board, in 
consultation with the departments of health and human services, 
shall adopt permanent rules for instruction and services for 
children under age five and their families.  Until June 30, 
1988, a developmental achievement center under contract to a 
school district to provide special instruction and services is 
eligible for variance from rules relating to personnel 
licensure.  Until June 30, 1988, the licensure variance for a 
developmental achievement center shall be granted according to 
the same procedures and criteria used for granting a variance to 
a school district.  The state board shall adopt rules to 
determine eligibility for special education services.  The rules 
shall include procedures and standards by which to grant 
variances for experimental eligibility criteria.  The state 
board shall, according to section 14.05, subdivision 4, notify a 
district applying for a variance from the rules within 45 
calendar days of receiving the request whether the request for 
the variance has been granted or denied.  If a request is 
denied, the board shall specify the program standards used to 
evaluate the request and the reasons for denying the request.  
    Sec. 2.  Minnesota Statutes 1988, section 120.17, 
subdivision 3b, is amended to read: 
    Subd. 3b.  [PROCEDURES FOR DECISIONS.] Every district shall 
utilize at least the following procedures for decisions 
involving identification, assessment, and educational placement 
of handicapped children: 
     (a) Parents and guardians shall receive prior written 
notice of:  
     (1) any proposed formal educational assessment or proposed 
denial of a formal educational assessment of their child; 
     (2) a proposed placement of their child in, transfer from 
or to, or denial of placement in a special education program; or 
     (3) the proposed provision, addition, denial or removal of 
special education services for their child; 
     (b) The district shall not proceed with the initial formal 
assessment of a child, the initial placement of a child in a 
special education program, or the initial provision of special 
education services for a child without the prior written consent 
of the child's parent or guardian.  The refusal of a parent or 
guardian to consent may be overridden by the decision in a 
hearing held pursuant to clause (d) at the district's 
initiative; 
     (c) Parents and guardians shall have an opportunity to meet 
with appropriate district staff in at least one conciliation 
conference if they object to any proposal of which they are 
notified pursuant to clause (a).  The conciliation process shall 
not be used to deny or delay a parent or guardian's right to a 
due process hearing.  If the parent or guardian refuses efforts 
by the district to conciliate the dispute with the school 
district, the requirement of an opportunity for conciliation 
shall be deemed to be satisfied; 
    (d) Parents, guardians, and the district shall have an 
opportunity to obtain an impartial due process hearing initiated 
and conducted by and in the school district where the child 
resides responsible for assuring that an appropriate program is 
provided in accordance with state board rules, if the parent or 
guardian continues to object to:  
    (1) a proposed formal educational assessment or proposed 
denial of a formal educational assessment of their child; 
    (2) the proposed placement of their child in, or transfer 
of their child to a special education program; 
    (3) the proposed denial of placement of their child in a 
special education program or the transfer of their child from a 
special education program; 
    (4) the proposed provision or addition of special education 
services for their child; or 
    (5) the proposed denial or removal of special education 
services for their child. 
    At least five calendar days before the hearing, the 
objecting party shall provide the other party with a brief 
written statement of the objection and the reasons for the 
objection.  
    The hearing shall take place before an impartial hearing 
officer mutually agreed to by the school board and the parent or 
guardian.  If the school board and the parent or guardian are 
unable to agree on a hearing officer, the school board shall 
request the commissioner to appoint a hearing officer.  The 
hearing officer shall not be a school board member or employee 
of the school district where the child resides or of the child's 
school district of residence, an employee of any other public 
agency involved in the education or care of the child, or any 
person with a personal or professional interest which would 
conflict with the person's objectivity at the hearing.  A person 
who otherwise qualifies as a hearing officer is not an employee 
of the district solely because the person is paid by the 
district to serve as a hearing officer.  If the hearing officer 
requests an independent educational assessment of a child, the 
cost of the assessment shall be at district expense.  The 
proceedings shall be recorded and preserved, at the expense of 
the school district, pending ultimate disposition of the action. 
     (e) The decision of the hearing officer pursuant to clause 
(d) shall be rendered not more than 45 calendar days from the 
date of the receipt of the request for the hearing.  A hearing 
officer may grant specific extensions of time beyond the 45-day 
period at the request of either party.  The decision of the 
hearing officer shall be binding on all parties unless appealed 
to the hearing review officer by the parent, guardian, or the 
school board of the district where the child resides pursuant to 
clause (f). 
    The local decision shall: 
    (1) be in writing; 
    (2) state the controlling facts upon which the decision is 
made in sufficient detail to apprise the parties and the hearing 
review officer of the basis and reason for the decision; 
    (3) state whether the special education program or special 
education services appropriate to the child's needs can be 
reasonably provided within the resources available to the 
responsible district or districts; 
    (4) state the amount and source of any additional district 
expenditure necessary to implement the decision; and 
    (5) be based on the standards set forth in subdivision 3a 
and the rules of the state board. 
    (f) Any local decision issued pursuant to clauses (d) and 
(e) may be appealed to the hearing review officer within 30 
calendar days of receipt of that written decision, by the 
parent, guardian, or the school board of the district where the 
child resides responsible for assuring that an appropriate 
program is provided in accordance with state board rules. 
    If the decision is appealed, a written transcript of the 
hearing shall be made by the school district and shall be 
accessible to the parties involved within five calendar days of 
the filing of the appeal.  The hearing review officer shall 
issue a final decision based on an impartial review of the local 
decision and the entire record within 30 calendar days after the 
filing of the appeal.  The hearing review officer shall seek 
additional evidence if necessary and may afford the parties an 
opportunity for written or oral argument; provided any hearing 
held to seek additional evidence shall be an impartial due 
process hearing but shall be deemed not to be a contested case 
hearing for purposes of chapter 14.  The hearing review officer 
may grant specific extensions of time beyond the 30-day period 
at the request of any party. 
     The final decision shall: 
     (1) be in writing; 
     (2) include findings and conclusions; and 
     (3) be based upon the standards set forth in subdivision 3a 
and in the rules of the state board. 
     (g) The decision of the hearing review officer shall be 
final unless appealed by the parent or guardian or school board 
to the court of appeals.  The judicial review shall be in 
accordance with chapter 14.  
     (h) The commissioner of education, having delegated general 
supervision of special education to the appropriate staff, shall 
be the hearing review officer except for appeals in which: 
     (1) the commissioner has a personal interest in or specific 
involvement with the student who is a party to the hearing; 
     (2) the commissioner has been employed as an administrator 
by the district that is a party to the hearing; 
     (3) the commissioner has been involved in the selection of 
the administrators of the district that is a party to the 
hearing; 
    (4) the commissioner has a personal, economic, or 
professional interest in the outcome of the hearing other than 
the proper administration of the federal and state laws, rules, 
and policies; 
    (5) the appeal challenges a state or local policy which was 
developed with substantial involvement of the commissioner; or 
    (6) the appeal challenges the actions of a department 
employee or official.  
    For any appeal to which the above exceptions apply, the 
state board of education shall name an impartial and competent 
hearing review officer.  
    In all appeals, the parent or guardian of the handicapped 
student or the district that is a party to the hearing may 
challenge the impartiality or competence of the proposed hearing 
review officer by applying to the state board of education.  
    (i) Pending the completion of proceedings pursuant to this 
subdivision, unless the district and the parent or guardian of 
the child agree otherwise, the child shall remain in the child's 
current educational placement and shall not be denied initial 
admission to school. 
    (j) The child's school district of residence, if different 
from the district where the child actually resides, a resident 
district, and providing district shall receive notice of and may 
be a party to any hearings or appeals pursuant to under this 
subdivision. 
    Sec. 3.  Minnesota Statutes 1988, section 120.17, 
subdivision 11a, is amended to read: 
    Subd. 11a.  [STATE INTERAGENCY COORDINATING COUNCIL.] An 
interagency coordinating council of 15 members is established. 
The members and the chair shall be appointed by the governor.  
The council shall be composed of at least three parents of 
handicapped children under age seven with handicaps, a 
representative of each of the commissioners of education, 
health, and human services, three representatives of public or 
private providers of services for handicapped children under age 
five with handicaps, one member of the senate, one member of the 
house of representatives, one representative of teacher 
preparation programs in early childhood-special education, at 
least one representative of advocacy organizations 
for handicapped children with handicaps, at least one 
representative of a school district or a school district 
cooperative, and other members knowledgeable about handicapped 
children under age five with handicaps.  Section 15.059, 
subdivisions 2 to 5, apply to the council.  The council shall 
meet at least quarterly.  A representative of each of the 
commissioners of education, health, and human services shall 
attend council meetings as a nonvoting member of the council. 
    The council shall address methods of implementing the state 
policy of developing and implementing comprehensive, 
coordinated, multidisciplinary interagency programs of early 
intervention services for handicapped children with handicaps 
and their families. 
    The duties of the council include recommending policies to 
ensure a comprehensive and coordinated system of all state and 
local agency services for handicapped children under age five 
with handicaps and their families.  The policies must address 
how to incorporate each agency's services into a unified state 
and local system of multidisciplinary assessment practices, 
individual intervention plans, comprehensive systems to find 
children in need of services, methods to improve public 
awareness, and assistance in determining the role of interagency 
early intervention committees.  
    It is the joint responsibility of county boards and school 
districts to coordinate, provide, and pay for appropriate 
services, and to facilitate payment for services from public and 
private sources.  Appropriate services must be determined in 
consultation with parents, physicians, and other educational, 
medical, health, and human services providers.  Appropriate 
services include family education and counseling, home visits, 
occupational and physical therapy, speech pathology, audiology, 
psychological services, case management, medical services for 
diagnostic and evaluation purposes, early identification, and 
screening, assessment, and health services necessary to enable 
handicapped children with handicaps to benefit from early 
intervention services.  School districts must be the primary 
agency in this cooperative effort.  
    Each year by January 15 the council shall submit its 
recommendations to the education committees of the legislature, 
the governor, and the commissioners of education, health, and 
human services. 
     Sec. 4.  Minnesota Statutes 1988, section 124.273, 
subdivision 4, is amended to read: 
    Subd. 4.  [APPLICATION DATES.] (a) To obtain aid for 
limited English proficiency programs, a district shall submit an 
initial application for aid by October 15 and shall submit an 
amended application by February 15 or by June 15 if the number 
of enrolled pupils of limited English proficiency has changed 
since filing a previous application.  Districts which do not 
submit an initial application by October 15 but enroll pupils of 
limited English proficiency after that date may submit an 
initial application by February 15 or by June 15.  A final 
report with actual salary and enrollment information shall be 
submitted by August 15 for calculation of the final payment 
information required by the department to implement this section.
    (b) All applications shall be submitted to the department 
in the manner prescribed by the commissioner.  Each application 
shall include (1) the number of pupils or additional pupils 
enrolled who meet the criteria in section 126.262, subdivision 
2; (2) the number, dates of hire, full time equivalency, and 
salaries of essential licensed personnel or additional essential 
licensed personnel employed in the district's educational 
program for pupils of limited English proficiency who meet the 
criteria in section 126.262, subdivision 3; and (3) any other 
information deemed necessary by the commissioner to implement 
this section.  School districts may submit joint applications 
for aid pursuant to this section and may share essential 
instructional personnel employed in educational programs for 
pupils of limited English proficiency. 
    Sec. 5.  Minnesota Statutes 1988, section 124.273, 
subdivision 5, is amended to read: 
    Subd. 5.  [NOTIFICATION; AID PAYMENTS.] The department 
shall must promptly inform each applicant district of the amount 
of aid it will receive pursuant to this section within a month 
after the application deadline. 
    Sec. 6.  [124.311] [ASSURANCE OF MASTERY REVENUE.] 
    Subdivision 1.  [INSTRUCTION IN REGULAR CLASSROOM.] A 
school district may receive assurance of mastery revenue to 
provide direct instructional services to eligible pupils in the 
pupils' regular classroom.  
    Subd. 2.  [ELIGIBLE DISTRICTS.] To be eligible to receive 
assurance of mastery revenue, a district must have a policy 
adopted according to section 126.67, subdivision 3a, that 
identifies the direct instructional services to be used to 
assure that individual pupils master the learner outcomes in 
communications and mathematics.  
    Subd. 3.  [ELIGIBLE PUPILS.] A pupil is eligible to receive 
services provided with assurance of mastery revenue if the pupil 
has not demonstrated mastery of learner outcomes in 
communications or mathematics, or both, after receiving 
instruction that was designed to enable the pupil to master the 
learner outcomes in a regular classroom setting.  To determine 
pupil eligibility, a district must use the learner outcomes and 
the evaluation process, adopted by the school board under 
section 126.666, subdivision 1, clauses (2) and (3), for the 
subjects and at the grade level at which the district uses the 
revenue. 
    Subd. 4.  [ELIGIBLE SERVICES.] Assurance of mastery revenue 
must be used to provide direct instructional services to an 
eligible pupil, or group of eligible pupils, under the following 
conditions:  
    (a) Instruction may be provided at one or more grade levels 
from kindergarten through grade eight. 
    (b) Instruction must be provided in the usual and customary 
classroom of the eligible pupil.  
    (c) Instruction must be provided under the supervision of 
the eligible pupil's regular classroom teacher.  Instruction may 
be provided by the eligible pupil's classroom teacher, by 
another teacher, by a team of teachers, or by an education 
assistant or aide.  A special education teacher may provide 
instruction, but instruction that is provided under this section 
is not eligible for aid under section 124.32.  
    (d) The instruction that is provided must differ from the 
initial instruction the pupil received in the regular classroom 
setting.  The instruction may differ by presenting different 
curriculum than was initially presented in the regular 
classroom, or by presenting the same curriculum:  
    (1) at a different rate or in a different sequence than it 
was initially presented; 
    (2) using different teaching methods or techniques than 
were used initially; or 
    (3) using different instructional materials than were used 
initially.  
    Subd. 5.  [REVENUE AMOUNT.] Assurance of mastery revenue is 
the sum of state and district money.  The sum may equal up to 
$45 for fiscal year 1991 and thereafter times the number of 
actual pupil units in kindergarten through grade eight in the 
district.  The district shall determine the amount of money it 
will provide and the state shall provide an equal amount of 
money. 
    Subd. 6.  [USES OF REVENUE.] Assurance of mastery revenue 
may be used only to provide eligible services to eligible pupils.
    Subd. 7.  [DISTRICT REPORT.] A district that receives 
assurance of mastery revenue shall include the following in the 
report required by section 126.666, subdivision 4:  
    (a) A summary of initial assessment results used to 
determine pupil eligibility to receive instructional services 
must be included.  The summary must include:  
    (1) a description of the assessment device used; 
    (2) the number of pupils who were assessed; and 
    (3) the number of pupils who were determined to be eligible 
to receive services.  
    (b) A description of the services provided to eligible 
pupils must be included.  
    (c) A summary of assessment results for eligible pupils 
obtained after providing the services must be included.  
    Sec. 7.  Minnesota Statutes 1988, section 124.32, 
subdivision 1b, is amended to read: 
    Subd. 1b.  [TEACHERS SALARIES.] Each year the state shall 
pay to a district a portion of the salary of each essential 
person employed in the district's program for handicapped 
children during the regular school year, whether the person is 
employed by one or more districts.  The portion for a full-time 
person shall be an amount not to exceed the lesser of 66 60 
percent of the salary or $18,400 $16,727.  The portion for a 
part-time or limited-time person shall be an amount not to 
exceed the lesser of 66 60 percent of the salary or the product 
of $18,400 $16,727 times the ratio of the person's actual 
employment to full-time employment. 
    Sec. 8.  Minnesota Statutes 1988, section 124.573, 
subdivision 2, is amended to read:  
    Subd. 2.  [SALARIES AND TRAVEL LIMIT.] The eligible 
expenses for secondary vocational aid are:  (1) the salaries 
paid to essential, licensed personnel in that school year for 
services rendered in that district's or center's approved 
secondary vocational education programs; (2) the costs of 
necessary travel between instructional sites by secondary 
vocational education teachers; and (3) the costs of necessary 
travel by secondary vocational education teachers accompanying 
students to and from vocational student organization meetings 
held within the state for educational purposes.  The state shall 
pay to any district or cooperative center 41.5 percent of the 
eligible expenses incurred in an approved secondary vocational 
program for the 1986-1987 school year.  The state shall pay to 
any district or cooperative center 39 percent of the eligible 
expenses incurred in an approved secondary vocational program 
for the 1987-1988 school year.  The commissioner may withhold 
all or any portion of this the aid paid under this section for a 
secondary vocational education program which receives funds from 
any other source.  In no event shall a district or center 
receive a total amount of state aid pursuant to this section 
which, when added to funds from other sources, will provide the 
program an amount for salaries and travel which exceeds 100 
percent of the amount of its expenditures for salaries and 
travel in the program. 
    Sec. 9.  Minnesota Statutes 1988, section 124.573, 
subdivision 2b, is amended to read: 
    Subd. 2b.  [SECONDARY VOCATIONAL AID.] For 1988-1989 
1989-1990 and later school years, a district's or cooperative 
center's "secondary vocational aid" for secondary vocational 
education programs for a school year equals the sum of the 
following amounts for each program: 
    (a) the greater of zero, or 75 percent of the difference 
between:  
    (1) the salaries paid to essential, licensed personnel in 
that school year for services rendered in that district's or 
cooperative center's approved secondary vocational education 
programs program, and 
    (2) 50 percent of the general education revenue 
attributable to secondary pupils for the number of hours that 
the pupils are enrolled in secondary vocational courses that 
program; and 
    (b) 30 percent of approved expenditures for the following: 
    (1) contracted services provided by a public or private 
agency other than a Minnesota school district or cooperative 
center under section 124.573, subdivision 3a; 
    (2) necessary travel between instructional sites by 
licensed secondary vocational education personnel; 
    (3) necessary travel by licensed secondary vocational 
education personnel for vocational student organization 
activities held within the state for instructional purposes; 
    (4) curriculum development activities that are part of a 
five-year plan for improvement based on program assessment; 
    (5) necessary travel by licensed secondary vocational 
education personnel for noncollegiate credit bearing 
professional development; and 
    (6) specialized vocational instructional supplies. 
    Sec. 10.  Minnesota Statutes 1988, section 124.573, is 
amended by adding a subdivision to read: 
    Subd. 2d.  [ADMINISTRATION.] In making the computation in 
subdivision 2b, paragraph (a), clause (1), the salaries of the 
administrator and support service facilitator must be 
apportioned among programs based on the number of 
full-time-equivalent instructors in each program. 
    Sec. 11.  Minnesota Statutes 1988, section 124.573, is 
amended by adding a subdivision to read: 
    Subd. 5a.  [DISTRICT REPORTS.] Each district or cooperative 
center shall report data to the department for all secondary 
vocational education programs as required by the department to 
implement the secondary vocational aid formula. 
    Sec. 12.  Minnesota Statutes 1988, section 124.574, 
subdivision 2b, is amended to read: 
    Subd. 2b.  [SALARIES.] Each year the state shall pay to any 
district or cooperative center a portion of the salary of each 
essential licensed person employed during that school year for 
services rendered in that district or center's secondary 
vocational education programs for handicapped children.  The 
portion for a full-time person shall be an amount not to exceed 
the lesser of 66 60 percent of the salary or $18,400 $16,727.  
The portion for a part-time or limited-time person shall be the 
lesser of 66 60 percent of the salary or the product 
of $18,400 $16,727 times the ratio of the person's actual 
employment to full-time employment.  
    Sec. 13.  Minnesota Statutes 1988, section 124.574, 
subdivision 4, is amended to read: 
    Subd. 4.  [AID FOR CONTRACTED SERVICES.] In addition to the 
provisions of subdivisions 2b and 3, a school district may 
contract with a public or private agency other than a Minnesota 
school district or cooperative center for the provision of 
secondary vocational education programs for handicapped 
children.  The formula for payment of aids for these contracts 
shall be that provided in section 124.32, subdivision 1b 1d.  
The state board shall promulgate rules relating to approval 
procedures and criteria for these contracts and aid shall be 
paid only for contracts approved by the commissioner of 
education.  For the purposes of subdivision 6, the district or 
cooperative center contracting for these services shall be 
construed to be providing these services.  
    Sec. 14.  Minnesota Statutes 1988, section 124.574, 
subdivision 5, is amended to read:  
    Subd. 5.  The aid provided pursuant to this section shall 
be paid only for services rendered as designated in subdivision 
2 or for the costs designated in subdivision 3 which are 
incurred in secondary vocational education programs for 
handicapped children which are approved by the commissioner of 
education and operated in accordance with rules promulgated by 
the state board.  These rules shall be subject to the 
restrictions provided in section 124.573, subdivision 3.  The 
procedure for application for approval of these programs shall 
be as provided in section 124.32, subdivisions 7 and 10 and the 
application review process shall be conducted jointly by the 
division of special and compensatory education and the division 
of vocational technical education section of the state 
department. 
    Sec. 15.  [124.86] [STATE REVENUE FOR AMERICAN INDIAN 
SCHOOLS.] 
    Subdivision 1.  [AUTHORIZATION.] Each year each American 
Indian-controlled contract school authorized by the United 
States Code, title 25, section 450f that is located on a 
reservation within the state is eligible to receive tribal 
contract school aid subject to the requirements in this 
subdivision. 
    (a) The school must plan, conduct, and administer an 
education program that complies with the requirements of 
chapters 120, 121, 122, 123, 124, 124A, 125, 126, 129, 129A, and 
129B. 
    (b) The school must comply with all other state statutes 
governing independent school districts.  
    (c) The state tribal contract school aid must be used to 
supplement, and not to replace, the money for American Indian 
education programs provided by the federal government. 
    Subd. 2.  [REVENUE AMOUNT.] For 1989-1990 and later school 
years, an American Indian-controlled contract school that is 
located on a reservation within the state and that complies with 
the requirements in subdivision 1 is eligible to receive tribal 
contract school aid.  The amount of aid is derived by: 
    (1) multiplying the formula allowance under section 
124A.22, subdivision 2, times the actual pupil units as defined 
in section 124A.02, subdivision 19, in attendance during the 
fall count week, but not including pupil units for which the 
school has received reimbursement under sections 123.933 and 
126.23 for the school for the current school year; 
    (2) subtracting from the result in clause (1) the amount of 
money allotted to the school by the federal government through 
the Indian School Equalization Program of the Bureau of Indian 
Affairs, according to Code of Federal Regulations, title 25, 
part 39, subparts A to E, for the basic program as defined by 
section 39, 11, b but not money allotted through subparts F to L 
for contingency funds, school board training, student training, 
interim maintenance and minor repair, interim administration 
cost, prekindergarten, and operation and maintenance, and the 
amount of money that is received according to section 126.23; 
    (3) dividing the result in clause (2) by the actual pupil 
units; and 
    (4) multiplying the actual pupil units by the lesser of 
$1,500 or the result in clause (3). 
    Subd. 3.  [LAW WAIVER.] Notwithstanding subdivision 1, 
paragraphs (a) and (b), a contract school: 
    (1) is not subject to the Minnesota election law; 
    (2) has no authority under this section to levy for 
property taxes, issue and sell bonds, or incur debt; and 
    (3) may request through its managing tribal organization a 
recommendation of the state board of education, for 
consideration of the legislature, that a contract school not be 
subject to specified statutes related to independent school 
districts. 
    Sec. 16.  [124.331] [REVENUE FOR INDIVIDUALIZED LEARNING 
AND DEVELOPMENT.] 
    Subdivision 1.  [PURPOSE.] The purpose of sections 16 to 18 
is to improve the education of public school pupils by: 
    (1) working toward reducing instructor-learner ratios and 
increasing the amount of individual attention given each learner 
in kindergarten and grade one to help each learner develop 
socially and emotionally and in knowledge, skills, and 
attitudes; and 
    (2) improving program offerings. 
    Subd. 2.  [DEFINITION.] "Instructor" in this section means 
a public employee licensed by the board of teaching whose duties 
are full-time instruction or the equivalent, excluding a teacher 
for whom categorical aids are received pursuant to sections 
124.273 and 124.32.  Instruction may be provided by a learner's 
instructor, by another instructor, by a team of instructors, or 
by an education assistant or aide supervised by a learner's 
regular instructor.  In this section, instructor does not 
include supervisory and support personnel, as defined in section 
125.03.  An instructor whose duties are less than full-time 
instruction must be included as an equivalent only for the 
number of hours of instruction. 
    Subd. 3.  [STATE REVENUE CRITERIA.] Revenue available under 
section 17 is to enable a district to work to achieve the 
district's instructor-learner ratios in kindergarten and grade 
one established by the curriculum advisory committee in each 
district, and to prepare and use an individualized learning plan 
for each learner in kindergarten and grade one.  A district must 
not increase the districtwide instructor-learner ratios in 
grades two through eight as a result of reducing 
instructor-learner ratios in kindergarten and grade one. 
    A district's curriculum advisory committee, as part of the 
policy under section 126.666, must develop a districtwide plan 
to work to achieve the instructor-learner ratios in kindergarten 
and grade one adopted by the school board of the district, and 
to prepare and use an individualized learning plan for each 
learner in kindergarten and grade one.  If the school board of a 
school district determines that the district has achieved and is 
maintaining the instructor-learner ratios specified by the 
district's curriculum advisory committee, and has prepared and 
is using individualized learning plans, the school board must 
direct the school district to use the aid it receives under 
section 17 to work to improve program offerings throughout the 
district, or the education district of which the district is a 
member, based upon a plan developed by the district's curriculum 
advisory committee. 
    Sec. 17.  [124.332] [INDIVIDUALIZED LEARNING AND 
DEVELOPMENT AID.] 
    Subdivision 1.  [ELIGIBILITY.] A district is eligible for 
individualized learning and development aid if the school board 
of the district has adopted a district instructor-learner ratio 
specified by the district's curriculum advisory committee and 
submits its ratio to the department of education by April 15, 
1990. 
    Subd. 2.  [AID AMOUNT.] An eligible district shall receive 
individualized learning and development aid in an amount equal 
to $62.25 times the district's average daily membership in 
kindergarten and grade one.  Aid received under this subdivision 
must be used only to achieve the district's instructor-learner 
ratios and prepare and use individualized learning plans for 
learners in kindergarten and grade one.  If the district has 
achieved and is maintaining the district's instructor-learner 
ratios, then the district may use the aid to work to improve 
program offerings throughout the district.  
    Subd. 3.  [WITHHOLDING.] The commissioner must withhold 
individualized learning and development aid from any district 
that fails to make a good faith effort to achieve its 
instructor-learner ratios. 
    Sec. 18.  [124.333] [REPORT.] 
    The commissioner of education shall monitor and evaluate 
the effectiveness of districts' reduced instructor-learner 
ratios, individualized learning plans, and efforts to improve 
program offerings and shall report to the education committees 
in the legislature before March 1 of each school year. 
    Sec. 19.  Minnesota Statutes 1988, section 124A.28, 
subdivision 1, is amended to read: 
    Subdivision 1.  [USE OF THE REVENUE.] The compensatory 
education revenue under section 124A.22, subdivision 3, may be 
used to provide eligible services to eligible pupils according 
to section 6, subdivisions 3 and 4.  It also may be used to meet 
the educational needs of pupils whose educational achievement is 
below the level that is appropriate for pupils of their age.  
These needs may be met by providing at least some of the 
following: 
    (1) remedial instruction in reading, language arts, and 
mathematics to improve the achievement level of these pupils; 
    (2) additional teachers and teacher aides to provide more 
individualized instruction to these pupils; 
    (3) summer programs that enable these pupils to improve 
their achievement or that reemphasize material taught during the 
regular school year; 
    (4) in-service education for teachers, teacher aides, 
principals, and other personnel to improve their ability to 
recognize these pupils and provide appropriate responses to the 
pupils' needs; 
    (5) for instructional material for these pupils including:  
textbooks, workbooks, periodicals, pamphlets, photographs, 
reproductions, filmstrips, prepared slides, prerecorded video 
programs, sound recordings, desk charts, games, study prints and 
pictures, desk maps, models, learning kits, blocks and cubes, 
flashcards, instructional computer software programs, pencils, 
pens, crayons, notebooks, duplicating fluids, and papers; 
    (6) programs to reduce truancy, encourage completion of 
high school, enhance self-concept, provide health services, 
provide nutrition services, provide a safe and secure learning 
environment, provide coordination for pupils receiving services 
from other governmental agencies, provide psychological services 
to determine the level of social, emotional, cognitive, and 
intellectual development, and provide counseling services, 
guidance services, and social work services; and 
    (7) bilingual programs, bicultural programs, and programs 
for pupils of limited English proficiency.  
    Sec. 20.  Minnesota Statutes 1988, section 126.151, 
subdivision 2, is amended to read: 
    Subd. 2.  [ACCOUNTS OF THE ORGANIZATION.] The state boards 
of education and vocational technical education may retain dues 
and other money collected on behalf of students participating in 
approved vocational student organizations and may deposit the 
money in separate accounts.  The money in these accounts shall 
be available for expenditures for state and national activities 
related to specific organizations.  Administration of money 
collected under this section is not subject to the provisions of 
chapters 15, 16A, and 16B, and may be deposited outside the 
state treasury.  Money shall be administered under the policies 
of the applicable state board or agency relating to 
post-secondary and secondary vocational student organizations 
and is subject to audit by the legislative auditor.  Any 
unexpended money shall not cancel but may be carried forward to 
the next fiscal year. 
    Sec. 21.  [126.237] [ALTERNATE INSTRUCTION REQUIRED.] 
    Before a pupil is referred for a special education 
assessment, the district must conduct and document at least two 
instructional strategies, alternatives, or interventions while 
the pupil is in the regular classroom.  The pupil's teacher must 
provide the documentation.  A special education assessment team 
may waive this requirement when they determine the pupil's need 
for the assessment is urgent.  This section may not be used to 
deny a pupil's right to a special education assessment. 
    Sec. 22.  [GRANTS FOR INDIAN TEACHERS.] 
    Subdivision 1.  [ESTABLISHMENT.] A grant program is 
established during the biennium to assist American Indian people 
to become teachers and to provide additional education for 
American Indian teachers.  The state board may award a joint 
grant to each of the following:  (1) the University of 
Minnesota, Duluth, and independent school district No. 709, 
Duluth; (2) Bemidji state university and independent school 
district No. 38, Red Lake; and (3) Moorhead state university and 
one of the school districts located within the White Earth 
reservation.  To obtain a joint grant, a joint application must 
be submitted to the state board of education.  The application 
must be developed with the participation of the district parent 
advisory committee, established according to Minnesota Statutes, 
section 126.51, and the Indian advisory committee at the 
post-secondary institution. 
    Subd. 2.  [GRANT APPLICATION.] The application must set 
forth the in-kind services to be provided by the post-secondary 
institution.  The coordination and mentorship services to be 
provided by the post-secondary institution and the school 
district must also be set forth in the application.  
    Subd. 3.  [LOAN FORGIVENESS.] The portion of the 
scholarship attributable to living expenses and additional 
needs, according to subdivision 4, clause (4), shall be in the 
form of a loan to be forgiven if the recipient teaches in a 
school district in Minnesota.  One-fifth of the principal of the 
outstanding loan amount must be forgiven for each year of 
teaching. The loan forgiveness program and procedures to 
administer the program shall be approved by the higher education 
coordinating board.  
    Subd. 4.  [ELIGIBILITY FOR SCHOLARSHIPS.] The following 
American Indian people are eligible for scholarships:  
     (1) a student who intends to become a teacher and who is 
enrolled in a post-secondary institution receiving a joint 
grant; 
    (2) a teacher aide who intends to become a teacher and who 
is employed by a district receiving a joint grant; 
    (3) a licensed employee of a district receiving a joint 
grant who is enrolled in a master of education degree program; 
and 
    (4) a student who, after receiving federal and state 
financial aid and an Indian scholarship according to Minnesota 
Statutes, section 124.48, has financial needs that remain unmet. 
Financial need shall be determined according to the uniform 
methodology for needs determination.  Additional needs 
attributable to living expenses may be included in the 
forgivable loan.  
    Subd. 5.  [REVIEW AND COMMENT.] The joint application shall 
be submitted to the Minnesota Indian scholarship committee for 
review and comment.  
    Subd. 6.  [GRANT AMOUNT.] The state board may award a joint 
grant in the amount it determines appropriate.  Scholarship 
money shall be included in the joint grant.  
    Sec. 23.  [LEVY ADJUSTMENT.] 
    The department of education shall adjust the 1989 levy for 
each school district by the amount of the increase in the 
district's special education levy for fiscal year 1990 according 
to Minnesota Statutes, section 275.125, subdivision 8c, 
resulting from the changes to special education aid under 
sections 7 and 12.  Notwithstanding Minnesota Statutes, section 
121.904, the entire amount of this levy shall be recognized as 
revenue for fiscal year 1990. 
    Sec. 24.  [HANDICAPPED CHILDREN UNDER AGE 5; REPORT.] 
    The department of education, the state interagency 
coordinating council, and the association of Minnesota counties 
shall jointly prepare a report describing the responsibilities 
of county boards and school districts to provide services for 
handicapped children under age five and their families. 
    The report shall include at least the following: 
    (1) a description of current procedures used to determine 
county and school district responsibilities; 
    (2) a summary of problems of the current delivery system; 
    (3) recommendations for improving the efficiency and 
quality of services; 
    (4) recommendations for funding services; and 
    (5) an accounting of current expenditures that includes a 
list of financing sources. 
    Sec. 25.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated.  
    Subd. 2.  [SPECIAL EDUCATION AID.] For special education 
aid: 
     $160,331,000     .....     1990 
     $165,870,000     .....     1991 
    The 1990 appropriation includes $23,074,000 for 1989 and 
$137,257,000 for 1990. 
    The 1991 appropriation includes $24,222,000 for 1990 and 
$141,648,000 for 1991. 
    Subd. 3.  [SPECIAL PUPIL AID.] For special education aid 
under Minnesota Statutes, section 124.32, subdivision 6, for 
pupils with handicaps placed in residential facilities within 
the district boundaries for whom no district of residence can be 
determined: 
     $284,000     .....     1990 
     $158,000     .....     1991 
     If the appropriation for either year is insufficient, the 
appropriation for the other year is available.  If the 
appropriations for both years are insufficient, the 
appropriation for special education aid may be used to meet the 
special pupil obligations. 
    Subd. 4.  [SUMMER SPECIAL EDUCATION AID.] For special 
education summer school aid according to Minnesota Statutes, 
section 124.32, subdivision 10: 
     $5,836,000     .....     1990 
     $5,766,000     .....     1991 
    The 1990 appropriation is for 1989 summer school programs. 
    The 1991 appropriation is for 1990 summer school programs. 
    Subd. 5.  [TRAVEL FOR HOME-BASED SERVICES.] For aid for 
teacher travel for home-based services according to Minnesota 
Statutes, section 124.32, subdivision 2b: 
     $51,000     .....     1990 
     $51,000     .....     1991 
    The 1990 appropriation includes $8,000 for 1989 and $43,000 
for 1990. 
    The 1991 appropriation includes $8,000 for 1990 and $43,000 
for 1991. 
    Subd. 6.  [RESIDENTIAL FACILITIES AID.] For residential 
facilities aid under aid according to Minnesota Statutes, 
section 124.32, subdivision 5: 
     $1,398,000     .....     1990 
     $1,374,000     .....     1991 
    Subd. 7.  [LIMITED ENGLISH PROFICIENCY PUPILS PROGRAM AID.] 
For aid to educational programs for pupils of limited English 
proficiency according to Minnesota Statutes, section 124.273: 
     $3,270,000     .....     1990 
     $3,403,000     .....     1991 
    The 1990 appropriation includes $454,000 for 1989 and 
$2,816,000 for 1990. 
    The 1991 appropriation includes $497,000 for 1990 and 
$2,906,000 for 1991. 
    Subd. 8.  [AMERICAN INDIAN SCHOLARSHIPS.] For American 
Indian scholarships under Minnesota Statutes, section 124.48: 
     $1,582,000     .....     1990 
     $1,582,000     .....     1991 
    Any unexpended balance remaining in the first year does not 
cancel but is available for fiscal year 1991. 
    Subd. 9.  [AMERICAN INDIAN POST-SECONDARY PREPARATION 
GRANTS.] For American Indian post-secondary preparation grants 
according to Minnesota Statutes, section 124.481: 
     $857,000     .....     1990
     $857,000     .....     1991
    Subd. 10.  [AMERICAN INDIAN LANGUAGE AND CULTURE PROGRAMS.] 
For grants to American Indian language and culture education 
programs according to Minnesota Statutes, section 126.54, 
subdivision 1: 
     $590,000     .....     1990
     $590,000     .....     1991
    The 1990 appropriation includes $89,000 for 1989 and 
$501,000 for 1990. 
    The 1991 appropriation includes $89,000 for 1990 and 
$501,000 for 1991. 
    Subd. 11.  [AMERICAN INDIAN EDUCATION.] For certain 
American Indian education programs in school districts there is 
appropriated: 
     $176,000     .....     1990
     $176,000     .....     1991
    The 1990 appropriation includes $27,000 for 1989 and 
$149,000 for 1990. 
    The 1991 appropriation includes $27,000 for 1990 and 
$149,000 for 1991. 
    These appropriations are available for expenditure with the 
approval of the commissioner of education. 
    The commissioner must not approve the payment of any amount 
to a school district under this subdivision unless that school 
district is in compliance with all applicable laws of this state.
    Up to the following amounts may be distributed to the 
following school districts for each fiscal year:  $54,800 to 
independent school district No. 309, Pine Point School; $9,700 
to independent school district No. 166; $14,900 to independent 
school district No. 432; $14,100 to independent school district 
No. 435; $42,200 to independent school district No. 707; and 
$39,100 to independent school district No. 38.  These amounts 
shall be spent only for the benefit of American Indian pupils 
and to meet established state educational standards or statewide 
requirements. 
    Before a district can receive money under to this 
subdivision, the district must submit to the commissioner of 
education evidence that it has: 
    (1) complied with the uniform financial accounting and 
reporting standards act, Minnesota Statutes, sections 121.90 to 
121.917.  For each school year, compliance with Minnesota 
Statutes, section 121.908, subdivision 3a, shall require the 
school district to prepare one budget including the amount 
available to the district under this subdivision and one budget 
that does not include the available amount.  The budget of that 
school district for the 1989-1990 school year prepared according 
to Minnesota Statutes, section 121.908, subdivision 3a, shall be 
submitted to the commissioner of education at the same time as 
1988-1989 budgets and shall not include money appropriated in 
this subdivision; and 
    (2) compiled accurate daily pupil attendance records. 
    Subd. 12.  [SECONDARY VOCATIONAL EDUCATION AID.] For 
secondary vocational education aid according to Minnesota 
Statutes, section 124.573: 
     $11,471,000     .....     1990 
     $11,720,000     .....     1991 
    The 1990 appropriation includes $1,525,000 for 1989 and 
$9,946,000 for 1990. 
    The 1991 appropriation includes $1,755,000 for 1990 and 
$9,965,000 for 1991. 
    Subd. 13.  [SECONDARY VOCATIONAL HANDICAPPED.] For aid for 
secondary vocational education for handicapped pupils according 
to Minnesota Statutes, section 124.574: 
     $5,294,000     .....     1990 
     $6,224,000     .....     1991 
    The 1990 appropriation includes $645,000 for 1989 and 
$4,649,000 for 1990. 
    The 1991 appropriation includes $821,000 for 1990 and 
$5,403,000 for 1991. 
    Subd. 14.  [TRIBAL CONTRACT SCHOOLS.] 
    For tribal contract school aid: 
     $200,000     .....     1990
     $200,000     .....     1991
    Subd. 15.  [AMERICAN INDIAN TEACHER GRANTS.] For joint 
grants to assist American Indian people to become teachers:  
    $150,000 ..... 1990 
    $150,000 ..... 1991 
    Up to $70,000 each year is for a joint grant to the 
University of Minnesota-Duluth and the Duluth school district.  
    Up to $40,000 each year is for a joint grant to Bemidji 
state university and Red Lake school district.  
    Up to $40,000 each year is for a joint grant to Moorhead 
state university and a school district located within the White 
Earth reservation. 
    Subd. 16.  [ASSURANCE OF MASTERY.] For assurance of mastery 
aid: 
    $10,582,000 ..... 1991 
    The 1991 appropriation includes $0 for 1990 and $10,582,000 
for 1991.  
    The 1991 appropriation is based on a formula entitlement of 
$12,449,000. 
    Subd. 17.  [INDIVIDUALIZED LEARNING AND DEVELOPMENT AID.] 
For individualized learning and development aid under section 17:
    $6,400,000 ..... 1991 
    The 1991 appropriation includes $6,400,000 for 1991. 
    This appropriation is based on a formula entitlement of 
$7,550,000. 
    Sec. 26.  [EFFECTIVE DATE.] 
    Section 4 is effective the day following final enactment.  
Sections 6, 16, 17, and 18 are effective for the 1990-1991 
school year. 

