Skip to main content Skip to office menu Skip to footer
Capital IconMinnesota Legislature

Office of the Revisor of Statutes

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

                            CHAPTER 105-S.F.No. 1894 
                  An act relating to flood relief; providing an 
                  exception to the nursing home moratorium; providing 
                  for early payment of state aids to local governments; 
                  providing certain temporary authority, waivers, and 
                  transfers due to the flood situation; appropriating 
                  money; amending Minnesota Statutes 1996, section 
                  144A.071, subdivision 4a. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 1996, section 144A.071, 
        subdivision 4a, is amended to read: 
           Subd. 4a.  [EXCEPTIONS FOR REPLACEMENT BEDS.] It is in the 
        best interest of the state to ensure that nursing homes and 
        boarding care homes continue to meet the physical plant 
        licensing and certification requirements by permitting certain 
        construction projects.  Facilities should be maintained in 
        condition to satisfy the physical and emotional needs of 
        residents while allowing the state to maintain control over 
        nursing home expenditure growth. 
           The commissioner of health in coordination with the 
        commissioner of human services, may approve the renovation, 
        replacement, upgrading, or relocation of a nursing home or 
        boarding care home, under the following conditions: 
           (a) to license or certify beds in a new facility 
        constructed to replace a facility or to make repairs in an 
        existing facility that was destroyed or damaged after June 30, 
        1987, by fire, lightning, or other hazard provided:  
           (i) destruction was not caused by the intentional act of or 
        at the direction of a controlling person of the facility; 
           (ii) at the time the facility was destroyed or damaged the 
        controlling persons of the facility maintained insurance 
        coverage for the type of hazard that occurred in an amount that 
        a reasonable person would conclude was adequate; 
           (iii) the net proceeds from an insurance settlement for the 
        damages caused by the hazard are applied to the cost of the new 
        facility or repairs; 
           (iv) the new facility is constructed on the same site as 
        the destroyed facility or on another site subject to the 
        restrictions in section 144A.073, subdivision 5; 
           (v) the number of licensed and certified beds in the new 
        facility does not exceed the number of licensed and certified 
        beds in the destroyed facility; and 
           (vi) the commissioner determines that the replacement beds 
        are needed to prevent an inadequate supply of beds. 
        Project construction costs incurred for repairs authorized under 
        this clause shall not be considered in the dollar threshold 
        amount defined in subdivision 2; 
           (b) to license or certify beds that are moved from one 
        location to another within a nursing home facility, provided the 
        total costs of remodeling performed in conjunction with the 
        relocation of beds does not exceed 25 percent of the appraised 
        value of the facility or $500,000, whichever is less; 
           (c) to license or certify beds in a project recommended for 
        approval under section 144A.073; 
           (d) to license or certify beds that are moved from an 
        existing state nursing home to a different state facility, 
        provided there is no net increase in the number of state nursing 
        home beds; 
           (e) to certify and license as nursing home beds boarding 
        care beds in a certified boarding care facility if the beds meet 
        the standards for nursing home licensure, or in a facility that 
        was granted an exception to the moratorium under section 
        144A.073, and if the cost of any remodeling of the facility does 
        not exceed 25 percent of the appraised value of the facility or 
        $500,000, whichever is less.  If boarding care beds are licensed 
        as nursing home beds, the number of boarding care beds in the 
        facility must not increase beyond the number remaining at the 
        time of the upgrade in licensure.  The provisions contained in 
        section 144A.073 regarding the upgrading of the facilities do 
        not apply to facilities that satisfy these requirements; 
           (f) to license and certify up to 40 beds transferred from 
        an existing facility owned and operated by the Amherst H. Wilder 
        Foundation in the city of St. Paul to a new unit at the same 
        location as the existing facility that will serve persons with 
        Alzheimer's disease and other related disorders.  The transfer 
        of beds may occur gradually or in stages, provided the total 
        number of beds transferred does not exceed 40.  At the time of 
        licensure and certification of a bed or beds in the new unit, 
        the commissioner of health shall delicense and decertify the 
        same number of beds in the existing facility.  As a condition of 
        receiving a license or certification under this clause, the 
        facility must make a written commitment to the commissioner of 
        human services that it will not seek to receive an increase in 
        its property-related payment rate as a result of the transfers 
        allowed under this paragraph; 
           (g) to license and certify nursing home beds to replace 
        currently licensed and certified boarding care beds which may be 
        located either in a remodeled or renovated boarding care or 
        nursing home facility or in a remodeled, renovated, newly 
        constructed, or replacement nursing home facility within the 
        identifiable complex of health care facilities in which the 
        currently licensed boarding care beds are presently located, 
