Minnesota Session Laws - 1991, Regular Session

  

                         Laws of Minnesota 1991 

                         CHAPTER 61-S.F.No. 732 
           An act relating to natural resources; offering an 
          alternative to bond or deposit requirements on 
          contracts for cutting timber; allowing reduction in 
          value of letters of credit given as security for 
          timber permits; amending Minnesota Statutes 1990, 
          section 90.173; proposing coding for new law in 
          Minnesota Statutes, chapter 90. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  [90.162] [ALTERNATIVE TO BOND OR DEPOSIT 
REQUIREMENTS.] 
    In lieu of the bond or cash deposit required by section 
90.161 or 90.173, a purchaser of state timber may, at the time 
of the bid approval and upon payment by the purchaser to the 
commissioner of 25 percent of the appraised value under section 
90.14, elect in writing on a form prescribed by the attorney 
general to prepay the purchase price for any designated cutting 
block identified on the permit before the date the purchaser 
enters upon the land to begin harvesting the timber. 
    Sec. 2.  Minnesota Statutes 1990, section 90.173, is 
amended to read: 
    90.173 [PURCHASER'S OR ASSIGNEE'S CASH DEPOSIT IN LIEU OF 
BOND.] 
    (a) In lieu of filing the bond required by section 90.161 
or 90.171, as security for the issuance or assignment of a 
timber permit the person required to file the bond may deposit 
with the state treasurer cash, a certified check, a cashier's 
check, a personal check, a postal, bank, or express money order, 
assignable bonds or notes of the United States, or an assignment 
of a bank savings account or investment certificate or an 
irrevocable bank letter of credit, in the same amount as would 
be required for a bond.  If securities listed in this section 
are deposited, the par value of the securities shall be not less 
than the amount required for the timber sale bond, and the 
person required to file the timber sale bond shall submit an 
agreement authorizing the commissioner to sell or otherwise take 
possession of the security in the event of default under the 
timber sale.  All of the conditions of the timber sale bond 
shall equally apply to the deposit with the state treasurer.  In 
the event of a default the state may take from the deposit the 
sum of money to which it is entitled; the remainder, if any, 
shall be returned to the person making the deposit and shall 
bear interest at the rate determined pursuant to section 549.09 
if not returned within 30 days from the date of the default.  
Sums of money as may be required by the state treasurer to carry 
out the terms and provisions of this section are appropriated 
from the general fund to the state treasurer for these 
purposes.  When cash is deposited for a bond, it shall be 
applied to the amount due when a statement is prepared and 
transmitted to the permit holder pursuant to section 90.181.  
Any balance due to the state shall be shown on the statement and 
shall be paid as provided in section 90.181.  Any amount of the 
deposit in excess of the amount determined to be due pursuant to 
section 90.181 shall be returned to the permit holder when a 
final statement is transmitted pursuant to that section.  All or 
part of a cash bond may be withheld from application to an 
amount due on a nonfinal statement if it appears that the total 
amount due on the permit will exceed the bid price.  
    (b) If an irrevocable bank letter of credit is provided as 
security under paragraph (a), at the written request of the 
permittee the state shall annually allow the amount of the bank 
letter of credit to be reduced by an amount proportionate to the 
value of timber that has been harvested and for which the state 
has received payment under the timber permit.  The remaining 
amount of the bank letter of credit after a reduction under this 
paragraph must not be less than the value of the timber 
remaining to be harvested under the timber permit. 
    Sec. 3.  [EFFECTIVE DATE.] 
    This act is effective the day following final enactment.  
Section 1 applies to timber sale contracts entered into after 
the effective date of that section. 
    Presented to the governor May 2, 1991 
    Signed by the governor May 6, 1991, 3:33 p.m.