                               ARTICLE 4

                     COMMUNITY AND ADULT EDUCATION
    Section 1.  Minnesota Statutes 1988, section 121.88, 
subdivision 8, is amended to read:  
    Subd. 8.  [YOUTH DEVELOPMENT PLANS.] A district advisory 
council may prepare a youth development plan.  The council is 
encouraged to use the state model plan developed under section 
121.87, subdivision 1a, when developing the local plan.  If The 
school board approves may approve the youth development plan and 
the district makes a community education levy, the district is 
eligible for additional community education revenue under 
section 124.271, subdivision 2b.  
    Sec. 2.  Minnesota Statutes 1988, section 121.88, 
subdivision 9, is amended to read: 
    Subd. 9.  [COMMUNITY YOUTH SERVICE PROGRAMS.] A school 
board may offer, as part of a community education program with a 
youth development program, a community youth service program for 
public school pupils for the purpose of promoting to promote 
active citizenship and addressing to address community needs 
through youth service.  The school board may award up to one 
credit, or the equivalent, toward graduation for a pupil who 
completes the youth service requirements of the district.  The 
community education advisory council shall design the service 
program in cooperation with the district planning, evaluating 
and reporting committee and local organizations that train 
volunteers or need volunteers' services.  Programs must include: 
    (1) preliminary training for pupil volunteers conducted, 
when possible, by organizations experienced in such training; 
    (2) supervision of the pupil volunteers to ensure 
appropriate placement and adequate learning opportunity; 
    (3) sufficient opportunity, in a positive setting for human 
development, for pupil volunteers to develop general skills in 
preparation for employment, to enhance self esteem and self 
worth, and to give genuine service to their community; and 
    (4) integration of academic learning with the service 
experience. 
    Examples of appropriate pupil service placements include: 
child care, Head Start, early childhood education, and extended 
day programs; tutoring programs involving older pupils tutoring 
younger pupils; environmental beautification projects; and 
regular visits for shut-in senior citizens. 
    Youth service projects include, but are not limited to, the 
following: 
    (1) human services for the elderly, including home care and 
related services; 
    (2) tutoring and mentoring; 
    (3) training for and providing emergency services; 
    (4) services at extended day programs; and 
    (5) environmental services. 
    The commissioner shall maintain a list of acceptable 
projects with a description of each project.  A project that is 
not on the list must be approved by the commissioner.  
    A youth service project must have a community sponsor that 
may be a governmental unit or nonprofit organization.  To assure 
that pupils provide additional services, each sponsor must 
assure that pupil services do not displace employees or reduce 
the workload of any employee. 
    The commissioner must assist districts in planning youth 
service programs, implementing programs, and developing 
recommendations for obtaining community sponsors. 
    Sec. 3.  Minnesota Statutes 1988, section 121.882, 
subdivision 2, is amended to read: 
    Subd. 2.  [PROGRAM CHARACTERISTICS.] Early childhood family 
education programs are programs for children in the period of 
life from birth to kindergarten, for the parents of such 
children, and for expectant parents.  The programs may include 
the following:  
    (1) programs to educate parents about the physical, mental, 
and emotional development of children; 
    (2) programs to enhance the skills of parents in providing 
for their children's learning and development; 
    (3) learning experiences for children and parents; 
    (4) activities designed to detect children's physical, 
mental, emotional, or behavioral problems that may cause 
learning problems; 
    (5) activities and materials designed to encourage 
self-esteem, skills, and behavior that prevent sexual and other 
interpersonal violence; 
    (6) educational materials which may be borrowed for home 
use; 
    (6) (7) information on related community resources; or 
    (7) (8) other programs or activities.  
    The programs shall not include activities for children that 
do not require substantial involvement of the children's 
parents.  The programs shall be reviewed periodically to assure 
the instruction and materials are not racially, culturally, or 
sexually biased.  The programs shall encourage parents to be 
aware of practices that may affect equitable development of 
children. 
    Sec. 4.  Minnesota Statutes 1988, section 121.912, is 
amended by adding a subdivision to read:  
    Subd. 1b.  [TRA AND FICA TRANSFER.] Notwithstanding 
subdivision 1, a district shall transfer money from the general 
fund to the community education fund for teacher retirement and 
FICA obligations attributable to community education programs.  
    Sec. 5.  [123.706] [EARLY CHILDHOOD SCREENING.] 
    Subdivision 1.  [OBJECTIVES.] The objectives of an early 
childhood screening program are to:  
    (1) detect health and developmental conditions that may 
impede learning; 
    (2) encourage further assessment, if needed; and 
    (3) refer children to appropriate programs.  
    Subd. 2.  [SCREENING.] Early childhood screening is a 
program for making a preliminary determination whether a child 
has a health or developmental condition that may impede learning.
After screening, a child who may have such a condition is 
referred to a qualified individual or organization for 
assessment.  
    Subd. 3.  [PROGRAM AVAILABLE.] Beginning in fiscal year 
1994, a school district shall make a screening program available 
to children who are three years old and older but who have not 
entered kindergarten.  No child may be required to be screened.  
A district shall follow up on referrals to determine whether a 
child needs or has obtained additional services.  To the extent 
possible, a district shall cooperate with public and private 
organizations in the community to deliver, finance, and provide 
volunteer and in-kind services.  
    Subd. 3a.  [DISTRICT OPTIONS DURING INTERIM YEARS.] During 
fiscal years 1990, 1991, 1992, and 1993, a school district must 
conduct a screening program either according to this section or 
according to sections 123.702 and 123.704. 
    Subd. 4.  [REQUIREMENTS FOR ALL CHILDREN.] The following 
must be available for all children who are screened: 
    (1) developmental screening; 
    (2) vision and hearing screening; 
    (3) height and weight assessment; 
    (4) immunization review and immunizations; 
    (5) review of health and family history; 
    (6) identification of additional risk factors that may 
influence learning; 
    (7) a summary interview with the parent; 
    (8) referral for assessment when potential needs are 
identified; and 
    (9) referral to a qualified health, developmental, 
education, or social service provider.  
    Subd. 5.  [REQUIREMENTS FOR CERTAIN CHILDREN.] (a) 
Additional services must be offered to children: 
    (1) who have not had a physical examination within one 
year; or 
    (2) for whom information from a physical examination 
conducted within one year cannot be provided by the parent.  
    (b) The following must be available for the children 
described in paragraph (a): 
    (1) nutrition assessment; 
    (2) physical examination; 
    (3) laboratory tests; 
    (4) oral inspection and dental referral; and 
    (5) any other service required by medical assistance rules 
set forth in Minnesota Rules, parts 9505.0275 and 9505.1693 to 
9505.1748. 
    Services in this subdivision may be offered in conjunction 
with the screening program or provided by a public or private 
individual or health care organization within 30 days before the 
screening program.  
    Subd. 6.  [DEVELOPMENTAL SCREENING.] Developmental 
screening, according to subdivision 4, clause (1), must be 
conducted by an individual who is licensed as, or has the 
equivalent training of, a special education teacher, school 
psychologist, kindergarten teacher, prekindergarten teacher, 
school nurse, public health nurse, registered nurse, or 
physician.  The individual may be a volunteer.  
    Subd. 7.  [DATA PRIVACY.] Data on individuals collected in 
a screening program is private, as defined in section 13.02, 
subdivision 12.  Summary data shall be reported by the health 
provider who performs the screening to the school district for 
the purposes of developing educational and health programs.  If 
the child's parent or guardian consents in writing, individual 
data shall also be reported. 
    Subd. 8.  [STATE AGENCY COOPERATION.] The commissioner of 
education shall consult regularly with the commissioners of 
human services, health, and jobs and training, about the 
development of effective policies, practices, and cooperative 
arrangements to maximize the participation of preschool children 
and in follow-up services to enhance their health, preparation 
for formal education, and family nurturing.  The commissioners 
of education and human services shall assist school districts in 
identifying children eligible for medical assistance or the 
children's health plan, providing outreach, and providing or 
paying for services with medical assistance or other available 
money, including private insurance.  
    Sec. 6.  [123.707] [HEALTH AND DEVELOPMENTAL SCREENING.] 
    Subdivision 1.  [AID AVAILABILITY.] Screening aid shall be 
paid to a district meeting the requirements of section 123.702 
or 5.  
    Subd. 2.  [AID FOR THREE YEAR OLD CHILDREN.] Health and 
developmental screening aid for a three year old screened is the 
following: 
    (a) for a child who is enrolled in the medical assistance 
program or the children's health plan, $4; 
    (b) for a child who is covered by a private medical 
insurance plan that will reimburse the district for some or all 
of the cost of screening the child, the difference between the 
amount of eligible reimbursement and $30, plus $4; and 
    (c) for all others, $30. 
    Subd. 3.  [AID FOR OTHER CHILDREN.] Health and 
developmental screening aid for a child who is over the age of 
three, but not yet enrolled in kindergarten, is the following: 
    (a) for a child who is enrolled in the medical assistance 
program or the children's health plan, $4; 
    (b) for a child who is covered by a private medical 
insurance plan that will reimburse the district for some or all 
of the cost of screening the child, and the reimbursement totals 
less than $8.15, the difference between the amount of 
reimbursement and $8.15, plus $4; and 
    (c) for all others, $8.15. 
    Sec. 7.  Minnesota Statutes 1988, section 124.26, 
subdivision 1c, is amended to read: 
    Subd. 1c.  [PROGRAM APPROVAL.] A district receiving To 
receive aid under this section, a district must have its program 
submit an application by June 1 describing the program, on a 
form provided by the department.  The program must be approved 
by the commissioner according to the following criteria:  
    (1) how the needs of all different levels of learners 
learning will be met; 
    (2) for continuing programs, an evaluation of results; 
    (3) anticipated number and education level of participants; 
    (4) coordination with other resources and services; 
    (5) participation in a consortium, if any, and funds money 
available from other participants; 
    (6) management and program design; 
    (7) volunteer training and use of volunteers; 
    (8) staff development services; 
    (9) program sites and schedules; and 
    (10) program expenditures that qualify for aid.  
    The commissioner may contract with a private, nonprofit 
organization to provide services that are not offered by a 
district or that are supplemental to a district's program.  The 
program provided under a contract must be approved according to 
the same criteria used for district programs. 
    Sec. 8.  Minnesota Statutes 1988, section 124.26, 
subdivision 7, is amended to read: 
    Subd. 7.  [ADULT BASIC AND CONTINUING EDUCATION AID.] Each 
district shall receive aid for approved adult basic and 
continuing education programs equal to 75 percent of the salary 
for each teacher, counselor, coordinator of volunteers, and 
nonlicensed instructional staff.  In addition, the state shall 
pay aid equal to 75 percent of the expenditures for benefits, 
contracted services, supplies, and materials.  Expenditures for 
which the district receives federal aid shall not qualify for 
state aid.  Up to five percent of the combined state and federal 
aid may be for the administrative costs of coordinating services 
with human services, employment, training, corrections, or other 
agencies providing educational services to adult learners. 
    Sec. 9.  Minnesota Statutes 1988, section 124.26, is 
amended by adding a subdivision to read:  
    Subd. 8.  [ADULT BASIC EDUCATION LEVY.] To obtain adult 
basic education aid, a district may levy an amount not to exceed 
the amount raised by a gross tax capacity rate of .16 percent 
times the adjusted gross tax capacity of the district for the 
preceding year for taxes payable in 1990 or a net tax capacity 
rate of .20 percent times the adjusted net tax capacity of the 
district for the preceding year for taxes payable in 1991 and 
thereafter. 
    Sec. 10.  Minnesota Statutes 1988, section 124.2711, 
subdivision 1, is amended to read: 
    Subdivision 1.  [MAXIMUM REVENUE.] (a) The maximum revenue 
for early childhood family education programs for a school year 
the 1989 and 1990 fiscal years for a school district is the 
amount of revenue derived by multiplying $84.50 times the 
greater of 150 or the number of people under five years of age 
residing in the school district on September 1 of the preceding 
school year. 
    (b) For 1991 and later fiscal years, the maximum revenue 
for early childhood family education programs for a school 
district is the amount of revenue earned by multiplying $87.75 
times the greater of: 
    (1) 150; or 
    (2) the number of people under five years of age residing 
in the school district on September 1 of the last school year. 
    Sec. 11.  Minnesota Statutes 1988, section 124.2711, 
subdivision 3, is amended to read: 
    Subd. 3.  [AID.] If a district complies with the provisions 
of section 121.882, it shall receive early childhood family 
education aid equal to: 
    (a) the difference between the maximum revenue, according 
to subdivision 1, and the permitted levy attributable to the 
same school year, according to section 275.125, subdivision 8b, 
times 
    (b) the ratio of the district's actual levy to its 
permitted levy attributable to the same school year, according 
to section 275.125, subdivision 8b. 
    In fiscal year 1990 only, a district receiving early 
childhood family education aid under this subdivision or levy 
under section 275.125, subdivision 8b, shall receive an 
additional amount of aid equal to $.95 times the greater of 150 
or the number of people under five years of age residing in the 
district on September 1 of the last school year. 
    Sec. 12.  [124.2713] [COMMUNITY EDUCATION REVENUE.] 
    Subdivision 1.  [TOTAL COMMUNITY EDUCATION 
REVENUE.] Community education revenue equals the sum of a 
district's general community education revenue, youth 
development plan revenue, and youth service program revenue.  
    Subd. 2.  [ELIGIBILITY.] To be eligible for community 
education revenue, a district must:  
    (1) operate a community education program that complies 
with section 121.88; and 
      (2) file a certificate of compliance with the commissioner 
of education.  The certificate of compliance shall certify that 
a meeting was held to discuss methods of increasing cooperation 
among the governing boards of each county, city, and township in 
which the district, or any part of the district, is located, and 
that each governing board was sent a written notice of the 
meeting at least 15 working days before the meeting.  The 
failure of a governing board to attend the meeting shall not 
affect the authority of the district to obtain community 
education revenue. 
    Subd. 3.  [GENERAL COMMUNITY EDUCATION REVENUE.] For fiscal 
year 1991 and thereafter, the general community education 
revenue for a district equals $5.95 times the greater of 1,335 
or the population of the district.  The population of the 
district is determined according to section 275.14.  
    Subd. 3a.  [1990 GENERAL COMMUNITY EDUCATION REVENUE.] For 
fiscal year 1990, the general community education revenue for 
each district equals $5.75 times the greater of 1,335 or the 
population of the district.  
    Subd. 4.  [YOUTH DEVELOPMENT PLAN REVENUE.] Youth 
development plan revenue for a district with a plan approved by 
the school board equals 50 cents times the greater of 1,335 or 
the population of the district.  
    Subd. 5.  [YOUTH SERVICE REVENUE.] Youth service program 
revenue is available to a district that has implemented a youth 
development plan and a youth service program.  Youth service 
revenue equals 25 cents times the greater of 1,335 or the 
population of the district. 
    Subd. 6.  [COMMUNITY EDUCATION LEVY.] To obtain community 
education revenue, a district may levy the amount raised by a 
gross tax capacity rate of 0.8 percent times the adjusted gross 
tax capacity of the district for taxes payable in 1990 or a net 
tax capacity rate of 1.0 percent times the adjusted net tax 
capacity of the district for taxes payable in 1991 and 
thereafter.  If the amount of the community education levy would 
exceed the community education revenue, the community education 
levy shall equal the community education revenue.  
    Subd. 7.  [COMMUNITY EDUCATION AID.] A district's community 
education aid is the difference between its community education 
revenue and the community education levy.  If the district does 
not levy the entire amount permitted, the community education 
aid shall be reduced in proportion to the actual amount levied. 
    Subd. 8.  [USES OF GENERAL REVENUE.] General community 
education revenue may be used for: 
    (1) nonvocational, recreational, and leisure time 
activities and programs; 
    (2) handicapped adult programs, if the programs and budgets 
are approved by the department of education; 
    (3) adult basic education programs, according to section 
124.26; 
    (4) summer programs for elementary and secondary pupils; 
    (5) implementation of a youth development plan; 
    (6) implementation of a youth service program; 
    (7) early childhood family education programs, according to 
section 121.882; and 
    (8) extended day programs, according to section 121.88, 
subdivision 10. 
    (9) In addition to money from other sources, a district may 
use up to ten percent of its community education revenue for 
equipment that is used exclusively in community education 
programs.  This revenue may be used only for the following 
purposes:  
    (i) to purchase or lease computers and related materials; 
    (ii) to purchase or lease equipment for instructional 
programs; and 
    (iii) to purchase textbooks and library books. 
    Subd. 9.  [USE OF YOUTH REVENUE.] Youth development revenue 
may be used only to implement the youth development plan 
approved by the school board.  Youth service revenue may be used 
only to provide a youth service program according to section 
121.88, subdivision 9. 
    Sec. 13.  [124.2714] [ADDITIONAL COMMUNITY EDUCATION 
REVENUE.] 
    A district that is eligible under section 12, subdivision 
2, may levy an amount up to the amount authorized by Minnesota 
Statutes 1986, section 275.125, subdivision 8, clause (2).  The 
proceeds of the levy may be used for the purposes set forth in 
section 12, subdivision 8.  
    Sec. 14.  [124.2715] [HANDICAPPED ADULT REVENUE.] 
    Subdivision 1.  [REVENUE AMOUNT.] A district that is 
eligible according to section 12, subdivision 2, may receive 
revenue for a handicapped adult program.  Handicapped adult 
program revenue for a district or a group of districts equals 
the lesser of:  
    (1) the actual expenditures for approved programs and 
budgets; or 
    (2) $60,000.  
    Subd. 2.  [AID.] Handicapped adult program aid equals the 
lesser of:  
    (1) one-half of the actual expenditures for approved 
programs and budgets; or 
    (2) $30,000.  
    Subd. 3.  [LEVY.] A district may levy for a handicapped 
adult program an amount up to the amount designated in 
subdivision 2.  In the case of a program offered by a group of 
districts, the levy amount shall be apportioned among the 
districts according to the agreement submitted to the department 
of education.  
    Subd. 4.  [OUTSIDE REVENUE.] A district may receive money 
from public or private sources to supplement handicapped adult 
program revenue.  Aid may not be reduced as a result of 
receiving money from these sources.  
    Subd. 5.  [USE OF REVENUE.] Handicapped adult program 
revenue may be used only to provide handicapped adult programs.  
    Sec. 15.  [129B.13] [INTERAGENCY ADULT LEARNING ADVISORY 
COUNCIL AND GRANTS.] 
    Subdivision 1.  [SPECIFIC GOALS.] The interagency adult 
learning initiative is intended to:  
    (1) increase the number of adults improving their basic 
skills and completing general educational development, high 
school diploma, and technical skills training programs; 
    (2) reduce the dropout rate in adult programs by ensuring 
that transportation, child care, and other barriers to learning 
are addressed; 
    (3) be a catalyst to upgrade existing adult education 
programs; 
    (4) expand cooperation among education, human services, and 
job training agencies; and 
    (5) support employer, labor union, or other initiatives to 
improve employed workers' basic skills.  
    Subd. 2.  [MEMBERS; MEETINGS; OFFICERS.] The interagency 
adult learning advisory council shall have 16 to 18 members.  
Members must have experience in educating adults or in programs 
addressing welfare recipients and incarcerated, unemployed, and 
underemployed people.  
    The members of the interagency adult learning advisory 
council are appointed as follows: 
    (1) one member appointed by the commissioner of the state 
planning agency; 
    (2) one member appointed by the commissioner of jobs and 
training; 
    (3) one member appointed by the commissioner of human 
services; 
    (4) one member appointed by the director of the refugee and 
immigrant assistance division of the department of human 
services; 
    (5) one member appointed by the commissioner of 
corrections; 
    (6) one member appointed by the commissioner of education; 
    (7) one member appointed by the director of the state board 
of vocational technical education; 
    (8) one member appointed by the chancellor of community 
colleges; 
    (9) one member appointed by the Minnesota adult literacy 
campaign or by another nonprofit literacy organization, as 
designated by the commissioner of the state planning agency; 
    (10) one member appointed by the council on Black 
Minnesotans; 
    (11) one member appointed by the Spanish-speaking affairs 
council; 
    (12) one member appointed by the council on Asian-Pacific 
Minnesotans; 
    (13) one member appointed by the Indian affairs council; 
and 
    (14) one member appointed by the disability council. 
    Up to four additional members of the council may be 
nominated by the participating agencies.  Based on the council's 
recommendations, commissioner of the state planning agency must 
appoint at least two, but not more than four, additional 
members.  Nominees shall include, but are not limited to, 
representatives of local education, government, nonprofit 
agencies, employers, labor organizations, and libraries.  
    The council shall elect its officers.  
    Subd. 3.  [STAFF.] The commissioner of the state planning 
agency shall provide space and administrative services to the 
council.  The commissioner may contract for staff for the 
council. 
    Subd. 4.  [COMPENSATION.] Compensation of members is 
governed by section 15.059, subdivision 6. 
    Subd. 5.  [EXPIRATION DATE.] The advisory council expires 
on June 30, 1995. 
    Subd. 6.  [COUNCIL RESPONSIBILITIES.] The responsibilities 
of the council are to make recommendations to:  
    (1) coordinate planning and activities of participating 
agencies; 
    (2) assist program coordination at the local level; 
    (3) develop policy recommendations on adult literacy for 
the state, and make recommendations to the participating 
commissioners and the legislature; 
    (4) establish standards for effective programs and promote 
statewide implementation of such standards; 
    (5) award grant funds; 
    (6) evaluate programs funded by the state; and 
    (7) provide technical assistance and staff development 
services, in coordination with participating agencies.  
    Subd. 7.  [TARGETED ADULT LITERACY GRANTS.] The council may 
make recommendations to award grants to qualified programs to 
serve people who are on public assistance, are unemployed, or 
underemployed and who:  
    (1) are functioning below the eighth grade level; 
    (2) have not completed high school or a GED program; 
    (3) need basic skills remediation for employment, 
occupational training, or post-secondary education; or 
    (4) do not speak English.  
    The council may prioritize funding for services for people 
described in clause (1) or to persons with learning disabilities.
    Priority must be given to qualified programs for the 
recipients of aid to families with dependent children who are 
identified for self-sufficiency services under section 256.736, 
and qualified programs for recipients of general assistance or 
work readiness assistance.  
    Subd. 8.  [STANDARDS FOR QUALIFIED PROGRAMS.] (a) Except as 
provided in paragraph (b) and subdivision 9, a program 
qualifying for a grant must:  
    (1) be directed to the unemployed, the underemployed, the 
incarcerated, public assistance recipients, or to non-English 
speaking immigrants; 
    (2) integrate learning and support services such as child 
care, transportation, and counseling; 
    (3) have intensive learning that maximizes the weekly hours 
available to learners; 
    (4) be accessible year-round and during daytime or evening 
hours as needed, except where otherwise appropriate to learners' 
needs; 
    (5) have individualized learning plans and outcome based 
learning; 
    (6) provide instruction in transferable basic skills; 
    (7) have context based learning linked to individual 
occupational or self-sufficiency goals; 
    (8) provide for reporting and evaluation; 
    (9) have appropriate coordination and differentiation of 
services among adult literacy services and agencies in the local 
area; 
    (10) be coordinated with human services and employment and 
training agencies, as appropriate to the target population; and 
    (11) maximize use of available local resources. 
    (b) The commissioner of the state planning agency may waive 
a standard because of client need or local conditions.  The 
reason for the waiver must be documented.  
    Subd. 9.  [INNOVATION GRANTS.] The commissioner of the 
state planning agency may award grants for innovative programs.  
An innovation grant need not comply with the standards in 
subdivision 8.  The nature and extent of the proposed innovation 
must be described in the award. 
    Subd. 10.  [NO FUNDING REQUIRED.] The commissioner of the 
state planning agency need not award a grant for any proposal 
that, in the determination of the commissioner does not meet the 
standards in subdivision 8. 
    Subd. 11.  [ELIGIBLE GRANTEES.] To be eligible for a grant, 
one or more public agencies, or public or private nonprofit 
organizations, must submit a plan to create or maintain a 
qualified program.  A profit-making organization cannot receive 
a grant but may be a subcontractor on a grant.  
    Grantees may not reduce existing expenditure levels for the 
target population. 
    Subd. 12.  [GEOGRAPHIC DISTRIBUTION.] The commissioner of 
the state planning agency shall seek to award grants throughout 
the state, taking into account the incidence of the target 
population.  It shall provide technical assistance to local 
agencies to enhance fulfillment of this subdivision. 
    Subd. 13.  [SUPPLEMENTAL GRANTS.] A grant may supplement 
existing local programs by financing additional services or 
hours of instruction.  
    Subd. 14.  [GRANT SCHEDULE.] The commissioner of the state 
planning agency must award initial grants by April 1, 1990.  
Beginning in 1991, grants must be awarded by July 1 of each 
year.  Grants may be awarded for a period not to exceed 24 
months. 
    Subd. 15.  [LOCAL AND REGIONAL JOINT PLANNING.] The 
commissioner of the state planning agency may require grant 
applicants and existing adult basic education providers in a 
locality to present a joint services plan as a condition of 
receiving a grant under this section. 
    Subd. 16.  [REPORTING AND EVALUATION.] The commissioner of 
the state planning agency shall evaluate the performance of the 
grantees and report to the legislature by November 15 of each 
year, except that a preliminary report may be submitted by 
February 15, 1991.  
    Sec. 16.  Minnesota Statutes 1988, section 275.14, is 
amended to read: 
    275.14 [CENSUS.] 
    For the purposes of sections 12 and 275.11 to 275.16, the 
population of a city shall be that established by the last 
federal census, by a special census taken by the United States 
Bureau of the Census, by an estimate made by the metropolitan 
council, or by the state demographer made according to section 
116K.04, subdivision 4, whichever has the latest stated date of 
count or estimate, before July 2 of the current levy year.  The 
population of a school district must be determined by as 
certified by the department of education from the most recent 
federal census. 
    In any year in which no federal census is taken pursuant to 
law in any school district affected by sections 275.11 to 275.16 
a population estimate may be made and submitted to the state 
demographer for approval as hereinafter provided.  The school 
board of a school district, in case it desires a population 
estimate, shall pass a resolution by September 1 containing a 
current estimate of the population of the school district and 
shall submit the resolution to the state demographer.  The 
resolution shall describe the criteria on which the estimate is 
based and shall be in a form and accompanied by the data 
prescribed by the state demographer.  The state demographer 
shall determine whether or not the criteria and process 
described in the resolution provide a reasonable basis for the 
population estimate and shall inform the school district of that 
determination within 30 days of receipt of the resolution.  If 
the state demographer determines that the criteria and process 
described in the resolution do not provide a reasonable basis 
for the population estimate, the resolution shall be of no 
effect.  If the state demographer determines that the criteria 
and process do provide a reasonable basis for the population 
estimate, the estimate shall be treated as the population of the 
school district for the purposes of sections 275.11 to 275.16 
until the population of the school district has been established 
by the next federal census or until a more current population 
estimate is prepared and approved as provided herein, whichever 
occurs first.  The state demographer shall establish guidelines 
for acceptable population estimation criteria and processes.  
The state demographer shall issue advisory opinions upon request 
in writing to cities or school districts as to proposed criteria 
and processes prior to their implementation in an estimation.  
The advisory opinion shall be final and binding upon the 
demographer unless the demographer can show cause why it should 
not be final and binding.  
     In the event that a census tract employed in taking a 
federal or local census overlaps two or more school districts, 
the county auditor shall, on the basis of the best information 
available, allocate the population of said census tract to the 
school districts involved.  
    The term "council," as used in sections 275.11 to 275.16, 
means any board or body, whether composed of one or more 
branches, authorized to make ordinances for the government of a 
city within this state.  
    Sec. 17.  [CONVENING THE INTERAGENCY ADULT LEARNING 
COUNCIL.] 
    The commissioner of the state planning agency shall convene 
the state agency members of the interagency adult learning 
council on an interim basis by August 1, 1989, and the full 
council by September 1, 1989. 
    Sec. 18.  [SCREENING AVAILABILITY.] 
    Subdivision 1.  [PLANNING PROCESS.] Beginning in the 
1989-1990 school year, districts must begin a process to make 
screening readily available to all three year old children, 
targeting those at-risk and unlikely to be served by other 
programs.  After July 1, 1993, a district shall make available 
voluntary health and developmental screening to all three year 
old children in the district.  Districts shall collaborate with 
public and private community-based resources to deliver and 
finance early childhood screening. 
    Subd. 2.  [GUIDELINES.] The commissioner of education shall 
establish guidelines to assist school districts in expanding the 
early childhood screening program to all three year old children.
    Sec. 19.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] Except as 
otherwise provided, the sums indicated in this section are 
appropriated from the general fund to the department of 
education for the fiscal years designated.  
    Subd. 2.  [ADULT BASIC EDUCATION AID.] For adult basic 
education aid according to Minnesota Statutes, section 124.26: 
    $4,780,000 ..... 1990 
    $5,043,000 ..... 1991 
    The 1990 appropriation includes $638,000 for 1989 and 
$4,142,000 for 1990.  
    The 1991 appropriation includes $731,000 for 1990 and 
$4,312,000 for 1991.  
    Up to $235,000 in 1990 and $250,000 in 1991 may be used for 
contracts with private, nonprofit organizations for approved 
programs.  
    Subd. 3.  [ADULT HANDICAPPED PROGRAM AID.] For handicapped 
adult programs according to section 14: 
    $610,000 ..... 1990 
    $670,000 ..... 1991 
    Any unexpended balance from the appropriations in this 
subdivision for 1990 does not cancel and is available for the 
second year of the biennium.  
    Subd. 4.  [COMMUNITY EDUCATION AID.] For community 
education aid according to section 12:  
    $4,853,000 ..... 1990 
    $3,591,000 ..... 1991 
    The 1990 appropriation includes $516,000 for 1989 and 
$4,337,000 for 1990.  
    The 1991 appropriation includes $766,000 for 1990 and 
$2,825,000 for 1991.  
    Subd. 5.  [EARLY CHILDHOOD FAMILY EDUCATION AID.] For early 
childhood family education aid according to Minnesota Statutes, 
section 124.2711: 
    $9,635,900 ..... 1990 
    $10,262,000 ..... 1991 
    The 1990 appropriation includes $1,235,000 for 1989 and 
$8,400,000 for 1990.  
    The 1991 appropriation includes $1,484,000 for 1990 and 
$8,778,000 for 1991. 
    Subd. 6.  [HEALTH AND DEVELOPMENTAL SCREENING AID.] For 
health and developmental screening aid according to section 6:  
    $881,000 ....... 1990 
    $1,357,000 ..... 1991 
    The 1990 appropriation includes $60,000 for 1989 and 
$821,000 for 1990.  
    The 1991 appropriation includes $145,000 for 1990 and 
$1,212,000 for 1991.  
    Any unexpended balance for fiscal year 1990 does not cancel 
but is available for fiscal year 1991.  
    Up to $25,000 of the appropriation available in fiscal year 
1990 may be used for start-up training and technical assistance. 
    Subd. 7.  [EVALUATION OF BASIC SKILLS PROGRAMS.] For 
continuing an independent statewide evaluation of basic skills 
programs: 
     $75,000     .....     1990
     $75,000     .....     1991
    This appropriation is contingent upon the department's 
receipt of $1 from private sources for each $2 of this 
appropriation.  The commissioner of education must certify the 
receipt of the private matching funds.  The commissioner shall 
contract with an organization that is not connected with the 
delivery system. 
    Subd. 8.  [EVALUATION OF ECFE PROGRAMS.] To develop outcome 
measures and evaluate district ECFE programs: 
     $ 25,000     .....     1990 
     Any unexpended balance for fiscal year 1990 does not cancel 
but is available for fiscal year 1991. 
    Subd. 9.  [GED AND LEARN TO READ ON TV.] For statewide 
purchase of broadcast costs, publicity, and coordination of the 
GED on TV series and the learn to read on TV series: 
     $100,000     .....     1990
     $100,000     .....     1991
    The department may contract for these services. 
    Subd. 10.  [HEARING IMPAIRED ADULTS.] For programs for 
hearing impaired adults according to Minnesota Statutes, section 
121.201: 
     $70,000     .....     1990
     $70,000     .....     1991
    Subd. 11.  [ADULT LITERACY GRANTS.] To the state planning 
agency for grants and duties of the interagency adult literacy 
council: 
    $400,000 ..... 1990 
    $500,000 ..... 1991 
    Up to $25,000 each year is to provide technical assistance 
to employers.  Up to $20,000 each year is for the commissioner 
to contract for staff to the council. 
    The appropriation includes $200,000 each year for programs 
to assist inmates in state correctional institutions in 
obtaining a high school diploma or its equivalent.  
    Sec. 20.  [REPEALER.] 
    Minnesota Statutes 1988, sections 123.703; 123.705; 
124.271, subdivisions 2b, 3, 4, and 7; 129B.48; and 275.125, 
subdivision 8, are repealed July 1, 1989.  Section 12, 
subdivision 3a, is repealed July 1, 1990.  Minnesota Statutes, 
sections 123.702 and 123.704, and section 5, subdivision 3a, are 
repealed July 1, 1993.  Section 15 is repealed June 30, 1995. 
    Sec. 21.  [EFFECTIVE DATE.] 
    Section 4 is effective the day following final enactment. 