        provided that the number of boarding care beds in the facility 
        or complex are decreased by the number to be licensed as nursing 
        home beds and further provided that, if the total costs of new 
        construction, replacement, remodeling, or renovation exceed ten 
        percent of the appraised value of the facility or $200,000, 
        whichever is less, the facility makes a written commitment to 
        the commissioner of human services that it will not seek to 
        receive an increase in its property-related payment rate by 
        reason of the new construction, replacement, remodeling, or 
        renovation.  The provisions contained in section 144A.073 
        regarding the upgrading of facilities do not apply to facilities 
        that satisfy these requirements; 
           (h) to license as a nursing home and certify as a nursing 
        facility a facility that is licensed as a boarding care facility 
        but not certified under the medical assistance program, but only 
        if the commissioner of human services certifies to the 
        commissioner of health that licensing the facility as a nursing 
        home and certifying the facility as a nursing facility will 
        result in a net annual savings to the state general fund of 
        $200,000 or more; 
           (i) to certify, after September 30, 1992, and prior to July 
        1, 1993, existing nursing home beds in a facility that was 
        licensed and in operation prior to January 1, 1992; 
           (j) to license and certify new nursing home beds to replace 
        beds in a facility condemned as part of an economic 
        redevelopment plan in a city of the first class, provided the 
        new facility is located within one mile of the site of the old 
        facility.  Operating and property costs for the new facility 
        must be determined and allowed under existing reimbursement 
        rules; 
           (k) to license and certify up to 20 new nursing home beds 
        in a community-operated hospital and attached convalescent and 
        nursing care facility with 40 beds on April 21, 1991, that 
        suspended operation of the hospital in April 1986.  The 
        commissioner of human services shall provide the facility with 
        the same per diem property-related payment rate for each 
        additional licensed and certified bed as it will receive for its 
        existing 40 beds; 
           (l) to license or certify beds in renovation, replacement, 
        or upgrading projects as defined in section 144A.073, 
        subdivision 1, so long as the cumulative total costs of the 
        facility's remodeling projects do not exceed 25 percent of the 
        appraised value of the facility or $500,000, whichever is less; 
           (m) to license and certify beds that are moved from one 
        location to another for the purposes of converting up to five 
        four-bed wards to single or double occupancy rooms in a nursing 
        home that, as of January 1, 1993, was county-owned and had a 
        licensed capacity of 115 beds; 
           (n) to allow a facility that on April 16, 1993, was a 
        106-bed licensed and certified nursing facility located in 
        Minneapolis to layaway all of its licensed and certified nursing 
        home beds.  These beds may be relicensed and recertified in a 
        newly-constructed teaching nursing home facility affiliated with 
        a teaching hospital upon approval by the legislature.  The 
        proposal must be developed in consultation with the interagency 
        committee on long-term care planning.  The beds on layaway 
        status shall have the same status as voluntarily delicensed and 
        decertified beds, except that beds on layaway status remain 
        subject to the surcharge in section 256.9657.  This layaway 
        provision expires July 1, 1997; 
           (o) to allow a project which will be completed in 
        conjunction with an approved moratorium exception project for a 
        nursing home in southern Cass county and which is directly 
        related to that portion of the facility that must be repaired, 
        renovated, or replaced, to correct an emergency plumbing problem 
        for which a state correction order has been issued and which 
        must be corrected by August 31, 1993; 
           (p) to allow a facility that on April 16, 1993, was a 
        368-bed licensed and certified nursing facility located in 
        Minneapolis to layaway, upon 30 days prior written notice to the 
        commissioner, up to 30 of the facility's licensed and certified 
        beds by converting three-bed wards to single or double 
        occupancy.  Beds on layaway status shall have the same status as 
        voluntarily delicensed and decertified beds except that beds on 
        layaway status remain subject to the surcharge in section 
        256.9657, remain subject to the license application and renewal 
        fees under section 144A.07 and shall be subject to a $100 per 
        bed reactivation fee.  In addition, at any time within three 
        years of the effective date of the layaway, the beds on layaway 
        status may be: 
           (1) relicensed and recertified upon relocation and 
        reactivation of some or all of the beds to an existing licensed 
        and certified facility or facilities located in Pine River, 
        Brainerd, or International Falls; provided that the total 
        project construction costs related to the relocation of beds 
        from layaway status for any facility receiving relocated beds 
        may not exceed the dollar threshold provided in subdivision 2 
        unless the construction project has been approved through the 
        moratorium exception process under section 144A.073; 
           (2) relicensed and recertified, upon reactivation of some 
        or all of the beds within the facility which placed the beds in 
        layaway status, if the commissioner has determined a need for 
        the reactivation of the beds on layaway status. 