                               ARTICLE 5 

                        FACILITIES AND EQUIPMENT 
    Section 1.  Minnesota Statutes 1988, section 16B.60, 
subdivision 6, is amended to read: 
    Subd. 6.  [PUBLIC BUILDING.] "Public building" means a 
building and its grounds, the cost of which is paid for by the 
state, or a state agency, or a school district.  
    Sec. 2.  Minnesota Statutes 1988, section 121.15, 
subdivision 2, is amended to read: 
    Subd. 2.  [PLAN SUBMITTAL.] For a project for which 
consultation is required under subdivision 1, the commissioner, 
after the consultation required in subdivision 1, may require a 
school district to submit the following for approval:  
    (a) two sets of preliminary plans for each new building or 
addition, and 
    (b) one set of final plans for each construction, 
remodeling, or site improvement project.  The commissioner shall 
approve or disapprove the plans within 60 days after submission. 
    Final plans shall meet all applicable state laws, rules, 
and codes concerning public buildings, including sections 16B.59 
to 16B.73.  The department may furnish to a school district 
plans and specifications for temporary school buildings 
containing two classrooms or less.  
    Sec. 3.  Minnesota Statutes 1988, section 123.36, 
subdivision 1, is amended to read: 
    Subdivision 1.  According to section 14 or 16, when funds 
are available therefor, the board may locate and acquire 
necessary sites of schoolhouses or enlargements, or additions to 
existing schoolhouse sites by lease, purchase or condemnation 
under the right of eminent domain; it may erect schoolhouses 
thereon; it may erect or purchase garages for district-owned 
school buses.  When property is taken by eminent domain by 
authority of this subdivision when needed by the school district 
for such purposes, the fact that the property so needed has been 
acquired by the owner under the power of eminent domain or is 
already devoted to public use, shall not prevent its acquisition 
by the school district.  The board may sell or exchange 
schoolhouses or sites, and execute deeds of conveyance thereof. 
    Sec. 4.  Minnesota Statutes 1988, section 123.36, 
subdivision 13, as amended by Laws 1989, chapter 222, section 
10, if enacted, is amended to read: 
    Subd. 13.  [PROCEEDS OF SALE OR EXCHANGE.] Proceeds of the 
sale or exchange of school buildings or real property of the 
school district shall be used as provided in this subdivision. 
    (1) (a) In districts with outstanding bonds, the proceeds 
of the sale or exchange shall first be deposited in the debt 
retirement fund of the district in an amount sufficient to meet 
when due that percentage of the principal and interest payments 
for outstanding bonds which is ascribable to the payment of 
expenses necessary and incidental to the construction or 
purchase of the particular building or property which is sold.  
    (2) (b) After satisfying the requirements of clause 
(1) paragraph (a), a district with outstanding bonds may deposit 
proceeds of the sale or exchange in its capital expenditure fund 
if the amount deposited is used for the following:  
    (a) for expenditures for the removal of asbestos from 
school buildings or property or for asbestos encapsulation, if 
the method for asbestos removal or encapsulation is approved by 
the department of education; 
    (b) (1) for expenditures for the cleanup of polychlorinated 
biphenyls, if the method for cleanup is approved by the 
department of education; 
    (c) (2) for capital expenditures for the betterment, as 
defined in section 475.51, subdivision 8, of district-owned 
school buildings, other than as provided in clause (a); or 
    (d) (3) to replace the building or property sold.  
    The amount of the proceeds used for the purposes specified 
in clauses (a) and (b) shall be deducted from the levy 
limitation computed for the levy authorized in section 124.83, 
subdivision 4, in the first year after the deposit and from levy 
limitations computed for this levy in succeeding years until the 
entire amount is deducted.  
    (3) (c) In a district with outstanding bonds, the amount of 
the proceeds of the sale or exchange remaining after the 
application of clauses (1) and (2) paragraphs (a) and (b), which 
is sufficient to meet when due that percentage of the principal 
and interest payments for the district's outstanding bonds which 
is not governed by clause (1) paragraph (a), shall be deposited 
in the debt retirement fund.  
    (4) (d) Any proceeds of the sale or exchange remaining in 
districts with outstanding bonds after the application of 
clauses (1), (2), and (3) paragraphs (a), (b), and (c), and all 
proceeds of the sale or exchange in districts without 
outstanding bonds shall be deposited in the capital expenditure 
fund of the district. 
    (5) (e) Notwithstanding clauses (2) and (3) paragraphs (b) 
and (c), a district with outstanding bonds may deposit in its 
capital expenditure fund and use for any lawful capital 
expenditure without the reduction of any levy limitation the 
same percentage of the proceeds of the sale or exchange of a 
building or property as the percentage of the initial cost of 
purchasing or constructing the building or property which was 
paid using revenue from the capital expenditure fund.  
    (6) Every district which sells or exchanges a building or 
property shall report to the commissioner in the form and at the 
time the commissioner prescribes on the disposition of the 
proceeds of the sale or exchange. 
    Sec. 5.  Minnesota Statutes 1988, section 124.243, 
subdivision 2, is amended to read: 
     Subd. 2.  [CAPITAL EXPENDITURE FACILITIES REVENUE.] Capital 
expenditure facilities revenue for a district equals the lesser 
of: 
    (1) $137 $130 times its actual pupil units for the school 
year; or 
    (2) the difference between $400 times the actual pupil 
units for the school year and the unreserved balance in the 
capital expenditure facilities account on June 30 of the second 
prior school year.  For the purpose of determining revenue for 
the 1989-1990 and the 1990-1991 school years, the unreserved 
balance in the capital expenditure facilities account on June 30 
of the second prior school year is zero.  
    Sec. 6.  Minnesota Statutes 1988, section 124.243, 
subdivision 3, is amended to read: 
    Subd. 3.  [CAPITAL EXPENDITURE FACILITIES LEVY.] To obtain 
capital expenditure facilities revenue, a district may levy an 
amount not to exceed the capital expenditure facilities revenue 
determined in subdivision 2 multiplied by the lesser of one, or 
the ratio of: 
    (1) the quotient derived by dividing the adjusted gross tax 
capacity of the district for the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the school year to which the levy is attributable, to 
    (2) 75 70 percent of the equalizing factor for the school 
year to which the levy is attributable. 
    Sec. 7.  Minnesota Statutes 1988, section 124.243, is 
amended by adding a subdivision to read: 
    Subd. 11.  [INSTALLMENT PURCHASE CONTRACTS.] An installment 
contract to purchase a facility in excess of $400,000 is subject 
to the review and comment provisions of section 121.15. 
    Sec. 8.  Minnesota Statutes 1988, section 124.244, 
subdivision 1, is amended to read: 
    Subdivision 1.  [REVENUE AMOUNT.] The capital expenditure 
equipment revenue for each district equals $70 $65 times its 
actual pupil units counted according to section 124.17, 
subdivision 1, for the school year.  
    Sec. 9.  Minnesota Statutes 1988, section 124.244, 
subdivision 2, is amended to read: 
    Subd. 2.  [CAPITAL EXPENDITURE EQUIPMENT LEVY.] To obtain 
capital expenditure equipment revenue, a district may levy an 
amount not to exceed the district's capital expenditure 
equipment revenue as determined in subdivision 1 multiplied by 
the lesser of one, or the ratio of: 
    (1) the quotient derived by dividing the adjusted gross tax 
capacity of the district for the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the school year to which the levy is attributable, to 
    (2) 75 70 percent of the equalizing factor for the school 
year to which the levy is attributable.  
    Sec. 10.  Minnesota Statutes 1988, section 124.245, 
subdivision 3b, is amended to read: 
    Subd. 3b.  [HAZARDOUS SUBSTANCE REVENUE AND AID.] (a) A 
district's "hazardous substance revenue" for fiscal year 1989 
equals the approved cost of the hazardous substance plan for the 
school fiscal year to which the levy is attributable, minus the 
unexpended portion of levies certified and aids earned by the 
district in earlier years under section sections 124.245, 
subdivision 3, and 275.125, subdivision 11c. 
    (b) A district's "hazardous substance levy limitation" 
means its levy limitation computed according to section 275.125, 
subdivision 11c. 
    (c) A district's "hazardous substance aid" for 1988-1989 
and later school years equals: 
    (i) the difference between its hazardous substance revenue 
and its hazardous substance levy limitation for the levy for 
that school year, multiplied by 
    (ii) the ratio of the amount actually levied to the amount 
of its hazardous substance levy limitation. 
    (d) Aid paid under this subdivision may be used only for 
the purposes for which the proceeds of the levy authorized in 
section 275.125, subdivision 11c, may be used. 
    (e) In the event that the aid available for any year is 
prorated, a district having its aid prorated may levy an 
additional amount equal to the amount not paid by the state due 
to proration. 
    Sec. 11.  Minnesota Statutes 1988, section 124.83, 
subdivision 3, is amended to read: 
    Subd. 3.  [HEALTH AND SAFETY REVENUE.] A district's health 
and safety revenue for a fiscal year equals the approved cost of 
the health and safety program for the school year to which the 
levy is attributable, minus the unexpended portion of levies 
certified by the district in earlier years under section 
275.125, subdivision 11c.: 
    (1) the sum of (a) the total approved cost of the 
district's hazardous substance plan for fiscal years 1985 
through 1989, plus (b) the total approved cost of the district's 
health and safety program for fiscal year 1990 through the 
fiscal year to which the levy is attributable, minus 
    (2) the sum of (a) the district's total hazardous substance 
aid and levy for fiscal years 1985 through 1989 under sections 
124.245 and 275.125, subdivision 11c, plus (b) the district's 
health and safety revenue under this subdivision, for years 
before the fiscal year to which the levy is attributable, plus 
(c) the amount of other federal, state, or local receipts for 
the district's hazardous substance or health and safety programs 
for fiscal year 1985 through the fiscal year to which the levy 
is attributable. 
    Sec. 12.  Minnesota Statutes 1988, section 124.83, 
subdivision 4, is amended to read: 
    Subd. 4.  [HEALTH AND SAFETY LEVY.] To receive health and 
safety revenue, a district may levy an amount equal to the 
district's health and safety revenue as defined in subdivision 3 
multiplied by the lessor of one, or the ratio of: 
    (1) the quotient derived by dividing the adjusted gross tax 
capacity of the district for the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the school year to which the levy is attributable, to 
    (2) 75 70 percent of the equalizing factor for the school 
year to which the levy is attributable. 
    Sec. 13.  Minnesota Statutes 1988, section 124.83, 
subdivision 6, is amended to read: 
    Subd. 6.  [USES OF HEALTH AND SAFETY REVENUE.] Health and 
safety revenue may be used only for approved expenditures 
necessary to correct fire safety hazards, life safety hazards, 
or for the removal or encapsulation of asbestos from school 
buildings or property, asbestos-related repairs, cleanup and 
disposal of polychlorinated biphenyls found in school buildings 
or property, or the cleanup, removal, disposal, and repairs 
related to storing heating fuel or transportation fuels such as 
alcohol, gasoline, fuel oil, and special fuel, as defined in 
section 296.01. 
    Sec. 14.  Minnesota Statutes 1988, section 275.125, 
subdivision 11d, is amended to read: 
    Subd. 11d.  [EXTRA CAPITAL EXPENDITURE LEVY FOR LEASING 
BUILDINGS.] When a district finds it economically advantageous 
to rent or lease a building, or to purchase a building and site 
under an installment purchase agreement, lease purchase 
agreement, or any other deferred payment agreement authorized 
under section 465.71, for a secondary vocational cooperative 
program any instructional purposes and it determines that the 
capital expenditure facilities revenues authorized under section 
124.243 are insufficient for this purpose, it may apply to the 
commissioner for permission to make an additional capital 
expenditure levy for this purpose.  An application for 
permission to levy under this subdivision must contain financial 
justification for the proposed levy, the terms and conditions of 
the proposed lease or agreement, and a description of the space 
to be leased or purchased according to any type of deferred 
payment agreement, and its proposed use.  The criteria for 
approval of applications to levy under this subdivision must 
include:  the reasonableness of the price, the appropriateness 
of the space to the proposed activity, the feasibility of 
transporting pupils to the leased building, conformity of the 
lease or agreement to the laws and rules of the state of 
Minnesota, and the appropriateness of the proposed lease or 
agreement to the space needs and the financial condition of the 
district.  The commissioner must not authorize a levy under this 
subdivision in an amount greater than the cost to the district 
of renting or leasing or purchasing a building for approved 
purposes.  The proceeds of this levy must not be used for 
leasing or renting a facility owned by a district or for 
custodial or other maintenance services or to purchase a 
building newly constructed under an installment purchase 
agreement, lease purchase agreement, or any other deferred 
payment agreement authorized under section 465.71. 
    Sec. 15.  Minnesota Statutes 1988, section 326.03, 
subdivision 2, is amended to read: 
    Subd. 2.  Nothing contained in sections 326.02 to 326.15 
shall prevent persons from advertising and performing services 
such as consultation, investigation, or evaluation in connection 
with, or from making plans and specifications for, or from 
supervising, the erection, enlargement, or alteration of any of 
the following buildings: 
    (a) Dwellings for single families, and outbuildings in 
connection therewith, such as barns and private garages; 
    (b) Two family dwellings; 
    (c) Any farm building or accessory thereto; or 
    (d) Temporary buildings or sheds used exclusively for 
construction purposes, not exceeding two stories in height, and 
not used for living quarters; or 
    (e) Any public work or public improvement done by a public 
body in this state where the cost of the work or improvement 
does not exceed $100,000. 
    Sec. 16.  Minnesota Statutes 1988, section 465.71, is 
amended to read: 
    465.71 [INSTALLMENT AND LEASE PURCHASES; CITIES; COUNTIES; 
SCHOOL DISTRICTS.] 
    A home rule charter city, statutory city, county, town, or 
school district may purchase real or personal property under an 
installment contract, or lease real or personal property with an 
option to purchase under a lease purchase agreement, by which 
contract or agreement title is retained by the seller or vendor 
or assigned to a third party as security for the purchase price, 
including interest, if any, but such purchases are subject to 
statutory and charter provisions applicable to the purchase of 
real or personal property.  For purposes of the bid requirements 
contained in section 471.345, "the amount of the contract" shall 
include the total of all lease payments for the entire term of 
the lease under a lease-purchase agreement.  The obligation 
created by a lease purchase agreement or installment contract 
shall not be included in the calculation of net debt for 
purposes of section 475.53, shall be deemed to constitute the 
issuance of an obligation under section 475.58, subdivision 1, 
clause (6), and shall not constitute debt under any other 
statutory provision.  No election shall be required in 
connection with the execution of a lease purchase agreement or 
installment contract authorized by this section.  The city, 
county, town, or school district shall must have the right to 
terminate a lease purchase agreement at the end of any fiscal 
year during its term.  
    Sec. 17.  Laws 1959, chapter 462, section 3, subdivision 
10, as renumbered, as amended by Laws 1963, chapter 645, section 
3, Laws 1967, chapter 661, section 3, Laws 1969, chapter 994, 
section 1, Laws 1975, chapter 320, section 1, and Laws 1980, 
chapter 525, section 2, is amended to read: 
    Subd. 10.  [SPECIAL SCHOOL DISTRICT NO. 1; MINNEAPOLIS, 
CITY OF; EXTENDING BONDING AUTHORITY.] As used in this act the 
word "project" shall mean any proposed new or enlarged school 
building site, any proposed new school building or any proposed 
new addition to a school building, and "undertaking" shall mean 
any other purpose for which bonds may be issued as authorized in 
this subdivision.  Subject to the limitations of subdivision 11, 
the special independent school district of Minneapolis may issue 
and sell bonds with the approval of 53 percent of the electors 
voting on the question at a general school district election or 
at a school district election held at the same time and place 
within the district as a state general or primary election, as 
determined by the board of education.  Subject to the provisions 
of subdivision 11, the school district may also by a two-thirds 
majority vote of all the members of its board of education and 
without any election by the voters of the district, issue and 
sell in each calendar year bonds of the district in an amount 
not to exceed one-half of one percent of the assessed value of 
the taxable property in the district (plus, for each of the 
calendar years 1980 through 1984 year 1990, an amount not to 
exceed 50 percent of the amount of indebtedness to be retired 
during the calendar year $7,500,000; with an additional 
provision that any amount of bonds so authorized for sale in a 
specific year and not sold can be carried forward and sold in 
the year immediately following); provided, however, that the 
board shall submit the list of projects and undertakings to be 
financed by a proposed issue to the city planning commission as 
provided in subdivision 11(c).  All bonds of the school district 
shall be payable in not more than 20 30 years.  The proceeds of 
the sale of the bonds shall be used only for the rehabilitating, 
remodeling, expanding and equipping of existing school buildings 
and for the acquisition of sites, construction and equipping of 
new school buildings, and for acquisition and betterment 
purposes, and no part of the proceeds shall be used for 
maintenance.  The provisions of this act shall apply to the 
issuance and sale of the bonds and to the purposes for which the 
bonds may be issued notwithstanding any provisions to the 
contrary in any other existing law relating thereto. 
    Sec. 18.  [HANDICAPPED ACCESSIBILITY LEVY:  INDEPENDENT 
SCHOOL DISTRICT NO. 228.] 
    For handicapped accessibility improvements, independent 
school district No. 228, Harmony, may levy an amount not more 
than the lesser of $100,000 or the costs of the handicapped 
accessibility improvements.  This levy is authorized for taxes 
payable in 1990, 1991, or 1992.  In no case may the sum of the 
levies exceed $100,000. 
    Sec. 19.  [INSTRUCTIONS TO THE DEPARTMENT.] 
    The department of education shall make adjustments to the 
capital expenditure facilities levy, the capital expenditure 
equipment levy, and the health and safety levy certified for 
fiscal year 1991, according to sections 5, 6, 8, 9, and 12, for 
revenue for fiscal year 1990.  
    Sec. 20.  [SCHOOL DISTRICT NO. 710 BONDS.] 
    Subdivision 1.  [AUTHORIZATION.] Independent school 
district No. 710, St. Louis county, may issue bonds in an 
aggregate principal amount not exceeding $1,000,000, in addition 
to any bonds already issued or authorized, to provide funds to 
construct, equip, furnish, remodel, rehabilitate, and acquire 
land for school facilities and buildings.  The district may 
spend the proceeds of the bond sale for those purposes and any 
architects', engineers', and legal fees incidental to those 
purposes or the sale.  Bonds may be issued under this section 
without a referendum.  Except as permitted by this section, the 
bonds shall be authorized, issued, sold, executed, and delivered 
in the manner provided by Minnesota Statutes, chapter 475.  An 
election on the question of issuing the bonds is not required.  
A resolution of the board levying taxes for the payment of the 
bonds and interest on them as authorized by this section and 
pledging the proceeds of the levies for the payment of the bonds 
and interest on them shall be deemed to be in compliance with 
the provisions of Minnesota Statutes, chapter 475 with respect 
to the levying of taxes for their payment. 
    Subd. 2.  [APPROPRIATION.] There is annually appropriated 
from the distribution of taconite production tax revenues to the 
taconite environmental protection fund pursuant to Minnesota 
Statutes, section 298.28, subdivision 11, and to the northeast 
Minnesota economic protection trust pursuant to Minnesota 
Statutes, section 298.28, subdivisions 9 and 11, in equal 
shares, an amount sufficient to pay when due 100 percent of the 
principal and interest on the bonds issued pursuant to 
subdivision 1.  If the annual distribution to the northeast 
Minnesota economic protection trust is insufficient to pay its 
share after fulfilling any obligations of the trust under 
Minnesota Statutes, section 298.225 or 298.293, the deficiency 
shall be appropriated from the taconite environmental protection 
fund. 
    Subd. 3.  [DISTRICT OBLIGATIONS.] Bonds issued under 
authority of this section shall be the general obligations of 
the school district for which its full faith and credit and 
unlimited taxing powers shall be pledged.  If there are any 
deficiencies in the amount received pursuant to subdivision 2, 
they shall be made good by general levies, not subject to limit, 
on all taxable properties in the district in accordance with 
Minnesota Statutes, section 475.74.  If any deficiency levies 
are necessary, the school board may effect a temporary loan or 
loans on certificates of indebtedness issued in anticipation of 
them to meet payments of principal or interest on the bonds due 
or about to become due. 
    Subd. 4.  [LEVY LIMITATIONS.] Taxes levied pursuant to this 
section shall be disregarded in the calculation of any other tax 
levies or limits on tax levies provided by other law. 
    Subd. 5.  [BONDING LIMITATIONS.] Bonds may be issued under 
authority of this section notwithstanding any limitations upon 
the indebtedness of a district, and their amounts shall not be 
included in computing the indebtedness of a district for any 
purpose, including the issuance of subsequent bonds and the 
incurring of subsequent indebtedness. 
    Subd. 6.  [TERMINATION OF APPROPRIATION.] The appropriation 
authorized in subdivision 2 shall terminate upon payment or 
maturity of the last of those bonds. 
    Subd. 7.  [LOCAL APPROVAL.] This section is effective for 
independent school district No. 710, the day after its governing 
body complies with Minnesota Statutes, section 645.021, 
subdivision 3. 
    Sec. 21.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated. 
    Subd. 2.  [CAPITAL EXPENDITURE FACILITIES AID.] For capital 
expenditure facilities aid according to Minnesota Statutes, 
section 124.243, subdivision 5:  
    $33,800,000 ..... 1990 
    $41,039,000 ..... 1991 
    The 1990 appropriation includes $33,800,000 for 1990.  
    The 1991 appropriation includes $5,965,000 for 1990 and 
$35,074,000 for 1991.  
    Subd. 3.  [CAPITAL EXPENDITURE EQUIPMENT AID.] For capital 
expenditure equipment aid according to Minnesota Statutes, 
section 124.244, subdivision 3:  
    $16,900,000 ..... 1990 
    $20,520,000 ..... 1991 
    The 1990 appropriation includes $16,900,000 for 1990.  
    The 1991 appropriation includes $2,983,000 for 1990 and 
$17,537,000 for 1991.  
    Subd. 4.  [HEALTH AND SAFETY AID.] For health and safety 
aid according to Minnesota Statutes, section 124.83, subdivision 
5: 
    $8,168,000 ...... 1990 
    $10,796,000 ..... 1991 
    The 1990 appropriation includes $8,168,000 for 1990.  
    The 1991 appropriation includes $1,442,000 for 1990 and 
$9,354,000 for 1991. 
     Subd. 8.  [MAXIMUM EFFORT SCHOOL LOAN FUND.] For the 
maximum effort school loan fund: 
    $855,500 ....... 1990 
    $2,100,000 ..... 1991 
    These appropriations shall be placed in the loan repayment 
account of the maximum effort school loan fund for the payment 
of the principal and interest on school loan bonds, as provided 
in Minnesota Statutes, section 124.46, to the extent that money 
in the fund is not sufficient to pay when due the full amount of 
principal and interest due on school loan bonds.  The purpose of 
these appropriations is to ensure that sufficient money is 
available in the fund to prevent a statewide property tax levy 
as would otherwise be required pursuant to Minnesota Statutes, 
section 124.46, subdivision 3.  Notwithstanding the provisions 
of Minnesota Statutes, section 124.39, subdivision 5, any amount 
of the appropriation made in this section which is not needed to 
pay when due the principal and interest due on school loan bonds 
shall not be transferred to the debt service loan account of the 
maximum effort school loan fund but instead shall cancel and 
revert to the general fund. 
    The 1990 appropriation does not cancel and is available 
until July 1, 1991. 
     Subd. 6.  [HAZARDOUS SUBSTANCE AID.] For the final 
adjustment payment of hazardous substance aid under Minnesota 
Statutes 1987 Supplement, section 124.245, subdivision 3b: 
    $9,000 ..... 1990 
     The 1990 appropriation includes $9,000 for 1989. 
    Subd. 5.  [CAPITAL EXPENDITURE AID.] For the final 
adjustment payment of capital expenditure aid according to 
Minnesota Statutes 1987 Supplement, section 124.244, subdivision 
3: 
    $5,628,000 ..... 1990 
    The 1990 appropriation includes $5,628,000 for 1989.  
     Sec. 22.  [REPEALER.] 
     Minnesota Statutes 1988, section 124.243, subdivision 4, is 
repealed. 
    Sec. 23.  [EFFECTIVE DATE.] 
    Section 10 is effective the day following final enactment. 