           The property-related payment rate of a facility placing 
        beds on layaway status must be adjusted by the incremental 
        change in its rental per diem after recalculating the rental per 
        diem as provided in section 256B.431, subdivision 3a, paragraph 
        (d).  The property-related payment rate for a facility 
        relicensing and recertifying beds from layaway status must be 
        adjusted by the incremental change in its rental per diem after 
        recalculating its rental per diem using the number of beds after 
        the relicensing to establish the facility's capacity day 
        divisor, which shall be effective the first day of the month 
        following the month in which the relicensing and recertification 
        became effective.  Any beds remaining on layaway status more 
        than three years after the date the layaway status became 
        effective must be removed from layaway status and immediately 
        delicensed and decertified; 
           (q) to license and certify beds in a renovation and 
        remodeling project to convert 13 three-bed wards into 13 two-bed 
        rooms and 13 single-bed rooms, expand space, and add 
        improvements in a nursing home that, as of January 1, 1994, met 
        the following conditions:  the nursing home was located in 
        Ramsey county; was not owned by a hospital corporation; had a 
        licensed capacity of 64 beds; and had been ranked among the top 
        15 applicants by the 1993 moratorium exceptions advisory review 
        panel.  The total project construction cost estimate for this 
        project must not exceed the cost estimate submitted in 
        connection with the 1993 moratorium exception process; 
           (r) to license and certify beds in a renovation and 
        remodeling project to convert 12 four-bed wards into 24 two-bed 
        rooms, expand space, and add improvements in a nursing home 
        that, as of January 1, 1994, met the following conditions:  the 
        nursing home was located in Ramsey county; had a licensed 
        capacity of 154 beds; and had been ranked among the top 15 
        applicants by the 1993 moratorium exceptions advisory review 
        panel.  The total project construction cost estimate for this 
        project must not exceed the cost estimate submitted in 
        connection with the 1993 moratorium exception process; 
           (s) to license and certify up to 117 beds that are 
        relocated from a licensed and certified 138-bed nursing facility 
        located in St. Paul to a hospital with 130 licensed hospital 
        beds located in South St. Paul, provided that the nursing 
        facility and hospital are owned by the same or a related 
        organization and that prior to the date the relocation is 
        completed the hospital ceases operation of its inpatient 
        hospital services at that hospital.  After relocation, the 
        nursing facility's status under section 256B.431, subdivision 
        2j, shall be the same as it was prior to relocation.  The 
        nursing facility's property-related payment rate resulting from 
        the project authorized in this paragraph shall become effective 
        no earlier than April 1, 1996.  For purposes of calculating the 
        incremental change in the facility's rental per diem resulting 
        from this project, the allowable appraised value of the nursing 
        facility portion of the existing health care facility physical 
        plant prior to the renovation and relocation may not exceed 
        $2,490,000; 
           (t) to license and certify two beds in a facility to 
        replace beds that were voluntarily delicensed and decertified on 
        June 28, 1991; 
           (u) to allow 16 licensed and certified beds located on July 
        1, 1994, in a 142-bed nursing home and 21-bed boarding care home 
        facility in Minneapolis, notwithstanding the licensure and 
        certification after July 1, 1995, of the Minneapolis facility as 
        a 147-bed nursing home facility after completion of a 
        construction project approved in 1993 under section 144A.073, to 
        be laid away upon 30 days' prior written notice to the 
        commissioner.  Beds on layaway status shall have the same status 
        as voluntarily delicensed or decertified beds except that they 
        shall remain subject to the surcharge in section 256.9657.  The 
        16 beds on layaway status may be relicensed as nursing home beds 
        and recertified at any time within five years of the effective 
        date of the layaway upon relocation of some or all of the beds 
        to a licensed and certified facility located in Watertown, 
        provided that the total project construction costs related to 
        the relocation of beds from layaway status for the Watertown 
        facility may not exceed the dollar threshold provided in 
        subdivision 2 unless the construction project has been approved 
        through the moratorium exception process under section 144A.073. 