                               ARTICLE 6
EDUCATION ORGANIZATION AND COOPERATION 
    Section 1.  Minnesota Statutes 1988, section 121.904, 
subdivision 4a, is amended to read: 
    Subd. 4a.  [LEVY RECOGNITION.] (a) "School district tax 
settlement revenue" means the current, delinquent, and 
manufactured home property tax receipts collected by the county 
and distributed to the school district, including distributions 
made pursuant to section 279.37, subdivision 7, and excluding 
the amount levied pursuant to section sections 124.2721, 
subdivision 3; 124.575, subdivision 3; and 275.125, subdivision 
9a,; and Laws 1976, chapter 20, section 4.  
    (b) In June of each year, the school district shall 
recognize as revenue, in the fund for which the levy was made, 
the lesser of:  
    (1) the June and July school district tax settlement 
revenue received in that calendar year; or 
    (2) the sum of the state aids and credits enumerated in 
section 124.155, subdivision 2, which are for the fiscal year 
payable in that fiscal year plus 27 27.8 percent of the amount 
of the levy certified in the prior calendar year according to 
section 124A.03, subdivision 2, plus or minus auditor's 
adjustments, not including levy portions that are assumed by the 
state; or 
    (3) 27 27.8 percent of the amount of the levy certified in 
the prior calendar year, plus or minus auditor's adjustments, 
not including levy portions that are assumed by the state, which 
remains after subtracting, by fund, the amounts levied for the 
following purposes:  
    (i) reducing or eliminating projected deficits in the 
reserved fund balance accounts for unemployment insurance and 
bus purchases; 
    (ii) statutory operating debt pursuant to section 275.125, 
subdivision 9a, and Laws 1976, chapter 20, section 4; and 
    (iii) retirement and severance pay pursuant to section 
sections 124.4945 and 275.125, subdivision 6a, and Laws 1975, 
chapter 261, section 4; and 
    (iv) amounts levied for bonds issued and interest thereon, 
amounts levied for debt service loans and capital loans, and 
amounts levied pursuant to section 275.125, subdivision 14a. 
    (c) In July of each year, the school district shall 
recognize as revenue that portion of the school district tax 
settlement revenue received in that calendar year and not 
recognized as revenue for the previous fiscal year pursuant to 
clause (b).  
    (d) All other school district tax settlement revenue shall 
be recognized as revenue in the fiscal year of the settlement. 
Portions of the school district levy assumed by the state, 
including prior year adjustments and the amount to fund the 
school portion of the reimbursement made pursuant to section 
273.425, shall be recognized as revenue in the fiscal year 
beginning in the calendar year for which the levy is payable. 
    Sec. 2.  Minnesota Statutes 1988, section 121.904, is 
amended by adding a subdivision to read:  
    Subd. 4e.  [COOPERATION LEVY RECOGNITION.] (a) A 
cooperative district is a district or cooperative that receives 
revenue according to section 124.2721 or 124.575.  
    (b) In June of each year, the cooperative district shall 
recognize as revenue, in the fund for which the levy was made, 
the lesser of:  
    (1) the sum of the state aids and credits enumerated in 
section 124.155, subdivision 2, that are for the fiscal year 
payable in that fiscal year; or 
    (2) 27.8 percent of the difference between 
    (i) the sum of the amount of levies certified in the prior 
year according to sections 124.2721, subdivision 3, and 124.575, 
subdivision 3; and 
    (ii) the amount of transition aid paid to the cooperative 
unit according to section 273.1392 for the fiscal year to which 
the levy is attributable.  
    Sec. 3.  Minnesota Statutes 1988, section 121.908, 
subdivision 5, is amended to read: 
    Subd. 5.  All governmental units formed by joint powers 
agreements entered into by districts pursuant to section 120.17, 
123.351, 471.59, or any other law and all educational 
cooperative service units and education districts shall be 
subject to the provisions of this section. 
    Sec. 4.  Minnesota Statutes 1988, section 122.23, is 
amended by adding a subdivision to read: 
    Subd. 13a.  [CONSOLIDATION IN AN EVEN-NUMBERED YEAR.] 
Notwithstanding subdivision 13, school districts may consolidate 
during an even-numbered year if the school board and the 
exclusive bargaining representative of the teachers in each 
affected district agree to the effective date of the 
consolidation.  The agreement must be in writing and submitted 
to the commissioner of education. 
    Sec. 5.  [122.241] [COOPERATION AND COMBINATION.] 
    Subdivision 1.  [SCOPE.] Sections 5 to 12 establish 
procedures for school boards that adopt, by resolution, a 
five-year written agreement: 
    (1) to provide at least secondary instruction cooperatively 
for at least two years; and 
    (2) to combine into one district after cooperating.  
    Subd. 2.  [COOPERATION REQUIREMENTS.] Cooperating districts 
shall: 
    (1) have a written agreement according to section 122.541; 
    (2) all be members of one education district, if any one of 
the districts is a member; and 
    (3) all be members of one ECSU, if any one of the districts 
is a member.  
    Subd. 3.  [COMBINATION REQUIREMENTS.] Combining districts 
must be contiguous and meet one of the following requirements at 
the time of combination:  
    (1) at least two districts with at least 400 resident 
pupils enrolled in grades 7 through 12 in the combined district 
and projections, approved by the department of education, of 
enrollment at least at that level for five years; 
    (2) at least two districts, both of which qualify for 
sparsity revenue under section 124A.22, subdivision 6, and have 
an average isolation index over 23; or 
    (3) at least three districts with fewer than 420 resident 
pupils enrolled in grades 7 through 12 in the combined district. 
    A combination under clause (3) must be approved by the 
state board of education.  The state board shall disapprove a 
combination under clause (3) if the combination is educationally 
unsound or would not reasonably enable the districts to fulfill 
statutory and rule requirements.  
    Sec. 6.  [122.242] [COOPERATION AND COMBINATION PLAN.] 
    Subdivision 1.  [ADOPTION AND STATE BOARD REVIEW.] Each 
school board must adopt, by resolution, a plan for cooperation 
and combination.  The plan must address each item in this 
section.  The plan must be specific for any item that will occur 
within three years and may be general or set forth alternative 
resolutions for an item that will occur in more than three 
years.  The plan must be submitted to the state board of 
education for review and comment.  Significant modifications and 
specific resolutions of items must be submitted to the state 
board for review and comment.  In the official newspaper of each 
district proposed for combination, the school board must publish 
at least a summary of the adopted plans, each significant 
modification and resolution of items, and each state board 
review and comment. 
    Subd. 2.  [RULE EXEMPTIONS.] The plan must identify the 
rules of the state board of education from which the district 
intends to request exemption, according to Minnesota Rules, part 
3500.1000.  The plan may provide information about state laws 
that deter or impair cooperation or combination.  
    Subd. 3.  [BOARD FORMATION.] The plan must state:  
    (1) whether the new district would have one elected school 
board or whether it would have one elected school board and one 
elected board for each elementary school exercising powers and 
duties delegated to it by the school board of the entire 
district; 
    (2) how many of the existing members of each district would 
become members of the school board of the combined district and, 
if so, a method to gradually reduce the membership to six or 
seven; and 
    (3) if desired, election districts that include the 
establishment of separate areas from each of the combining 
districts from which school board members will be elected, the 
boundaries of these election districts, and the initial term of 
the member elected from each of these election districts.  
    Subd. 4.  [ADMINISTRATION.] The plan must provide for:  
    (1) selection of one superintendent for the combined 
district at a specified time, according to section 123.34, 
subdivision 9; and 
    (2) alterations, if any, in administrative personnel and 
duties. 
    Subd. 5.  [EMPLOYEES.] The plan must state: 
    (1) procedures needed, at the time of combination, to 
combine teachers into one bargaining unit, with the exclusive 
representative determined according to section 122.532; 
    (2) procedures needed, at the time of combination, to 
combine other bargaining units; 
    (3) procedures to negotiate, with the assistance of the 
bureau of mediation services, an employment plan for licensed 
employees affected by the agreement; 
    (4) procedures to negotiate, with the assistance of the 
bureau of mediation services, an employment plan for nonlicensed 
employees affected by the agreement; and 
    (5) incentives that may be offered to superintendents, 
principals, teachers, and other licensed and nonlicensed 
employees, such as early retirement, severance pay, and health 
insurance benefits.  
    Subd. 6.  [ACADEMIC PROGRAMS.] The plan must set forth:  
    (1) elementary curriculum and programs; 
    (2) improvements in secondary course offerings in at least 
communications, mathematics, science, social studies, foreign 
languages, physical education, health, and career education; 
    (3) procedures for involving parents, teachers, and other 
interested people in developing learner outcomes in curricular 
areas; 
    (4) procedures for involving teachers in determining levels 
of learner outcomes; 
    (5) implications for special education cooperatives, 
secondary vocational cooperatives, joint powers agreements, 
education districts, and other cooperative arrangements if the 
districts combined and if they did not; and 
    (6) a description of the long-range educational services of 
the combined district and of the individual districts if the 
combination is not achieved.  
    Subd. 7.  [PUPIL ACTIVITIES.] The plan must provide for 
combining extracurricular and cocurricular activities.  
    Subd. 8.  [REFERENDUM.] The plan must set forth:  
    (1) procedures for a referendum, held prior to the year of 
the proposed combination, to approve combining the school 
districts; and 
    (2) whether a majority of those voting in each district 
proposed for combination or a majority of those voting on the 
question in the entire area proposed for combination would be 
needed to pass the referendum.  
    Subd. 9.  [FINANCES.] The plan must state:  
    (1) whether debt service for the bonds outstanding at the 
time of combination remains solely with the district that issued 
the bonds or whether the debt service for the bonds will be 
assumed by the combined district and paid by the combined 
district on behalf of the district that issued the bonds; 
    (2) the treatment of debt service levies and referendum 
levies; 
    (3) two-, five-, and ten-year projections, prepared by the 
department of education upon the request of any district, of 
revenues, expenditures, and property taxes for each district if 
it cooperated and combined and if it did not.  
    Subd. 10.  [BUILDING SITES.] The plan must provide for: 
    (1) locations for elementary schools which need not be 
altered and may contain assurances that, to the extent feasible, 
elementary schools will be retained for at least the number of 
years specified in the plan; and 
    (2) one location, if possible, for a secondary school.  
    Subd. 11.  [TIMING.] The plan must contain a time schedule 
for implementation.  
    Sec. 7.  [122.243] [STATE BOARD AND VOTER APPROVAL.] 
    Subdivision 1.  [STATE BOARD APPROVAL.] Before submitting 
the question of combining school districts to the voters at a 
referendum, the cooperating districts shall submit the proposed 
combination to the state board of education.  The state board 
shall determine the date for submission and may require any 
information it determines necessary.  The state board shall 
disapprove the proposed combination if it is educationally 
unsound, will not reasonably enable the combined district to 
fulfill statutory and rule requirements, or if the plan or 
modifications are incomplete.  If disapproved by the state 
board, the referendum shall be postponed, but not canceled, by 
the school boards. 
    Subd. 2.  [VOTER APPROVAL.] During the second year of 
cooperation, a referendum on the question of combination shall 
be conducted.  The referendum shall be on a date called by the 
school boards.  The referendum shall be conducted by the school 
boards according to the Minnesota election law, as defined in 
section 200.01.  If the referendum fails, the same question or a 
modified question may be submitted the following school year.  
If a question is submitted, the second referendum must be 
conducted on a date before October 1.  If the referendum fails 
again, the same question may not be submitted.  A different 
question may be submitted on any date before October 1.  
Referendums shall be conducted on the same date in all districts.
    Sec. 8.  [122.244] [EFFECTIVE DATE OF COMBINATION.] 
    The effective date for combination of districts shall be 
July 1.  
    Sec. 9.  [122.245] [EMPLOYEES OF COOPERATING AND COMBINING 
DISTRICTS.] 
    Subdivision 1.  [COMBINED SENIORITY LIST.] During the 
school year before the cooperation begins and during the school 
years of cooperation, the districts shall comply with section 
122.541, subdivision 5, unless compatible plans are negotiated 
according to section 122.541, subdivision 4.  The districts 
shall comply with section 122.532. 
    Subd. 2.  [NONLICENSED EMPLOYEES TERMINATION.] If 
compatible plans are not negotiated according to section 6, 
subdivision 5, the school boards shall comply with this 
subdivision with respect to nonlicensed employees.  Nonlicensed 
employees whose positions are discontinued as a result of 
cooperation or combination, as applicable, shall be:  
    (1) employed by a cooperating board or the combined board, 
if possible; 
    (2) assigned to work in a cooperating district or the 
combined district, if possible; or 
    (3) terminated in the inverse order in which they were 
employed in a district, according to a combined seniority list 
of nonlicensed employees in the cooperating or combined 
district, as applicable.  
    Subd. 3.  [EMPLOYMENT LAWS.] Unless otherwise explicitly 
provided, chapter 179A governs the rights and duties of 
employers and employees.  Either party may promptly submit 
questions of procedure, interpretation, or application to the 
commissioner of mediation services.  
    Sec. 10.  [122.246] [COUNTY AUDITOR PLAT.] 
    Upon the request of two or more districts that have adopted 
a resolution to cooperate and combine, the county auditor shall 
prepare a plat.  If the proposed combined district is located in 
more than one county, the request shall be submitted to the 
county auditor of the county that has the greatest land area in 
the proposed district.  The plat shall show: 
    (1) the boundaries of each of the present districts; 
    (2) the boundaries of the proposed district; 
    (3) the boundaries of proposed election districts, if 
requested; and 
    (4) other information deemed pertinent by the school boards 
or the county auditor. 
    Sec. 11.  [122.247] [LEVIES FOR DISTRICTS AT THE TIME OF 
COMBINATION.] 
    Subdivision 1.  [REFERENDUM LEVIES.] The referendum levy 
authorization of the combined district shall be one of the 
methods set forth in section 122.531, subdivision 2a, 2b, or 2c, 
and must be consistent with the plan adopted according to 
section 6, and any subsequent modifications.  
    Subd. 2.  [BONDED DEBT.] Debt service for bonds outstanding 
at the time of the combination may be levied by the combined 
school board consistent with the plan adopted according to 
section 6, and any subsequent modifications, subject to section 
475.61.  The primary obligation to pay the bonded indebtedness 
that is outstanding on the effective date of combination remains 
with the district that issued the bonds.  However, the combined 
district may make debt service payments on behalf of a 
preexisting district. 
    Subd. 3.  [TRANSITIONAL LEVY.] The board of the combined 
district may levy for the expenses of negotiation, 
administrative expenses directly related to the transition from 
cooperation to combination, and the cost of necessary new 
athletic and music uniforms.  The board may levy this amount 
over three or fewer years.  All expenses must be approved by the 
state board of education.  
    Sec. 12.  [122.248] [REPORTS TO DEPARTMENT OF EDUCATION.] 
    Cooperating districts may submit joint reports and jointly 
provide information required by the department of education.  
The joint reports must allow information to be attributed to 
each district.  A combined district must report and provide 
information as a single unit.  
    Sec. 13.  Minnesota Statutes 1988, section 122.41, is 
amended to read: 
    122.41 [POLICY.] 
    The policy of the state is to encourage organization of 
school districts into units of administration to afford better 
educational opportunities for all pupils, make possible more 
economical and efficient operation of the schools, and insure 
more equitable distribution of public school revenue.  To this 
end all area of the state shall be included in an independent or 
special school district maintaining classified elementary and 
secondary schools, grades 1 through 12, unless a district has 
made an agreement with another district or districts as provided 
in section sections 122.535 or, 122.541, or sections 5 to 12, 
or 27, or has received a grant under sections 124.492 to 124.495.
    Sec. 14.  Minnesota Statutes 1988, section 122.43, 
subdivision 1, is amended to read: 
    Subdivision 1.  Any organized school district not a part of 
an independent A school district maintaining classified shall 
maintain elementary and secondary schools, grades 1 through 
12 is dissolved, unless the district has made an agreement with 
another district or districts as provided in section sections 
122.535 or, 122.541, 5 to 12, or 27, or has received a grant 
under sections 124.492 to 124.495.  
    Sec. 15.  Minnesota Statutes 1988, section 122.532, 
subdivision 3, is amended to read: 
    Subd. 3.  The organization certified as the exclusive 
bargaining representative for the teachers in the particular 
preexisting district which employed the largest proportion of 
the teachers who are assigned to a new employing district 
according to subdivision 2 shall be certified as the exclusive 
bargaining representative for the teachers assigned to that new 
employing district, until that organization is decertified or 
another organization is certified in its place pursuant to 
sections 179A.01 to 179A.25. If no new contract has been 
executed as of the effective date of the consolidation or 
dissolution and attachment, the terms and conditions of 
employment of teachers assigned to the new employing district 
shall be temporarily governed by the contract executed by that 
exclusive bargaining representative and that particular 
preexisting district, until a new contract is executed between 
the newly elected board or the board of the district to which a 
dissolved district is attached and the exclusive bargaining 
representative.  For purposes of negotiation of a new contract 
with the board of the new employing district and the 
certification of an exclusive bargaining representative for 
purposes of that negotiation, the teachers assigned to that 
district shall be considered an appropriate unit of employees of 
that district as of the date the county board orders its 
interlocutory order of dissolution and attachment to be final 
and effective or as of the date the commissioner assigns an 
identification number to a new district created by 
consolidation.  During the school year before the consolidation 
becomes effective, the newly elected board or the board of the 
district to which a dissolved district is attached, may place 
teachers assigned to it on unrequested leave of absence as 
provided in section 125.12 according to:  (a) a plan negotiated 
in a new master contract between it and the exclusive bargaining 
representative of the teachers assigned to it, or (b) if no such 
plan exists, an applicable plan negotiated in the contract which 
according to this subdivision will temporarily govern the terms 
and conditions of employment of teachers assigned to it, or (c) 
if no plan exists pursuant to either (a) or (b), the provisions 
of section 125.12, subdivision 6b, on the basis of a combined 
seniority list of all teachers assigned to it.  
    Sec. 16.  Minnesota Statutes 1988, section 122.532, is 
amended by adding a subdivision to read:  
    Subd. 3a.  [INTERIM CONTRACTUAL AGREEMENTS.] (a) Until a 
successor contract is executed between the new school board and 
the exclusive representative of the teachers of the new 
district, the school boards of both districts and the exclusive 
representatives of the teachers of both districts may agree: 
    (1) to comply with the contract of either district with 
respect to all of the teachers assigned to the new district; or 
    (2) that each of the contracts shall apply to the teachers 
previously subject to the respective contract.  
    (b) In the absence of an agreement according to paragraph 
(a), the following shall apply: 
    (1) if the effective date is July 1 of an even-numbered 
year, each of the contracts shall apply to the teachers 
previously subject to the respective contract and shall be 
binding on the new school board; or 
    (2) if the effective date is July 1 of an odd-numbered 
year, the contract of the district that previously employed the 
largest proportion of teachers assigned to the new district 
applies to all of the teachers assigned to the new district and 
shall be binding on the new school board.  
    Sec. 17.  Minnesota Statutes 1988, section 122.532, 
subdivision 4, is amended to read: 
    Subd. 4.  Except as provided in this section, the 
provisions of section 125.12 or 125.17 shall apply to the 
employment of each teacher by the new employing district on the 
same basis as they would have applied to the employment if the 
teacher had been employed by that new district before the 
effective date of the consolidation or dissolution and 
attachment.  For the purpose of applying the provisions of 
subdivision 3, clause (b) (c), and the provisions of section 
125.12, subdivision 6b, pursuant to this section, a teacher's 
date of first employment shall be the date of beginning 
continuous employment in the preexisting district which employed 
the teacher each school district must be considered to have 
started school each year on the same date.  
    Sec. 18.  Minnesota Statutes 1988, section 122.541, is 
amended to read:  
    122.541 [INTERDISTRICT COOPERATION.] 
    Subdivision 1.  [DISTRICT REQUIREMENTS.] The school boards 
of two or more school districts may, after consultation with the 
department of education, enter into an agreement providing 
for the:  
    (1) discontinuance by a district all districts except one 
of any of at least the 10th, 11th, and 12th grades kindergarten 
through 12 or portions of those grades; and the 
    (2) instruction in a cooperating district of the pupils in 
the discontinued grades or portions of grades; provided, the 
board of a district discontinuing a grade pursuant to the 
agreement in one of the cooperating districts.  Each district 
shall continue to maintain operate a school enrolling pupils 
in with at least three grades.  Before making entering into a 
final an agreement permitted by this subdivision, the boards 
shall provide a copy of this agreement to the commissioner of 
education.  
    Subd. 2.  [AID; TRANSPORTATION.] A (a) Each district 
entering into an agreement permitted in subdivision 1 shall:  
    (1) continue to count its resident pupils who are educated 
in a cooperating district as resident pupils in the calculation 
of pupil units for all purposes, including the calculation of 
state aids and levy limitations.  Notwithstanding section 
124.18, subdivision 2, an The agreement permitted by subdivision 
1 shall provide for the tuition payments between or among the 
cooperating districts determine are necessary and equitable to 
compensate each district for the instruction of nonresident 
pupils; and.  
    (2) (b) Each district shall continue to provide 
transportation and collect transportation aid for its resident 
pupils pursuant to sections 123.39, 124.223, and 124.225.  This 
clause shall not be construed to prohibit A district from 
providing may provide some or all transportation to its resident 
pupils by contracting with a cooperating district that has 
entered the agreement.  For purposes of aid calculations 
pursuant to section 124.225, the commissioner may adjust the 
base cost per eligible pupil transported to reflect changes in 
costs resulting from an the agreement which provides for a 
district to discontinue at least one grade.  
    Subd. 3.  [TEACHER DEFINED.] As used in this section, the 
term "teacher" shall have has the meaning given it in section 
125.12, subdivision 1. 
    Subd. 4.  [NEGOTIATED PLAN FOR DISCONTINUED TEACHERS.] The 
school board and exclusive bargaining representative of the 
teachers in each district discontinuing grades pursuant to an 
agreement permitted by subdivision 1 may negotiate a plan for 
the assignment to assign or employment employ in a cooperating 
district or the placement to place on unrequested leave of 
absence of all teachers whose positions are discontinued as a 
result of the agreement.  The school board and exclusive 
bargaining representative of the teachers in each district 
providing instruction to nonresident pupils pursuant to an 
agreement permitted by subdivision 1 may negotiate a plan for 
the employment of to employ teachers from a cooperating district 
whose positions are discontinued as a result of the agreement.  
If such plans are negotiated in cooperating districts and if the 
boards determine the plans are compatible with one another, the 
boards of the districts shall include the plans in their 
agreement.  
    Subd. 5.  [COMBINED SENIORITY LIST.] If compatible plans 
are not negotiated pursuant to subdivision 4 before the March 1 
preceding any year of the agreement permitted by subdivision 1, 
the cooperating districts shall be governed by the provisions of 
this subdivision.  Insofar as possible, teachers who have 
acquired continuing contract rights and whose positions are 
discontinued as a result of the agreement shall be employed by a 
cooperating district or assigned to teach in a cooperating 
district as exchange teachers pursuant to section 125.13.  If 
necessary, teachers whose positions are discontinued as a result 
of the agreement and who have acquired continuing contract 
rights shall be placed on unrequested leave of absence in fields 
in which they are licensed in the inverse order in which they 
were employed by a cooperating district, according to a combined 
seniority list of teachers in the cooperating districts.  For 
the purpose of establishing a combined seniority list, each 
school district must be considered to have started school each 
year on the same date. 
    Subd. 6.  [NOTICE AND HEARING.] Prior to making entering 
into an agreement permitted by subdivision 1, the school 
board of a district participating in the agreement shall consult 
with the community at an informational meeting.  The board shall 
publish notice of the meeting in the official newspaper of the 
district and may send written notice of the meeting to parents 
of pupils who would be affected by the plan.  
    Subd. 7.  [MEETING LOCATION.] Notwithstanding any law to 
the contrary, the school boards of districts with that have an 
agreement under this section may hold a valid joint meeting at 
any location that would be permissible for one of the school 
boards participating in the meeting. 
    Sec. 19.  Minnesota Statutes 1988, section 122.91, 
subdivision 1, is amended to read: 
    122.91 [EDUCATION DISTRICT ESTABLISHMENT.] 
    Subdivision 1.  [PURPOSE.] The purpose of an education 
district is to increase educational opportunities for pupils 
learners by increasing cooperation and coordination among school 
districts and post-secondary institutions. 
    Sec. 20.  Minnesota Statutes 1988, section 122.91, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [AGREEMENT; SPECIAL PROVISIONS.] The education 
district agreement may contain a special provision adopted by 
the vote of a majority of the full membership of each of the 
boards of the member school districts to allow a post-secondary 
institution to become a member of the education district.  
    Sec. 21.  Minnesota Statutes 1988, section 122.91, 
subdivision 3, is amended to read: 
    Subd. 3.  [REQUIREMENTS FOR FORMATION.] An education 
district must have one of the following at the time of formation:
    (1) at least five districts; 
    (2) at least four districts with a total of at least 5,000 
pupils in average daily membership; or 
    (3) at least four districts with a total of at least 2,000 
square miles.  
    Members of an education district must be contiguous.  
Districts with a cooperation agreement according to section 18 
may belong to an education district only as a unit.  
    A noncontiguous district may be a member of an education 
district if the state board of education determines that: 
    (1) a district between the education district and the 
noncontiguous district has considered and is unwilling to become 
a member; or 
    (2) a noncontiguous configuration of member districts has 
sufficient technological or other resources to offer effective 
levels of programs and services required under sections 122.94, 
subdivision 2, and 122.945. 
    Sec. 22.  Minnesota Statutes 1988, section 122.91, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [MEETING WITH REPRESENTATIVES.] Before entering 
into an agreement, the school board of each member district must 
meet and confer with the exclusive representatives of the 
teachers of each school district proposing to enter the 
education district. 
    Sec. 23.  Minnesota Statutes 1988, section 122.91, 
subdivision 5, is amended to read: 
    Subd. 5.  [JOINDER AND WITHDRAWAL.] A process for a 
district to join or withdraw from an education district shall be 
included in the education district agreement. 
    If a school district withdraws from an education district 
that receives revenue under section 124.2721 before the end of 
the fiscal year for which a levy under section 124.2721 has been 
certified, a reduction in the school district's general 
education aid for the fiscal year to which the levy is 
attributable must be made.  The amount of aid reduction equals 
the amount that the school district certified for that year 
under section 124.2721 minus transition aid allocated for that 
levy according to section 273.1398, subdivision 6.  The amount 
of the aid reduction shall be paid to the education district.  
The school district need not transfer the revenue required under 
section 36, subdivision 3a. 
    Sec. 24.  Minnesota Statutes 1988, section 122.92, is 
amended to read: 
    122.92 [EDUCATION DISTRICT BOARD.] 
    Subdivision 1.  [SCHOOL DISTRICT REPRESENTATION.] The 
education district board shall be composed of at least one 
representative appointed by the school board of each member 
district.  The Each representative shall reside in the school 
district must be a member of the appointing school board.  The 
Each representative shall serve at the pleasure of the 
appointing school board and may be recalled by a majority vote 
of the appointing school board.  Each representative shall serve 
for the term that is specified in the agreement.  The board 
shall select its officers from among its members and shall 
determine the terms of the officers.  The board shall adopt 
bylaws for the conduct of its business.  
    Subd. 2.  [POST-SECONDARY REPRESENTATION.] The education 
district board may appoint, with the approval of the member 
post-secondary institution, a representative from one or more 
member post-secondary institutions as a member of the education 
district board.  Each post-secondary representative shall serve 
at the pleasure of the education district board and may be 
recalled by a majority vote of the education district board.  
The education district agreement may specify issues on which a 
post-secondary representative may vote.  
    Sec. 25.  Minnesota Statutes 1988, section 122.93, 
subdivision 2, is amended to read: 
    Subd. 2.  [PERSONNEL.] The board may employ personnel as 
necessary to provide and support the programs and services of 
the education district.  Education district staff shall 
participate in retirement programs.  Notwithstanding section 
123.34, subdivision 9, a member district of an education 
district may contract with the education district to obtain the 
services of a superintendent.  The person to provide the 
services need not be employed by the education district or a 
member district at the time the contract is entered into. 
    Sec. 26.  Minnesota Statutes 1988, section 122.93, is 
amended by adding a subdivision to read: 
    Subd. 7.  [BUDGET.] The education district board must adopt 
a budget for the expenditure of revenue received by the 
education district.  The budget must be included in the 
five-year plan required under section 30. 
    Sec. 27.  Minnesota Statutes 1988, section 122.93, is 
amended by adding a subdivision to read: 
    Subd. 8.  [DISCONTINUING GRADES.] The board of a school 
district that is a member of an education district may 
discontinue any of kindergarten through grade 12 or part of 
those grades and provide instruction for those grades or parts 
of grades within the education district. 
    Sec. 28.  Minnesota Statutes 1988, section 122.94, 
subdivision 1, is amended to read: 
    Subdivision 1.  [ESTABLISHMENT.] An education district 
board shall adopt a comprehensive agreement for continuous 
learning.  The agreement must address methods to improve the 
educational opportunities available in the education district.  
It must be submitted for review by all the educational 
cooperative service units serving unit within which the majority 
of the education district membership lies.  The education 
district board shall review the agreement annually and propose 
necessary amendments to the member districts. 
    Sec. 29.  Minnesota Statutes 1988, section 122.94, is 
amended by adding a subdivision to read: 
    Subd. 6.  [COMMON ACADEMIC CALENDAR.] For 1990-1991 and 
later school years, the agreement must require a common academic 
calendar for all member districts of an education district.  For 
purposes of this subdivision, a common academic calendar must 
include at least the following: 
    (1) the number of days of instruction; 
    (2) the first and last days of instruction in a school 
year; and 
    (3) the specific days reserved for staff development. 
    Before the 1990-1991 school year, each education district 
must report to the state board of education on ways that other 
components of the academic calendar in each member district will 
affect the implementation of the five-year plan described in 
section 30.  Other components include the length of the school 
day, the time the school day begins and ends, and the number of 
periods in the day. 
    Sec. 30.  [122.945] [EDUCATION DISTRICT PLAN.] 
    Subdivision 1.  [FIVE-YEAR PLAN.] Each education district 
must develop a five-year plan to increase educational 
opportunities for all learners.  The plan must give priority to 
the mandated programs and services under section 122.94, 
subdivision 2, with an emphasis on new, improved, or expanded 
programs or services.  The plan must emphasize the integration 
of all aspects of education, including community education.  
Teachers must be involved in developing the plan.  The plan must 
include at least the following components: 
    (1) a detailed description of the proposed increased 
educational opportunities for pupils resulting from the new, 
improved, or expanded programs or services; 
    (2) a budget for the current fiscal year and an estimated 
budget for the next fiscal year; 
    (3) an estimate of the number of school districts and 
pupils affected by program and service expenditures; and 
    (4) any other information required by the state board. 
    Subd. 2.  [SUBMISSION AND APPROVAL OF FIVE-YEAR PLAN.] Each 
education district must submit a five-year plan developed 
according to subdivision 1 to the state board of education.  An 
education district established before January 1, 1990, must 
submit a plan to the state board by April 1, 1990.  An education 
district established after December 31, 1989, must submit a plan 
to the state board by April 1 of the first year that the 
education district will certify the amount of education district 
revenue to be raised under section 36.  The board must approve 
or disapprove the plan within 60 days of receiving it from the 
education district. 
    Subd. 3.  [UPDATING EDUCATION DISTRICT PLAN.] The state 
board of education may require education districts to submit 
updated five-year plans. 
    Subd. 4.  [EDUCATION DISTRICT REVENUE.] An education 
district must receive state board of education approval of its 
five-year plan to be eligible for education district revenue 
under section 124.2721, subdivision 6, for fiscal year 1991 and 
thereafter. 
    Subd. 5.  [EVALUATION OF FIVE-YEAR PLAN.] The state board 
of education must annually evaluate the programs and services in 
a selected number of education districts to determine compliance 
with the five-year plan and any updated plans submitted to the 
board under this section. 
    Sec. 31.  Minnesota Statutes 1988, section 122.95, is 
amended by adding a subdivision to read: 
    Subd. 1a.  [FILLING POSITIONS; NEGOTIATED AGREEMENTS.] The 
school boards in all member districts and exclusive bargaining 
representatives of the teachers in all member districts may 
negotiate a plan for filling positions resulting from 
implementation of the education district agreement.  If the plan 
is negotiated among the member school districts and the 
exclusive bargaining representative of each member school 
district and unanimously agreed upon, in writing, the education 
district shall include the plan in the education district 
agreement.  If a plan is not negotiated, the education district 
is governed by subdivision 2. 
    Sec. 32.  Minnesota Statutes 1988, section 122.95, 
subdivision 2, is amended to read: 
    Subd. 2.  [FILLING POSITIONS.] (a) When an education 
district board or a member board is filling a position resulting 
from implementation of the agreement, the board may offer the 
position to a teacher currently employed by a member district 
according to the exchange teacher provisions of section 125.13. 
    (b) If the position is not filled by a currently employed 
teacher, the board shall offer the position to an available 
teacher in the order of seniority in fields of licensure on a 
combined seniority list of all available teachers in the member 
districts.  For the purpose of establishing a combined seniority 
list, each school district must be considered to have started 
school each year on the same date.  An available teacher is a 
teacher in a member district who:  
    (1) was placed on unrequested leave of absence by a member 
district, according to section 125.12, subdivision 6a or 6b, or 
was terminated according to section 125.17, subdivision 11, not 
more than one year before the initial formation of an education 
district as a result of an intention to enter into an education 
district agreement; 
    (2) was placed on unrequested leave of absence by a member 
district, according to section 125.12, subdivision 6a or 6b, or 
was terminated according to section 125.17, subdivision 11, as a 
result of implementing the education district agreement, after 
the formation of the education district; or 
    (3) is placed on unrequested leave of absence by a member 
district, according to section 125.12, subdivision 6a or 6b, or 
is terminated according to section 125.17, subdivision 11, as a 
result of implementing the education district, in the same year 
the position is filled. 
     (c) If no currently employed teacher or available teacher 
accepts the position, the board may fill the position with any 
other teacher.  
     (d) Any teacher who has been placed on unrequested leave of 
absence or who has been terminated has a right to a position 
only as long as the teacher has a right to reinstatement in a 
member district under section 125.12, subdivision 6a or 6b, or 
125.17, subdivision 11.  
    Sec. 33.  Minnesota Statutes 1988, section 123.58, 
subdivision 4, is amended to read: 
    Subd. 4.  [MEMBERSHIP AND PARTICIPATION.] Full membership 
in an ECSU shall be limited to public school districts of the 
state but nonvoting associate memberships shall be available to 
nonpublic school administrative units within the ECSU.  
Participation in programs and services provided by the ECSU 
shall be discretionary and.  No school district shall be 
compelled to participate in these services under authority of 
this section, except that.  However, all school districts whose 
central administrative offices are within that ECSU whose 
boundaries coincide with those of development region 11 shall 
participate in the planning and planning research functions of 
that ECSU.  All of the members of an education district shall 
belong to the same ECSU, if any members belong to an ECSU. No 
planning or planning research decision of that ECSU shall be 
binding on these region 11 districts.  Nonpublic school students 
and personnel are encouraged to participate in programs and 
services to the extent allowed by law. 
    Sec. 34.  Minnesota Statutes 1988, section 124.155, 
subdivision 1, is amended to read: 
    Subdivision 1.  [AMOUNT OF ADJUSTMENT.] In fiscal year 1984 
and Each year thereafter, state aids and credits enumerated in 
subdivision 2 payable to any school district, education 
district, or secondary vocational cooperative for that fiscal 
year shall be adjusted, in the order listed, by an amount equal 
to (1) the amount the district, education district, or secondary 
vocational cooperative recognized as revenue for the prior 
fiscal year pursuant to section 121.904, subdivision 4a, clause 
(b), plus revenue recognized according to section 2, minus (2) 
the amount the district recognizes as revenue for the current 
fiscal year pursuant to section 121.904, subdivision 4a, clause 
(b), plus revenue recognized according to section 2.  For the 
purposes of making the aid adjustment under this subdivision, 
the amount the district recognizes as revenue for either the 
prior fiscal year or the current fiscal year pursuant to section 
121.904, subdivision 4a, clause (b), plus revenue recognized 
according to section 2, shall not include any amount levied 
pursuant to section 124A.03, subdivision 2.  Payment from the 
permanent school fund shall not be adjusted pursuant to this 
section.  The school district shall be notified of the amount of 
the adjustment made to each payment pursuant to this section.  
    Sec. 35.  Minnesota Statutes 1988, section 124.155, 
subdivision 2, is amended to read: 
    Subd. 2.  [ADJUSTMENT TO AIDS.] The amount specified in 
subdivision 1 shall be used to adjust the following state aids 
and credits in the order listed: 
    (a) general education aid authorized in section 124A.23; 
    (b) secondary vocational aid authorized in section 124.573; 
    (c) special education aid authorized in section 124.32; 
    (d) secondary vocational aid for handicapped children 
authorized in section 124.574; 
    (e) aid for pupils of limited English proficiency 
authorized in section 124.273; 
    (f) transportation aid authorized in section 124.225; 
    (g) community education programs aid authorized in section 
124.271; 
    (h) adult education aid authorized in section 124.26; 
    (i) early childhood family education aid authorized in 
section 124.2711; 
    (j) capital expenditure aid authorized in sections 124.244 
and 124.245; 
    (k) education district aid according to section 124.2721; 
    (l) secondary vocational cooperative aid according to 
section 124.575; 
    (m) homestead credit under section 273.13 for taxes payable 
in 1989 and under section 273.1398 for taxes payable in 1990 and 
thereafter; 
    (l) (n) agricultural credit under section 273.132 for taxes 
payable in 1989 and under section 273.1398 for taxes payable in 
1990 and thereafter; and 
    (m) (o) transition aid and disparity reduction aid 
authorized in section 273.1398; 
    (n) (p) attached machinery aid authorized in section 
273.138, subdivision 3.  
    The commissioner of education shall schedule the timing of 
the adjustments to state aids and credits specified in 
subdivision 1, as close to the end of the fiscal year as 
possible. 
    Sec. 36.  Minnesota Statutes 1988, section 124.2721, is 
amended to read: 
    124.2721 [EDUCATION DISTRICT REVENUE.] 
    Subdivision 1.  [ELIGIBILITY.] An education district is 
eligible for education district revenue if the department 
certifies that it meets the requirements of section 122.91, 
subdivisions 3 and 4, and section 30.  The pupil units of 
a school district that is a member of intermediate district No. 
287, 916, or 917 may not be used to obtain revenue under this 
section.  The pupil units of a school district may not be used 
to obtain revenue under this section and section 124.575. 
    Subd. 2.  [REVENUE.] Education district revenue is $60 per 
actual pupil unit in each district that is a member of an 
education district.  Each year the education district board 
shall certify to the department of education the amount of 
revenue to be raised.  Revenue for the education district shall 
be the lesser of:  
    (1) $60 times the actual pupil units in the education 
district, or 
    (2) the amount certified by the education district board.  
    Subd. 3.  [LEVY.] To obtain education district revenue, an 
eligible education district may levy the lesser of its education 
district revenue or the amount raised by 1.3 mills times the 
adjusted gross tax capacity of each participating district for 
the preceding year.  Each year, the education district board 
shall certify to the county auditor or county auditors the 
amount of taxes to be levied under this section.  The education 
district levy is equal to the following:  
    (1) the education district revenue according to subdivision 
2, times 
    (2) the lesser of 
    (a) one, or 
    (b) the ratio of the adjusted gross tax capacity for taxes 
payable in 1990 and adjusted net tax capacity for taxes payable 
in 1991 and thereafter of the education district divided by the 
number of actual pupil units in the education district to an 
amount equal to $60 divided by 1.5 percent for taxes payable in 
1990 and 1.87 percent for taxes payable in 1991 and thereafter.  
    The department of education shall allocate the levy amount 
proportionately among the member districts based on adjusted tax 
capacity.  The member districts shall levy the amount allocated. 
    Subd. 3a.  [REVENUE TRANSFER.] Each year a member district 
shall transfer revenue to the education district board according 
to this subdivision.  By June 20 and November 30 of each year, 
an amount shall be transferred equal to:  
    (1) 50 percent times 
    (2) the amount certified in subdivision 3 minus transition 
aid allocated for that levy according to section 273.1398, 
subdivision 6.  
    Subd. 4.  [AID.] The aid for an education district equals 
its education district revenue minus its education district 
levy, times the ratio of the actual amount levied to the 
permitted levy.  
    Subd. 5.  [USES OF REVENUE.] Education district revenue is 
under the control of the education district board.  Education 
district revenue must be used by the education district board to 
provide educational programs according to the agreement adopted 
by the education district board, as required by section 122.94.  
    The education district board may pay to member school 
districts a part of the education district revenue received by 
the education district under this section only for programs that 
are (1) available to all member districts, and (2) included in 
the five-year plan under section 30. 
    Subd. 6.  [CONSOLIDATION.] If all member districts of an 
education district receiving revenue under this section or a 
group of member districts of an education district receiving 
revenue under this section that would qualify as an education 
district under section 122.91, subdivision 3, consolidate into a 
single independent school district by proceedings taken in 
accordance with section 122.23, that consolidated district may 
continue to receive education district revenue according to this 
section. 
    Sec. 37.  [124.2725] [COOPERATION AND COMBINATION REVENUE.] 
    Subdivision 1.  [ELIGIBILITY.] A school district is 
eligible for cooperation and combination revenue if it has a 
plan approved by the state board of education according to 
section 7.  
    Subd. 2.  [COOPERATION AND COMBINATION REVENUE.] 
Cooperation and combination revenue equals, for each resident 
and nonresident pupil receiving instruction in a cooperating or 
combined district, $100 times the actual pupil units.  A 
district may not receive revenue under this section if it levies 
under section 275.125, subdivision 8e.  
    Subd. 3.  [COOPERATION AND COMBINATION LEVY.] To obtain 
cooperation and combination revenue, a district may levy an 
amount equal to the cooperation and combination revenue 
multiplied by the lesser of one or the following ratio: 
    (1) the quotient derived by dividing the adjusted gross tax 
capacity for the district in the year preceding the year the 
levy is certified by the actual pupil units in the district for 
the year to which the levy is attributable, to 
    (2) the percentage, specified in subdivision 4, of the 
equalizing factor for the school year to which the levy is 
attributable. 
    Subd. 4.  [INCREASING LEVY.] The percentage in subdivision 
3, clause (2), shall be: 
    (1) 100 percent for the first year of cooperation; 
    (2) 75 percent for the second year of cooperation; 
    (3) 50 percent for the first year of combination; and 
    (4) 25 percent for the second year of combination. 
    Subd. 5.  [COOPERATION AND COMBINATION AID.] For the first 
two years of cooperation and the first two years of combination, 
cooperation and combination aid is equal to the difference 
between the cooperation and combination revenue and cooperation 
and combination levy.  Aid shall not be paid after two years of 
combining.  
    Subd. 6.  [ADDITIONAL AID.] In addition to the aid in 
subdivision 5, districts shall receive aid under this 
subdivision.  For the first year of cooperation, a district 
shall receive, for each resident and nonresident pupil receiving 
instruction in a cooperating district, $100 times the actual 
pupil units.  For the first year of combination, the combined 
district shall receive, for each resident and nonresident pupil 
receiving instruction in the combined district, $100 times the 
actual pupil units.  
    Subd. 7.  [PROPORTIONAL AID.] If a district does not levy 
the entire amount permitted under subdivision 3, the aid in 
subdivisions 5 and 6 must be reduced in proportion to the actual 
amount levied.  
    Subd. 8.  [PERMANENT REVENUE.] For the third year of 
combination and thereafter, a combined district may levy an 
amount equal to the cooperation and combination revenue, defined 
in subdivision 2. 
     Subd. 9.  [SUBSEQUENT DISTRICTS.] If a district 
subsequently cooperates or combines with districts that have 
previously received revenue under this section, the new district 
shall receive revenue, according to subdivision 4 or 6, as 
though it had been a party to the initial agreement.  The 
previously cooperating or combined districts may not receive 
revenue, according to subdivision 6 or 10, as though parties to 
a new agreement. 
    Subd. 10.  [REVENUE LIMIT.] Revenue under this section 
shall not exceed the revenue received by cooperating districts 
or a combined district with 2,000 actual pupil units.  
    Subd. 11.  [USE OF REVENUE.] Revenue under this section 
shall be used for expenses of cooperating and combining school 
districts, including, but not limited to: 
    (1) secondary course offerings in communications, 
mathematics, science, social studies, foreign languages, 
physical education, health, and career education if the courses 
have specific learner outcomes; 
    (2) participation by teachers in determining the learner 
outcomes; 
    (3) staff in-service related to cooperation and 
combination; 
    (4) any of the purposes set forth in section 124.243, 
subdivision 6, clauses (3), (4), and (15), and section 124.244, 
subdivision 4, clauses (2), (3), (4), (5), and (6), if the 
purposes are related to courses offered cooperatively; and 
    (5) incentives for superintendents, principals, teachers, 
and other licensed and nonlicensed employees, such as early 
retirement, severance pay, and health insurance benefits. 
    Subd. 12.  [JOINT PURPOSES.] Cooperating district revenue 
may only be used for purposes of joint efforts between 
cooperating districts.  The revenue shall be in a separate 
account.  School boards shall mutually determine cooperative 
expenditures. 
    Subd. 13.  [REVENUE FOR EXTENDED COOPERATION.] If the state 
board disapproves of the plan according to section 7, 
subdivision 1, or if a second referendum fails under section 7, 
subdivision 2, cooperation and combination revenue shall equal 
$60 times the actual pupil units.  Cooperation and combination 
aid must be reduced by an amount equal to the aid paid under 
subdivision 6 plus the difference between the aid paid under 
subdivision 5 for the first two years of the agreement and the 
aid that would have been paid if the revenue had been $60 times 
the actual pupil units.  If the aid is insufficient to recover 
the entire amount, the department of education shall reduce 
other aids due the district to recover the entire amount.  The 
cooperation and combination levy shall be reduced by an amount 
equal to the difference between the levy for the first two years 
of the agreement and the levy that would have been authorized if 
the revenue had been $60 times the actual pupil units.  A 
district that receives revenue under this subdivision may not 
also receive revenue according to sections 124.2721 and 124.575. 
    Subd. 14.  [CESSATION OF REVENUE.] At any time the 
districts cease cooperating, aid shall not be paid and the 
authority to levy ceases. 
    Subd. 15.  [RETIREMENT AND SEVERANCE LEVY.] A cooperating 
or combined district may levy for severance pay or early 
retirement incentives for licensed and nonlicensed employees who 
retire early as a result of the cooperation or combination. 
    Sec. 38.  Minnesota Statutes 1988, section 124.494, 
subdivision 2, is amended to read: 
     Subd. 2.  [REVIEW BY COMMISSIONER.] (a) Any group of 
districts that submits an application for a grant shall submit a 
proposal to the commissioner for review and comment under 
section 121.15, and the commissioner shall prepare a review and 
comment on the proposed facility, regardless of the amount of 
the capital expenditure required to acquire, construct, remodel 
or improve the secondary facility.  The commissioner must not 
approve an application for an incentive grant for any secondary 
facility unless the facility receives a favorable review and 
comment under section 121.15 and the following criteria are met: 
     (1) a minimum of three or more districts, with kindergarten 
to grade 12 enrollments in each district of no more than 1,000 
pupils, enter into a joint powers agreement; 
     (2) a joint powers board representing all participating 
districts is established under section 471.59 to govern the 
cooperative secondary facility; 
     (3) the planned secondary facility will result in the joint 
powers district meeting the requirements of Minnesota Rules, 
parts 3500.2010 and 3500.2110; 
     (4) at least 240 pupils would be served in grades 10 to 12, 
320 pupils would be served in grades 9 to 12, or 480 pupils 
would be served in grades 7 to 12; 
     (5) no more than one superintendent is employed by the 
joint powers board as a result of the cooperative secondary 
facility agreement; 
    (6) a statement of need is submitted, that may include 
reasons why the current secondary facilities are inadequate, 
unsafe or inaccessible to the handicapped; 
    (7) an educational plan is prepared, that includes input 
from both community and professional staff; 
    (8) a combined seniority list for all participating 
districts is developed by the joint powers board; 
    (9) an education program is developed that provides for 
more learning opportunities and course offerings for students 
than is currently available in any single member district; and 
    (10) a plan is developed for providing instruction of any 
resident students in other districts when distance to the 
secondary education facility makes attendance at the facility 
unreasonably difficult or impractical.  
    (b) To the extent possible, the joint powers board is 
encouraged to provide for severance pay or for early retirement 
incentives under section 125.611, for any teacher or 
administrator, as defined under section 125.12, subdivision 1, 
who is placed on unrequested leave as a result of the 
cooperative secondary facility agreement. 
    (c) For the purpose of paragraph (a), clause (8), each 
school district must be considered to have started school each 
year on the same date. 
    Sec. 39.  [124.4946] [TRANSPORTATION.] 
    The joint powers board representing the districts that have 
entered into a joint powers agreement under section 124.494, 
subdivision 2, or the boards of the districts that are 
contiguous to the districts that have entered into a joint 
powers agreement, may transport nonresident pupils without 
charge between a school within the district and a point within a 
district that has entered into a joint powers agreement chosen 
by the pupil on a route traveled by a bus from the district. 
    Sec. 40.  Minnesota Statutes 1988, section 124.575, 
subdivision 2, is amended to read: 
    Subd. 2.  [REVENUE.] Secondary vocational cooperative 
revenue is $20 per actual pupil unit in the participating school 
districts of a secondary vocational cooperative.  Each year the 
secondary vocational cooperative board shall certify to the 
department of education the amount of revenue to be raised.  
Revenue for the secondary vocational cooperative shall be the 
lesser of: 
    (1) $20 times the actual pupil units in the secondary 
vocational cooperative, or 
    (2) the amount certified by the secondary vocational 
cooperative board. 
    Sec. 41.  Minnesota Statutes 1988, section 124.575, 
subdivision 3, is amended to read: 
    Subd. 3.  [LEVY.] To obtain secondary vocational 
cooperative revenue, an eligible secondary vocational 
cooperative may levy the lesser of its secondary vocational 
cooperative revenue or the amount raised by .4 mills times the 
adjusted gross tax capacity of each member district for the 
preceding year.  Each year, the secondary vocational cooperative 
board must certify the amount of taxes to be levied under this 
section to the county auditor or county auditors.  The secondary 
vocational cooperative levy is equal to the following:  
    (1) the secondary vocational cooperative revenue according 
to subdivision 2, times 
    (2) the lesser of 
    (a) one, or 
    (b) the ratio of the adjusted gross tax capacity for taxes 
payable in 1990 and adjusted net tax capacity for taxes payable 
in 1991 and thereafter of the secondary vocational cooperative 
divided by the number of actual pupil units in the secondary 
vocational cooperative to an amount equal to $20 divided by .6 
percent for taxes payable in 1990 and .74 percent for taxes 
payable in 1991 and thereafter. 
    The department of education shall allocate the levy amount 
proportionately among the member districts based on adjusted tax 
capacity.  The member districts shall levy the amount allocated. 
    Sec. 42.  Minnesota Statutes 1988, section 124.575, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [REVENUE TRANSFER.] Each year a member district 
shall transfer revenue to the secondary vocational cooperative 
according to this subdivision.  By June 20 and November 30 of 
each year, an amount shall be transferred equal to:  
    (1) 50 percent times 
    (2) the amount certified in subdivision 3 minus transition 
aid allocated for that levy according to section 273.1398, 
subdivision 6.  
    Sec. 43.  [129B.12] [GRANTS FOR COOPERATION AND 
COMBINATION.] 
    Subdivision 1.  [ELIGIBILITY.] Two or more districts that 
have adopted a plan according to section 6 may apply for a grant 
under this section.  The grant shall be awarded after the 
districts combine according to sections 5 to 12.  
    Subd. 2.  [PROCEDURES.] The state board shall establish 
procedures and deadlines for the grants.  The state board shall 
review each application for a grant and may require 
modifications consistent with sections 5 to 12.  
    Subd. 3.  [GRANT AMOUNT.] The state board shall determine 
the amount of a grant according to the needs of the districts to 
effectuate combination.  A grant may not exceed $250,000. 
    Subd. 4.  [USE OF GRANT MONEY.] The grant money may be used 
for any purpose related to combining school districts, 
including, but not limited to: 
    (1) secondary course offerings in communications, 
mathematics, science, social studies, foreign languages, 
physical education, health, and career education if the courses 
have specific learner outcomes; 
    (2) staff development related to cooperation; and 
    (3) any of the purposes set forth in section 124.243, 
subdivision 6, clauses (3), (4), and (15), and section 124.244, 
subdivision 4, clauses (2), (3), (4), (5), and (6), in all cases 
only if related to courses offered cooperatively. 
    Sec. 44.  Minnesota Statutes 1988, section 136D.27, 
subdivision 1, is amended to read: 
    Subdivision 1.  [LEVIES FOR CERTAIN PROGRAMS.] Each year 
the joint school board may certify to each participating school 
district tax levies that shall not in any year exceed .6 mills 
on each dollar of adjusted gross tax capacity for special 
education and .7 mills on each dollar of adjusted gross tax 
capacity for expenses for secondary vocational education. the 
greater of:  
     (a) the amount of levy certified for taxes payable in 1989; 
or 
     (b) the lesser of (1) $60 times the actual pupil units in 
the participating district for the fiscal year to which the levy 
is attributable, or (2) 1.1 percent of adjusted gross tax 
capacity.  Each participating school district shall include 
these tax levies in the next tax roll which it shall certify to 
the county auditor or auditors, and shall remit the collections 
of such levies to the board promptly when received.  These 
levies shall not be included in computing the limitations upon 
the levy of any participating district.  The board may, any time 
after these levies have been certified to the participating 
school districts, issue and sell certificates of indebtedness in 
anticipation of the collection of such levies, but in aggregate 
amounts such as will not exceed the portion of the levies which 
is then not collected and not delinquent. 
    Five-elevenths of the proceeds of the levy must be used for 
special education and six-elevenths of the proceeds of the levy 
must be used for secondary vocational education. 
    Sec. 45.  Minnesota Statutes 1988, section 136D.74, 
subdivision 2, is amended to read: 
    Subd. 2.  [TAX LEVY.] Each year the intermediate school 
board may certify to each county auditor of each county in which 
said intermediate school district shall lie, as a single taxing 
district, tax levies that shall not in any year exceed .6 mills 
on each dollar of adjusted gross tax capacity for expenses for 
special education and .7 mills on each dollar of adjusted gross 
tax capacity for expenses for secondary vocational education. 
the greater of:  
    (a) the amount of levy certified for taxes payable in 1989; 
or 
    (b) the lesser of (1) $60 times the actual pupil units in 
the participating district for the fiscal year to which the levy 
is attributable, or (2) 1.1 percent of adjusted gross tax 
capacity.  Said annual tax levies shall be certified pursuant to 
section 275.07.  Upon such certification the county auditor or 
auditors and other appropriate county officials shall levy and 
collect such levies and remit the proceeds of collection thereof 
to the intermediate school district as in the case with 
independent school districts.  Such levies shall not be included 
in computing the limitations upon the levy of any of the 
participating districts. 
    Five-elevenths of the proceeds of the levy must be used for 
special education and six-elevenths of the proceeds of the levy 
must be used for secondary vocational education. 
    Sec. 46.  Minnesota Statutes 1988, section 136D.87, 
subdivision 1, is amended to read: 
    Subdivision 1.  [LEVIES FOR CERTAIN PROGRAMS.] Each year 
the joint school board may certify to each participating school 
district tax levies that shall not in any year exceed .6 mills 
on each dollar of adjusted gross tax capacity for expenses for 
special education and .7 mills on each dollar of adjusted gross 
tax capacity for expenses for secondary vocational education. 
the greater of: 
    (a) the amount of levy certified for taxes payable in 1989; 
or 
    (b) the lesser of (1) $60 times the actual pupil units in 
the participating district for the fiscal year to which the levy 
is attributable, or (2) 1.1 percent of adjusted gross tax 
capacity.  Each participating school district shall include 
these tax levies in the next tax roll which it shall certify to 
the county auditor or auditors and shall remit the collections 
of these levies to the board promptly when received.  These 
levies shall not be included in computing the limitations upon 
the levy of any participating district.  The board may, any time 
after these levies have been certified to the participating 
school districts, issue and sell certificates of indebtedness in 
anticipation of the collection of levies, but in aggregate 
amounts that will not exceed the portion of the levies which is 
then not collected and not delinquent. 
    Five-elevenths of the proceeds of the levy must be used for 
special education and six-elevenths of the proceeds of the levy 
must be used for secondary vocational education. 
    Sec. 47.  Minnesota Statutes 1988, section 273.1398, 
subdivision 6, is amended to read: 
    Subd. 6.  [PAYMENT.] The commissioner shall certify the 
aids provided in subdivisions 2 and 3 before September 30 of the 
year preceding the distribution year to the county auditor of 
the affected local government and pay them and the credit 
reimbursements to local governments other than school districts 
at the times provided in section 477A.015 for payment of local 
government aid to taxing jurisdictions.  Aids and credit 
reimbursements to school districts must be certified to the 
commissioner of education and paid under section 273.1392.  
Except for education districts and secondary cooperatives that 
receive revenue according to section 124.2721 or 124.575, 
payment shall not be made to any taxing jurisdiction that has 
ceased to levy a property tax nor shall transition aid be 
payable on the part of a levy to which transition aid was 
separately allocated under subdivision 2, paragraph (b), clause 
(2), which is no longer levied. 
    Sec. 48.  Minnesota Statutes 1988, section 275.125, 
subdivision 8e, is amended to read: 
    Subd. 8e.  [INTERDISTRICT COOPERATION LEVY.] (a) This 
subdivision does not apply to special school district No. 1, 
independent school district No. 11, 625, or 709, or to a 
district that is a member of intermediate school district No. 
287, 916, or 917.  
     (b) A district may levy each year under this subdivision if 
it:  
    (1) is a member of an education district, under sections 
122.91 to 122.96, and the education district of which the 
district is a member does not receive revenue under section 
124.2721; or 
    (2) has a written cooperation agreement with other 
districts to expand curricular offerings in mathematics in 
grades 10 to 12, science in grades 10 to 12, foreign languages 
for two years, computer usage, or other programs recommended by 
the state board. 
    (c) The levy must not exceed the amount raised by one mill 
times the adjusted gross tax capacity of the district for the 
preceding year $50 times the actual pupil units, the cost of the 
agreement to expand curricular offerings, or $50,000, whichever 
is the smallest.  
     (d) A district that is a member of a secondary vocational 
cooperative that levies under section 124.575, may levy the 
difference between (1) the smallest amount raised by one mill 
times the adjusted gross tax capacity of the district for the 
preceding year and under paragraph (c), and (2) the amount 
levied under section 124.575.  
    (e) The proceeds of the levy may be used only to pay for 
instructional and administrative costs incurred in providing the 
curricular offerings under this section.  A district may not 
spend more than five percent of the amount of the levy for 
administration. 
     Sec. 49.  Minnesota Statutes 1988, section 275.125, is 
amended by adding a subdivision to read:  
    Subd. 11e.  [EXTRA CAPITAL EXPENDITURE LEVY FOR COOPERATING 
DISTRICTS.] A district that has an agreement according to 
section 122.535 or 122.541 may levy for the repair costs, as 
approved by the department of education, of a building located 
in another district that is a party to the agreement. 
     Sec. 50.  [1988-1989 INTERDISTRICT COOPERATION AGREEMENTS.] 
    Notwithstanding section 18, independent school district Nos.
424, Lester Prairie; 427, Winsted; and 880, Howard Lake, may 
renew or continue an agreement according to Minnesota Statutes 
1988, section 122.541, providing for instruction of pupils in 
10th, 11th, and 12th grades in two districts. 
    Sec. 51.  [BOARD OF CONSOLIDATED DISTRICT.] 
    Subdivision 1.  [SCHOOL BOARD COMPOSITION.] Notwithstanding 
any other law to the contrary, independent school districts Nos. 
232, Peterson, and 234, Rushford, may elect a seven-member 
school board in the first election after consolidation in the 
following manner: 
    (1) two members elected from the Peterson school district, 
one member for a one-year term and one member for a two-year 
term; 
    (2) two members elected from the Rushford school district, 
one member for a one-year term and one member for a two-year 
term; and 
    (3) three members elected at large, each for a three-year 
term. 
    Subsequent elections must comply with the general 
provisions of law governing the election of school board members.
    Subd. 2.  [LOCAL APPROVAL.] Subdivision 1 is effective upon 
approval of the board of independent school district No. 232 and 
the board of independent school district No. 234 the day 
following compliance with Minnesota Statutes, section 645.021, 
subdivision 3, by the board of independent school district No. 
232 and the board of independent school district No. 234. 
    Sec. 52.  [TECHNOLOGY REPORT.] 
    Subdivision 1.  Between July 1, 1989 and February 15, 1990, 
each school district, education district, intermediate district, 
ECSU, and school district that is party to a cooperative 
agreement must submit a report to the information policy office 
in the department of administration for review and comment 
before purchasing, contracting for, or otherwise committing to 
new two-way interactive television equipment, or to a system or 
service agreement other than a maintenance agreement, that 
expands the capacity of two-way interactive television. 
    Subd. 2.  Between July 1, 1989 and February 15, 1990, a 
school district must file a report as specified in subdivision 1 
of this section before receiving grant funds received under 
section 53, subdivisions 5, 6, and 7.  
    Sec. 53.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated. 
    Subd. 2.  [EDUCATION DISTRICT AID.] For education district 
aid: 
     $4,653,000     .....     1990
     $3,967,000     .....     1991
    The 1990 appropriation includes $0 for 1989 and $4,652,000 
for 1990. 
    The 1991 appropriation includes $822,000 for 1990 and 
$3,145,000 for 1991. 
    Subd. 3.  [COOPERATION AND COMBINATION AID.] For aid for 
districts that cooperate and combine there is appropriated: 
    $75,000 ..... 1991. 
    Subd. 4.  [SECONDARY VOCATIONAL COOPERATIVE AID.] For 
secondary vocational cooperative aid: 
     $495,000     .....     1990
     $224,000     .....     1991
    The 1990 appropriation includes $0 for 1989 and $495,000 
for 1990. 
    The 1991 appropriation includes $88,000 for 1990 and 
$136,000 for 1991. 
    Subd. 5.  [TELECOMMUNICATIONS GRANT.] For a grant to the 
Wasioja cooperative, involving independent school district Nos. 
201, Claremont; 202, Dodge Center; 205, West Concord; 253, 
Goodhue; 254, Kenyon; 255, Pine Island; 258, Wanamingo; and 260, 
Zumbrota, to support the cooperative educational technology 
program:  
    $150,000 ..... 1990. 
    Subd. 6.  [TELECOMMUNICATIONS GRANT.] For a grant to 
independent school districts Nos. 356, 353, 444, 441, 524, 564, 
592, 440, 678, 676, 682, 690, 390, 593, 595, 630, and 600 to 
support a cooperative educational technology program: 
    $340,000 ..... 1990. 
    Subd. 7.  [COMMUNICATIONS LINK GRANT.] For a grant to 
independent school district No. 240, Blue Earth, to pay for the 
cost of a communications link between the Blue Earth school 
district and Mankato:  
    $4,500 ..... 1990.  
    The appropriation does not cancel but is available until 
June 30, 1991. 
    Sec. 54.  [TIME OF EFFECT.] 
    The changes in the composition of an education district 
board required by section 122.92 must be made as soon as 
possible after the effective date of section 122.92 as vacancies 
occur or terms of members expire.  
    Sec. 55.  [REPEALERS.] 
    Minnesota Statutes 1988, sections 122.96 and 129B.11, are 
repealed. 
    Sec. 56.  [EFFECTIVE DATE.] 
    Section 37 is effective for revenue for fiscal year 1991 
and thereafter. 