           The property-related payment rate of the facility placing 
        beds on layaway status must be adjusted by the incremental 
        change in its rental per diem after recalculating the rental per 
        diem as provided in section 256B.431, subdivision 3a, paragraph 
        (d).  The property-related payment rate for the facility 
        relicensing and recertifying beds from layaway status must be 
        adjusted by the incremental change in its rental per diem after 
        recalculating its rental per diem using the number of beds after 
        the relicensing to establish the facility's capacity day 
        divisor, which shall be effective the first day of the month 
        following the month in which the relicensing and recertification 
        became effective.  Any beds remaining on layaway status more 
        than five years after the date the layaway status became 
        effective must be removed from layaway status and immediately 
        delicensed and decertified; 
           (v) to license and certify beds that are moved within an 
        existing area of a facility or to a newly-constructed addition 
        which is built for the purpose of eliminating three- and 
        four-bed rooms and adding space for dining, lounge areas, 
        bathing rooms, and ancillary service areas in a nursing home 
        that, as of January 1, 1995, was located in Fridley and had a 
        licensed capacity of 129 beds; or 
           (w) to relocate 36 beds in Crow Wing county and four beds 
        from Hennepin county to a 160-bed facility in Crow Wing county, 
        provided all the affected beds are under common ownership; 
           (x) to license and certify a total replacement project of 
        up to 49 beds located in Norman county that are relocated from a 
        nursing home destroyed by flood and whose residents were 
        relocated to other nursing homes.  The operating cost payment 
        rates for the new nursing facility shall be determined based on 
        the interim and settle-up payment provisions of Minnesota Rules, 
        part 9549.0057, and the reimbursement provisions of section 
        256B.431, except that subdivision 25, paragraphs (b), clause 
        (3), and (d), shall not apply until the second rate year after 
        the settle-up cost report is filed.  Property-related 
        reimbursement rates shall be determined under section 256B.431, 
        taking into account any federal or state flood-related loans or 
        grants provided to the facility; or 
           (y) to license and certify a total replacement project of 
        up to 129 beds located in Polk county that are relocated from a 
        nursing home destroyed by flood and whose residents were 
        relocated to other nursing homes.  The operating cost payment 
        rates for the new nursing facility shall be determined based on 
        the interim and settle-up payment provisions of Minnesota Rules, 
        part 9549.0057, and the reimbursement provisions of section 
        256B.431, except that subdivision 25, paragraphs (b), clause 
        (3), and (d), shall not apply until the second rate year after 
        the settle-up cost report is filed.  Property-related 
        reimbursement rates shall be determined under section 256B.431, 
        taking into account any federal or state flood-related loans or 
        grants provided to the facility. 
           Sec. 2.  [TEMPORARY AUTHORITY TO SUSPEND RULES.] 
           Notwithstanding any law to the contrary, for fiscal years 
        1997 and 1998, an agency, with the approval of the governor, may 
        temporarily suspend specific agency rules as necessary to 
        expedite flood recovery effort.  The suspension of rules must be 
        confined to geographic areas affected by flooding within 
        counties included in a federal disaster declaration and to the 
        minimum periods of times necessary to deal with the emergency 
        situation.  The agency must promptly report the reasons for and 
        the impact of any suspended rules to the chairs of the 
        legislative committees that oversee the policy and budgetary 
        affairs of the agency and to the chairs of the legislative 
        committees on governmental operations.  This section expires 
        February 1, 1998. 
           Sec. 3.  [TEMPORARY WAIVER OF FEES.] 
           Notwithstanding any law to the contrary, for fiscal years 
        1997 and 1998, an agency, with the approval of the governor, may 
        waive fees that would otherwise be charged for agency services.  
        The waiver of fees must be confined to geographic areas affected 
        by flooding within counties included in a federal disaster 
        declaration and to the minimum periods of times necessary to 
        deal with the emergency situation.  The agency must promptly 
        report the reasons for and the impact of any suspended fees to 
        the chairs of the legislative committees that oversee the policy 
        and budgetary affairs of the agency.  This section expires 
        February 1, 1998. 
           Sec. 4.  [FEDERAL FUNDS.] 
           State agencies may apply for any federal funds available 
        for flood relief.  Notwithstanding Minnesota Statutes, section 
        3.3005, the commissioner of finance may submit the request to 
        receive and spend federal funds to the legislative advisory 
        commission required under Minnesota Statutes, section 3.3005, 
        any time after the application is made for those funds.  If a 
        recommendation is not made within five days, no further review 
        by the legislative advisory commission is required, and the 
        commissioner shall approve or disapprove the request.  If a 
        recommendation is made for further review, the commissioner may 
        proceed according to Minnesota Statutes, section 3.3005, 
        subdivision 5.  This section expires February 1, 1998. 