                               ARTICLE 7

                          ACCESS TO EXCELLENCE
    Section 1.  Minnesota Statutes 1988, section 120.06, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [EDUCATION OF HOMELESS.] Notwithstanding 
subdivision 1, a school district must not deny free admission to 
a homeless person of school age solely because the school 
district cannot determine that the person is a resident of the 
school district. 
    Sec. 2.  Minnesota Statutes 1988, section 121.11, 
subdivision 7, is amended to read: 
    Subd. 7.  [GENERAL SUPERVISION OVER EDUCATIONAL AGENCIES.] 
The state board of education shall adopt goals for and exercise 
general supervision over public schools and public educational 
agencies in the state, classify and standardize public 
elementary and secondary schools, and prepare for them outlines 
and suggestive suggested courses of study.  The board shall 
develop a plan to attain the adopted goals.  At the board's 
request, the commissioner may assign department of education 
staff to assist the board in attaining its goals.  The 
commissioner shall explain to the board in writing any reason 
for refusing or delaying a request for staff assistance.  The 
board shall establish rules relating to examinations, reports, 
acceptances of schools, courses of study, and other proceedings 
in connection with elementary and secondary schools applying for 
special state aid.  The state board may recognize educational 
accrediting agencies for the sole purposes of sections 120.101, 
120.102, and 120.103. 
    Sec. 3.  [121.111] [OFFICE OF EDUCATIONAL LEADERSHIP.] 
    Subdivision 1.  [ESTABLISHMENT.] The office of educational 
leadership is established within the department of education.  
The purpose of the office is to assist school districts, 
education districts, and other education organizations in 
developing education policies that maximize the learning of all 
pupils. 
    Subd. 2.  [OFFICE STRUCTURE.] The assistant commissioner of 
instructional effectiveness, in consultation with the assistant 
commissioner of development and partnership effectiveness, shall 
administer the office of educational leadership.  A director in 
the unclassified service appointed by the assistant commissioner 
of instructional effectiveness shall manage the office. 
    Subd. 3.  [RESEARCH PROJECT ON LEARNER OUTCOMES.] The 
office shall develop a plan for a two-year research project to 
determine the effectiveness of a learner outcome-based system of 
education in improving pupils' learning.  The plan shall include:
    (1) specific educational goals to be attained; 
    (2) various options for achieving the goals; 
     (3) the development of a hierarchy of learner outcomes 
composed of state learner goals, integrated learner outcomes and 
program learner outcomes, and course, unit, and lesson learner 
outcomes; 
    (4) mechanisms for communicating the progress and the 
results of the research; 
    (5) an objective process for evaluating the progress and 
results of the research that is performed by an independent 
evaluator; 
    (6) alternatives for evaluating pupils' progress at the 
classroom level; and 
    (7) methods of assessing pupils' thinking and 
problem-solving skills. 
    Subd. 4.  [RESEARCH ADVISORY COMMITTEE.] The state board of 
education shall appoint an advisory committee of seven members 
to assist the office in developing its two year plan. Committee 
members shall solicit and obtain information and ideas from 
school districts, education districts, and other education 
organizations. Committee members, or their designees, shall 
include the chairs of the task force on education organization, 
the state curriculum advisory committee, the state board of 
education, the Minnesota association of colleges of teacher 
education, the education effectiveness council, the council on 
vocational technical education, and the minority education 
partnership. 
    Sec. 4.  [124.276] [CAREER TEACHER AID.] 
    Subdivision 1.  [ELIGIBILITY.] A school district that has a 
career teacher program, according to sections 129B.41 to 
129B.46, for one or more of its teachers is eligible for aid to 
extend the teaching contract of a career teacher.  
    Subd. 2.  [STATE SHARE OF EXTENDED CONTRACT.] The state 
shall pay two-thirds of the portion of the teaching contract, 
excluding fringe benefits, that is in addition to the standard 
teaching contract of the district.  The district shall pay the 
remaining portion.  
    Subd. 3.  [STATE BOARD APPROVAL.] The state board may 
approve plans and applications for districts throughout the 
state for career teacher aid.  Application procedures and 
deadlines shall be established by the state board.  
    Subd. 4.  [USE OF AID.] Career teacher aid may be used only 
to implement a career teacher program.  
    Sec. 5.  Minnesota Statutes 1988, section 124A.036, is 
amended by adding a subdivision to read: 
    Subd. 1a.  [REPORTING; REVENUE FOR HOMELESS.] For all 
school purposes, unless otherwise specifically provided by law, 
a homeless pupil must be considered a resident of the school 
district that enrolls the pupil. 
    Sec. 6.  Minnesota Statutes 1988, section 124A.29, is 
amended to read: 
    124A.29 [RESERVED REVENUE FOR STAFF DEVELOPMENT.] 
    Subdivision 1.  [GENERAL STAFF DEVELOPMENT PROGRAMS.] Of a 
district's basic revenue under section 124A.22, subdivision 2, 
an amount equal to $10 times the number of actual pupil units 
shall be reserved and may be used only to provide staff 
development programs, according to section 126.70, subdivisions 
1 and 2a.  The school board shall determine which programs to 
provide, the manner in which they will be provided, and the 
extent to which other money may be used for the programs. 
    Subd. 2.  [CAREER TEACHER STAFF DEVELOPMENT.] Of a 
district's basic revenue under section 124A.22, subdivision 2, 
an amount equal to $5 times the number of actual pupil units 
shall be reserved by a district operating a career teacher 
program according to sections 129B.42 to 129B.46.  The revenue 
may be used only to provide staff development for the career 
teacher program. 
    Sec. 7.  [124A.291] [RESERVED REVENUE FOR CAREER TEACHER 
PROGRAM.] 
    A district that has a career teacher program may reserve 
part of the basic revenue under section 124A.22, subdivision 2, 
for the district's share, according to section 4, of the portion 
of the teaching contract that is in addition to the standard 
teaching contract of the district. 
    Sec. 8.  Minnesota Statutes 1988, section 126.22, 
subdivision 3, is amended to read: 
    Subd. 3.  [ELIGIBLE PROGRAMS.] (a) A pupil who is eligible 
according to subdivision 2, clause (a), (b), (c), or (d), may 
enroll in any program approved by the state board of education 
under Minnesota Rules, part 3500.3500, including area learning 
centers under sections 129B.52 to 129B.55, or according to 
section 121.11, subdivision 12. 
    (b) A pupil who is eligible according to subdivision 2, 
clause (b), (c), or (d), may enroll in secondary school courses 
upon a resolution passed by a school board approving enrollment, 
or may enroll in post-secondary courses under section 123.3514. 
    (c) A pupil who is eligible under subdivision 2, clause 
(a), (b), (c), or (d), may enroll in any public secondary 
education program. 
    (d) A pupil who is eligible under subdivision 2, clause 
(a), (b), or (c), may enroll in any nonprofit, nonpublic, 
nonsectarian school that has contracted with the school district 
of residence to provide educational services.  
    (e) An eligible institution providing eligible programs as 
defined in this subdivision may contract with an entity 
providing adult basic education programs under the community 
education program contained in section 121.88 for actual program 
costs. 
    Sec. 9.  Minnesota Statutes 1988, section 126.22, is 
amended by adding a subdivision to read: 
    Subd. 8.  [ENROLLMENT VERIFICATION.] For eligible programs 
under subdivision 3, paragraph (d), the department of education 
shall pay 85 percent of the basic revenue of the district to the 
eligible program and 15 percent of the basic revenue to the 
resident district within 30 days after enrollment verification.  
The department of education shall provide a form for the 
eligible program to use for enrollment verification. 
    Sec. 10.  Minnesota Statutes 1988, section 126.23, is 
amended to read: 
    126.23 [AID FOR PRIVATE ALTERNATIVE PROGRAMS.] 
    If a pupil enrolls in a nonsectarian alternative program 
operated by a private organization that has contracted with a 
school district to provide educational services for high school 
dropouts or other eligible students under section 126.22, 
subdivision 2, the resident district must reimburse the provider 
an amount equal to at least 50 85 percent of the basic revenue 
of the district for each pupil.  Pupils for whom a district 
provides reimbursement may not be counted by the district for 
any purpose other than computation of basic revenue, according 
to section 124A.22, subdivision 2. 
    Sec. 11.  Minnesota Statutes 1988, section 126.661, is 
amended by adding a subdivision to read: 
    Subd. 3a.  [STATE LEARNER GOALS.] "State learner goals" 
means the knowledge, skills, processes, values, and attitudes 
pupils can expect to attain. 
    Sec. 12.  Minnesota Statutes 1988, section 126.663, 
subdivision 2, is amended to read: 
    Subd. 2.  [MODEL STATE CORE CURRICULUM LEARNER OUTCOMES.] 
The state board of education, with the assistance of the state 
curriculum advisory committee and the office on educational 
leadership shall identify and adopt a set of learner outcomes 
that it considers to be goals, essential for each subject 
area learner outcomes, and integrated learner outcomes for 
curriculum areas, under section 120.101, subdivision 6, and for 
career vocational curricula.  Learner outcomes shall include 
thinking and problem solving skills.  The department of 
education, in cooperation with the state curriculum advisory 
committee, shall develop a validated research-based process to 
identify a set of learner outcomes that are essential for each 
subject area. 
    Sec. 13.  Minnesota Statutes 1988, section 126.663, 
subdivision 3, is amended to read: 
    Subd. 3.  [MODEL LEARNER OUTCOMES.] The department shall 
develop and maintain sets of model learner outcomes in state 
board identified subject areas that it considers to be model 
learner outcomes, including career vocational learner outcomes.  
The department shall make the sets learner outcomes 
available for use by a district at the option of the 
districts upon request by a district.  The sets Learner outcomes 
shall be for pupils in kindergarten to grade 12.  The department 
shall consult with each of the public post-secondary systems and 
with the higher education coordinating board in developing model 
learner outcomes appropriate for entry into post-secondary 
institutions.  Learner outcomes shall include thinking and 
problem solving skills. 
    Sec. 14.  Minnesota Statutes 1988, section 126.67, 
subdivision 5, is amended to read: 
    Subd. 5.  [ASSESSMENT ITEM BANK.] The department shall 
maintain an assessment item bank to provide assessment programs 
items that are tailored designed to measure pupils' attainment 
of state essential learner outcomes and specific educational 
objectives learner outcomes of an individual school or 
district.  The department shall develop an item bank for at 
least two curriculum areas each year.  The department shall 
develop and maintain an item bank for at least ten different 
curriculum areas. 
    Sec. 15.  Minnesota Statutes 1988, section 129B.41, is 
amended to read: 
    129B.41 [CITATION.] 
    Sections 129B.41 129B.42 to 129B.47 129B.46 may be cited as 
the "Minnesota improved learning and principal-teacher, 
counselor-teacher, and career teacher act."  
    Sec. 16.  Minnesota Statutes 1988, section 129B.42, is 
amended to read: 
    129B.42 [PURPOSE OF THE CAREER TEACHER ACT.] 
    The legislature recognizes the unique and lifelong learning 
and development process of all human beings.  The legislature is 
committed to the goal of maximizing the individual growth 
potential of all students through the secondary 
schools learners.  The purposes of sections 129B.41 to 
129B.47 the career teacher act are:  
    (a) (1) to offer improved learning career teacher programs 
which emphasize basic and applied learning skills and the 
liberal arts learning and development based on learner outcomes; 
    (b) (2) to recognize and utilize the unique skills that 
teachers, students, family, and the community have in both the 
teaching process and the learning and development process; and 
    (c) (3) to provide an opportunity for maximum use of 
principals and teachers, principals, and counselors.  
    Sec. 17.  Minnesota Statutes 1988, section 129B.44, is 
amended to read: 
    129B.44 [ADVISORY COUNCIL.] 
    The school board of a district providing an improved 
learning a career teacher program shall appoint an advisory 
council.  Council members shall be selected from the school 
attendance area in which programs are provided.  Members of the 
council may include students, teachers, principals, 
administrators and community members.  A majority of the members 
shall be parents with children participating in the local 
program.  The local advisory council shall advise the school 
board in the development, coordination, supervision, and review 
of the improved learning career teacher program.  The council 
shall meet at least two times each year with any established 
community education advisory council in the district.  Members 
of the council may be members of the community education 
advisory council.  The council shall report to the school board. 
    Sec. 18.  Minnesota Statutes 1988, section 129B.45, is 
amended to read: 
    129B.45 [CAREER TEACHER PROGRAM COMPONENTS.] 
    Subdivision 1.  [MANDATORY COMPONENTS.] An improved 
learning A career teacher program shall include:  
    (a) (1) participation by a designated individual as a 
career teacher, principal-teacher, career or counselor teacher, 
or counselor-teacher, as defined in sections 129B.46 and 
129B.47; 
    (b) a plan (2) an emphasis on each individual child's 
unique learning and development needs; 
    (3) procedures to give the career teacher a major 
responsibility for leadership of the instructional and 
noninstructional activities of each child beginning with early 
childhood family education; 
    (4) procedures to involve parents in planning the 
educational learning and development experiences of their 
children; 
    (c) an annual plan for the district to evaluate program 
goals and objectives; 
    (d) a plan (5) procedures to implement outcome based 
education by focusing on the needs of the learner; 
    (6) procedures to coordinate and integrate the 
instructional program with all community education programs; 
    (7) procedures to concentrate career teacher programs at 
sites that provide early childhood family education and 
subsequent learning and development programs; and 
    (8) procedures for the district to fund the program after 
the third year of the program.  
    Subd. 2.  [OPTIONAL COMPONENTS.] An improved learning A 
career teacher program may include:  
    (a) (1) efforts to improve curricula strategies, 
instructional strategies, and use of materials which that 
respond to the individual educational needs and learning styles 
of each pupil in order to enable each pupil to make continuous 
progress and to learn at a rate appropriate to that pupil's 
abilities; 
    (b) (2) efforts to develop student abilities in basic 
skills; applied learning skills; and, when appropriate, arts; 
humanities; physical, natural, and social sciences; 
multicultural education; physical, emotional, and mental health; 
consumer economics; and career education; 
    (c) (3) use of community resources and communications media 
to pursue improved learning and development opportunities for 
pupils; 
    (d) (4) staff development for teachers and other school 
personnel; 
    (e) (5) improvements to the learning and development 
environment, including use of the community in general, to 
enhance the learning and development process; 
    (f) (6) cooperative efforts with other agencies involved 
with human services or child development and development of 
alternative community based learning and development 
experiences; 
    (g) apprenticeship (7) post-secondary education components 
for pupils who are able to accelerate or programs for pupils 
with special abilities and interests who are given advanced 
learning and development opportunities within existing programs; 
    (h) (8) use of volunteers in the learning and development 
program; 
    (i) (9) flexible attendance schedules for pupils; 
    (j) (10) adult education component; 
    (k) (11) coordination with early childhood and family 
education and community education programs; 
    (l) (12) variable student/faculty ratios for special 
education students to provide for special programming; 
    (m) (13) inclusion of nonpublic pupils as part of the ratio 
in the career teacher, principal-teacher, and career counselor 
teacher component; 
    (n) (14) application of educational research findings; 
    (o) (15) summer learning and development experiences for 
students as recommended by the career teacher, principal-teacher 
, and career counselor teacher; 
    (p) (16) use of educational education assistants, teacher 
aides, or paraprofessionals as part of the improved learning 
career teacher program; 
    (q) (17) establishment of alternative criteria for high 
school graduation; and 
    (r) (18) variable age and class learning size groupings of 
students. 
    Sec. 19.  Minnesota Statutes 1988, section 129B.46, is 
amended to read: 
    129B.46 [PRINCIPAL-TEACHER AND CAREER TEACHER COMPONENT.] 
    Subdivision 1.  [STATUS.] An improved learning A career 
teacher program may include a career teacher, principal-teacher 
and career teacher, and counselor teacher component.  The career 
teacher, principal-teacher, and career counselor teacher shall 
not be the exclusive teacher for students assigned to them but 
shall serve as a primary teacher and perform the function of 
developing and implementing a student's overall learning and 
development program.  The career teacher, principal-teacher, and 
career counselor teacher may be responsible for 
regular classroom assignments as well as learning and 
development programs for other assigned students.  
    Subd. 2.  [QUALIFICATIONS.] (a) An individual employed as a 
principal-teacher must be licensed as a principal by the state 
board of education and shall be considered a principal as 
defined in section 179A.03, subdivision 12, for purposes of the 
public employment labor relations act.  
    (b) An individual employed as a career teacher must be 
licensed as a teacher by the state board of teaching and shall 
be considered a teacher as defined in section 179A.03, 
subdivision 18, for purposes of the public employment labor 
relations act chapter 179A.  
    (b) An individual employed as a principal teacher must be 
licensed as a teacher and shall be considered a principal, as 
defined in section 179A.03, subdivision 12, for purposes of 
chapter 179A. 
    (c) An individual employed as a counselor teacher must be 
licensed as a counselor and shall be considered a teacher, as 
defined in section 179A.03, subdivision 18, for purposes of 
chapter 179A.  
    Subd. 3.  [STAFF/STUDENT RATIO.] (a) Except as provided in 
clause (b), one career teacher, principal-teacher, or career 
counselor teacher shall be assigned for every 125 students.  For 
each special education student included in the assignment, the 
1:125 ratio shall be reduced by one.  
    (b) One principal-teacher shall be assigned for every 50 
students when the principal-teacher is also the principal of the 
school.  
    Subd. 4.  [SELECTION; RENEWAL.] (a) The school board shall 
establish procedures for teachers and, principals, and 
counselors to apply for the position of career teacher, 
principal-teacher and career, or counselor teacher.  The 
authority for selection of career teachers, principal-teachers, 
and career counselor teachers shall be vested in the board and 
no individual shall have a right to employment as a career 
teacher, principal-teacher, or career counselor teacher based on 
seniority or order of employment in the district.  
    (b) Employment of the career teacher, principal-teacher, 
and career counselor teacher shall may be on a 12-month basis 
with vacation time negotiated individually with the board.  The 
annual contract of a career teacher, principal-teacher, or 
career counselor teacher may not be renewed, as the board shall 
see fit; provided, however, the board shall give any such 
teacher whose contract as a career teacher, principal-teacher, 
or career counselor teacher it declines to renew for the 
following year written notice to that effect before April 15.  
If the board fails to renew the contract of a career teacher, 
principal-teacher, or career counselor teacher, that individual 
shall be reinstated to another position in the district if 
eligible pursuant to section 125.12 or 125.17.  
    Subd. 5.  [DUTIES.] The career teacher, principal-teacher, 
and career counselor teacher shall be responsible for:  
    (a) (1) the overall education and, learning, and 
development plan of assigned students.  This plan shall be 
designed by the career teacher, principal-teacher, and career 
counselor teacher with the student, parents, and other faculty, 
and shall seek to maximize the learning and development 
potential and maturation level of each pupil; 
    (b) (2) measuring the proficiency of the assigned students 
and assisting other staff in identifying pupil needs and making 
appropriate educational and subject groupings; 
    (c) (3) when part of the district's plan, taking 
responsibility for the parent and early childhood education of 
assigned students; 
    (d) (4) designing and being responsible for program 
components which meet special learning needs of high potential 
and talented students; and 
    (e) (5) coordinating the ongoing, year-to-year learning and 
development program for assigned students; and 
    (6) developing learning and development portfolios.  
    Sec. 20.  [MINORITY TEACHER INCENTIVES.] 
    During the biennium, a school district that has a minority 
enrollment of more than ten percent or that has a desegregation 
plan approved by the state board shall be reimbursed if it 
employs a minority teacher who has not taught in a Minnesota 
school district during the school year before the year the 
teacher is employed according to this section.  The 
reimbursement shall equal one-half of the salary and fringe 
benefits, but not more than $20,000.  The district shall receive 
reimbursement for each year during the biennium that a minority 
teacher is employed.  
    The department of education shall contract with an outside 
agency, school district, or group of districts to assist in 
recruiting minority teachers from outside the state.  
    The department of education shall establish application or 
other procedures for districts to obtain the entire 
reimbursement amount.  The department shall not prorate the 
reimbursement amount. 
    For the purposes of this section, a minority person is an 
African American, American Indian, Asian Pacific American, or an 
American of Mexican, Puerto Rican, or Spanish origin or ancestry.
    Sec. 21.  [RESEARCH AND DEVELOPMENT SITES.] 
    Subdivision 1.  [SITE CHARACTERISTICS.] The state board of 
education shall select up to ten sites, including public schools 
or classrooms, school districts, and education districts, to 
serve as research and development sites to examine and implement 
learner outcome-based education policies. 
    The office of educational leadership shall coordinate the 
learner outcome-based education efforts of each research and 
development site and shall provide technical assistance upon 
request. 
    The educational activities and policies of each site must 
conform with the research plan of the office developed under 
section 121.111, subdivision 3.  The sites must be located in 
different geographical areas of the state, and include school 
populations of various sizes and schools at various stages of 
implementing a learner outcome-based system of education.  The 
sites must establish and maintain an affiliation with a teacher 
preparation institution that incorporates a learner 
outcome-based system of education in training beginning 
teachers.  The sites may have been pilot or demonstration sites 
for other education improvement programs.  Sites may be chosen 
to demonstrate how vocational outcomes can be integrated into a 
comprehensive education curriculum. 
    Subd. 2.  [SELECTION CRITERIA.] The office of educational 
leadership, in consultation with the research advisory 
committee, shall develop criteria the state board shall use to 
award two year grants.  The office shall determine the form and 
manner by which to apply for grants.  The office may consider 
the following in developing selection criteria, including: 
    (1) building upon the PER process for curriculum 
development under sections 126.661 to 126.67; 
    (2) identifying or developing district resources and 
management policies under section 126.666, subdivision 1; 
    (3) developing policies for involving teachers in 
identifying and integrating learner outcomes and establishing 
levels of attainment of learner outcomes by classroom, by school 
and by district; 
    (4) incorporating alternative technology-based learning 
models and administrative practices that promote individualized 
learning; 
    (5) incorporating staffing alternatives, including a career 
teacher program and teacher mentors; 
    (6) developing and using multiple assessment indicators; 
    (7) identifying and incorporating into district or 
site-based education programs the career vocational learner 
outcomes that ensure the articulation of secondary and 
post-secondary vocational programs; 
    (8) examining state board of education and state board of 
teaching rules that affect learner outcome-based education; 
    (9) developing site-based management and collaborative 
decision making; 
    (10) identifying the professional needs of education staff 
and designing staff programs to implement outcome based 
education; and 
     (11) developing alternative models for grouping pupils 
according to their attainment of learner outcomes. 
Sites may use staff development revenue under section 126.70 to 
accomplish clauses (3) and (10). 
     Subd. 3.  [REQUIREMENTS OF SITES.] To be considered for 
selection as a site by the state board, an applicant must 
develop a written proposal that describes the activities to be 
conducted at the site.  The site proposal must include: 
     (1) plans for a two-year project; 
     (2) specific goals to be achieved in the first and second 
years; 
     (3) documentation that will allow other districts to 
replicate the activities of the proposed site; 
     (4) procedures to involve the community in the project; and 
     (5) a budget. 
     The state board, in consultation with the office, shall 
select the sites and determine the amount of the grant to be 
awarded to each site by October 1, 1989. 
    Sec. 22.  [REPORT OF OFFICE OF EDUCATIONAL LEADERSHIP.] 
    By January 15, 1991, the office of educational leadership 
shall submit to the education committees of the legislature an 
interim evaluation of the progress of the ten sites in 
implementing their plans.  By January 15, 1992, the office shall 
submit a final evaluation of the efforts of the ten sites to 
implement learner outcome-based education. 
    Sec. 23.  [APPROPRIATIONS FOR THE OFFICE OF EDUCATIONAL 
LEADERSHIP.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the office of educational 
leadership for the fiscal years indicated.  
    Subd. 2.  [RESEARCH AND DEVELOPMENT GRANTS.] For grants for 
research and development sites: 
    $1,050,000 ..... 1990 
    Up to $50,000 may be used for administration and evaluation.
    Any unexpended balance remaining from fiscal year 1990 does 
not cancel and is available for fiscal year 1991.  
    Subd. 3.  [TECHNICAL ASSISTANCE; RESEARCH AND DEVELOPMENT 
SITES.] For technical assistance to research and development 
sites: 
    $250,000 ..... 1990 
    $250,000 ..... 1991 
    Sec. 24.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated. 
    Subd. 2.  [ADULT GRADUATION AID.] For adult graduation aid: 
     $1,238,000     .....     1990
     $1,573,000     .....     1991
    The 1990 appropriation includes $0 for 1989 and $1,238,000 
for 1990. 
    The 1991 appropriation includes $219,000 for 1990 and 
$1,354,000 for 1991. 
    Subd. 3.  [AREA LEARNING CENTER GRANTS.] For grants to area 
learning centers:  
    $150,000 ..... 1990 
    $150,000 ..... 1991 
    Subd. 4.  [ARTS PLANNING GRANTS.] For grants for arts 
planning according to Minnesota Statutes, section 129B.20:  
    $38,000 ..... 1990, 
    $38,000 ..... 1991.  
    Any unexpended balance in the first year does not cancel 
but is available for fiscal year 1991. 
    Subd. 5.  [PER PROCESS AID.] For the planning, evaluating, 
and reporting process according to Minnesota Statutes, section 
124.274: 
    $1,038,000 ..... 1990 
    $1,046,000 ..... 1991 
    Subd. 6.  [CAREER TEACHER AID.] For career teacher aid: 
    $1,000,000 ..... 1990 
    This appropriation is available until June 30, 1991. 
    Subd. 7.  [MINORITY TEACHER INCENTIVES.] For minority 
teacher incentives: 
   $1,000,000 ..... 1990 
    This appropriation is available until June 30, 1991. 
    Sec. 25.  [REPEALER.] 
    Minnesota Statutes 1988, section 129B.47, is repealed. 

                               ARTICLE 8

                        OTHER EDUCATION PROGRAMS
    Section 1.  Minnesota Statutes 1988, section 121.11, 
subdivision 14, is amended to read: 
    Subd. 14.  [SCHOOL LUNCH PROGRAM, REVOLVING FUND.] The 
commissioner of finance shall establish for the state board a 
revolving fund for deposit of storage and handling charges paid 
by recipients of donated foods shipped by the school lunch 
section of the department of education.  These funds are to be 
used only to pay storage and related charges as they are 
incurred for United States Department of Agriculture foods. 
    The commissioner of finance shall also establish a 
revolving fund for the department of education to deposit 
charges paid by recipients of processed commodities and for any 
authorized appropriation transfers for the purpose of this 
subdivision.  These funds are to be used only to pay for 
commodity processing and related charges as they are incurred 
using United States Department of Agriculture donated 
commodities. 
    Sec. 2.  Minnesota Statutes 1988, section 124.195, 
subdivision 8, is amended to read:  
    Subd. 8.  [PAYMENT PERCENTAGE FOR REIMBURSEMENT AIDS.] One 
hundred percent of the aid for the last fiscal year must be paid 
for the following aids:  abatement aid according to section 
124.214, subdivision 2; special education residential aid 
according to section 124.32, subdivision 5; special education 
pupil aid according to section 124.32, subdivision 6; special 
education summer school aid, according to section 124.32, 
subdivision 10; and planning, evaluating, and reporting process 
aid according to section 124.274. 
    Sec. 3.  Minnesota Statutes 1988, section 124.195, 
subdivision 9, is amended to read: 
    Subd. 9.  [PAYMENT PERCENTAGE FOR CERTAIN AIDS.] One 
hundred percent of the aid for the current fiscal year must be 
paid for the following aids:  management information center 
subsidies, according to section 121.935; reimbursement for 
transportation to post-secondary institutions, according to 
section 123.3514, subdivision 8; handicapped adult program aid, 
according to section 124.271, subdivision 7; school lunch aid, 
according to section 124.646; tribal contract school aid, 
according to article 3, section 15; hearing impaired support 
services aid, according to section 121.201; Indian 
post-secondary preparation grants according to section 124.481; 
and desegregation integration grants according to Laws 1987, 
chapter 398, article 6, section 18 section 14, subdivision 3. 
    Sec. 4.  Minnesota Statutes 1988, section 124.252, 
subdivision 3, is amended to read: 
    Subd. 3.  [DISTRICT AID.] An eligible district shall 
receive 54 cents in fiscal year 1987 and each year thereafter 
for each pupil, in average daily membership enrolled in a public 
elementary, secondary, or technical institute or nonpublic 
elementary or secondary school.  Aid for nonpublic school pupils 
shall be paid to the district upon request by or on behalf of 
the pupils.  No school district shall receive less than $1,040 
in fiscal year 1987 and each year thereafter.  
    Sec. 5.  [124.6472] [SCHOOL BREAKFAST PROGRAM] 
    Subdivision 1.  [BREAKFAST REQUIRED.] A school district 
shall offer a school breakfast program in every school building 
in which: 
    (1) at least 40 percent of the school lunches served during 
the 1989-1990 school year were served free or at a reduced 
price; or 
    (2) at least 15 percent of the children in the school would 
take part in the program, as indicated by a survey of the 
parents in the school. 
    Subd. 2.  [EXEMPTION.] Subdivision 1 does not apply to a 
school in which fewer than 25 pupils are expected to take part 
in the program. 
    Sec. 6.  [SCHOOL BREAKFAST SURVEY.] 
    Subdivision 1.  [SURVEY REQUIRED.] By October 1, 1990, a 
school district shall complete a survey of parents of pupils 
enrolled in each school to determine the number of parents who 
are interested in having their children participate in a school 
breakfast program. 
    Subd. 2.  [APPLICABILITY.] This section does not apply to a 
school building: 
    (1) that has a school breakfast program; or 
    (2) that is subject to section 5, subdivision 1, clause (1).
    Subd. 3.  [REPORTS.] Each school district shall report the 
survey results, including anticipated costs of providing the 
program, to the commissioner of education by November 1, 1990.  
    Sec. 7.  [127.46] [SEXUAL HARASSMENT AND VIOLENCE POLICY.] 
    Each school board shall adopt a written sexual harassment 
and sexual violence policy that conforms with sections 363.01 to 
363.15.  The policy shall apply to pupils, teachers, 
administrators, and other school personnel, include reporting 
procedures, and set forth disciplinary actions that will be 
taken for violation of the policy.  Disciplinary actions must 
conform with collective bargaining agreements and sections 
127.27 to 127.39.  The policy must be conspicuously posted in 
each school building and included in each school's student 
handbook on school policies.  
    Sec. 8.  [127.455] [MODEL POLICY.] 
     The commissioner of education shall maintain and make 
available to school boards a model sexual harassment and 
violence policy.  The model policy shall address the 
requirements of section 127.45. 
     Each school board shall submit to the commissioner of 
education a copy of the sexual harassment and sexual violence 
policy the board has adopted. 
    Sec. 9.  Minnesota Statutes 1988, section 129.121, is 
amended by adding a subdivision to read: 
    Subd. 6.  [SEXUAL HARASSMENT AND VIOLENCE POLICY AND 
RULES.] The board of the league shall adopt a policy, rules, 
penalties, and recommendations addressing sexual harassment and 
sexual violence toward and by participants in league activities. 
    Sec. 10.  Minnesota Statutes 1988, section 171.29, 
subdivision 2, is amended to read: 
    Subd. 2.  (a) A person whose drivers license has been 
revoked as provided in subdivision 1, except under section 
169.121 or 169.123, shall pay a $30 fee before the person's 
drivers license is reinstated. 
     (b) A person whose drivers license has been revoked as 
provided in subdivision 1 under section 169.121 or 169.123 shall 
pay a $200 fee before the person's drivers license is reinstated 
to be credited as follows: 
     (1) 25 percent shall be credited to the trunk highway fund; 
     (2) 50 percent shall be credited to a separate account to 
be known as the county probation reimbursement account.  Money 
in this account may be appropriated to the commissioner of 
corrections for the costs that counties assume under Laws 1959, 
chapter 698, of providing probation and parole services to wards 
of the commissioner of corrections.  This money is provided in 
addition to any money which the counties currently receive under 
section 260.311, subdivision 5; 
     (3) ten percent shall be credited to a separate account to 
be known as the bureau of criminal apprehension account.  Money 
in this account may be appropriated to the commissioner of 
public safety and shall be divided as follows:  eight percent 
for laboratory costs; two percent for carrying out the 
provisions of section 299C.065; 
    (4) 15 percent shall be credited to a separate account to 
be known as the alcohol impaired alcohol-impaired driver 
education account.  Money in the account may be appropriated to 
the commissioner of education for grants to develop alcohol 
impaired alcohol-impaired driver education programs in 
elementary, secondary, and post-secondary schools.  The state 
board of education shall establish guidelines for the 
distribution of the grants.  The commissioner of education shall 
report to the legislature by January 15, 1988, on the 
expenditure of grant funds under this clause.  Each year the 
commissioner may use $100,000 to administer the grant program 
and other traffic safety education programs. 
    Sec. 11.  Minnesota Statutes 1988, section 363.06, 
subdivision 3, is amended to read: 
    Subd. 3.  [TIME FOR FILING CLAIM.] A claim of an unfair 
discriminatory practice must be brought as a civil action 
pursuant to section 363.14, subdivision 1, clause (a), filed in 
a charge with a local commission pursuant to section 363.116, or 
filed in a charge with the commissioner within one year after 
the occurrence of the practice.  The running of the one-year 
limitation period is suspended during the time a potential 
charging party and respondent are voluntarily engaged in a 
dispute resolution process involving a claim of unlawful 
discrimination under this chapter, including arbitration, 
conciliation, mediation or grievance procedures pursuant to a 
collective bargaining agreement or statutory, charter, or 
ordinance provisions for a civil service or other employment 
system or a school board sexual harassment or sexual violence 
policy.  A potential respondent who participates in such a 
process with a potential charging party before a charge is filed 
or a civil action is brought shall notify the department and the 
charging party in writing of the participation in the process 
and the date the process commenced and shall also notify the 
department and the charging party of the ending date of the 
process.  A respondent who fails to provide this notification is 
barred from raising the defense that the statute of limitations 
has run unless one year plus a period of time equal to the 
suspension period has passed.  
    Sec. 12.  [SPECIAL LEVY.] 
     Independent school district No. 232, Peterson, may levy an 
amount not more than $100,000 for purposes of retiring operating 
debt.  This levy is authorized for taxes payable in 1990, 1991, 
or 1992.  In no case may the sum of the levies exceed $100,000. 
    Sec. 13.  [1989 RULE COMPLIANCE LEVY.] 
     In 1989, special school district No. 1, Minneapolis, and 
independent school district No. 709, Duluth, may each levy an 
amount up to a gross tax capacity rate of .80 percent times the 
adjusted gross tax capacity of the district for taxes payable in 
1990.  Each district may levy according to Minnesota Statutes, 
section 275.125, subdivision 6i, and this section.  
Notwithstanding Minnesota Statutes, section 121.904, the entire 
amount of this levy shall be recognized as revenue for the 
fiscal year in which the levy is certified.  This levy shall not 
be considered in computing the aid reduction under Minnesota 
Statutes, section 124.155. 
    Sec. 14.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums in this 
section are appropriated, unless otherwise indicated, from the 
general fund to the department of education for the fiscal years 
designated.  
    Subd. 2.  [ABATEMENT AID.] For abatement aid according to 
Minnesota Statutes, section 124.214:  
    $5,111,000 ..... 1990 
    $6,018,000 ..... 1991 
    The 1990 appropriation includes $0 for 1989 and $5,111,000 
for 1990. 
    The 1991 appropriation includes $902,000 for 1990 and 
$5,116,000 for 1991. 
    Subd. 3.  [INTEGRATION GRANTS.] For grants to districts 
implementing desegregation plans mandated by the state board: 
    $14,944,000 ..... 1990 
    $14,944,000 ..... 1991 
    $1,285,200 each year shall be allocated to independent 
school district No. 709, Duluth; $7,382,300 each year shall be 
allocated to special school district No. 1, Minneapolis; and 
$6,276,500 each year shall be allocated to independent school 
district No. 625, St. Paul.  As a condition of receiving a 
grant, each district must continue to report its costs according 
to the uniform financial accounting and reporting system.  As a 
further condition of receiving a grant, each district must 
submit a report to the chairs of the education committees of the 
legislature about the actual expenditures it made for 
integration using the grant money.  These grants may be used to 
transport students attending a nonresident district under 
Minnesota Statutes, section 120.062 or 123.3515, to the border 
of the resident district.  A district may allocate a portion of 
the grant to the transportation fund for this purpose.  
    Subd. 4.  [NONPUBLIC PUPIL AID.] For nonpublic pupil 
education aid according to Minnesota Statutes, sections 123.931 
to 123.947: 
    $8,524,000 ...... 1990 
    $8,847,000 ...... 1991 
    The 1990 appropriation includes $1,229,000 for 1989 and 
$7,295,000 for 1990. 
    The 1991 appropriation includes $1,288,000 for 1990 and 
$7,559,000 for 1991. 
    Subd. 5.  [SCHOOL LUNCH AND FOOD STORAGE AID.] For school 
lunch aid according to Minnesota Statutes, section 124.646, and 
for food storage and transportation costs for USDA donated 
commodities; and for a temporary transfer to the commodity 
processing revolving fund to provide cash flow to permit schools 
and other recipients of donated commodities to take advantage of 
volume processing rates:  
    $4,625,000 ..... 1990 
    $4,625,000 ..... 1991 
    Any unexpended balance remaining from the appropriations in 
this subdivision shall be prorated among participating schools 
based on the number of fully paid lunches served during that 
school year in order to meet the state revenue matching 
requirement of the USDA National School Lunch Program.  
    If the appropriation amount attributable to either year is 
insufficient, the rate of payment for each fully paid student 
lunch shall be reduced and the aid for that year shall be 
prorated among participating schools so as not to exceed the 
total authorized appropriation for that year.  
    Any temporary transfer processed in accordance with this 
subdivision to the commodity processing fund will be returned by 
June 30 in each year so that school lunch aid and food storage 
costs can be fully paid as scheduled.  
    Subd. 6.  [SCHOOL MILK AID.] For school milk aid according 
to Minnesota Statutes, section 124.648:  
    $800,000 ..... 1990 
    $800,000 ..... 1991 
    Subd. 7.  [TOBACCO USE PREVENTION.] For tobacco use 
prevention aid according to Minnesota Statutes, section 124.252: 
    $565,000 ...... 1990 
    $672,000 ...... 1991 
    The 1990 appropriation includes $0 for 1989 and $565,000 
for 1990. 
    The 1991 appropriation includes $100,000 for 1990 and 
$572,000 for 1991. 
    Subd. 8.  [WEST ST. PAUL.] For a grant to independent 
school district No. 197, West St. Paul: 
    $500,000 ...... 1990 
    The proceeds of this grant must be deposited in the 
district's debt redemption fund. 
    Subd. 9.  [ALCOHOL-IMPAIRED DRIVER EDUCATION GRANTS.] For 
grants for alcohol-impaired driver education according to 
Minnesota Statutes, section 171.29, subdivision 2, paragraph 
(b), clause (4): 
    $620,000 ..... 1990 
    $620,000 ..... 1991 
    This appropriation is from the special revenue fund. 
    Subd. 10.  [NETT LAKE LIABILITY INSURANCE.] For a grant to 
independent school district No. 707, Nett Lake, to pay insurance 
premiums under Minnesota Statutes, section 466.06:  
    $40,000 ..... 1990 
    This sum is available until June 30, 1991.  
    Subd. 11.  [NETT LAKE UNEMPLOYMENT COMPENSATION.] For 
payment of the obligation of independent school district No. 
707, Nett Lake, for transfer to the appropriate state agency for 
unemployment compensation:  
    $40,000 ..... 1990 
    This sum is available until June 30, 1991.  
     Subd. 12.  [PETERSON OPERATING DEBT.] For a grant to 
independent school district No. 232, Peterson to retire 
operating debt. 
     $50,000 ..... 1990 
    Sec. 15.  [EFFECTIVE DATE.] 
    Subdivision 1.  Section 5 is effective September 1, 1991. 
    Subd. 2.  Each school board shall adopt a written sexual 
harassment and sexual violence policy required under section 
127.45 before September 1, 1991.  Each school board shall submit 
a copy of its adopted sexual harassment and sexual violence 
policy required under section 127.455 to the education 
commissioner by September 1, 1991. 

                               ARTICLE 9 

                             MISCELLANEOUS 
    Section 1.  Minnesota Statutes 1988, section 120.062, 
subdivision 4, is amended to read: 
    Subd. 4.  [PUPIL APPLICATION PROCEDURES.] In order that a 
pupil may attend a school or program in a nonresident district, 
the pupil's parent or guardian must submit an application to the 
nonresident district.  Before submitting an application, the 
pupil and the pupil's parent or guardian must explore with a 
school guidance counselor, or other appropriate staff member 
employed by the district the pupil is currently attending, the 
pupil's academic or other reason for applying to enroll in a 
nonresident district.  The pupil's application must identify the 
reason for enrolling in the nonresident district.  The parent or 
guardian of a pupil residing in a district that does not have a 
desegregation plan approved by the state board of education must 
submit an application by January 1 for initial enrollment during 
beginning the following school year.  The parent or guardian of 
a pupil residing in a district that has a desegregation plan 
approved by the state board of education may apply to a district 
at any time.  The application shall be on a form provided by the 
department of education.  A particular school or program may be 
requested by the parent.  Once enrolled in a nonresident 
district, the pupil may remain enrolled and is not required to 
submit annual or periodic applications.  To return to the 
resident district or to transfer to a different nonresident 
district, the parent or guardian of the pupil must provide 
notice to the resident district or apply to a different 
nonresident district by January 1 for enrollment beginning the 
following school year. 
    Sec. 2.  Minnesota Statutes 1988, section 120.062, 
subdivision 5, is amended to read: 
    Subd. 5.  [DESEGREGATION PLANS DISTRICT TRANSFERS.] (a) 
This subdivision applies to a transfer into or out of a district 
that has a desegregation plan approved by the state board of 
education.  
    (b) An application to transfer may be submitted at any time 
for enrollment beginning at any time. 
    (c) The parent or guardian of a pupil who is a resident of 
a district that has a desegregation plan must submit an 
application to the resident district.  If the district accepts 
the application, it must forward the application to the 
nonresident district. 
    (d) The parent or guardian of a pupil who applies for 
enrollment in a nonresident district that has a desegregation 
plan must submit an application to the nonresident district.  
    (e) Each district must accept or reject an application it 
receives and notify the parent or guardian in writing within 30 
calendar days of receiving the application.  A notification of 
acceptance must include the date enrollment can begin. 
    (f) If an application is rejected, the district must state 
the reason for rejection in the notification.  If a district 
that has a desegregation plan rejects an application for a 
reason related to the desegregation plan, the district must 
state with specificity how acceptance of the application would 
result in noncompliance with state board rules with respect to 
the school or program for which application was made.  
    (g) If an application is accepted, the parent or guardian 
must notify the nonresident district in writing within 15 
calendar days of receiving the acceptance whether the pupil 
intends to enroll in the nonresident district.  Notice of 
intention to enroll obligates the pupil to enroll in the 
nonresident district, unless the school boards of the resident 
and nonresident districts agree otherwise.  If a parent or 
guardian does not notify the nonresident district, the pupil may 
not enroll in that nonresident district at that time, unless the 
school boards of the resident and nonresident district agree 
otherwise. 
    (h) Within 15 calendar days of receiving the notice from 
the parent or guardian, the nonresident district shall notify 
the resident district in writing of the pupil's intention to 
enroll in the nonresident district.  
    (i) A pupil enrolled in a nonresident district under this 
subdivision is not required to make annual or periodic 
application for enrollment but may remain enrolled in the same 
district.  A pupil may transfer to the resident district at any 
time.  
    (j) A pupil enrolled in a nonresident district and applying 
to transfer into or out of a district that has a desegregation 
plan must follow the procedures of this subdivision.  For the 
purposes of this type of transfer, "resident district" means the 
nonresident district in which the pupil is enrolled at the time 
of application.  
    (k) A district that has a desegregation plan approved by 
the state board of education may limit the number of pupils who 
transfer into or out of the district.  To remain in compliance 
with its desegregation plan, the district may establish the 
number of majority and minority group pupils who may transfer 
into or out of the district.  The district may must accept or 
reject applications each individual application in a manner that 
will enable compliance with the its desegregation plan.  The 
district shall notify the parent or guardian and the resident 
district according to the requirements of subdivision 6. 
    Sec. 3.  Minnesota Statutes 1988, section 120.062, 
subdivision 6, is amended to read: 
    Subd. 6.  [NONRESIDENT DISTRICT PROCEDURES.] Within 60 days 
of receiving an application, A district that does not exclude 
nonresident pupils, according to subdivision 3, shall notify the 
parent or guardian and the resident district in writing by 
February 1 whether the application has been accepted or rejected.
If an application is rejected, the district must state in the 
notification the reason for rejection.  The parent or guardian 
shall notify the nonresident district by February 15 whether the 
pupil intends to enroll in the nonresident district.  Notice of 
intent to enroll in the nonresident district obligates the pupil 
to attend the nonresident district during the following school 
year, unless the school boards of the resident and the 
nonresident districts agree in writing to allow the pupil to 
transfer back to the resident district, or the pupil's parents 
or guardians change residence to another district.  If a parent 
or guardian does not notify the nonresident district, the pupil 
may not enroll in that nonresident district during the following 
school year, unless the school boards of the resident and 
nonresident district agree otherwise.  The nonresident district 
shall notify the resident district by March 1 of the pupil's 
intent to enroll in the nonresident district.  The same 
procedures apply to a pupil who applies to transfer from one 
participating nonresident district to another participating 
nonresident district. 
    Sec. 4.  Minnesota Statutes 1988, section 121.11, 
subdivision 12, is amended to read:  
    Subd. 12.  [ADMINISTRATIVE RULES.] The state board 
shall may adopt and enforce rules, consistent with this code, 
appropriate for the administration and enforcement thereof only 
upon specific authority other than under this subdivision.  
Notwithstanding the provisions of section 14.05, subdivision 4, 
the state board may grant a variance to its rules upon 
application by a school district for purposes of implementing 
experimental programs in learning or school management which 
that attempt to make better use of community resources or 
available technology. 
    Sec. 5.  [121.585] [LEARNING YEAR PROGRAMS.] 
    Subdivision 1.  [PROGRAM ESTABLISHED.] A learning year 
program provides instruction throughout the year.  A pupil may 
participate in the program and accelerate attainment of grade 
level requirements or graduation requirements.  A learning year 
program may begin after the close of the regular school year in 
June.  The program may be for students in one or more grade 
levels from kindergarten through twelfth grade.  
    Students may participate in the program if they reside in:  
    (1) a district that has been designated a learning year 
site under subdivision 2; 
    (2) a district that is a member of the same education 
district as a site; or 
    (3) a district that participates in the same area learning 
center program as a site.  
    Subd. 2.  [STATE BOARD DESIGNATION.] An area learning 
center designated by the state must be a site.  Up to an 
additional ten learning year sites may be designated by the 
state board of education.  To be designated, a district or 
center must demonstrate to the commissioner of education that it 
will: 
    (1) provide a program of instruction that permits pupils to 
receive instruction throughout the entire year; and 
    (2) maintain a record system that, for purposes of section 
124.17, permits identification of membership attributable to 
pupils participating in the program.  The record system and 
identification must ensure that the program will not have the 
effect of increasing the total number of pupil units 
attributable to an individual pupil as a result of a learning 
year program.  
    Subd. 3.  [HOURS OF INSTRUCTION.] Pupils participating in a 
program must be able to receive the same total number of hours 
of instruction they would receive if they were not in the 
program.  If a pupil has not completed the graduation 
requirements of the district after completing the minimum number 
of secondary school hours of instruction, the district may allow 
the pupil to continue to enroll in courses needed for graduation.
    For the purposes of section 120.101, subdivision 5, the 
minimum number of hours for a year determined for the 
appropriate grade level of instruction shall constitute 170 days 
of instruction.  Hours of instruction that occur after the close 
of the instructional year in June shall be attributed to the 
following fiscal year.  
    Subd. 4.  [STUDENT PLANNING.] A district must inform all 
pupils and their parents about the learning year program.  A 
continual learning plan must be developed for each pupil with 
the participation of the pupil, parent or guardian, teachers, 
and other staff.  The plan must specify the learning experiences 
that must occur each year and, for secondary students, for 
graduation.  The plan may be modified to conform to district 
schedule changes.  The district may not modify the plan if the 
modification would result in delaying the student's time of 
graduation.  
    Subd. 5.  [TRANSPORTATION.] Summer transportation 
expenditures for this program must be included in nonregular 
transportation according to sections 124.225, subdivision 8; and 
275.125, subdivision 5c.  
    Subd. 6.  [CONTRACTS.] A district may contract with a 
licensed employee to provide services in a learning year program 
that are in addition to the services provided according to the 
master contract of employment for teachers or an equivalent 
contract for licensed employees who are not teachers.  These 
additional services and compensation, if any, for the services 
shall not become a part of the employee's continuing contract 
rights under section 125.12 or 125.17.  
    Subd. 7.  [REVENUE COMPUTATION AND REPORTING.] Aid and levy 
revenue computations shall be based on the total number of hours 
of education programs for pupils in average daily membership for 
each fiscal year.  For purposes of section 124.17, average daily 
membership shall be computed by dividing the total number of 
hours of participation for the fiscal year by the minimum number 
of hours for a year determined for the appropriate grade level.  
Hours of participation that occur after the close of the regular 
instructional year and before July 1 shall be attributed to the 
following fiscal year.  Thirty hours may be used for teacher 
workshops, staff development, or parent-teacher conferences.  As 
part of each pilot program, the department of education and each 
district must report and evaluate the changes needed to adjust 
the dates of the fiscal year for aid and levy computation and 
fiscal year reporting.  For revenue computation purposes, the 
learning year program shall generate revenue based on the 
formulas for the fiscal year in which the services are provided. 
    State aid and levy revenue computation for the learning 
year programs begins July 1, 1988, for fiscal year 1989.  
    Subd. 8.  [EXEMPTION.] To operate the pilot program, the 
state board of education may exempt the district from specific 
rules relating to student and financial accounting, reporting, 
and revenue computation.  
    Sec. 6.  Minnesota Statutes 1988, section 121.88, 
subdivision 10, is amended to read: 
    Subd. 10.  [EXTENDED DAY PROGRAMS.] A school board may 
offer, as part of a community education program, an extended day 
program for children from kindergarten through grade 6 for the 
purpose of expanding students' learning opportunities.  A 
program must include the following: 
    (1) adult supervised programs while school is not in 
session; 
    (2) parental involvement in program design and direction; 
    (3) partnerships with the K-12 system, and other public, 
private, or nonprofit entities; and 
    (4) opportunities for trained secondary school pupils to 
work with younger children in a supervised setting as part of a 
community service program. 
    The district may charge a sliding fee based upon family 
income for extended day programs.  The district may receive 
money from other public or private sources for the extended day 
program.  The school board of the district shall develop 
standards for school age child care programs.  The state board 
of education may not adopt rules for extended day programs. 
    Sec. 7.  Minnesota Statutes 1988, section 123.33, 
subdivision 7, is amended to read: 
    Subd. 7.  The board shall superintend and manage the 
schools of the district; adopt, modify, or repeal rules for 
their organization, government, and instruction and for the 
keeping of; keep registers; and prescribe textbooks and courses 
of study.  The board may arrange for courses for secondary 
pupils that are offered by a post-secondary institution. 
    Sec. 8.  Minnesota Statutes 1988, section 123.3514, 
subdivision 4c, is amended to read: 
    Subd. 4c.  [LIMIT ON PARTICIPATION.] A pupil who first 
enrolls in grade 11 may not enroll in post-secondary courses 
under this section for secondary credit for more than the 
equivalent of two academic years.  A pupil who first enrolls in 
grade 12 may not enroll in post-secondary courses under this 
section for secondary credit for more than the equivalent of one 
academic year.  If a pupil in grade 11 or 12 first enrolls in a 
post-secondary course for secondary credit during the school 
year, the time of participation shall be reduced proportionately.
A pupil who has graduated from high school cannot participate in 
a program under this section.  A pupil who has completed course 
requirements for graduation but who has not received a diploma 
may participate in the program under this section. 
    Sec. 9.  Minnesota Statutes 1988, section 123.3514, 
subdivision 5, is amended to read: 
    Subd. 5.  [CREDITS.] A pupil may enroll in a course under 
this section for either secondary credit or post-secondary 
credit.  At the time a pupil enrolls in a course, the pupil 
shall designate whether the course is for secondary or 
post-secondary credit.  A pupil taking several courses may 
designate some for secondary credit and some for post-secondary 
credit.  A pupil must not audit a course under this section. 
    A school district shall grant academic credit to a pupil 
enrolled in a course for secondary credit if the pupil 
successfully completes the course.  Nine quarter or six semester 
college credits equal at least one full year of high school 
credit.  Fewer college credits may be prorated.  A school 
district shall also grant academic credit to a pupil enrolled in 
a course for post-secondary credit if secondary credit is 
requested by a pupil.  If no comparable course is offered by the 
district, the district shall, as soon as possible, notify the 
state board of education, which shall determine the number of 
credits that shall be granted to a pupil who successfully 
completes a course.  If a comparable course is offered by the 
district, the school board shall grant a comparable number of 
credits to the pupil.  If there is a dispute between the 
district and the pupil regarding the number of credits granted 
for a particular course, the pupil may appeal the school board's 
decision to the state board of education.  The state board's 
decision regarding the number of credits shall be final.  
    The secondary credits granted to a pupil shall be counted 
toward the graduation requirements and subject area requirements 
of the school district.  Evidence of successful completion of 
each course and secondary credits granted shall be included in 
the pupil's secondary school record.  A pupil must provide the 
school with a copy of the pupil's grade in each course taken for 
secondary credit under this section.  Upon the request of a 
pupil, the pupil's secondary school record shall also include 
evidence of successful completion and credits granted for a 
course taken for post-secondary credit.  In either case, the 
record shall indicate that the credits were earned at a 
post-secondary institution. 
    If a pupil enrolls in a post-secondary institution after 
leaving secondary school, the post-secondary institution shall 
award post-secondary credit for any course successfully 
completed for secondary credit at that institution.  Other 
post-secondary institutions may award, after a pupil leaves 
secondary school, post-secondary credit for any courses 
successfully completed under this section.  An institution may 
not charge a pupil for the award of credit.  
    Sec. 10.  Minnesota Statutes 1988, section 123.3514, 
subdivision 7, is amended to read: 
    Subd. 7.  [FEES; TEXTBOOKS; MATERIALS.] A post-secondary 
institution that receives reimbursement for a pupil under 
subdivision 6 may not charge that pupil for fees, textbooks, 
materials, or other necessary costs of the course or program in 
which the pupil is enrolled if the charge would be prohibited 
under section 120.74, except for equipment purchased by the 
pupil that becomes the property of the pupil.  An institution 
may require the pupil to pay for fees, textbooks, and materials 
for a course taken for post-secondary credit. 
    Sec. 11.  Minnesota Statutes 1988, section 123.3514, is 
amended by adding a subdivision to read: 
    Subd. 7a.  [TEXTBOOKS; MATERIALS.] All textbooks and 
equipment provided to a pupil, and paid for under subdivision 6, 
are the property of the pupil's school district of residence.  
Each pupil is required to return all textbooks and equipment to 
the school district after the course has ended. 
    Sec. 12.  Minnesota Statutes 1988, section 123.3514, 
subdivision 10, is amended to read: 
    Subd. 10.  [LIMIT; STATE OBLIGATION.] The provisions of 
subdivisions 6, 7, 8, and 9 shall not apply for any 
post-secondary courses in which a pupil is enrolled in addition 
to being enrolled full time in that pupil's district or for any 
post-secondary course in which a pupil is enrolled for 
post-secondary credit.  The pupil is enrolled full time if the 
pupil attends credit-bearing classes in the high school or high 
school program for all of the available hours of instruction. 
    Sec. 13.  [126.1995] [SAFETY REQUIREMENT GUIDELINES.] 
    The department of education, in cooperation with the 
Minnesota fire marshal's division, shall develop guidelines for 
school lab safety.  The guidelines shall include a list of 
safety requirements and an explanation of the minimum state and 
national laws, codes, and standards affecting school lab safety 
the Minnesota fire marshal considers necessary for schools to 
implement.  The district superintendent must ensure that every 
school lab within the district complies with the school lab 
safety requirements.  Lack of funding is not an excuse for 
noncompliance. 
    Sec. 14.  Minnesota Statutes 1988, section 126.22, 
subdivision 2, is amended to read: 
    Subd. 2.  [ELIGIBLE PUPILS.] The following pupils are 
eligible to participate in the high school graduation incentives 
program: 
    (a) any pupil who is between the ages of 12 and 16 and who: 
    (1) is at least two grade levels below the performance 
level for pupils of the same age in a locally determined 
achievement test; or 
    (2) is at least one year behind in obtaining credits for 
graduation; or 
    (3) is pregnant or is a parent; or 
    (4) has been assessed as chemically dependent; or 
    (5) has been absent from attendance at school without 
lawful excuse for more than 15 consecutive school days in the 
preceding or current school year excluded or expelled according 
to sections 127.26 to 127.39; or 
    (6) has been referred by a school district for enrollment 
in an eligible program or a program pursuant to section 126.23; 
    (b) any pupil who is between the ages of 16 and 19 who is 
attending school, and who is at least two grade levels below the 
performance level for pupils of the same age in a locally 
determined achievement test, or is at least one year behind in 
obtaining credits for graduation, or is pregnant or is a parent, 
or has been assessed as chemically dependent; or 
    (c) any person between 16 and 21 years of age who has not 
attended a high school program for at least 15 consecutive 
school days, excluding those days when school is not in session, 
and who is at least two grade levels below the performance level 
for pupils of the same age in a locally determined achievement 
test, or is at least one year behind in obtaining credits for 
graduation, or is pregnant or is a parent, or has been assessed 
as chemically dependent; or 
    (d) any person who is at least 21 years of age and who: 
    (1) has received less than 14 years of public or nonpublic 
education, beginning at age 5; 
    (2) has already completed the studies ordinarily required 
in the 10th grade but has not completed the requirements for a 
high school diploma or the equivalent; and 
    (3) at the time of application, (i) is eligible for 
unemployment compensation benefits or has exhausted the 
benefits, (ii) is eligible for or is receiving income 
maintenance and support services, as defined in section 
268.0111, subdivision 5, or (iii) is eligible for services under 
the displaced homemaker program, state wage-subsidy program, or 
any programs under the federal Jobs Training Partnership Act or 
its successor. 
    Notwithstanding section 127.27, subdivision 7, the 
provisions of section 127.29, subdivision 1, do not apply to 
pupils age 17 and older who participate in the high school 
graduation incentives program. 
    Sec. 15.  Minnesota Statutes 1988, section 126.67, 
subdivision 8, is amended to read: 
    Subd. 8.  [CAREER INFORMATION; APPROPRIATION.] The 
department of education may provide career information to school 
districts and other educational systems organizations, 
employment and training services, human service agencies, 
libraries, and families.  The department may shall collect 
reasonable fees for subscriptions to necessary to recover all 
expenditures related to the operation of the Minnesota career 
information service.  Grants may be accepted and used for the 
improvement or operation of the program. 
    Sec. 16.  Minnesota Statutes 1988, section 129.121, is 
amended by adding a subdivision to read: 
    Subd. 7.  The Minnesota state high school league shall 
establish, conduct and regulate championship high school 
tournament activities.  The league shall determine the number of 
classes in all interscholastic athletic activities under its 
jurisdiction.  The league shall adopt league rules and 
regulations governing the athletic participation of pupils 
attending school in a nonresident district under section 120.062.
    Notwithstanding the date and time of day of final 
enactment, this section supersedes any inconsistent provision of 
H.F. 372. 
    Sec. 17.  Minnesota Statutes 1988, section 136D.22, 
subdivision 1, is amended to read: 
    Subdivision 1.  [BOARD.] The agreement may shall provide 
for a joint school board which shall represent representing the 
parties to the agreement, and.  The agreement shall specify the 
name of the board, the number and manner of election or 
appointment of its members, their terms and qualifications, and 
other necessary and desirable provisions; provided, that.  Each 
member of the board shall be a voter of one school board member 
of the a school districts which district that is a party to the 
agreement. 
    Sec. 18.  Minnesota Statutes 1988, section 136D.72, 
subdivision 1, is amended to read: 
    Subdivision 1.  [MEMBERS.] The district shall be operated 
by a school board of not less than six nor more than 12 members 
which.  The board shall consist of at least one member from each 
of the school districts within the special intermediate school 
district created.  Board members shall be residents of the 
respective school districts represented, may be members of the 
school boards of the respective school districts and shall be 
appointed by their respective school boards.  Members so 
appointed shall serve at the pleasure of their respective school 
districts boards and may be subject to recall by a majority vote 
of the participating school district board.  They shall report 
at least quarterly to their appointing boards on the activities 
of the intermediate district and shall attend no less than one 
meeting of their respective appointing boards each month.  
    Sec. 19.  Minnesota Statutes 1988, section 136D.82, 
subdivision 1, is amended to read: 
    Subdivision 1.  [BOARD.] The agreement may shall provide 
for a joint school board which shall represent representing the 
parties to the agreement, and.  The agreement shall specify the 
name of the board, the number and manner of election or 
appointment of its members, their terms and qualifications, and 
other necessary and desirable provisions; provided, that.  Each 
member of the board shall be a voter of one school board member 
of the a school districts which district that is a party to the 
agreement.  
    Sec. 20.  Minnesota Statutes 1988, section 354.094, 
subdivision 1, is amended to read: 
    Subdivision 1.  [SERVICE CREDIT CONTRIBUTIONS.] A member 
granted an extended leave of absence pursuant to section 125.60 
or 136.88, except as provided in subdivision 1a or 1b, may pay 
employee contributions and receive allowable service credit 
toward annuities and other benefits under this chapter, for each 
year of the leave provided the member and the employing board 
make the required employer contribution in any proportion they 
may agree upon, during the period of the leave which shall not 
exceed five years.  Except as provided in subdivision 1a or 1b, 
The state shall not pay employer contributions into the fund for 
any year for which a member is on extended leave.  The employee 
and employer contributions shall be based upon the rates of 
contribution prescribed by section 354.42 for the salary 
received during the year immediately preceding the extended 
leave.  Payments for the years for which a member is receiving 
service credit while on extended leave shall be made on or 
before the later of June 30 of each fiscal year for which 
service credit is received or within 30 days after first 
notification of the amount due, if requested by the member, is 
given by the association.  No payment is permitted after the 
following September 30.  Payments received after June 30 must 
include six percent interest from June 30 through the end of the 
month in which payment is received. 
    Sec. 21.  Minnesota Statutes 1988, section 354.094, 
subdivision 2, is amended to read: 
    Subd. 2.  [MEMBERSHIP; RETENTION.] Notwithstanding section 
354.49, subdivision 4, clause (3), a member on extended leave 
whose employee and employer contributions are paid into the fund 
pursuant to subdivisions subdivision 1 and 1a shall retain 
membership in the association for as long as the contributions 
are paid, under the same terms and conditions as if the member 
had continued to teach in the district, the community college 
system or the state university system. 
    Sec. 22.  Minnesota Statutes 1988, section 354.66, 
subdivision 4, is amended to read: 
    Subd. 4.  [RETIREMENT CONTRIBUTIONS.] Notwithstanding any 
provision to the contrary in this chapter relating to the salary 
figure to be used for the determination of contributions or the 
accrual of service credit, a teacher assigned to a part-time 
position pursuant to this section shall continue to make 
employee contributions to and to accrue allowable service credit 
in the retirement fund during the period of part-time employment 
on the same basis and in the same amounts as would have been 
paid and accrued if the teacher had been employed on a full-time 
basis provided that, except as provided in subdivision 4a, prior 
to June 30 each year, or within 30 days after notification by 
the association of the amount due, whichever is later, the 
member and the employing board make that portion of the required 
employer contribution to the retirement fund, in any proportion 
which they may agree upon, that is based on the difference 
between the amount of compensation that would have been paid if 
the teacher had been employed on a full-time basis and the 
amount of compensation actually received by the teacher for the 
services rendered in the part-time assignment.  The employing 
unit shall make that portion of the required employer 
contributions to the retirement fund on behalf of the teacher 
that is based on the amount of compensation actually received by 
the teacher for the services rendered in the part-time 
assignment in the manner described in section 354.43, 
subdivision 3.  The employee and employer contributions shall be 
based upon the rates of contribution prescribed by section 
354.42.  Full accrual of allowable service credit and employee 
contributions for part-time teaching service pursuant to this 
section and section 354A.094 shall not continue for a period 
longer than ten years.  
    Sec. 23.  Minnesota Statutes 1988, section 354A.091, 
subdivision 1, is amended to read: 
    Subdivision 1.  [RETIREMENT CONTRIBUTIONS.] Notwithstanding 
any provision to the contrary of this chapter or the articles of 
incorporation or bylaws of an association relating to the salary 
figure to be used for the determination of contributions or the 
accrual of service credit, except as provided in subdivision 1a 
or 1b, an elementary, secondary or technical institute teacher 
in the public schools of a city of the first class who is 
granted an extended leave of absence pursuant to section 125.60, 
may pay employee contributions to the applicable association and 
shall be entitled to receive allowable service credit in that 
association for each year of leave, provided the member and the 
employing board make the required employer contributions, in any 
proportion they may agree upon, to that association during the 
period of leave which shall not exceed five years.  Except as 
provided in subdivision 1a or 1b The state shall not make an 
employer contribution on behalf of the teacher.  The employee 
and employer contributions shall be based upon the rates of 
contribution prescribed by section 354A.12 as applied to a 
salary figure equal to the teacher's actual covered salary for 
the plan year immediately preceding the leave.  Payment of the 
employee and employer contributions authorized pursuant to this 
section shall be made on or before June 30 of the fiscal year 
for which service credit is to be received.  No allowable 
service with respect to a year of extended leave of absence 
shall be credited to a teacher until payment of the required 
employee and employer contributions has been received by the 
association. 
    Sec. 24.  Minnesota Statutes 1988, section 354A.091, 
subdivision 2, is amended to read: 
    Subd. 2.  [MEMBERSHIP RETENTION.] A teacher on extended 
leave pursuant to section 125.60 whose employee and employer 
contributions are made to the applicable teachers retirement 
fund association pursuant to subdivisions subdivision 1 and 1a 
shall retain membership in the association for each year during 
which the contributions are made, under the same terms and 
conditions as if the teacher had continued to teach in the 
district. 
    Sec. 25.  Minnesota Statutes 1988, section 354A.094, 
subdivision 4, is amended to read: 
    Subd. 4.  [RETIREMENT CONTRIBUTIONS.] Notwithstanding any 
provision to the contrary in this chapter or the articles of 
incorporation or bylaws of an association relating to the salary 
figure to be used for the determination of contributions or the 
accrual of service credit, a teacher assigned to a part-time 
position pursuant to this section shall continue to make 
employee contributions to and to accrue allowable service credit 
in the applicable association during the period of part-time 
employment on the same basis and in the same amounts as would 
have been paid and accrued if the teacher had been employed on a 
full-time basis provided that, except as provided in subdivision 
4a, prior to June 30 each year the member and the employing 
board make that portion of the required employer contribution to 
the applicable association in any proportion which they may 
agree upon, that is based on the difference between the amount 
of compensation that would have been paid if the teacher had 
been employed on a full-time basis and the amount of 
compensation actually received by the teacher for services 
rendered in the part-time assignment.  The employer 
contributions to the applicable association on behalf of the 
teacher shall be based on the amount of compensation actually 
received by the teacher for the services rendered in the 
part-time assignment in the manner described in section 354.43, 
subdivisions 1 and 5.  The employee and employer contributions 
shall be based upon the rates of contribution prescribed by 
section 354A.12.  Full membership, accrual of allowable service 
credit and employee contributions for part-time teaching service 
by a teacher pursuant to this section and section 354.66 shall 
not continue for a period longer than ten years.  
    Sec. 26.  Minnesota Statutes 1988, section 363.01, is 
amended by adding a subdivision to read: 
    Subd. 41.  [BUSINESS.] The term "business" includes any 
partnership, association, corporation, legal representative, 
trustee, trustee in bankruptcy, or receiver, but excludes the 
state and its departments, agencies, and political subdivisions. 
    Sec. 27.  Minnesota Statutes 1988, section 363.073, 
subdivision 1, is amended to read: 
    Subdivision 1.  [SCOPE OF APPLICATION.] No department or 
agency of the state shall receive, enter into, or accept any bid 
or proposal for a contract nor or agreement or execute any 
contract or agreement for goods, or services, or the performance 
of any function, or any agreement to transfer funds for any 
reason in excess of $50,000 with any person business having more 
than 20 full-time employees in Minnesota at any time during the 
previous 12 months, unless the person firm or business has an 
affirmative action plan for the employment of minority persons, 
women, and the disabled that has been approved by the 
commissioner of human rights.  Receipt of a certificate of 
compliance issued by the commissioner shall signify that 
a person firm or business has an affirmative action plan that 
has been approved by the commissioner.  A certificate shall be 
valid for a period of two years.  A municipality as defined in 
section 466.01, subdivision 1, that receives state funds for any 
reason is encouraged to prepare and implement an affirmative 
action plan for the employment of minority persons, women, and 
the disabled and submit the plan to the commissioner of human 
rights.  
    Sec. 28.  Minnesota Statutes 1988, section 422A.101, 
subdivision 2, is amended to read: 
    Subd. 2.  [CONTRIBUTIONS BY OR FOR CITY-OWNED PUBLIC 
UTILITIES, IMPROVEMENTS, OR MUNICIPAL ACTIVITIES.] Contributions 
by or for any city-owned public utility, improvement project and 
other municipal activities supported in whole or in part by 
revenues other than real estate taxes, any public corporation, 
any employing unit of metropolitan government, special school 
district No. 1 or Hennepin county, on account of any employee 
covered by the fund shall be calculated as follows: 
    (a) a regular employer contribution of an amount equal to 
the percentage rounded to the nearest two decimal places of the 
salaries and wages of all employees of the employing unit 
covered by the retirement fund which equals the difference 
between the level normal cost plus administrative cost reported 
in the annual actuarial valuation prepared by the 
commission-retained actuary and the employee contributions 
provided for in section 422A.10; 
    (b) an additional employer contribution of an amount equal 
to the percent specified in section 353.27, subdivision 3a, 
clause (a), multiplied by the salaries and wages of all 
employees of the employing unit covered by the retirement fund; 
    (c) a proportional share of an additional employer 
amortization contribution of an amount equal to $3,900,000 
annually until June 30, 2017, based upon the share of the fund's 
unfunded actuarial accrued liability attributed to the employer 
as disclosed in the annual actuarial valuation prepared by the 
commission-retained actuary. 
    The city council or any board or commission may, by proper 
action, provide for the inclusion of the cost of the retirement 
contributions for employees of any city-owned public utility or 
for persons employed in any improvement project or other 
municipal activity supported in whole or in part by revenues 
other than taxes who are covered by the retirement fund in the 
cost of operating the utility, improvement project or municipal 
activity.  The cost of retirement contributions for these 
employees shall be determined by the retirement board and the 
respective governing bodies having jurisdiction over the 
financing of these operating costs.  
    The cost of the employer contributions on behalf of 
employees of special school district No. 1 who are covered by 
the retirement fund shall be the obligation of the school 
district.  Contributions by the school district to the 
retirement fund or any other public pension or retirement fund 
of which its employees are members must be remitted to the fund 
each month.  An amount due and not transmitted begins to accrue 
interest at the rate of six percent compounded annually 15 days 
after the date due.  If the amount due plus interest is not paid 
30 days after interest begins to accrue, a penalty equal to ten 
percent of the amount due is added, and interest then accrues on 
the penalty as well as the amount originally due.  The 
retirement board shall prepare an itemized statement of the 
financial requirements of the fund payable by the school 
district, which shall be submitted prior to September 15.  
Contributions by the school district shall be made at times 
designated by the retirement board.  The school district may 
levy for its contribution to the retirement fund only to the 
extent permitted pursuant to section 275.125, subdivision 6a.  
    The cost of the employer contributions on behalf of 
elective officers or other employees of Hennepin county who are 
covered by the retirement fund pursuant to section 422A.09, 
subdivision 3, clause (2), 422A.22, subdivision 2, or 488A.115, 
or Laws 1973, chapter 380, section 3, Laws 1975, chapter 402, 
section 2, or any other applicable law shall be the obligation 
of Hennepin county.  The retirement board shall prepare an 
itemized statement of the financial requirements of the fund 
payable by Hennepin county, which shall be submitted prior to 
September 15.  Contributions by Hennepin county shall be made at 
times designated by the retirement board.  Hennepin county may 
levy for its contribution to the retirement fund. 
     Sec. 29.  Minnesota Statutes 1988, section 471.38, 
subdivision 3, is amended to read: 
    Subd. 3.  [ELECTRONIC FUNDS TRANSFER.] Electronic funds 
transfer is the process of value exchange via mechanical means 
without the use of checks, drafts or similar negotiable 
instruments.  A school district may make an electronic funds 
transfer for the following:  
    (1) for a claim for a payment from an imprest payroll bank 
account or investment of excess money; 
    (2) for a payment of tax or aid anticipation certificates; 
    (3) for a payment of contributions to pension or retirement 
fund; 
    (4) for vendor payments; and 
    (5) for payment of bond principal, bond interest and a 
fiscal agent service charge from the debt redemption fund.  This 
    Subd. 3a.  [SCHOOL DISTRICT ELIGIBILITY.] The authorization 
in subdivision 3 extends only to a school district which that 
has enacted all of the following policy controls:  
    (a) The school board shall annually delegate the authority 
to make electronic funds transfers to a designated business 
administrator; 
    (b) The dispersing bank shall keep on file a certified copy 
of the delegation of authority; 
    (c) The initiator of the electronic transfer shall be 
identified; 
    (d) The initiator shall document the request and obtain an 
approval from the designated business administrator before 
initiating the transfer; 
    (e) A written confirmation of the transaction shall be made 
no later than one business day after the transaction and shall 
be used in lieu of a check, order check or warrant required to 
support the transaction; 
    (f) A list of all transactions made by electronic funds 
transfer shall be submitted to the school board at its next 
regular meeting after the transaction. 
    Sec. 30.  [STAFF EXCHANGE PROGRAM.] 
    Subdivision 1.  [ESTABLISHMENT.] A staff exchange program 
for the 1989-1990 and 1990-1991 school years is established to 
allow local school districts to arrange temporary and voluntary 
exchanges between members of their kindergarten through grade 12 
instructional and administrative staffs.  The purpose of the 
program is to provide participants with an understanding of the 
educational concerns of other local school districts, including 
concerns of class organization, curriculum development, 
instructional practices, and characteristics of the student 
population. 
    The educational needs and interests of the host school 
district and the training, experience, and interests of the 
participants shall determine the assignment of the participants 
in the host district.  Participants may teach courses, provide 
counseling and tutorial services, work with teachers to better 
prepare students for future educational experiences, serve an 
underserved population in the district, or assist with 
administrative functions.  The assignments participants perform 
for the host district must be comparable to the assignments the 
participants perform for the district employing the 
participants.  Participation in the exchange program need not be 
limited to one school or one school district and may involve 
other education organizations including education districts and 
ECSUs. 
    Subd. 2.  [PROGRAM REQUIREMENTS.] All staff exchanges made 
under this section are subject to the requirements in this 
subdivision. 
    (a) A school district employing a participating staff 
member must not adversely affect the staff member's salary, 
seniority, or other employment benefits, or otherwise penalize 
the staff member for participating in the program. 
    (b) Upon completion or termination of an exchange, a school 
district employing a participating staff member must permit the 
staff member to return to the same assignment the staff member 
performed in the district before the exchange, if available, or, 
if not, a similar assignment. 
    (c) A school district employing a participating staff 
member must continue to provide the staff member's salary and 
other employment benefits during the period of the exchange. 
    (d) A participant must be licensed and tenured. 
    (e) Participation in the program must be voluntary. 
    (f) The length of participation in the program must be no 
less than one-half of a school year and no more than one school 
year, and any premature termination of participation must be 
upon the mutual agreement of the participant and the 
participating school districts. 
    (g) A participant is responsible for transportation to and 
from the host school district. 
    This subdivision does not abrogate or change rights of 
staff members participating in the staff exchange program or the 
terms of an agreement between the exclusive representative of 
the school district employees and the school district.  
Participating school districts may enter into supplementary 
agreements with the exclusive representative of the school 
district employees to accomplish the purpose of this section. 
    Subd. 3.  [APPLICATION PROCEDURES.] The school board of a 
school district must decide by resolution to participate in the 
staff exchange program.  A staff member wishing to participate 
in the exchange program must submit an application to the school 
district employing the staff member.  The district must, in a 
timely and appropriate manner, provide to the exclusive 
bargaining representatives of teachers in the state the number 
and names of prospective participants within the district, the 
assignments available within the district, and the length of 
time for each exchange.  The exclusive bargaining 
representatives are requested to cooperatively participate in 
the coordination of exchanges to facilitate exchanges across all 
geographical regions of the state.  Prospective participants 
must contact teachers and districts with whom they are 
interested in making an exchange.  The prospective participants 
must make all arrangements to accomplish their exchange and the 
superintendents of the participating districts must approve the 
arrangements for the exchange in writing. 
    Subd. 4.  [REPORT.] By January 1, 1991, the school 
districts participating in the staff exchange program shall 
report to the commissioner of education on the number and 
location of staff members participating in the exchange, the 
assignments of the participants, and other matters of interest, 
including the advisability of continuing the exchange.  
    Sec. 31.  [APPLICABILITY.] 
    Section 4 applies to rules for which the intention to adopt 
rules is published in the State Register after August 1, 1989. 
    Sec. 32.  [LAB SAFETY TIMELINES.] 
    The state department of education shall send the guidelines 
on school lab safety to district superintendents before 
September 1, 1989.  Each district superintendent must inform the 
department by January 1, 1990, of its efforts to comply with the 
safety requirements. 
    Sec. 33.  [REPEALER.] 
    Minnesota Statutes 1988, section 120.062, subdivision 8, is 
repealed effective for the 1989-1990 school year. 
    Sec. 34.  [REPEALER.] 
    Minnesota Statutes 1988, sections 120.05, subdivision 1; 
120.13; 120.15; 120.16; 120.77; 121.09; 121.12; 121.151; 121.35, 
subdivision 5; 121.496, subdivision 1; 121.83; 121.84; 121.843; 
121.844; 121.845; 121.86; 121.882, subdivision 10; 121.902, 
subdivision 2; 121.9121, subdivision 6; 121.914, subdivisions 9 
and 10; 122.86; 122.87; 122.88; 123.3511; 123.3512; 123.581, 
subdivisions 1 and 6; 123.60; 123.601; 123.68; 124.12, 
subdivision 1; 124.2138, subdivisions 3 and 4; 124.496; 124A.27, 
subdivision 7; 125.241, subdivision 3; 125.60, subdivision 7; 
126.03; 126.07; 126.10; 126.11; 126.39, subdivision 11; 126.52, 
subdivision 11; 126.70, subdivision 3; 126.80; 275.128; and Laws 
1988, chapter 718, article 7, section 61, are repealed July 1, 
1989. 
    Sec. 35.  [EFFECTIVE DATE.] 
    Sections 17, 18, and 19 are effective July 1, 1992.  
Section 28 is effective retroactively to May 7, 1988. 
    Section 30 is effective for the 1989-1990 school year. 
    Sections 1 and 3 are effective for the 1990-1991 school 
year and thereafter. 

                               ARTICLE 10
 LIBRARIES
    Section 1.  Minnesota Statutes 1988, section 134.31, is 
amended by adding a subdivision to read: 
    Subd. 5.  [ADVISORY COMMITTEE.] The commissioner shall 
appoint an advisory committee of five members to advise the 
staff of the Minnesota library for the blind and physically 
handicapped on long-range plans and library services.  Members 
shall be people who use the library.  Section 15.059 governs 
this committee.  
    Sec. 2.  Minnesota Statutes 1988, section 134.34, 
subdivision 2, is amended to read: 
    Subd. 2.  [REQUIRED INCREASES; LIMIT.] Notwithstanding the 
provisions of section 134.33 and subdivision 1 of this section, 
after the second year of participation by a city or county, the 
dollar amount of the minimum level of support for that city or 
county shall not be required to increase by more than ten 
percent over the dollar amount of the minimum level of support 
required of it in the previous year.  If a participating city or 
county which has been providing for public library service 
support in an amount equivalent to .67 mill times the gross tax 
capacity of the taxable property of that city or county for the 
year preceding that calendar year would be required to increase 
the dollar amount of such support by more than ten percent to 
reach the equivalent of .4 mill times the adjusted gross tax 
capacity of the taxable property of that participating city or 
county as determined by the commissioner of revenue for the 
second year preceding that calendar year or the per capita 
amount calculated under the provisions of subdivision 1, it 
shall only be required to increase the dollar amount of such 
support by ten percent per year until such time as it reaches an 
amount equivalent to .4 mill times the adjusted gross tax 
capacity of that taxable property as determined by the 
commissioner of revenue for the second year preceding that 
calendar year or the per capita amount calculated under the 
provisions of subdivision 1.  
    Sec. 3.  Minnesota Statutes 1988, section 134.34, 
subdivision 3, is amended to read: 
    Subd. 3.  [REGIONAL DESIGNATION.] Regional library basic 
system support grants shall be made only to those regional 
public library systems officially designated by the state board 
of education as the appropriate agency to strengthen, improve 
and promote public library services in the participating areas.  
The state board of education shall designate no more than one 
such regional public library system located entirely within any 
single development region existing under sections 462.381 
to 462.396 462.398 or chapter 473. 
    Sec. 4.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated. 
    Subd. 2.  [BASIC SUPPORT GRANTS.] For basic support grants 
according to Minnesota Statutes, sections 134.32 to 134.35: 
    $5,801,000 ..... 1990 
    $6,093,000 ..... 1991 
    The 1990 appropriation includes $747,000 for 1989 and 
$5,054,000 for 1990.  
    The 1991 appropriation includes $892,000 for 1990 and 
$5,201,000 for 1991.  
    Subd. 3.  [MULTICOUNTY, MULTITYPE LIBRARY SYSTEMS.] For 
grants according to Minnesota Statutes, sections 134.353 and 
134.354, to multicounty, multitype library systems:  
    $247,000 ..... 1990 
    $256,000 ..... 1991 
    The 1990 appropriation includes $34,000 for 1989 and 
$213,000 for 1990.  
    The 1991 appropriation includes $38,000 for 1990 and 
$218,000 for 1991.  
    Subd. 4.  [STATE AGENCY ON-LINE SYSTEM.] For the ongoing 
cost of operating a computer library catalog system in state 
agency libraries: 
     $43,000     .....     1990
     $43,000     .....     1991
    Subd. 5.  [MATERIALS FOR LIBRARIANS.] To update materials 
on library information and services available to librarians 
through the department of education: 
     $20,000     .....     1990
    This appropriation is available until June 30, 1991. 
    Subd. 6.  [AUTOMATED LIBRARY SYSTEM.] For a computer system 
to support operations of the Minnesota library for the blind and 
physically handicapped and for an advisory committee: 
    $222,000 ..... 1990 
    $21,000 ...... 1991 
    Up to $4,000 each year may be used for the advisory 
committee for the Minnesota library for the blind and physically 
handicapped. 
    Sec. 5.  [REPEALERS.] 
    Subdivision 1.  [JULY 1, 1989.] Minnesota Statutes, section 
134.34, subdivision 5, is repealed July 1, 1989. 
    Subd. 2.  [JULY 1, 1991.] Minnesota Statutes, section 
134.33, subdivision 1, is repealed July 1, 1991. 