           Sec. 5.  [SCHOOL DISTRICT AVERAGE DAILY MEMBERSHIP.] 
           For fiscal year 1998, the commissioner of children, 
        families, and learning may adjust school district average daily 
        membership data calculated under Minnesota Statutes, section 
        124.17, for those school districts affected by flooding in the 
        spring of 1997 for students who have not yet returned to their 
        resident school districts because school facilities or homes are 
        not available for occupancy. 
           Sec. 6.  [FLOOD COSTS; STATE AGENCIES.] 
           $1,000,000 is appropriated from the budget reserve in the 
        general fund to the commissioner of finance for transfer to 
        state agencies as required for flood-related costs.  Before 
        making a transfer to an agency, the commissioner must determine 
        that the agency does not have sufficient resources available to 
        support local flood recovery efforts in a timely manner.  Each 
        agency receiving a transfer from this appropriation must submit 
        a report to the commissioner of public safety identifying the 
        costs paid from the amount transferred and requesting 
        reimbursement from the federal emergency management agency 
        (FEMA).  All reimbursements received from FEMA for these costs 
        are available for reappropriation under this section.  This 
        appropriation is available until June 30, 1998, and any amount 
        remaining on June 30, 1998, cancels to the budget reserve in the 
        general fund. 
           Sec. 7.  [FLOOD-RELATED DISASTER APPROPRIATION.] 
           $20,000,000 is appropriated from the budget reserve in the 
        general fund to the commissioner of public safety for 
        reimbursements to counties, cities, and towns and to individuals 
        or families for individual/family grants which may be used for 
        costs related to flooding in 1997.  This appropriation is added 
        to the $3,000,000 appropriation in Laws 1997, chapter 12, for 
        flood-related purposes. 
           Sec. 8.  [ALLOCATION.] 
           (a) The amount appropriated in section 7 is available for 
        the following purposes: 
           (1) for the state costs associated with section 1; 
           (2) for state match of federal disaster funds for 1997 
        flood-related disaster costs according to the formula agreed to 
        by the state and the federal emergency management agency (FEMA); 
           (3) for what would otherwise be the local government match 
        for eligible 1997 flood-related disaster costs in the formula in 
        clause (2); and 
           (4) for other flood-related costs not covered in clauses 
        (2) and (3). 
           (b) In allocating any funds available under paragraph (a), 
        clause (4), the commissioner of public safety must consult with 
        the commissioners of natural resources, transportation, and the 
        pollution control agency. 
           Sec. 9.  [NO PRECEDENT SET.] 
           Funding by the state in this act for costs that would 
        otherwise be a local fiscal responsibility under funding 
        formulas negotiated by the state and FEMA is not to be 
        considered a precedent for any future disaster funding. 
           Sec. 10.  [APPROPRIATION CARRYOVER.] 
           The appropriation in section 7 is available until June 30, 
        1998. 
           Sec. 11.  [EARLY PAYMENT OF STATE AIDS.] 
           Notwithstanding Minnesota Statutes, sections 273.1398, 
        subdivision 6, and section 477A.015, the commissioner of 
        revenue, in consultation with the division of emergency 
        management, shall make the payments of homestead and 
        agricultural credit aid and local government aid as provided in 
        this section to all qualified local units of government that the 
        commissioner determines have suffered financial hardship.  As 
        used in this section, "qualified local units of government" 
        means: 
           (1) counties that have been designated by the director of 
        the Federal Emergency Management Agency as eligible for federal 
        aid due to flooding; and 
           (2) home rule charter and statutory cities and towns 
        located in whole or in part within those counties. 
        Payment of the homestead and agricultural credit aid and local 
        government aid that would otherwise have been payable on July 
        20, 1997, shall be made as soon as practicable after the date of 
        enactment of this act.  For payments in 1997 only, the entire 
        amount of any deduction from local government aid or homestead 
        and agricultural credit aid under Minnesota Statutes, section 
        273.1399, shall be deducted from the December payments of aids 
        to the affected local governments. 
           Sec. 12.  [EFFECTIVE DATE.] 
           This act is effective the day following final enactment. 
           Presented to the governor May 5, 1997 
           Signed by the governor May 6, 1997, 2:45 p.m.