                               ARTICLE 11

                       EDUCATION AGENCY SERVICES
    Section 1.  Minnesota Statutes 1988, section 121.612, is 
amended to read: 
    121.612 [CITATION MINNESOTA ACADEMIC EXCELLENCE 
FOUNDATION.] 
    Subdivision 1.  [CITATION.] This section may be cited as 
the "Minnesota academic excellence act."  
    Subd. 1a 2.  [CREATION OF FOUNDATION.] There is created the 
Minnesota academic excellence foundation.  The purpose of the 
foundation shall be to promote academic excellence in Minnesota 
public schools through a public-private partnership partnerships.
The foundation shall be a nonprofit organization.  The board of 
directors of the foundation and foundation activities are under 
the direction of the state board of education. 
    Subd. 2 3.  [BOARD OF DIRECTORS.] The board of directors of 
the foundation shall consist of the governor or the governor's 
designee; the chairs of the education committee and education 
finance division in the house of representatives and the chairs 
of the education committee and education subcommittee on 
education aids in the senate; a minority member of the house of 
representatives to be appointed by the house minority leader; a 
minority member of the senate, to be appointed by the senate 
minority leader; the commissioner of education;, a member of the 
state board of education selected by the state board who shall 
serve as chair and 15 members to be appointed by the governor.  
Of the 15 members appointed by the governor, six shall represent 
various education groups and nine shall represent various 
business groups.  The board of directors shall meet as soon as 
possible after the effective date of this section.  The 
commissioner of education shall serve as secretary for the board 
of directors and provide administrative support to the 
foundation.  An executive committee of the foundation board 
composed of the board officers and chairs of board committees, 
may only advise and make recommendations to the foundation board.
    Subd. 3 4.  [FOUNDATION PROGRAMS.] The foundation shall 
plan for may develop programs which that advance the concept of 
educational excellence.  These may include, but are not limited 
to:  
    (a) recognition programs and awards for students 
demonstrating academic excellence; 
    (b) summer institute programs for students with special 
talents; 
    (c) recognition programs for teachers, administrators, and 
others who contribute to academic excellence; 
    (d) summer mentorship programs with business and industry 
for students with special career interests and high academic 
achievements; and 
    (e) governor's awards ceremonies to promote academic 
competition; and 
    (f) an academic league to provide organized challenges 
requiring cooperation and competition for public and nonpublic 
pupils in elementary and secondary schools. 
    To the extent possible, the foundation shall make these 
programs available to students in all parts of the state.  
    Subd. 3a.  [ACADEMIC LEAGUE PLANS.] The academic excellence 
foundation shall develop a plan for an academic league to 
promote academic excellence through organized challenges 
requiring both cooperation and competition for public and 
nonpublic pupils in elementary and secondary schools.  The 
foundation shall develop the plan in consultation with 
administrators of existing programs of academic competition and 
cooperation, the Minnesota state high school league, and the 
Minnesota association of secondary school principals.  The 
foundation shall submit the plans to the education committees of 
the legislature by January 15, 1989. 
    Subd. 5.  [POWERS AND DUTIES.] The foundation may: 
    (1) establish and collect membership fees; 
    (2) publish brochures or booklets relating to the purposes 
of the foundation and collect reasonable fees for the 
publications; 
    (3) receive money and grants from nonstate sources for the 
purposes of the foundation; 
    (4) contract with consultants; and 
    (5) expend money for awards and other forms of recognition 
and appreciation. 
    Subd. 6.  [CONTRACTS.] The foundation board shall review 
and approve each contract of the board.  Each contract of the 
foundation board shall be subject to the same review and 
approval procedures as a contract of the state board of 
education. 
    Subd. 7.  [FOUNDATION STAFF.] The state board shall appoint 
the executive director and other staff who shall perform duties 
and have responsibilities solely related to the foundation.  
    Subd. 4 8.  [PRIVATE FUNDING.] The foundation shall seek 
private resources to supplement the available public money. 
Individuals, businesses, and other organizations may contribute 
to the foundation in any manner specified by the board of 
directors.  All money received shall be administered by the 
board of directors.  
    Subd. 5 9.  [REPORT.] The board of directors of the 
foundation shall submit an annual report to the education 
committees of the legislature on the progress of its activities 
made pursuant to the provisions of this section.  The annual 
report shall contain a financial report for the preceding year, 
including all receipts and expenditures of the foundation. 
    Subd. 6.  [FOUNDATION PUBLICATIONS.] The foundation may 
publish brochures or booklets relating to the purposes of the 
foundation.  The foundation may collect reasonable fees for the 
publications. 
    Subd. 7 10.  [APPROPRIATION.] There is annually 
appropriated to the academic excellence foundation any and all 
amounts received by the foundation pursuant to subdivision 6 
this section. 
    Sec. 2.  Minnesota Statutes 1988, section 121.931, 
subdivision 3, is amended to read: 
    Subd. 3.  [SYSTEMS ARCHITECTURE PLAN.] The state board, 
with the advice and assistance of the ESV computer council, 
shall develop a systems architecture plan for providing 
administrative data processing to school districts, the 
department of education, and the legislature.  In developing the 
plan, the state board shall consider at least the following:  
user needs; systems design factors; telecommunication 
requirements; computer hardware technology; and alternative 
hardware purchase and lease arrangements.  The plan shall be 
completed by September 1, 1981. 
    Sec. 3.  Minnesota Statutes 1988, section 121.931, 
subdivision 4, is amended to read: 
    Subd. 4.  [LONG-RANGE PLAN.] The state board, with the 
advice and assistance of the ESV computer council and the 
information policy office, shall develop a long-range plan for 
providing administrative data processing to elementary, 
secondary, and technical institute school districts, the 
department of education, and the legislature. In developing the 
plan, the state board shall consider at least the following: 
desirable major enhancements to the ESV-IS and SDE-IS; new 
system development proposals; new or modified approaches to 
provide support services to districts; the responsibility of 
regional management information centers to provide reports to 
the department on behalf of affiliated districts; and related 
development and implementation time schedules.  The long-range 
plan shall address the feasibility and practicability of 
utilizing microcomputers, minicomputers, and larger computer 
systems.  The preliminary plan shall be prepared by November 1, 
1981, and the plan shall be completed by January 1, 1982.  The 
plan shall be updated by September 15 of each even-numbered 
year.  The long-range plan shall consist of one document and 
shall incorporate the systems architecture plan and all relevant 
portions of previous documents which have been referred to as 
the state computing plan. 
    Sec. 4.  Minnesota Statutes 1988, section 121.931, 
subdivision 7, is amended to read: 
    Subd. 7.  [APPROVAL POWERS.] The state board, with the 
advice and assistance of the ESV computer council and the 
information policy office of the department of administration, 
shall approve or disapprove the following, according to the 
criteria in section 121.937 and rules adopted pursuant to 
subdivision 8: 
    (a) the creation of regional management information centers 
pursuant to section 121.935; 
    (b) the transfer by a district of its affiliation from one 
regional management information center to another; 
    (c) the use by a district of a management information 
system other than the ESV-IS subsystem through the regional 
management information center or a state board approved 
alternative system pursuant to section 121.936, subdivisions 2 
to 4; and 
    (d) annual and biennial plans and budgets submitted by 
regional management information centers pursuant to section 
121.935, subdivisions 3 and 4. 
    Sec. 5.  Minnesota Statutes 1988, section 121.934, 
subdivision 2, is amended to read: 
    Subd. 2.  [MEMBERSHIP.] The council shall be composed of:  
    (a) four six representatives of school districts, including 
one school district administrator from a rural school district, 
one school district administrator from an urban school district, 
one school board member from a rural school district, and one 
school board member from an urban school district, one teacher 
from a rural school district, and one teacher from an urban 
school district; 
    (b) three persons employed in management positions in the 
private sector, at least two of whom are data processing 
managers or hold an equivalent position in the private sector; 
    (c) three persons employed in management positions in the 
public sector other than elementary, secondary, or vocational 
education, at least two of whom are data processing managers or 
hold an equivalent position in the public sector; 
    (d) one person from the general public; 
    (e) one person representing post-secondary vocational 
technical education; and 
    (f) (e) one person from the department of education.  
    Members selected pursuant to clauses (b) and (c) shall not 
be employees or board members of local school districts or the 
department of education.  The council shall include at least one 
resident of each congressional district.  
    Sec. 6.  Minnesota Statutes 1988, section 121.935, 
subdivision 6, is amended to read: 
    Subd. 6.  [FEES.] Regional management information centers 
may charge fees to affiliated districts for the cost of services 
provided to the district and the district's proportionate share 
of outstanding regional debt.  If a district uses a state 
approved alternative finance system for processing its detailed 
transactions or transfers to another region, the district is 
liable for its contracted proportionate share of the outstanding 
regional debt.  The district is not liable for any additional 
outstanding regional debt that occurs after written notice is 
given to transfer or use an alternative finance system.  In no 
event shall the annual fee of a district participating in a 
state pilot program of an alternative financial management 
information system exceed the annual fee chargeable to the 
district in the absence of the pilot program.  A regional 
management information center must not charge a district for 
transferring the district's summary financial data and essential 
data elements to the state.  The regional management information 
center may charge the district for any service it provides to, 
or performs on behalf of, a district to render the data in the 
proper format for reporting to the state.  
    Sec. 7.  Minnesota Statutes 1988, section 121.936, 
subdivision 4a, is amended to read: 
    Subd. 4a.  By July 1, 1984, The department of education 
shall develop and implement an alternative reporting system for 
submission of financial data in summary form.  This system shall 
accommodate the use of a microcomputer finance system to be 
developed and maintained by the department of education.  The 
alternative reporting system must comply with sections 121.90 to 
121.917.  The provisions of this subdivision shall not be 
construed to require the department to purchase computer 
hardware nor to prohibit the department from purchasing services 
from any regional management information center or the Minnesota 
educational computing consortium.  
     Sec. 8.  Minnesota Statutes 1988, section 123.58, 
subdivision 9, is amended to read:  
    Subd. 9.  [FINANCIAL SUPPORT FOR THE EDUCATIONAL 
COOPERATIVE SERVICE UNITS.] (a) Financial support for ECSU 
programs and services shall be provided by participating local 
school districts and nonpublic school administrative units with 
private, state and federal financial support supplementing as 
available.  The ECSU board of directors may, in each year, for 
the purpose of paying any administrative, planning, operating, 
or capital expenses incurred or to be incurred, assess and 
certify to each participating school district and nonpublic 
school administrative unit its proportionate share of any and 
all expenses.  This share shall be based upon the extent of 
participation by each district or nonpublic school 
administrative unit and shall be in the form of a service fee.  
Each participating district and nonpublic school administrative 
unit shall remit its assessment to the ECSU board as provided in 
the ECSU bylaws.  The assessments shall be paid within the 
maximum levy limitations of each participating district.  No 
participating school district or nonpublic school administrative 
unit shall have any additional liability for the debts or 
obligations of the ECSU except that assessment which has been 
certified as its proportionate share or any other liability the 
school district or nonpublic school administrative unit agrees 
to assume. 
    (b) Any property acquired by the ECSU board is public 
property to be used for essential public and governmental 
purposes which shall be exempt from all taxes and special 
assessments levied by a city, county, state or political 
subdivision thereof.  If the ECSU is dissolved, its property 
must be distributed to the member public school districts at the 
time of the dissolution. 
    (c) A school district or nonpublic school administrative 
unit may elect to withdraw from participation in the ECSU by a 
majority vote of its full board membership and upon compliance 
with the applicable withdrawal provisions of the ECSU 
organizational agreement.  Upon receipt of the withdrawal 
resolution reciting the necessary facts, the ECSU board shall 
file a certified copy with the state board of education.  The 
withdrawal shall be effective on the June 30 following receipt 
by the board of directors of written notification of the 
withdrawal at least six months prior to June 30.  
Notwithstanding the withdrawal, the proportionate share of any 
expenses already certified to the withdrawing school district or 
nonpublic school administrative unit for the ECSU shall be paid 
to the ECSU board. 
    (d) The ECSU is a public corporation and agency and its 
board of directors may make application for, accept and expend 
private, state and federal funds that are available for programs 
of educational benefit approved by the state board of education 
in accordance with rules adopted by the state board of education 
pursuant to chapter 14.  The state board of education shall not 
distribute special state aid or federal aid directly to an ECSU 
in lieu of distribution to a school district within the ECSU 
which would otherwise qualify for and be entitled to this aid 
without the consent of the school board of that district. 
    (e) The ECSU is a public corporation and agency and as 
such, no earnings or interests of the ECSU may inure to the 
benefit of an individual or private entity. 
    Sec. 9.  Minnesota Statutes 1988, section 126.56, 
subdivision 4, is amended to read: 
    Subd. 4.  [ELIGIBLE PROGRAMS INSTITUTIONS.] A scholarship 
may be used only for an eligible program.  An eligible program 
shall be approved by the state board of education.  An eligible 
program shall be sponsored by at an eligible institution.  A 
Minnesota public post-secondary institution is an eligible 
institution.  A private post-secondary institution that is 
eligible if it: 
    (1) is accredited by the North Central Association of 
Colleges; 
    (2) offers at least an associate or baccalaureate degree 
program approved under section 136A.65, subdivision 1; and 
    (3) is located in Minnesota. 
    An eligible program shall, as its primary purpose, provide 
academic instruction for student enrichment in curricular areas 
including, but not limited to, communications, humanities, 
social studies, social science, science, mathematics, art, or 
foreign language.  The program shall not be offered for credit 
to post-secondary students.  It shall not provide remedial 
instruction.  Additional requirements for eligibility may be 
established by the state board of education and the higher 
education coordinating board.  
    Sec. 10.  Minnesota Statutes 1988, section 126.56, is 
amended by adding a subdivision to read: 
    Subd. 4a.  [ELIGIBLE PROGRAMS.] A scholarship may be used 
only for an eligible program.  To be eligible, a program must: 
    (1) provide, as its primary purpose, academic instruction 
for student enrichment in curricular areas including, but not 
limited to, communications, humanities, social studies, social 
science, science, mathematics, art, or foreign languages; 
    (2) not be offered for credit to post-secondary students; 
    (3) not provide remedial instruction; 
    (4) meet any other program requirements established by the 
state board of education and the higher education coordinating 
board; and 
     (5) be approved by the state board of education.  
    Sec. 11.  [129B.481] [TEACHER CENTER GRANTS.] 
    Subdivision 1.  [DEFINITION.] For the purposes of this 
section, "teacher" has the meaning given it in section 179A.03, 
subdivision 18. 
    Subd. 2.  [ESTABLISHMENT.] A teacher center may be 
established by one or more school boards and the exclusive 
representatives of the teachers.  The teacher center shall serve 
at least ten districts or 3,000 teachers. 
    Subd. 3.  [POLICY BOARD MEMBERSHIP.] Representatives of 
exclusive representatives and representatives of the school 
boards shall mutually determine the composition of the policy 
board according to the guidelines in this subdivision.  A 
majority of the policy board must be teachers.  The number of 
policy board members from each participating district must be in 
proportion to the number of teachers in each district.  The 
board shall be composed of elementary teachers, secondary 
teachers, and other teachers, parents, and representatives of 
school boards, post-secondary education, business, and labor.  
At least one teacher from each participating district shall be a 
member of the board. 
    Subd. 4.  [BOARD POWERS AND DUTIES.] The board shall 
develop policy, designate a fiscal agent, adopt a budget, expend 
funds to accomplish the purposes of the center, contract for 
technical and other assistance, and perform other managerial or 
supervisory activities consistent with the rules of the state 
board of education.  The board may employ staff or contract with 
consultants for services. 
    Subd. 5.  [CENTER FUNCTIONS.] A teacher center shall 
perform functions according to this subdivision.  The center 
shall assist teachers, diagnose learning needs, experiment with 
the use of multiple instructional approaches, assess pupil 
outcomes, assess staff development needs and plans, and teach 
school personnel about effective pedagogical approaches.  The 
center shall develop and produce curricula and curricular 
materials designed to meet the educational needs of pupils being 
served, by applying educational research and new and improved 
methods, practices, and techniques.  The center shall provide 
programs to improve the skills of teachers to meet the special 
educational needs of pupils.  The center shall provide programs 
to familiarize teachers with developments in curriculum 
formulation and educational research, including how research can 
be used to improve teaching skills.  The center shall facilitate 
sharing of resources, ideas, methods, and approaches directly 
related to classroom instruction and improve teachers' 
familiarity with current teaching materials and products for use 
in their classrooms.  The center shall provide in-service 
programs. 
    Subd. 6.  [TASK FORCE.] An advisory task force is 
established to assist the board of teaching in various aspects 
of teacher centers.  The advisory task force consists of 14 
persons appointed by the board of teaching as follows:  (1) two 
elementary, two secondary, and one special area teacher 
recommended by the Minnesota federation of teachers; (2) two 
elementary, two secondary, and one special area teacher 
recommended by the Minnesota education association; (3) one 
member recommended by the Minnesota school boards association; 
(4) one member representing the faculty of post-secondary 
colleges of education recommended by the higher education 
coordinating board; (5) one member recommended by the 
commissioner of education; and (6) one member recommended by the 
state board of education. 
    Subd. 7.  [GRANT APPLICATIONS AND AWARDS.] The board of 
teaching, through the advisory task force, shall prescribe the 
form and manner of applications for grants for teacher centers.  
Each application must include the approval of the teachers' 
exclusive representatives and the school boards of all 
participating districts. 
    Upon approval of an application by the advisory task force, 
the board of teaching shall award a planning grant of not more 
than $75,000 for a teacher center.  The grant shall be used to 
develop a final plan of operation for a teacher center.  The 
advisory task force shall recommend the amount of a planning 
grant based on the number of teachers to be served by the center.
    Each grant recipient shall provide information to the board 
of teaching about how the proceeds of the grant were used. 
    Sec. 12.  [LOANS TO ECSUs.] 
    Subdivision 1.  [ACCOUNT ESTABLISHED.] During the biennium, 
an account in the state treasury shall be established to loan 
money to an educational cooperative service unit to the extent a 
loan is necessary to meet cash flow needs.  
    Subd. 2.  [LOANS AND REPAYMENT.] The commissioner of 
education, in consultation with the commissioner of finance, 
shall establish criteria for determining cash flow needs and 
conditions and procedures for a loan.  The commissioner of 
education, in consultation with the commissioner of finance, 
shall approve or disapprove each loan application according to 
the demonstrated need of the ECSU.  An ECSU shall repay the 
loan, with interest at the average monthly rate on invested 
treasurer's cash, by June 30 of the fiscal year in which the 
money was loaned.  If the ECSU does not repay the loan according 
to the terms of the loan, the commissioner of education shall 
withhold state payments to the ECSU and aid to the school 
districts that are members of the ECSU, in proportion to the 
number of pupil units in each district, in an amount equal to 
the outstanding loan amount.  
    Sec. 13.  [APPROPRIATION.] 
    Subdivision 1.  [HIGHER EDUCATION COORDINATING BOARD.] The 
sums indicated in this section are appropriated from the general 
fund to the higher education coordinating board for the fiscal 
years designated. 
    Subd. 2.  [SUMMER PROGRAM SCHOLARSHIPS.] To the higher 
education coordinating board, for scholarship awards for summer 
programs according to Minnesota Statutes, section 126.56:  
    $214,000 ..... 1990, 
    $214,000 ..... 1991.  
    Of this appropriation, any amount required by the higher 
education coordinating board may be used for the board's costs 
of administering the program.  
    Sec. 14.  [APPROPRIATIONS.] 
    Subdivision 1.  [BOARD OF TEACHING.] The sums indicated in 
this section are appropriated from the general fund to the board 
of teaching for the fiscal years designated.  Any unexpended 
balance from the appropriations in this section in the first 
year does not cancel and is available for the second year. 
    Subd. 2.  [TEACHER CENTER GRANTS.] To the board of teaching 
for grants to teacher centers according to section 11:  
    $150,000 ..... 1990 
    $150,000 ..... 1991 
    A grant must be awarded to each existing teacher center 
under Laws 1987, chapter 398, article 8, section 43.  
    Sec. 15.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general fund 
to the department of education for the fiscal years designated. 
    Subd. 2.  [TEACHER MENTORSHIP.] For grants to develop 
mentoring programs in school districts according to Minnesota 
Statutes, section 125.231: 
     $250,000     .....     1990
     $250,000     .....     1991
    Any unexpended balance in the first year does not cancel 
and is available for the second year. 
    Subd. 3.  [ADMINISTRATOR'S ACADEMY.] For the 
administrator's academy: 
     $168,000     .....     1990 
     $168,000     .....     1991
    $24,000 must be used each year for the school management 
assessment center at the University of Minnesota. 
    Subd. 4.  [OFFICE ON TRANSITION SERVICES.] For the 
interagency office on transition services according to Minnesota 
Statutes, section 120.183: 
    $80,000 ..... 1990 
    $80,000 ..... 1991 
    Subd. 5.  [EDUCATIONAL COOPERATIVE SERVICE UNITS.] For 
educational cooperative service units:  
    $749,000 ..... 1990 
    $749,000 ..... 1991 
    The 1990 appropriation includes $113,000 for 1989 and 
$636,000 for 1990.  
    The 1991 appropriation includes $113,000 for 1990 and 
$636,000 for 1991.  
    Money from this appropriation may be transmitted to ECSU 
boards of directors for general operations in amounts of up to 
$68,000 per ECSU for each fiscal year.  The ECSU whose 
boundaries coincide with the boundaries of development region 11 
and the ECSU whose boundaries encompass development regions six 
and eight may receive up to $136,000 for each fiscal year. 
    Before releasing money to the ECSUs, the department of 
education shall assure that the annual plan of each ECSU 
explicitly addresses the specific educational services that can 
be better provided by an ECSU than by a member district.  The 
annual plan must include methods to increase direct services to 
school districts in cooperation with the state department of 
education.  The department may withhold all or a portion of the 
money for an ECSU if the department determines that the ECSU has 
not been providing services according to its annual plan. 
    Subd. 6.  [MANAGEMENT INFORMATION CENTERS.] For management 
information centers according to Minnesota Statutes, section 
121.935, subdivision 5: 
     $3,411,000     .....     1990
     $3,411,000     .....     1991
    Subd. 7.  [LEGISLATIVE COMMISSION ON PUBLIC EDUCATION.] To 
the legislative commission on public education: 
    $250,000 ..... 1990.  
    The appropriation for fiscal year 1990 does not cancel and 
is available until June 30, 1991. 
    Subd. 8.  [STATE PER ASSISTANCE.] For state assistance for 
planning, evaluating, and reporting:  
    $601,000 ..... 1990 
    $601,000 ..... 1991 
    At least $45,000 each year shall be used for assisting 
districts with the assurance of mastery program.  
    Subd. 9.  [EDUCATIONAL EFFECTIVENESS.] For educational 
effectiveness programs according to Minnesota Statutes, sections 
121.608 and 121.609: 
     $600,000     .....     1990
     $600,000     .....     1991
    Subd. 10.  [CURRICULUM AND TECHNOLOGY INTEGRATION.] For 
curriculum and technology services:  
    $600,000 ..... 1990, 
    $600,000 ..... 1991.  
    Up to $355,000 each year shall be used for courseware 
integration centers.  
    Up to $215,000 each year shall be used for technology 
services.  
    Up to $30,000 each year may be used for disseminating 
information about technology innovations identified in the 
technology demonstration sites.  
    Subd. 11.  [ARTS PLANNING PROGRAM ASSISTANCE.] For 
technical assistance for the comprehensive arts planning program 
according to Minnesota Statutes, section 129B.21:  
    $38,000 ..... 1990, 
    $38,000 ..... 1991.  
     The appropriation for 1990 does not cancel but is available 
for fiscal year 1991. 
    Subd. 12.  [ACADEMIC EXCELLENCE FOUNDATION.] For the 
academic excellence foundation according to Minnesota Statutes, 
section 121.612:  
    $160,000 ..... 1990 
    $160,000 ..... 1991 
     Up to $50,000 each year is contingent upon the department's 
receipt of $1 from private sources for each $1 of the 
appropriation.  The commissioner of education must certify 
receipt of the private matching funds. 
    Subd. 13.  [HEALTH AND WELLNESS CURRICULUM.] For the 
development and dissemination of the comprehensive health and 
wellness curriculum:  
    $30,000 ..... 1990 
    The appropriation is available until June 30, 1991.  
    Subd. 14.  [ECSU LOANS.] For loans to ECSUs:  
    $500,000 ..... 1990 
    $500,000 ..... 1991 
    It is anticipated that loans of not more than the amount 
appropriated will be repaid or otherwise recovered by June 30 
each fiscal year. 
    Sec. 16.  [APPROPRIATION.] 
    Subdivision 1.  [STATE UNIVERSITY BOARD.] The sums 
indicated in this section are appropriated from the general fund 
to the state university board for the fiscal years designated. 
    Subd. 2.  [FACULTY EXCHANGE.] For expenses incurred by 
elementary and secondary teachers participating in the faculty 
education exchange: 
     $25,000     .....     1990
    The appropriation is available until June 30, 1991. 
    Sec. 17.  [APPROPRIATION.] 
    Subdivision 1.  [BOARD OF REGENTS.] The sums indicated in 
this section are appropriated from the general fund to the board 
of regents of the University of Minnesota for the fiscal years 
designated. 
    Subd. 2.  [FACULTY EXCHANGE.] For expenses incurred by 
elementary and secondary teachers participating in the faculty 
education exchange: 
     $25,000     .....     1990
    The appropriation is available until June 30, 1991. 
    Sec. 18.  [REPEALER.] 
    Minnesota Statutes 1988, section 126.81, is repealed.  Laws 
1988, chapter 718, article 5, section 4, is repealed. 
    Sec. 19.  [EFFECTIVE DATE.] 
    Section 5 is effective the day following final enactment.  
The changes in the composition of the ESV computer council shall 
occur as vacancies occur or the terms of members expire. 

                               ARTICLE 12 

                            STATE AGENCIES' 

                      APPROPRIATIONS FOR EDUCATION 
    Section 1.  Minnesota Statutes 1988, section 43A.08, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [ADDITIONAL UNCLASSIFIED POSITIONS.] Appointing 
authorities for the following agencies may designate additional 
unclassified positions according to this subdivision:  the 
departments of administration; agriculture; commerce; 
corrections; jobs and training; education; employee relations; 
trade and economic development; finance; health; human rights; 
labor and industry; natural resources; office of administrative 
hearings; public safety; public service; human services; 
revenue; transportation; and veterans affairs; the housing 
finance, state planning, and pollution control agencies; the 
state board of investment; the waste management board; the 
offices of the secretary of state, state auditor, and state 
treasurer; the state board of vocational technical education; 
the school and resource Minnesota center for the arts education; 
and the Minnesota zoological board. 
    A position designated by an appointing authority according 
to this subdivision must meet the following standards and 
criteria:  
    (1) the designation of the position would not be contrary 
to other law relating specifically to that agency; 
    (2) the person occupying the position would report directly 
to the agency head or deputy agency head and would be designated 
as part of the agency head's management team; 
    (3) the duties of the position would involve significant 
discretion and substantial involvement in the development, 
interpretation, and implementation of agency policy; 
    (4) the duties of the position would not require primarily 
personnel, accounting, or other technical expertise where 
continuity in the position would be important; 
    (5) there would be a need for the person occupying the 
position to be accountable to, loyal to, and compatible with the 
governor and the agency head, or the employing constitutional 
officer; 
    (6) the position would be at the level of division or 
bureau director or assistant to the agency head; and 
    (7) the commissioner has approved the designation as being 
consistent with the standards and criteria in this subdivision. 
    Sec. 2.  Minnesota Statutes 1988, section 128A.09, is 
amended to read: 
    128A.09 [SERVICE, SEMINAR, AND CONFERENCE FEES.] 
    Subdivision 1.  [DEPOSIT; CREDIT RENTAL INCOME; 
APPROPRIATION.] Fees and Rental income, excluding rent for land 
and living residences, collected by the academies for services, 
seminars, and conferences must be deposited in the state 
treasury and credited to the a revolving fund of the academies. 
Money in the revolving fund for rental income is annually 
appropriated to the academies for staff development purposes.  
Payment from the revolving fund for rental income may be made 
only according to vouchers authorized by the administrator of 
the academies. 
    Subd. 2.  [ADMINISTRATOR'S VOUCHERS FEES; 
APPROPRIATION.] Payment may be made from the revolving fund only 
according to vouchers authorized by the administrator of the 
academies.  Income from fees for conferences, seminars, 
nondistrict technical assistance, and production of 
instructionally-related materials must be deposited in the state 
treasury and credited to a revolving fund of the academies.  
Money in the revolving fund for fees from conferences, seminars, 
nondistrict technical assistance, and production of 
instructionally-related materials is annually appropriated to 
the academies to defray expenses of the services conferences, 
seminars, technical assistance, and conferences production of 
materials.  Payment from the revolving fund for conferences and 
other fees may be made only according to vouchers authorized by 
the administrator of the academies. 
    Sec. 3.  Minnesota Statutes 1988, section 129C.10, is 
amended to read: 
    129C.10 [MINNESOTA SCHOOL AND RESOURCE CENTER FOR THE 
ARTS EDUCATION.] 
    Subdivision 1.  [GOVERNANCE.] The board of the Minnesota 
school and resource center for the arts education shall consist 
of 15 persons.  The members of the board shall be appointed by 
the governor with the advice and consent of the senate.  At 
least one member must be appointed from each congressional 
district. 
    Subd. 2.  [TERMS, COMPENSATION, AND OTHER.] The membership 
terms, compensation, removal of members, and filling of 
vacancies shall be as provided for in section 15.0575.  A member 
may serve not more than two consecutive terms. 
    Subd. 3.  [POWERS AND DUTIES OF BOARD.] (a) The board has 
the powers necessary for the care, management, and control of 
the Minnesota school and resource center for the arts education 
and all its real and personal property.  The powers shall 
include, but are not limited to, those listed in this 
subdivision. 
    (b) The board may employ and discharge necessary employees, 
and contract for other services to ensure the efficient 
operation of the school and resource center for arts education. 
    (c) The board may receive and award grants.  The board may 
establish a charitable foundation and accept, in trust or 
otherwise, any gift, grant, bequest, or devise for educational 
purposes and hold, manage, invest, and dispose of them and the 
proceeds and income of them according to the terms and 
conditions of the gift, grant, bequest, or devise and its 
acceptance. 
     (d) The board may establish or coordinate evening, 
continuing education, extension, and summer programs through the 
resource center for teachers and pupils. 
     (e) The board may identify pupils in grades 9 to 12 who 
have artistic talent, either demonstrated or potential, in 
dance, literary arts, media arts, music, theater, and visual 
arts, or in more than one art form. 
     (f) The board shall educate pupils with artistic talent by 
providing:  
     (1) a pilot interdisciplinary academic and arts program for 
pupils in the 11th and 12th grades, beginning with 135 pupils in 
the 11th grade in September 1989, and 135 pupils in the 11th 
grade and 135 pupils in the 12th grade in September 1990; 
    (2) intensive arts seminars for one or two weeks for 9th 
and 10th grade pupils in grades 9 to 12; 
     (3) summer arts institutes for pupils in grades 9 to 12; 
     (4) artist mentor and extension programs in regional sites; 
and 
     (5) teacher education programs for indirect curriculum 
delivery. 
    (g) The board may determine the location for the Minnesota 
school and resource center for the arts education and any 
additional facilities related to the school center, including 
the authority to lease a temporary facility. 
    (h) The board must plan for the enrollment of pupils on an 
equal basis from each congressional district.  
    (i) The board may establish task forces as needed to advise 
the board on policies and issues.  The task forces expire as 
provided in section 15.059, subdivision 6.  
    (j) The board may request the commissioner of education for 
assistance and services. 
    (k) The board may enter into contracts with other public 
and private agencies and institutions for residential and 
building maintenance services if it determines that these 
services could be provided more efficiently and less expensively 
by a contractor than by the board itself.  The board may also 
enter into contracts with public or private agencies and 
institutions, school districts or combinations of school 
districts, or educational cooperative service units to provide 
supplemental educational instruction and services. 
    (l) The board may provide or contract for services and 
programs by and for the arts high school center for arts 
education, including a school store, operating in connection 
with the school center; theatrical events; and other programs 
and services that, in the determination of the board, serve the 
purposes of the arts high school center. 
    (m) The board may provide for transportation of pupils to 
and from the school and resource center for the arts education 
for all or part of the school year, as the board considers 
advisable and subject to its rules.  Notwithstanding any other 
law to the contrary, the board may charge a reasonable fee for 
transportation of pupils.  Every driver providing transportation 
of pupils under this paragraph must possess all qualifications 
required by the state board of education.  The board may 
contract for furnishing authorized transportation under rules 
established by the commissioner of education and may purchase 
and furnish gasoline to a contract carrier for use in the 
performance of a contract with the board for transportation of 
pupils to and from the school and resource center for the arts 
education.  When transportation is provided, scheduling of 
routes, establishment of the location of bus stops, the manner 
and method of transportation, the control and discipline of 
pupils, and any other related matter is within the sole 
discretion, control, and management of the board. 
    (n) The board may provide room and board for its pupils. 
    (o) The board may establish and set fees for services and 
programs without regard to chapter 14.  If the board sets fees 
not authorized or prohibited by the Minnesota public school fee 
law, it may do so without complying with the requirements of 
section 120.75, subdivision 1. 
    Subd. 3a.  [ARTS HIGH SCHOOL CENTER FUND APPROPRIATION.] 
There is established in the state treasury an a center for arts 
high school education fund.  All money collected by the board 
shall be deposited in the fund. Money in the fund, including 
interest earned, is annually appropriated to the board for the 
operation of its services and programs. 
    Subd. 4.  [EMPLOYEES.] (a) (1) The board shall appoint a 
director of the school and resource center for the arts 
education who shall serve in the unclassified service. 
    (2) The board shall employ, upon recommendation of the 
director, a coordinator of the resource center programs who 
shall serve in the unclassified service. 
    (3) The board shall employ, upon recommendation of the 
director, up to six department chairs who shall serve in the 
unclassified service.  The chairs shall be licensed teachers 
unless no licensure exists for the subject area or discipline 
for which the chair is hired. 
    (4) The board may employ other necessary employees, upon 
recommendation of the director. 
    (5) The board shall employ, upon recommendation of the 
director, an executive secretary for the director, who shall 
serve in the unclassified service. 
    (b) The employees hired under this subdivision and other 
necessary employees hired by the board shall be state employees 
in the executive branch. 
    Subd. 4a.  [ADMISSION AND CURRICULUM REQUIREMENTS 
GENERALLY.] (a) The board may adopt rules for admission to and 
discharge from the school full-time programs for talented pupils 
and rules regarding the operation of the school and resource 
center, including transportation of its pupils.  Rules covering 
admission and discharge are governed by chapter 14.  Rules 
covering discharge from the full-time program for talented 
pupils must be consistent with sections 127.26 to 127.39, the 
pupil fair dismissal act.  Rules regarding discharge and the 
operation of the school center are not governed by chapter 14. 
    (b) Proceedings concerning the full-time program for 
talented pupils, including admission to or, discharge from the 
school, a pupil's program at the school, and a pupil's 
progress at the school, are governed by the rules adopted by the 
board and are not contested cases governed by chapter 14. 
    Subd. 5.  [RESOURCE CENTER PROGRAMS.] The Resource center 
shall offer programs that are must be directed at improving arts 
education in elementary and secondary schools throughout the 
state.  The programs offered shall include at least summer 
institutes offered to pupils in various regions of the state, 
in-service workshops for teachers, and leadership development 
programs for teachers.  The board shall establish a 
resource center programs advisory council composed of elementary 
and secondary arts educators, representatives from 
post-secondary educational institutions, department of 
education, state arts board, regional arts councils, educational 
cooperative service units, school district administrators, 
parents, and other organizations involved in arts education.  
The advisory council shall include representatives from a 
variety of arts disciplines and from various areas of the 
state.  The advisory council shall advise the board about 
the activities of the center resource programs.  Programs 
offered through the Resource center programs shall promote and 
develop arts education programs offered by school districts and 
arts organizations and shall assist school districts and arts 
organizations in developing innovative programs programming.  
The board may contract with arts organizations to 
provide resource programs through the resource center.  The 
advisory council shall advise the board on contracts 
and programs grants related to the operation of the resource 
center programs.  
    Subd. 6.  [PUBLIC POST-SECONDARY INSTITUTIONS; PROVIDING 
SPACE.] Public post-secondary institutions shall provide space 
for programs offered by the Minnesota school and resource center 
for the arts education at no cost to the Minnesota school and 
resource center for the arts to the extent that space is 
available at the public post-secondary institutions. 
    Sec. 4.  Minnesota Statutes 1988, section 141.25, 
subdivision 8, is amended to read: 
    Subd. 8.  [FEES AND TERMS OF LICENSE.] (a) Applications for 
initial license under sections 141.21 to 141.36 shall be 
accompanied by $440 $510 as a nonrefundable application fee. 
    (b) All licenses shall expire on December 31 of each year.  
Each renewal application shall be accompanied by a nonrefundable 
renewal fee of $330 $380.  
    (c) Application for renewal of license shall be made on or 
before October 1 of each calendar year.  Each renewal form shall 
be supplied by the commissioner.  It shall not be necessary for 
an applicant to supply all information required in the initial 
application at the time of renewal unless requested by the 
commissioner.  
    Sec. 5.  Minnesota Statutes 1988, section 141.26, 
subdivision 5, is amended to read: 
    Subd. 5.  [FEE.] The initial and renewal application for 
each permit shall be accompanied by a nonrefundable fee of $165 
$190. 
    Sec. 6.  Minnesota Statutes 1988, section 297A.25, 
subdivision 11, is amended to read: 
    Subd. 11.  [SALES TO GOVERNMENT.] The gross receipts from 
all sales, including sales in which title is retained by a 
seller or a vendor or is assigned to a third party under an 
installment sale or lease purchase agreement under section 
465.71, of tangible personal property to, and all storage, use 
or consumption of such property by, the United States and its 
agencies and instrumentalities, the University of Minnesota, 
state universities, community colleges, technical institutes, 
state academies, the Minnesota center for arts education, and 
political subdivisions of the state are exempt.  Sales exempted 
by this subdivision include sales under section 297A.01, 
subdivision 3, clause (f).  This exemption shall not apply to 
building, construction or reconstruction materials purchased by 
a contractor or a subcontractor as a part of a lump-sum contract 
or similar type of contract with a guaranteed maximum price 
covering both labor and materials for use in the construction, 
alteration or repair of a building or facility.  This exemption 
does not apply to construction materials purchased by tax exempt 
entities or their contractors to be used in constructing 
buildings or facilities which will not be used principally by 
the tax exempt entities. 
    Sec. 7.  [INSTRUCTION TO REVISOR.] 
    The revisor of statutes is requested to change the name of 
Minnesota Statutes, chapter 129C, from "Minnesota School and 
Resource Center for the Arts" to "Minnesota Center for Arts 
Education." 
     Sec. 8.  [MAGNET ARTS PROGRAMS.] 
    The center shall identify at least one school district in 
each congressional district with the interest and potential to 
offer magnet arts programs using the curriculum developed by the 
Minnesota center for arts education.  A report on legislative 
action needed to implement magnet arts programs shall be 
submitted to the education committees of the legislature by 
February 1, 1990. 
    Sec. 9.  [APPROPRIATIONS.] 
    Subdivision 1.  [DEPARTMENT OF EDUCATION.] The sums 
indicated in this section are appropriated from the general 
fund, unless otherwise indicated, to the department of education 
for the fiscal years designated. 
    The amounts that may be spent for each program are 
specified in the following subdivisions. 
    The approved complement is: 
             1990      1991
General Fund 262.5     262.5
Federal      128.4     129.4
Other         28.1      28.1
Total        419.0     420.0
    The commissioner of education, with the approval of the 
commissioner of finance, may transfer unencumbered balances 
among the programs during the biennium.  Transfers must be 
reported immediately to the house education finance division and 
the senate education funding division.  During the biennium, the 
commissioner may transfer money among the various objects of 
expenditure categories and activities within each program, 
unless restricted by executive order. 
    The commissioner of education, with the approval of the 
commissioner of finance, may transfer complement among funds if 
necessary.  The commissioner must report material changes to the 
house education finance division and the senate education 
funding division. 
    Subd. 2.  [EDUCATIONAL SERVICES.] 
     $8,302,000     .....    1990 
     $7,571,000     .....    1991 
    $21,000 each year is from the trunk highway fund. 
    $100,000 each year is from the alcohol-impaired driver 
education account in the special revenue fund. 
    The federal complement of the community education section 
is increased by 3.0. 
    The base in the learner support section is reduced by 
$691,000 in 1991.  
     $1,191,000 in 1990 and $500,000 in 1991 are for the learner 
support section.  Any unexpended balance remaining in the first 
year is available for the second year.  For the purpose of 
developing the fiscal years 1992-1993 biennial budget, the base 
for the learner support section is $220,000 each year plus 
allowable statewide department of finance base adjustments.  
    The state complement in the institutional approval section 
is increased by 1.0.  
    The state complement in the equal opportunities section is 
increased by 1.0. 
    The state complement of the Indian education section is 
increased by 4.0. 
     $47,000 is added to the vocational student organization 
base in 1990 only. 
    The state complement of the assessment and program 
evaluation section is increased by 4.5.  $495,000 each year is 
for 2.0 of the 4.5 complement and for continued development of 
the assessment item bank and for technical assistance to 
districts in the use of assessment measures including the item 
bank.  
    One complement in the curriculum services section is 
transferred from the public health fund to the general fund. 
    $450,000 each year may be used for the identification and 
integration of learner outcomes.  Of these amounts, $175,000 in 
fiscal year 1990 is for the identification and development of 
vocational career learner outcomes.  
    The federal complement of the curriculum services section 
is increased by 2.0. 
    The federal complement of the special education section is 
increased by 1.0 in 1991. 
    The state complement includes 1.0 for the office of 
educational leadership and the federal complement includes 3.0 
for the office of educational leadership. 
    Subd. 3.  [ADMINISTRATION AND FINANCIAL SERVICES.] 
     $8,851,700     .....     1990
     $8,906,700     .....     1991
    The state complement of the education finance and analysis 
section is increased by 2.0 for processing pupil enrollment 
transfers.  The base in the education finance and analysis 
section is reduced by $30,000 each year for program cost 
analysis. 
    School districts shall report information on salary 
schedules to the department of education in a manner prescribed 
by the department. 
    $25,000 each year is for the development and distribution 
of training videos for school bus drivers. 
    The state complement of the education data systems section 
is increased by 6.0.  
    $1,267,000 in 1990 and $1,420,000 in 1991 are for the 
education data systems section.  $15,000 each year of these 
amounts are for the expenses of the ESV computer council.  Any 
unexpended balance remaining in the first year does not cancel 
and is available for the second year. 
    The ESV computer council shall study and evaluate the 
current structure of regional management information centers.  
The study shall include at least the following:  
    (1) the number and location of regional data processing 
centers; 
    (2) the number, location, and administrative structure of 
regional service centers; 
    (3) the relationship of regional computing centers to the 
departments of administration and education; 
    (4) the administrative relationship of regional processing 
or service centers to other regional administrative units, 
including educational cooperative service units; 
    (5) the relationship of the development of regional 
processing to state telecommunications networks; and 
    (6) other administrative or related issues, as determined 
by the council.  
    The council shall report to the education committees of the 
legislature by February 1, 1990, its recommendations for 
changes.  The report shall also include recommendations about 
the role of the council in implementing the recommendations.  
    $50,000 in 1990 is for the ESV computer council to contract 
with the information policy office in the department of 
administration for this study.  
    The child nutrition section is reduced by $30,000 each year.
    $14,000 each year is for internal auditing of the 
department.  The auditing shall include analysis of the payment 
of credits and aids by the department to school districts.  
    The commissioner shall maintain no more than six total 
complement in the categories of commissioner, deputy 
commissioner, assistant commissioner, assistant to the 
commissioner, or executive assistant. 
    $50,000 in 1990 is for development of an information 
management policy within the department of education to analyze 
the purpose and use of the integrated data base and other data 
gathered by the department from school districts.  The policy 
shall consider uses of the information by the department of 
education, other state departments, the public, and the 
legislature.  The department may contract with an independent 
consultant to design an information management policy. 
    The state complement for the administrative support section 
is increased by 2.5 including 0.5 for affirmative action and 2.0 
for publications.  
    The state complement of the Minnesota academic excellence 
foundation is increased by 0.5. 
    $168,000 each year is for the state board of education.  
The state complement for the state board is increased by 1.0. 
    $179,700 in fiscal year 1990 and $179,700 in fiscal year 
1991 are for expenses incurred for litigation of a challenge to 
the constitutionality of the education financing system.  Any 
unencumbered balances must not be transferred to other programs. 
    Sec. 10.  [FARIBAULT ACADEMIES APPROPRIATION.] 
    The sums indicated in this section are appropriated to the 
department of education for the Faribault Academies: 
     $7,139,000     .....     1990
     $7,139,000     .....     1991
    $115,000 each year is for an extended year program. 
    $16,000 each year is for the resource center.  
   Any unexpended balance in the first year does not cancel 
and is available for the second year. 
    The approved complement is: 
              1990      1991
General fund 185.6     185.6
Federal        8.0       8.0
Total        193.6     193.6
    The state board of education, with the approval of the 
commissioner of finance, may transfer complement among funds if 
necessary.  The state board must report material changes to the 
house education finance division and the senate education 
funding division. 
     Sec. 11.  MINNESOTA CENTER  
FOR ARTS EDUCATION 
Total Appropriations                   $ 5,800,000  $ 6,200,000
     Approved Complement -  1990     1991
     General Fund -         39.0     49.0
     Total -                39.0     49.0
    The state complement for the Minnesota center for arts 
education is increased by 18.0 for the first year and 28.0 the 
second year. 
    Any unexpended balance from the appropriation in this 
section in 1990 does not cancel but is available in 1991. 

                               ARTICLE 13 

                           TECHNICAL CHANGES 

                   FOR SCHOOL DISTRICT PROPERTY TAXES 
    Section 1.  Minnesota Statutes 1988, section 124.2131, 
subdivision 1, is amended to read: 
    Subdivision 1.  [ADJUSTED GROSS TAX CAPACITY.] (a) [ 
COMPUTATION.] The department of revenue shall annually conduct 
an assessment/sales ratio study of the taxable property in each 
school district in accordance with the procedures referenced in 
paragraphs (b) and (c).  Based upon the results of this 
assessment/sales ratio study, the department of revenue shall 
determine an aggregate equalized gross tax capacity and an 
aggregate equalized net tax capacity for the various strata 
classes of taxable property in each school district, which tax 
capacity shall be designated as the adjusted gross tax 
capacity and the adjusted net tax capacity, respectively.  The 
department of revenue shall take such steps as are necessary in 
the performance of that duty and may incur such the expense as 
is necessary therefor to make the determinations.  The 
commissioner of revenue is authorized to may reimburse any 
county or governmental official for requested services performed 
in ascertaining such the adjusted gross tax capacity and the 
adjusted net tax capacity.  On or before March 15 annually, the 
department of revenue shall file with the chair of the tax 
committee of the house of representatives and the chair of the 
committee on taxes and tax laws of the senate a report of 
adjusted gross tax capacities and adjusted net tax capacities.  
On or before June 15, annually, the department of revenue shall 
file its final report on the adjusted gross tax capacities and 
adjusted net tax capacities established by the previous year's 
assessment with the commissioner of education and each county 
auditor for those school districts for which the auditor has the 
responsibility for determination of mill tax capacity rates.  A 
copy of the adjusted gross tax capacity report so filed shall be 
forthwith mailed to the clerk of each district involved and to 
the county assessor or supervisor of assessments of the county 
or counties in which each district is located. 
    (b)  [METHODOLOGY.] In making its annual assessment/sales 
ratio studies, the department of revenue shall use a methodology 
consistent with the most recent Standard on Assessment Ratio 
Studies published by the assessment standards committee of the 
International Association of Assessing Officers.  The 
commissioner of revenue shall supplement this general 
methodology with specific procedures necessary for proper 
execution of the study in accordance with other Minnesota laws 
impacting the assessment/sales ratio study.  The commissioner 
shall document these specific procedures in writing and shall 
publish the procedures in the State Register, but these 
procedures will not be considered "rules" pursuant to the 
Minnesota administrative procedure act.  By January 15, 1985, 
the commissioner shall report to the chairs of the house tax 
committee and the senate committee on taxes and tax laws the 
results of a study which the commissioner shall prepare 
comparing the 1983 sales ratio study based upon the original 
1983 assessment/sales ratio study methodology with the new 
methodology as provided in clause (b).  The 1984 adjusted 
assessed values which are certified to the commissioner of 
education shall be computed using the 1983 assessment/sales 
ratio study methodology unless the 1985 legislature directs 
otherwise.  
    (c)  [AGRICULTURAL LANDS.] For purposes of determining the 
adjusted gross tax capacity and adjusted net tax capacity of 
agricultural lands for the calculation of 1987 adjusted gross 
tax capacities and thereafter adjusted net tax capacities, the 
market value of agricultural lands shall be the price for which 
the property would sell in an arms length transaction. 
    Sec. 2.  Minnesota Statutes 1988, section 124.38, 
subdivision 7, is amended to read: 
    Subd. 7.  [MAXIMUM EFFORT DEBT SERVICE LEVY.] "Maximum 
effort debt service levy" means the lesser of: 
    (1) A levy in whichever of the following amounts is 
applicable: 
    (a) In any school district granted a debt service loan 
after July 31, 1981 or granted a capital loan which is approved 
after July 31, 1981, a levy in a total dollar amount computed as 
16 mills a gross tax capacity rate of 13.08 percent on the 
adjusted gross tax capacity for taxes payable in 1990 or a net 
tax capacity rate of 16.27 percent on the adjusted net tax 
capacity for taxes payable in 1991 and thereafter; 
    (b) In any school district granted a debt service loan 
before August 1, 1981 or granted a capital loan which was 
approved before August 1, 1981, a levy in a total dollar amount 
computed as 15 mills a gross tax capacity rate of 12.26 percent 
on the adjusted gross tax capacity for taxes payable in 1990 or 
a net tax capacity rate of 15.26 percent on the net tax capacity 
for taxes payable in 1991 and thereafter, until and unless the 
district receives an additional loan; or 
    (2) A levy in whichever of the following amounts is 
applicable: 
    (a) In any school district which received a debt service or 
capital loan from the state before January 1, 1965, a levy in a 
total dollar amount computed as 4.10 mills on the market value 
in each year, unless the district applies or has applied for an 
additional loan subsequent to January 1, 1965, or issues or has 
issued bonds on the public market, other than bonds refunding 
state loans, subsequent to January 1, 1967; 
    (b) In any school district granted a debt service or 
capital loan between January 1, 1965, and July 1, 1969, a levy 
in a total dollar amount computed as 5-1/2 mills on the market 
value in each year, until and unless the district receives an 
additional loan; 
     (c) In any school district granted a debt service or 
capital loan between July 1, 1969 and July 1, 1975, a levy in a 
total dollar amount computed as 6.3 mills on market value in 
each year until and unless the district has received an 
additional loan; 
     (d) In any school district for which a capital loan was 
approved prior to August 1, 1981, a levy in a total dollar 
amount equal to the sum of the amount of the required debt 
service levy and an amount which when levied annually will in 
the opinion of the commissioner be sufficient to retire the 
remaining interest and principal on any outstanding loans from 
the state within 30 years of the original date when the capital 
loan was granted; provided, that the school board in any 
district affected by the provisions of clause (2)(d) may elect 
instead to determine the amount of its levy according to the 
provisions of clause (1); provided further that if a district's 
capital loan is not paid within 30 years because it elects to 
determine the amount of its levy according to the provisions of 
clause (2)(d), the liability of the district for the amount of 
the difference between the amount it levied under clause (2)(d) 
and the amount it would have levied under clause (1), and for 
interest on the amount of that difference, shall not be 
satisfied and discharged pursuant to section 124.43, subdivision 
4. 
    Sec. 3.  Minnesota Statutes 1988, section 124.43, 
subdivision 1, is amended to read: 
    Subdivision 1.  [REVIEW BY COMMISSIONER.] (a) The 
commissioner may, after review and a favorable recommendation by 
the state board of education, recommend to the legislature 
capital loans to school districts.  Proceeds of the loans shall 
be used only for sites for school buildings and for acquiring, 
bettering, furnishing, or equipping school buildings under 
contracts to be entered into within 12 months from and after the 
date on which each loan is granted.  
     (b) Any school board that intends to submit an application 
for a capital loan shall submit a proposal to the commissioner 
for review and comment pursuant to section 121.15 by September 1 
of any year, and the commissioner shall prepare a review and 
comment on the proposed facility, regardless of the amount of 
the capital expenditure required to construct the facility.  The 
state board shall not make a favorable recommendation on an 
application for a capital loan for any facility unless:  
     (1) the facility receives a positive review and comment 
pursuant to section 121.15; and 
     (2) the state board determines that 
     (A) the facilities are needed to replace facilities 
dangerous to the health and safety of pupils, or to provide for 
pupils for whom no adequate facilities exist; 
     (B) the facilities could not be made available through 
dissolution and attachment of the district to another district 
or through pairing, interdistrict cooperation, or consolidation 
with another district, or through the purchase or lease of 
facilities from existing institutions within the area.  The 
preference of the school district regarding reorganization shall 
not be a criterion used by the state board in determining 
whether the facilities could be made available through 
reorganization; 
    (C) the facilities are comparable in size and quality to 
facilities recently constructed in other districts of similar 
enrollment; and 
    (D) the district's need for the facilities is comparable to 
needs that comparable districts are meeting through local bond 
issues. 
    The state board may recommend that the loan be approved in 
a reduced amount in order to meet the foregoing criteria.  If 
the state board recommends that a loan not be approved, the 
commissioner shall not recommend approval of the loan.  If the 
state board recommends that the loan be approved in a reduced 
amount, the commissioner shall not recommend approval of a loan 
larger than that recommended by the state board.  
    (c) As part of reviewing an application for a capital loan, 
the commissioner of education shall prepare estimated yearly 
repayments by the school district and the estimated amount of 
principal and interest that may be forgiven after the term of 
the loan.  These estimates shall assume no growth in gross tax 
capacity over the term of the loan, shall assume a levy equal to 
16 mills a gross tax capacity rate of 13.08 percent times the 
adjusted gross tax capacity for taxes payable in 1990 or a net 
tax capacity rate of 16.27 percent for taxes payable in 1991 and 
thereafter, and shall be prepared using a methodology approved 
by the commissioner of finance.  The commissioner of education 
shall use a discount factor provided by the commissioner of 
finance in determining the present value of the estimated amount 
of interest and principal which may be forgiven after the term 
of the loan.  
    (d) No loan shall be recommended for approval for any 
district exceeding an amount computed as follows: 
    (1) The amount requested by the district under subdivision 
2; 
    (2) Plus the aggregate principal amount of general 
obligation bonds of the district outstanding on June 30 of the 
year following the year the application was received, not 
exceeding the limitation on net debt of the district in section 
475.53, subdivision 4, or 24 percent of the adjusted gross tax 
capacity, the following amount: 
     (i) for the period October 1, 1988, to September 30, 1989, 
197 percent of its adjusted gross tax capacity, 
     (ii) for any 12-month period beginning October 1 of any 
year after 1988, 245 percent of its adjusted net tax capacity as 
most recently determined, whichever is less; 
    (3) Less the maximum net debt permissible for the district 
on December 1 of the year the application is received, under the 
limitation in section 475.53, subdivision 4, or 24 percent of 
the most recent adjusted gross tax capacity available at the 
time of application, the following amount: 
    (i) for the period October 1, 1988, to September 30, 1989, 
197 percent of its adjusted gross tax capacity, 
    (ii) for any 12-month period beginning October 1 of any 
year after 1988, 245 percent of its adjusted net tax capacity as 
most recently determined, whichever is less; and 
    (4) Less any amount by which the amount voted exceeds the 
total cost of the facilities for which the loan is granted, as 
estimated in accordance with subdivision 4, provided that the 
loan may be approved in an amount computed as provided in 
clauses (1) to (3), subject to subsequent reduction in 
accordance with this clause. 
    Sec. 4.  Minnesota Statutes 1988, section 124.82, 
subdivision 3, is amended to read: 
    Subd. 3.  [FACILITIES DOWN PAYMENT LEVY REFERENDUM.] A 
district may levy the tax capacity rate approved by a majority 
of the electors voting on the question to provide funds for a 
down payment for an approved project.  The election must take 
place no more than five years before the estimated date of 
commencement of the project.  The referendum must be held on a 
date set by the school board.  A referendum for a project not 
receiving a positive review and comment by the commissioner 
under section 121.15 must be approved by at least 60 percent of 
the voters at the election.  The referendum may be called by the 
school board and may be held: 
    (1) separately, before an election for the issuance of 
obligations for the project under chapter 475; or 
    (2) in conjunction with an election for the issuance of 
obligations for the project under chapter 475; or 
    (3) notwithstanding section 475.59, as a conjunctive 
question authorizing both the down payment levy and the issuance 
of obligations for the project under chapter 475.  Any 
obligations authorized for a project may be issued within five 
years of the date of the election. 
    The ballot must provide a general description of the 
proposed project, state the estimated total cost of the project, 
state whether the project has received a positive or negative 
review and comment from the commissioner of education, state the 
maximum amount of the down payment levy in mills as a percentage 
of net tax capacity, state the amount that will be raised by 
that tax capacity rate in the first year it is to be levied, and 
state the maximum number of years that the levy authorization 
will apply. 
    The ballot must contain a textual portion with the 
information required in this section and a question stating 
substantially the following: 
    "Shall the down payment levy proposed by the board of 
.......... School District No. .......... be approved?" 
    If approved, the amount provided by the approved tax 
capacity rate applied to each year's gross the net tax capacity 
for the year preceding the year the levy is certified may be 
certified for the number of years approved. 
    In the event a conjunctive question proposes to authorize 
both the down payment levy and the issuance of obligations for 
the project, appropriate language authorizing the issuance of 
obligations must also be included in the question.  
    The district must notify the commissioner of education of 
the results of the referendum. 
    Sec. 5.  Minnesota Statutes 1988, section 134.33, 
subdivision 1, is amended to read: 
    Subdivision 1.  An establishment grant as described in 
section 134.32, subdivision 2, shall be made to any regional 
public library system for the first two state fiscal years after 
a board of county commissioners has contracted to join that 
system and has agreed that the county will provide the levels of 
support for public library service specified in this section.  
In the first year of participation 1990, the county shall 
provide an amount of support equivalent to .3 mill times 0.25 
percent of the adjusted gross tax capacity of the taxable 
property of the county as determined by the commissioner of 
revenue for the second year preceding that calendar year or 
two-thirds of the per capita amount established under the 
provisions of section 134.34, subdivision 1, whichever amount is 
less.  In the second year of participation 1991 and in each year 
thereafter, the county shall provide an amount of support 
equivalent to .4 mill times 0.41 percent of the adjusted gross 
net tax capacity of the taxable property of the county as 
determined by the commissioner of revenue for the second year 
preceding that calendar year or the per capita amount 
established under the provisions of section 134.34, subdivision 
1, whichever is less.  The minimum level of support shall be 
certified annually to the county by the department of 
education.  In no event shall the department of education 
require any county to provide a higher level of support than the 
level of support specified in this section in order for a system 
to qualify for an establishment grant.  This section shall not 
be construed to prohibit any county from providing a higher 
level of support for public libraries than the level of support 
specified in this section. 
    Sec. 6.  Minnesota Statutes 1988, section 134.34, 
subdivision 1, is amended to read: 
    Subdivision 1.  [LOCAL SUPPORT LEVELS.] A regional library 
basic system support grant shall be made to any regional public 
library system where there are at least three participating 
counties and where each participating city and county, except in 
the first year of participation as provided in section 134.33, 
is providing for public library service support the lesser of 
(a) an amount equivalent to .4 mill times 0.33 percent of the 
adjusted gross tax capacity of the taxable property of that city 
or county, as determined by the commissioner of revenue for the 
second year preceding that calendar year in 1990 and an amount 
equivalent to .41 percent of the net tax capacity of the taxable 
property of that city or county, as determined by the 
commissioner of revenue for the second year preceding that 
calendar year in 1991 and later years or (b) a per capita amount 
calculated under the provisions of this subdivision.  The per 
capita amount is established for calendar year 1980 1990 as 
$3 $3.62.  In succeeding calendar years, the per capita amount 
shall be increased by a percentage equal to one-half of the 
percentage by which the total state adjusted gross net tax 
capacity of property as determined by the commissioner of 
revenue for the second year preceding that calendar year 
increases over that total adjusted gross net tax capacity for 
the third year preceding that calendar year.  The minimum level 
of support shall be certified annually to the participating 
cities and counties by the department of education.  A city 
which is a part of a regional public library system shall not be 
required to provide this level of support if the property of 
that city is already taxable by the county for the support of 
that regional public library system.  In no event shall the 
department of education require any city or county to provide a 
higher level of support than the level of support specified in 
this section in order for a system to qualify for a regional 
library basic system support grant.  This section shall not be 
construed to prohibit a city or county from providing a higher 
level of support for public libraries than the level of support 
specified in this section.  
    Sec. 7.  Minnesota Statutes 1988, section 273.1102, 
subdivision 3, is amended to read: 
    Subd. 3.  [1988 ADJUSTMENT.] For School districts district 
levy limitations or authorities expressed in terms of mills and 
adjusted assessed value, their levy limitations in any special 
law that is not codified in Minnesota Statutes shall be 
converted by the department of education to "equalized gross tax 
capacity rates." for taxes payable in 1989 and 1990 and 
equalized net tax capacity rates for taxes payable in 1991 and 
thereafter.  For purposes of this calculation, the 1987 adjusted 
assessed values of the district shall be converted to "adjusted 
gross tax capacities" by multiplying the equalized market values 
by class of property by the gross tax capacity rates provided in 
section 273.13.  Each county assessor and the city assessors of 
Minneapolis, Duluth, and St. Cloud shall furnish the 
commissioner of revenue the 1987 market value for taxes payable 
in 1988 for any new classes of property established in this 
article.  The commissioner shall use those values, and estimate 
values where needed, in developing the 1987 tax capacity for 
each school district under this section.  The requirements of 
section 124.2131, subdivisions 1, paragraph (c), and 2 and 3, 
shall remain in effect. 
    Sec. 8.  Minnesota Statutes 1988, section 275.011, 
subdivision 1, is amended to read: 
    Subdivision 1.  The property tax levied for any purpose 
under a special law that is not codified in Minnesota Statutes 
or a city charter provision and that is subject to a mill rate 
limitation imposed by statute or the special law, excluding 
levies subject to mill rate limitations that use adjusted 
assessed values determined by the commissioner of revenue under 
section 124.2131, must not exceed the following amount for the 
years specified: 
    (a) for taxes payable in 1988, the product of the 
applicable mill rate limitation imposed by statute or special 
law multiplied by the total assessed valuation of all taxable 
property subject to the tax as adjusted by the provisions of 
Minnesota Statutes 1986, sections 272.64; 273.13, subdivision 
7a; and 275.49; 
    (b) for taxes payable in 1989, the product of (1) the 
property tax levy limitation for the taxes payable year 1988 
determined under clause (a) multiplied by (2) an index for 
market valuation changes equal to the assessment year 1988 total 
market valuation of all taxable property subject to the tax 
divided by the assessment year 1987 total market valuation of 
all taxable property subject to the tax; and 
    (c) for taxes payable in 1990 and subsequent years, the 
product of (1) the property tax levy limitation for the previous 
year determined pursuant to this subdivision multiplied by (2) 
an index for market valuation changes equal to the total market 
valuation of all taxable property subject to the tax for the 
current assessment year divided by the total market valuation of 
all taxable property subject to the tax for the previous 
assessment year. 
     For the purpose of determining the property tax levy 
limitation for the taxes payable year 1988 and subsequent years 
under this subdivision, "total market valuation" means the total 
market valuation of all taxable property subject to the tax 
without valuation adjustments for fiscal disparities (chapter 
473F), tax increment financing (sections 469.174 to 469.179), 
and high voltage transmission lines (section 273.425). 
    Sec. 9.  Minnesota Statutes 1988, section 275.125, 
subdivision 6e, is amended to read: 
    Subd. 6e.  [DESEGREGATION LEVY.] Each year, independent 
school district No. 625, St. Paul, may levy an amount not to 
exceed one mill a gross tax capacity rate of .80 percent times 
the adjusted gross tax capacity of the district for taxes 
payable in 1990 or a net tax capacity rate of 1.0 percent times 
the adjusted net tax capacity of the district for taxes payable 
in 1991 and thereafter.  Notwithstanding section 121.904, the 
entire amount of this levy shall be recognized as revenue for 
the fiscal year in which the levy is certified.  This levy shall 
not be considered in computing the aid reduction under section 
124.155. 
    Sec. 10.  Minnesota Statutes 1988, section 275.125, 
subdivision 6h, is amended to read: 
    Subd. 6h.  [MINNEAPOLIS HEALTH INSURANCE SUBSIDY LEVY.] 
Each year special school district No. 1, Minneapolis, may make 
an additional levy not to exceed the amount raised by .1 mill a 
gross tax capacity rate of .08 percent times the adjusted gross 
tax capacity for taxes payable in 1990 or a net tax capacity 
rate of .11 percent times the adjusted net tax capacity for 
taxes payable in 1991 and thereafter of the property in the 
district for the preceding year.  In addition, in 1987 the 
district may levy an amount not to exceed the amount raised by 
.1 mill times the adjusted gross tax capacity of the property in 
the district for the preceding year for health insurance 
subsidies for fiscal year 1988.  The proceeds may be used only 
to subsidize health insurance costs for eligible teachers as 
provided in this section.  
    "Eligible teacher" means a retired teacher who was a basic 
member of the Minneapolis teachers retirement fund association, 
who retired before May 1, 1974, and who is not eligible to 
receive the hospital insurance benefits of the federal Medicare 
program of the Social Security Act without payment of a monthly 
premium.  The district shall notify eligible teachers that a 
subsidy is available.  An eligible teacher may submit to the 
school district a copy of receipts for health insurance premiums 
paid during the previous 12-month period.  The school district 
shall disburse the health insurance premium subsidy to each 
eligible teacher in a timely and efficient manner.  An eligible 
teacher may receive a subsidy up to an amount equal to the 
lesser of 90 percent of the cost of the eligible teacher's 
health insurance or up to 90 percent of the cost of the number 
two qualified plan of health coverage for individual policies 
made available by the Minnesota comprehensive health association 
under chapter 62E.  
    If funds remaining from the previous year's health 
insurance subsidy levy, minus the previous year's required 
subsidy amount, are sufficient to pay the estimated current year 
subsidy, the levy must be discontinued until the remaining funds 
are estimated by the school board to be insufficient to pay the 
subsidy. 
    Sec. 11.  Minnesota Statutes 1988, section 275.125, 
subdivision 6i, is amended to read: 
    Subd. 6i.  [RULE COMPLIANCE LEVY.] Each year a district 
that is required to implement a plan according to the 
requirements of Minnesota Rules, parts 3535.0200 to 3535.2200, 
may levy an amount not to exceed one mill a gross tax capacity 
rate of .80 percent times the adjusted gross tax capacity of the 
district for taxes payable in 1990 or a net tax capacity rate of 
1.0 percent times the adjusted net tax capacity of the district 
for taxes payable in 1991 and thereafter.  Independent school 
district No. 625, St. Paul, may levy according to this 
subdivision and subdivision 6e.  Notwithstanding section 
121.904, the entire amount of this levy shall be recognized as 
revenue for the fiscal year in which the levy is certified.  
This levy shall not be considered in computing the aid reduction 
under section 124.155.  
    Sec. 12.  Minnesota Statutes 1988, section 275.125, 
subdivision 8b, is amended to read: 
    Subd. 8b.  [EARLY CHILDHOOD FAMILY EDUCATION LEVY.] A 
district may levy for its early childhood family education 
program.  The amount levied shall not exceed the lesser of:  
    (a) .5 mill a gross tax capacity rate of .4 percent times 
the adjusted gross tax capacity for taxes payable in 1990 or a 
net tax capacity rate of .49 percent times the adjusted net tax 
capacity for taxes payable in 1991 and thereafter of the 
district for the year preceding the year the levy is certified, 
or 
    (b) the maximum revenue as defined in section 124.2711, 
subdivision 1, for the school year for which the levy is 
attributable. 
    Sec. 13.  Minnesota Statutes 1988, section 275.125, 
subdivision 9, is amended to read: 
    Subd. 9.  [LEVY REDUCTIONS; TACONITE.] (1) Reductions in 
levies pursuant to subdivision 10, and section 273.138, shall be 
made prior to the reductions in clause (2). 
     (2) Notwithstanding any other law to the contrary, 
districts which received payments pursuant to sections 298.018; 
298.23 to 298.28, except an amount distributed under section 
298.28, subdivision 4, paragraph (c), clause (ii); 298.34 to 
298.39; 298.391 to 298.396; 298.405; and any law imposing a tax 
upon severed mineral values, or recognized revenue pursuant to 
section 477A.15; shall not include a portion of these aids in 
their permissible levies pursuant to those sections, but instead 
shall reduce the permissible levies authorized by this section 
and chapters 124 and 124A by the greater of the following: 
     (a) an amount equal to 50 percent of the total dollar 
amount of the payments received pursuant to those sections or 
revenue recognized pursuant to section 477A.15 in the previous 
fiscal year; or 
     (b) an amount equal to the total dollar amount of the 
payments received pursuant to those sections or revenue 
recognized pursuant to section 477A.15 in the previous fiscal 
year less the product of the same dollar amount of payments or 
revenue times the ratio of the maximum levy allowed the district 
under Minnesota Statutes 1986, sections 124A.03, subdivision 2, 
124A.06, subdivision 3a, 124A.08, subdivision 3a, 124A.10, 
subdivision 3a, 124A.12, subdivision 3a, and 124A.14, 
subdivision 5a, to the total levy allowed the district under 
this section and Minnesota Statutes 1986, sections 124A.03, 
124A.06, subdivision 3a, 124A.08, subdivision 3a, 124A.10, 
subdivision 3a, 124A.12, subdivision 3a, 124A.14, subdivision 
5a, and 124A.20, subdivision 2, for levies certified in 1986. 
    (3) No reduction pursuant to this subdivision shall reduce 
the levy made by the district pursuant to section 124A.23, to an 
amount less than the amount raised by a levy of 12.5 mills a 
gross tax capacity rate of 10.22 percent times the adjusted 
gross tax capacity for taxes payable in 1990 or a net tax 
capacity rate of 12.71 percent times the adjusted net tax 
capacity for taxes payable in 1991 and thereafter of that 
district for the preceding year as determined by the 
commissioner.  The amount of any increased levy authorized by 
referendum pursuant to section 124A.03, subdivision 2, shall not 
be reduced pursuant to this subdivision.  The amount of any levy 
authorized by subdivision 4, to make payments for bonds issued 
and for interest thereon, shall not be reduced pursuant to this 
subdivision.  
    (4) Before computing the reduction pursuant to this 
subdivision of the capital expenditure levy authorized by 
section 124.244, subdivision 2, and subdivisions 11c, 12, and 
12a, and the community education levy authorized by subdivisions 
8 and 8b, the commissioner shall ascertain from each affected 
school district the amount it proposes to levy for capital 
expenditures pursuant to section 124.244, subdivision 2, and 
subdivisions 11c, 12, and 12a, and for community education 
pursuant to subdivisions 8 and 8b.  The reduction of the capital 
expenditure levy and the community education levy shall be 
computed on the basis of the amount so ascertained. 
     (5) Notwithstanding any law to the contrary, any amounts 
received by districts in any fiscal year pursuant to sections 
298.018; 298.23 to 298.28; 298.34 to 298.39; 298.391 to 298.396; 
298.405; or any law imposing a tax on severed mineral values; 
and not deducted from general education aid pursuant to section 
124A.035, subdivision 5, clause (2), and not applied to reduce 
levies pursuant to this subdivision shall be paid by the 
district to the St. Louis county auditor in the following amount 
by March 15 of each year, the amount required to be subtracted 
from the previous fiscal year's general education aid pursuant 
to section 124A.035, subdivision 5, which is in excess of the 
general education aid earned for that fiscal year.  The county 
auditor shall deposit any amounts received pursuant to this 
clause in the St. Louis county treasury for purposes of paying 
the taconite homestead credit as provided in section 273.135. 
    Sec. 14.  Minnesota Statutes 1988, section 275.125, 
subdivision 9a, is amended to read: 
    Subd. 9a.  [STATUTORY OPERATING DEBT LEVY.] (1) In 1978 and 
each year thereafter in which so required by this subdivision, a 
district shall make an additional levy to eliminate its 
statutory operating debt, determined as of June 30, 1977 and 
certified and adjusted by the commissioner.  This levy shall not 
be made in more than 20 successive years and each year before it 
is made, it must be approved by the commissioner and the 
approval shall specify its amount.  This levy shall in each year 
be an amount which is equal to the amount raised by a levy 
of 1.5 mills a gross tax capacity rate of 1.20 percent times the 
adjusted gross tax capacity of the district for the preceding 
year for taxes payable in 1990 or a net tax capacity rate of 
1.50 percent times the adjusted net tax capacity of the district 
for the preceding year for taxes payable in 1991 and thereafter; 
provided that in the last year in which the district is required 
to make this levy, it shall levy an amount not to exceed the 
amount raised by a levy of 1.5 mills a gross tax capacity rate 
of 1.20 percent times the adjusted gross tax capacity of the 
district for the preceding year for taxes payable in 1990 or a 
net tax capacity rate of 1.50 percent times the adjusted net tax 
capacity of the district for the preceding year for taxes 
payable in 1991 and thereafter.  When the sum of the cumulative 
levies made pursuant to this subdivision and transfers made 
according to section 121.912, subdivision 4 equals an amount 
equal to the statutory operating debt of the district, the levy 
shall be discontinued. 
    (2) The district shall establish a special account in the 
general fund which shall be designated "appropriated fund 
balance reserve account for purposes of reducing statutory 
operating debt" on its books and records.  This account shall 
reflect the levy authorized pursuant to this subdivision.  The 
proceeds of this levy shall be used only for cash flow 
requirements and shall not be used to supplement district 
revenues or income for the purposes of increasing the district's 
expenditures or budgets. 
    (3) Any district which is required to levy pursuant to this 
subdivision shall certify the maximum levy allowable under 
section 124A.23, subdivision 2 in that same year. 
    (4) Each district shall make permanent fund balance 
transfers so that the total statutory operating debt of the 
district is reflected in the general fund as of June 30, 1977. 
    Sec. 15.  Minnesota Statutes 1988, section 275.125, 
subdivision 9b, is amended to read: 
    Subd. 9b.  [OPERATING DEBT LEVY.] (1) Each year, a district 
may make an additional levy to eliminate a deficit in the net 
unappropriated operating funds of the district, determined as of 
June 30, 1983, and certified and adjusted by the commissioner.  
This levy may in each year be an amount not to exceed the amount 
raised by a levy of 1.5 mills a gross tax capacity rate of 1.20 
percent times the adjusted gross tax capacity for taxes payable 
in 1990 or a net tax capacity rate of 1.50 percent times the 
adjusted net tax capacity for taxes payable in 1991 and 
thereafter of the district for the preceding year as determined 
by the commissioner.  However, the total amount of this levy for 
all years it is made shall not exceed the lesser of (a) the 
amount of the deficit in the net unappropriated operating funds 
of the district as of June 30, 1983, or (b) the amount of the 
aid reduction, according to Laws 1981, Third Special Session 
chapter 2, article 2, section 2, but excluding clauses (l), (m), 
(n), (o), and (p), and Laws 1982, Third Special Session chapter 
1, article 3, section 6, to the district in fiscal year 1983.  
When the cumulative levies made pursuant to this subdivision 
equal the total amount permitted by this subdivision, the levy 
shall be discontinued.  
    (2) The proceeds of this levy shall be used only for cash 
flow requirements and shall not be used to supplement district 
revenues or income for the purposes of increasing the district's 
expenditures or budgets.  
    (3) Any district that levies pursuant to this subdivision 
shall certify the maximum levy allowable under section 124A.23, 
subdivisions 2 and 2a, in that same year. 
    Sec. 16.  Minnesota Statutes 1988, section 275.125, 
subdivision 9c, is amended to read: 
    Subd. 9c.  [1985 OPERATING DEBT LEVY.] (1) Each year, a 
district may levy to eliminate a deficit in the net 
unappropriated balance in the general fund of the district, 
determined as of June 30, 1985, and certified and adjusted by 
the commissioner.  Each year this levy may be an amount not to 
exceed the amount raised by a levy of 1.5 mills a gross tax 
capacity rate of 1.20 percent times the adjusted gross tax 
capacity for taxes payable in 1990 or a net tax capacity rate of 
1.50 percent times the adjusted net tax capacity for taxes 
payable in 1991 and thereafter of the district for the preceding 
year.  However, the total amount of this levy for all years it 
is made shall not exceed the amount of the deficit in the net 
unappropriated balance in the general fund of the district as of 
June 30, 1985.  When the cumulative levies made pursuant to this 
subdivision equal the total amount permitted by this 
subdivision, the levy shall be discontinued.  
    (2) A district, if eligible, may levy under this 
subdivision or subdivision 9b but not both. 
    (3) The proceeds of this levy shall be used only for cash 
flow requirements and shall not be used to supplement district 
revenues or income for the purposes of increasing the district's 
expenditures or budgets.  
    (4) Any district that levies pursuant to this subdivision 
shall certify the maximum levy allowable under section 124A.23, 
subdivision 2 in that same year. 
    Sec. 17.  Minnesota Statutes 1988, section 275.125, 
subdivision 14a, is amended to read: 
    Subd. 14a.  [LEVY FOR LOCAL SHARE OF TECHNICAL INSTITUTE 
CONSTRUCTION.] (a) The definitions in section 136C.02 apply to 
this subdivision. 
    (b) A district maintaining a technical institute may levy 
for its local share of the cost of construction of facilities 
for the technical institute as provided in this subdivision.  
         (c) The construction must be authorized by a specific 
legislative act pursuant to section 136C.07, subdivision 5, 
after January 1, 1980.  The specific legislative act must 
require that part of the cost of construction for post-secondary 
vocational purposes shall be financed by the state and that part 
of the cost of construction for post-secondary vocational 
purposes shall be financed by the school district operating the 
technical institute.  
         (d) The district may levy an amount equal to the local 
share of the cost of construction for post-secondary vocational 
purposes, minus the amount of any unappropriated net balance in 
the district's post-secondary vocational technical building 
construction fund.  A district may levy the total amount 
authorized by this subdivision in one year, or a proportionate 
amount of the total authorized amount each year for up to three 
successive years.  
         (e) By the July 1 before a district certifies the first 
levy pursuant to this subdivision for the local share of any 
construction project, at least three weeks published notice of 
the proposed levy shall be given in the legal newspaper with the 
largest circulation in the district.  The notice shall state the 
purpose of the proposed levy, the duration of the proposed levy 
and the amount of the proposed levy in dollars and mills in 
terms of the tax capacity rate.  Upon petition within 20 days 
after the notice of the greater of (a) 50 voters, or (b) 15 
percent of the number of voters who voted in the district at the 
most recent regular school board election, the board shall call 
a referendum on the proposed levy. The referendum shall be held 
on a date set by the school board, but no later than the August 
20 before the levy is certified.  The question on the ballot 
shall state the amount of the proposed levy in mills on the 
district's adjusted gross tax capacity terms of the tax capacity 
rate and in dollars in the first year of the proposed levy. 
    (f) For the purposes of this subdivision, "construction" 
includes the acquisition and betterment of land, buildings and 
capital improvements for technical institutes.  
    (g) A district may not levy for the cost of a construction 
project pursuant to this subdivision if it issues any bonds to 
finance any costs of the project. 
    Sec. 18.  Laws 1965, chapter 705, as amended by Laws 1975, 
chapter 261, section 4, and Laws 1980, chapter 609, article 6, 
section 37, is amended to read:  
    Sec. 6.  The school board, for the purpose of providing 
moneys for the payment of its severance pay obligations under a 
plan approved by resolution of the district, in addition to all 
other powers possessed by the school district and in addition to 
and in excess of any existing limitation upon the amount it is 
otherwise authorized by law to levy as taxes, is authorized to 
levy taxes annually not exceeding in any one year an amount 
equal to two tenths of one mill upon each dollar of the assessed 
valuation thereof a gross tax capacity rate of .17 percent for 
taxes payable in 1990 or a net tax capacity rate of .21 percent 
for taxes payable in 1991 and thereafter upon all taxable 
property within the school district which taxes as levied shall 
be spread upon the tax rolls, and all corrections thereof shall 
be held by the school district, and allocated therefor to be 
disbursed and expended by the school district in payment of any 
public school severance pay obligations and for no other 
purpose.  Disbursements and expenditures previously authorized 
on behalf of the school district for payment of severance pay 
obligations shall not be deemed to constitute any part of the 
cost of the operation and maintenance of the school district 
within the meaning of any statutory limitation of any school 
district expenditures.  
     The amount of such severance pay allowable or to become 
payable in respect of any such employment or to any such 
employee shall not exceed the amount permitted by Minnesota 
Statutes, Section 465.72.  
     Sec. 19.  Laws 1976, chapter 20, section 4, is amended to 
read:  
     Sec. 4.  [EXCESS LEVY.] In addition to all other levies 
permitted by law, in 1976 and each year thereafter, Independent 
School District No. 625 shall make an additional levy to 
eliminate its statutory operating debt for the school year 
ending June 30, 1976 as certified by the legislative auditor 
pursuant to section 3.  Each year the commissioner of education 
shall certify to the county auditor and Independent School 
District No. 625 the correct amount of this levy.  This levy 
shall in each year be an amount which is equal to the amount 
raised by a levy of 1.5 mills a gross tax capacity rate of 1.20 
percent times the adjusted assessed valuation gross tax capacity 
for taxes payable in 1990 or a net tax capacity rate of 1.50 
percent times the adjusted net tax capacity for taxes payable in 
1991 and thereafter of the district for the preceding year as 
determined by the equalization aid review committee, less any 
amount necessary for the payment of principal and interest on 
bonds sold pursuant to section 1.  When the cumulative receipts 
from the levies made pursuant to this section and the earnings 
in the reserve account established under section 5 equal an 
amount equal to the statutory operating debt, the levy shall be 
discontinued.  
     Sec. 20.  Laws 1988, chapter 719, article 5, section 84, is 
amended to read:  
     Sec. 84.  [INSTRUCTION TO REVISOR.] 
     The revisor of statutes shall change the words "assessed 
value" or "assessed valuation" wherever they appear in Minnesota 
Statutes to "gross tax capacity" in Minnesota Statutes 1988 and 
"net tax capacity" in Minnesota Statutes 1989 Supplement and 
subsequent editions of the statutes except section 275.011, and 
except in sections of Minnesota Statutes amended in this act.  
The revisor of statutes shall change the words "mill rate" 
wherever they appear in Minnesota Statutes to "tax capacity 
rate" in Minnesota Statutes 1988 and subsequent editions of the 
statutes except section 275.011. 
    Sec. 21.  [EFFECTIVE DATE.] 
    Sections 1 to 20 are effective the day following final 
enactment. 
    Presented to the governor May 30, 1989 
    Signed by the governor June 1, 1989, 10:18 p.m.

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